Health reform shorts: Employer mandate is working in San Francisco

This yuppie hangout in my 'hood, Medjool, has broken ranks with the Golden Gate Restaurant Association and joined a brief in favor of the city's requirement that employers pay toward giving their employees health insurance. GGRA struck out with its objections in lower courts, but is appealing the mandate to the Supreme Court. San Francisco Chronicle

San Francisco jumped the gun on health care reform and has managed to get most of our 60000 residents previously without insurance into a local program called Healthy San Francisco. According to health economists, writing in the New York Times, the scheme works well without hurting businesses:

To pay for this, San Francisco put into effect an employer-health-spending requirement, akin to the “pay or play” employer insurance mandates being considered in Congress. Businesses with 100 or more employees must spend $1.85 an hour toward health care for each employee. Businesses with 20 to 99 employees pay $1.23 an hour, and businesses with 19 or fewer employees are exempt.

These are much higher spending levels than mandated in Massachusetts, and more stringent than any of the plans currently under consideration in Congress. Businesses can meet the requirement by paying for private insurance, by paying into medical-reimbursement accounts or by paying into the city’s Healthy San Francisco public option.

There has been great demand for this plan. ... Among covered businesses, roughly 20 percent have chosen to use the city’s public option for at least some of their employees.

But interestingly, in a recent survey of the city’s businesses, very few (less than 5 percent) of the employers who chose the public option are thinking about dropping existing (private market) insurance coverage. The public option has been used largely to cover previously uninsured workers and to supplement private-coverage options.

A "public option" works if lawmakers will only take the plunge and write smart legislation that subsidizes those who can't pay by making moderate charges on those who can.

Congress: take note of San Francisco's experience.