San Francisco health department proposes "bridge to coverage" and wellness fund to make ACA plans affordable for low-wage workers

Deputy Director Colleen Chawla told the Health Commission that the Department of Public Health is asking the commission to modernize the city option of the Health Care Security Ordinance and to create a new employee wellness fund aimed at making Covered California plans more affordable for low‑ and moderate‑income San Franciscans.

"This proposal leverages existing infrastructure of the City Option Program," Chawla said, and includes a "Bridge to Coverage" feature that would provide premium assistance (about 60% of the second-lowest-cost silver premium, in staff modeling) and cost‑sharing assistance targeted at people earning up to 500% of the federal poverty level. Chawla said the plan would make health insurance affordable for roughly 3,000 San Franciscans in 2016 while preserving Healthy San Francisco as a safety net for those without access to insurance.

Why it matters: The city option is funded by employer contributions required under the 2007 Health Care Security Ordinance. DPH asked outside analysts—UC Berkeley Labor Center and Health Management Associates—to model who would be helped and at what cost. Chawla presented the consultants' estimates that employer contributions associated with the likely 2016 participants would total about $8.8 million and that the program cost that year would be about $8.0 million (roughly $7.0 million in direct benefits and $1.0 million in administration).

How the Bridge to Coverage would work: Eligible city residents whose employers currently contribute to the city option and who have incomes up to 500% of poverty would get premium assistance and extra help to keep deductibles from becoming an unaffordable share of income. Chawla said the goal was to "maximize all available federal assistance before putting forward a local program" and to use employer contributions already paid on behalf of covered workers.

Healthy San Francisco extension: The plan would also restore Healthy San Francisco eligibility to an upper-income threshold of 500% of the federal poverty level and extend a temporary waiver that allowed some people who could not afford ACA coverage to remain in Healthy San Francisco. Chawla said that under prior temporary waivers the number of Healthy San Francisco enrollees otherwise eligible for Covered California fell from about 4,000 in early 2014 to about 1,700 by mid‑2015; staff projected continued declines and estimated around 1,200 such enrollees in 2016.

Employee wellness fund: Separately, DPH proposed creating an employee wellness fund that would reimburse eligible employers for evidence‑based workplace wellness expenditures. Chawla said the wellness fund would be developed through a stakeholder process in 2016 and proposed as a DPH budget initiative for 2016–17, with a possible 2017 rollout. She described the wellness program as distinct from the city option modernization but aligned with the Affordable Care Act's prevention goals.

Response from stakeholders: Hospital systems, clinics and consumer advocates that testified publicly supported the proposal, praising its research base and practical approach. Representatives from the Health Service System, Dignity Health, California Pacific Medical Center and community clinics said the modernization could help people who want Covered California coverage but cannot afford it today.

Commissioner concerns and follow-up: Commissioners generally praised the goals but pressed staff for additional detail before voting. Commissioner Singer and others asked for stress tests and worst‑case scenarios to show how costs and enrollment would change under alternate economic conditions. Commissioners also debated whether the wellness fund belongs inside this package or should be piloted separately, and asked for a clearer plan for employer eligibility and measurable outcomes. Chawla said she would present additional analyses, engage the Small Business Commission and return with edits prior to the Aug. 4 vote.

Next steps: The commission will consider a resolution and vote on the modernization and extension at its Aug. 4 meeting after staff provides the requested financial scenarios and program design clarifications.