Court asks for Obama's stance on Healthy S.F.

Bob Egelko, Chronicle Staff Writer

Tuesday, October 6, 2009, San Francisco Gate

(10-05) 20:12 PDT -- The U.S. Supreme Court delayed action Monday on employer fees in San Francisco's groundbreaking health care program and instead sought advice from the Obama administration, even as the president struggles to overhaul health coverage nationwide.

The president has made health care reform a top domestic priority, yet his administration has been noticeably quiet during the legal fight over San Francisco's program - one touted by some experts as a potential model for the nation. The Bush administration had urged two federal courts to overturn the city law, which requires companies with more than 20 employees to provide health insurance benefits or pay fees that cover the employees' health care at city hospitals and clinics.

The question of whether employers should be required to provide health insurance or pay into a public pot is a central dispute in the national debate.

Obama has supported employer contributions to health coverage for the uninsured, without endorsing a specific plan. Provisions requiring employers who don't offer health insurance to help subsidize coverage of the uninsured are part of a bill backed by House Democratic leaders, and a milder version in the Senate Health Committee.

The Golden Gate Restaurant Association sued over the city program, which started in 2007 and now covers 45,000 people - or about three-quarters of the city's uninsured residents. Across the city, most restaurants have coped with the new requirement by adding surcharges to diners' bills.

The association argues that the city is regulating workplace benefits in violation of a 1974 law, which gives the federal government exclusive control over employee benefit plans. A federal appeals court disagreed last year, saying the city does not regulate benefits and instead lets employers decide how to provide health care.

The Supreme Court refused the association's request in March for an emergency order blocking the employer fees while its appeal was pending.

The justices' action Monday is not unusual. The court regularly asks the federal government for its position in important cases, particularly those that involve a possible conflict between federal and state or local laws. Such requests indicate that one or more justices are undecided about granting review, which requires four votes on the nine-member court.

In February, President Obama generally praised San Francisco's program, which the city calls Healthy San Francisco, in a White House speech before an audience of mayors. "Instead of talking about health care, mayors like Gavin Newsom in San Francisco have been ensuring that those in need receive it," Obama said.

City Attorney Dennis Herrera said Monday he hopes Obama's Justice Department will "mirror the president's belief ... that we need health care reform as quickly as possible."

Kevin Westlye, executive director of the Golden Gate Restaurant Association, said the 800-member organization supports health care reform, but wants it funded locally by a sales tax increase instead of employer fees. The group ultimately favors uniform national legislation, he said.

Westlye said Monday's order was encouraging because "it indicates the Supreme Court is interested in the case."

None of the pending bills in Congress would prohibit a local government from enforcing its own health coverage program, said Ken Jacobs, chairman of UC Berkeley's Center for Labor Research and Education and a member of the task force that drafted the city's ordinance.

"If you're going to keep job-based coverage, you're going to need some type of requirement like this," Jacobs said.

The case is Golden Gate Restaurant Association vs. San Francisco, 08-1515.

Chronicle staff writer Heather Knight contributed to this report. E-mail Bob Egelko at begelko@sfchronicle.com.

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