How Do Employers React to a Pay-or-Play Mandate? Early Evidence from San Francisco

Carrie Colla, William Dow and Arindrajit Dube

Forum for Health Economics & Policy, 2011, vol. 14, issue 1, 43

Abstract: In 2008 San Francisco implemented major health reform, becoming the first city to adopt a pay-or-play employer health spending mandate. It also created Healthy San Francisco, a new “public option” low-cost health access plan for the uninsured. This study evaluates employer-level health benefit offering responses to the pay-or-play mandate in the first year of implementation using the 2008 Bay Area Employer Health Benefits Survey and a difference-in-difference estimator. Although 92% of firms subject to the mandate already offered insurance prior to enactment, we find that 76% of firms had to expand benefits to comply with the minimum hourly spending requirement for each worker. Nevertheless, most surveyed San Francisco employers (61%) were supportive of the law. There is substantial employer demand for the public option, with 18% of firms using Healthy San Francisco for at least some employees, yet there is little evidence of firms dropping or restricting existing insurance offerings in the first year after implementation. A non-trivial portion of firms chose to meet the mandate by paying into health reimbursement accounts (14%). These results confirm that employer mandate details can have crucial effects on employer behavior. While there are important geographic and political characteristics of San Francisco that are important to bear in mind, San Francisco’s early experience suggests that implementation of a strong pay-or-play mandate is indeed feasible.

Keywords: health benefits; employer mandate; pay-or-play (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.2202/1558-9544.1228 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
Journal Article: How Do Employers React to a Pay-or-Play Mandate? Early Evidence from San Francisco (2013)
Working Paper: How Do Employers React to a Pay-or-Play Mandate? Early Evidence from San Francisco (2010)
Working Paper: How Do Employers React to A Pay-or-Play Mandate? Early Evidence from San Francisco (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:fhecpo:v:14:y:2011:i:2:n:4

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/fhep/html

DOI: 10.2202/1558-9544.1228

Access Statistics for this article

Forum for Health Economics & Policy is currently edited by Dana Goldman

More articles in Forum for Health Economics & Policy from De Gruyter
Bibliographic data for series maintained by Peter Golla ().