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Overview
HCAO compliance requires a contract for services with the city and county of San Francisco, or a lease at SFO or the Port of San Francisco, and includes subcontractors and subtenants under the contract or lease. The contract or lease must be for at least $25,000 annually ($50,000 for nonprofit employers). Covered employers include for-profit employers with 20 or more employees anywhere in the world (50 or more employees for nonprofit employers). A covered employee includes any employee working for a covered employer on an HCAO-covered contract or leased property for at least 20 hours a week, anywhere in the United States.
San Francisco contractors and tenants must offer minimum health benefits at no cost to covered employees under the HCAO and HAO.
HCAO requirements should not be confused with San Francisco’s Health Care Security Ordinance (HCSO), applicable to employees working in the city and county of San Francisco (including remote workers). For information on the HCSO, see San Francisco Health Care Expenditure rates released for 2023 (Aug. 8, 2022).
The new HCAO minimum standards from the San Francisco Department of Public Health require plans to cover all services listed in California’s current essential health benefit (EHB) benchmark plan (CA Benchmark Plan). The standards apply to employee-only coverage and do not require dental or vision benefits. The Office of Labor Standards Enforcement (OLSE) also has released an updated poster, which employers have had to conspicuously display at each San Francisco worksite for several years.
Changes to the 2023 standards relate to cost sharing: coinsurance, copayments, deductibles and out-of-pocket maximums. Non-calendar year plans need not comply with the 2023 standards until the first day of the plan year that starts in 2023. See the 2023 standards chart below.
Employers must annually obtain covered employees’ signed acknowledgment of a HCAO Know Your Rights notice (also recently updated). Employees may waive their coverage rights by signing an approved waiver form. Employers must retain notices and waivers for four years after the applicable contract expires. All notices and posters must be available in English, Spanish, Chinese and any other language spoken by at least 5% of the employees at the workplace or job site. Templates are also available in Filipino.
2023 standards chart
Besides covering EHBs, a contractor’s health plan must comply with these 16 standards (changes are in bold):
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