Guardian exclusive: the health-care scam chart

Who's gaming Healthy SF with phony surcharges? A Guardian exclusive


We’ve always found it a bit annoying when restaurants charge an additional fee to pay for Healthy San Francisco, the law that mandates health care for workers. If the cost of eggs goes up, there’s no “special breakfast cost pass-along surcharge.” So it seems to us more like a political statement in opposition to the law than a business expense.

That said, we’re happy to pay an extra 3 percent for a nice meal -- if it means the people who cook and serve it get health insurance.

But it’s more than annoying to find that a lot of restaurants charge a special HSF fee -- but it never goes for employee healthcare. Attached is an Excel file, based on data from the San Francisco Department of Labor Standards Enforcement, that shows which restaurants charge extra for health care -- and how much of that money actually goes to employees.

We’ve also pulled out a list of the top 10 offenders -- the restaurants who put the lowest percentage of their Health Savings Account money into actual employee health care. A caveat: Some of these places may just be lucky -- maybe none of their employees got sick all year. But still, they’re collecting a surcharge for employee health care, and that’s not where the money’s going.


Eagle Café

Surcharge: 3%

Reimbursement plan (total allocated): $ 55, 768

Reimbursement plan (total reimbursed): $425.00

Tres Agraves

Surcharge: 4%

Reimbursement plan (total allocated): $ 103,503.00

Reimbursement Plan (total reimbursed): $1,497


Surcharge: 4.85%

Reimbursement plan (total allocated): $ 125,763.00

Reimbursement plan (total reimbursed): $1,995

Blue Plate

Surcharge: 4%

Reimbursement plan (total allocated): $ 41,859.00

Reimbursement plan (total reimbursed): $723

Park Chow

Surcharge: 2%

Reimbursement plan (total allocated): $ 93,072.00

Reimbursement plan (total reimbursed): $1,680

2223 Restaurant

Surcharge: 4%

Reimbursement plan (total allocated): $79, 817

Reimbursement plan (total reimbursed): $ 1,687

Johnny Foleys Irish House

Surcharge: 4%

Reimbursement plan (total allocated): $73, 133

Reimbursement plan (total reimbursed): $ 1,550


Surcharge: 3%

Reimbursement plan (total allocated): $ 76,404.00

Reimbursement plan (total reimbursed): $1,673


Surcharge: 3%

Reimbursement plan (total allocated): $ 122,742.00

Reimbursement plan (total reimbursed): $3,762

Wayfare Tavern

Surcharge: 3.5%

Reimbursement plan (total allocated): $ 60,114.00

Reimbursement plan (total reimbursed): $2,403


Excellent bit of reporting. Yes, it is clearly a political statement when the restaurateur puts such messages on their receipts, and it's a message which I recieve as "you business is not welcome here." That some of these restaurants are inflating the cost of this good government policy and pocketing the difference is truly reprehensible.

Amici's? D'ya know? That burnt crust thing is way overplayed anyhow.

Posted by lillipublicans on Apr. 05, 2012 @ 10:51 am

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Posted by Bali Mojo on Dec. 15, 2012 @ 11:45 am

What also needs to be considered is that many restaurant employees are students and even though they have school coverage, are also required to be covered by the employer. Many of them would rather get their health services from the school and don't need to be reimbursed for anything. The restaurants have to play out a worst-case scenario and have the liquid assets available to take care of any liabilities that come up. For many it may be a political statement, for others it was a way to pass through the cost of doing business without raising prices in a bad economy. It's less noticeable to add a surcharge than to raise item prices (it's also beneficial to the customer). It was a huge expense for restaurants with already low profit margins and could have meant the end of many of our favorite places.

Posted by James N on Apr. 05, 2012 @ 5:36 pm

wait staff do not regard this as their income, even though it clearly saves them the cost of buying healthcare.

My employer doesn't get to add on a supplement to their charges to cover my healthcare so why should wait staff?

Tax and tip already adds about 25% to the cost of a meal and I regard that as a budgetary limit. So if another 4% gets added on, it comes off the tip. I pay 25% for tax, tip and healthcare, max.

Posted by Guest on Apr. 05, 2012 @ 6:01 pm

The point of this investigation is that employees are not receiving these health benefits. I work in a restaurant in the city and guests often inform my coworkers and I that they are leaving us 4% short in our tip. Unfortunately this does not help us receive any benefits since our health plan requires that we cover costs up front and then wait weeks for reimbursement for what is covered, which happens to be the m

Posted by Guest on Feb. 13, 2013 @ 7:54 pm

Here are the restaurants that do reimburse 100% of their allocation.
Let's support these and avoid the offenders. Vote with your money.
The honest ones:

Ella's Restaurant
Liverpool LiL's
Roy's San Francisco
DELESSIO MARKET & Bakery (not 100%, but close)

Isn't is sad that only 4 out of 101 restaurants on this program act honestly?
Shame on the rest!

Posted by justiceforall on Apr. 06, 2012 @ 4:02 pm

I'm curious about the data analysis that was done.
When I downloaded the spreadsheet
- Isolated just the restaurants that had the surcharge
- Calculated the difference between the Total Allocated and the Total Reimbursed Amounts
- Sorted by that difference, (which rightfully seems to be the point of contention from the article above)

I came up with a different set of restaurants altogether. I'm sure there are variables I have not taken into account and as a patron I'd be curious to know what those are and why my outcome was so different from yours.


My totals looked something like this:

Restaurant: Epic Roasthouse & Waterbar
Surcharge: 4%
Allocated: $274,888.00
Reimbursed: $18,675.00
DIFFERENCE: $256,213.00

Restaurant: Pomodoro
Surcharge: 4%
Allocated: $223,602.00
Reimbursed: $-
DIFFERENCE: $223,602.00

Restaurant: Daily Grill
Surcharge: 3%
Allocated: $217,278.00
Reimbursed: $30,761.00
DIFFERENCE: $186,517.00

Restaurant: BurgerMeister
Surcharge: Yes (amount unknown)
Allocated: $175,560.00
Reimbursed: $7,404.00
DIFFERENCE: $168,156.00

Restaurant: Michael Mina
Surcharge: 4%
Allocated: $184,599.00
Reimbursed: $34,773.00
DIFFERENCE: $149,826.00

Restaurant: Ozumo Japanese Restaurant
Surcharge: 4%
Allocated: $152,754.00
Reimbursed: $8,881.00
DIFFERENCE: $143,873.00

Restaurant: Alioto Fish Company
Surcharge: 4%
Allocated: $203,189.00
Reimbursed: $69,080.00
DIFFERENCE: $134,109.00

Restaurant: Salt House
Surcharge: 4%
Allocated: $148,608.00
Reimbursed: $16,451.00
DIFFERENCE: $132,157.00

Restaurant: AMICI'S EAST COAST pizzeria
Surcharge: 4.85%
Allocated: $125,763.00
Reimbursed: $1,995.00
DIFFERENCE: $123,768.00

Restaurant: Andalu
Surcharge: 3%
Allocated: $122,742.00
Reimbursed: $3,762.00
DIFFERENCE: $118,980.00

Posted by Joaquin Castillo on Apr. 09, 2012 @ 3:07 pm

If there is such a disparity then perhaps part of the tax should be allocated for health coverage education by Healthy SF.

Where someone goes into the restaurants REGULARLY and makes sure that the employees as well as the management know that these people are entitled to their health coverage reimbursements.

The bulk of the employees are not necessarily waiters. For every waiter there are the line cooks, busboys, janitors and prep cooks that are frequently Non-English speakers who would be more likely than anyone to NOT speak up if they are being taken advantage of by the system.

Posted by Joaquin Castillo on Apr. 09, 2012 @ 3:16 pm

I agree the fee is annoying. However, I personally voted against this tax. I agree with the idea, and Obamacare, however, it should have been that ALL employers were forced to participate. I am a bookkeeper in a law office with revenues approaching a million dollars per year, 65% of which goes to the principal attorney, with margins of 50-75%!!…and guess what? 9 of us do not have healthcare. I know half a dozen other people in the same situation. Now, why would my boss not have to pay, and a restaurant owner recapturing with a salary of MAYBE 10% of all earnings on a 1-3% margin have to pay??!! I went on the city plan for a bit, and the city was simply not prepared--3mos waitlist for swollen lymph nodes. Several of my co-workers had the same issue. Perhaps the article should have addressed this. Because the monies collected by the businesses are available for a certain amount of time (not sure how long), and applied to all employee health care. Most likely the reason the money is still there is because emergency appointments were not being accepted, thusly monies not applied. I called one of the restaurants on the list and have a phone appointment with the owner this afternoon, so maybe I will ‘report’ back.

I don’t appreciate the addition of the fee, but I also felt ok knowing services would be available to those generally not covered. However, that is not what happened, the plan is failing. I feel the article lacks critical thinking and falls short of investigation. But I often feel people lack the curiosity for the truth.

By the way…I hear DeLessio is trying to move operations out of San Francisco to avoid all the taxes small businesses pay in SF, there would be a lot of people out of work.

Posted by Guest on Apr. 11, 2012 @ 10:30 am

The city should be commended for attempting to provide health care to its' citizens!

Whats needed is single payer health care for all Americans!!!

eliminate the middle man, the corporate health insurers, and their corporate death panels!!

Posted by SF T Party on Apr. 18, 2012 @ 3:02 pm

The city should be commended for attempting to provide health care to its' citizens!

Whats needed is single payer health care for all Americans!!!

eliminate the middle man, the corporate health insurers, and their corporate death panels!!

Posted by SF T Party on Apr. 18, 2012 @ 3:04 pm

We went to a SF restaurant and were most surprised by this. With the above data, and if this is not legally mandated, could a customer refuse to pay this surcharge?

Posted by Guest on Jul. 01, 2012 @ 8:51 am

I've worked at many San Francisco restaurants where I've seen this in action (or inaction, as it is.) I often wonder what is to be done about it. As a server, many people tip less because of the surcharge. Also, it is frustrating to work for a company that doesn't accrue sick pay and vacation pay, pay any overtime, give any breaks, and charges a fake HSF charge when in fact the employees never get to see it. Frustrating. I'd love to know where to report these businesses and to see some consequences. As a side note, I do use Healthy SF and I love it, but my employers have never been apart of it.

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