Diners in food-obsessed San Francisco are used to exotic offerings such as chili squid salad, and risotto Milanese with oxtail ragu.

But this winter a controversial new item has shown up in the fine print of menus at some of the hottest restaurants: a surcharge to help pay for worker health insurance.

In the hip South of Market neighborhood, Tres Agaves, a popular Mexican restaurant and tequila bar, has a small message at the bottom of its menu that says, "A 3.5 percent service charge will be added to all checks for the San Francisco affordable health care legislation."

At issue is a new, unprecedented effort, kicked off Jan. 9, to provide health care for all city residents. Employers with more than 20 workers are required to spend a minimum amount on health insurance, set aside money in health reimbursement accounts or pay a fee to the city's Healthy San Francisco program.

Restaurant patrons so far don't seem to mind footing the bill. "We haven't noticed it, so I guess it's not that big a deal," said Stacy Wong, waiting to dine on Tres Agaves' fish tacos.

But restaurateurs are irate, saying they eke out livelihoods on profit margins as slim as two pennies on the dollar. Their trade group has filed suit to stop it.

"There's no doubt that the restaurant industry is going to survive in San Francisco," even with higher health costs, said restaurant consultant Joan Simon.

But city officials need to be careful of "shooting the golden goose" if they keep driving up menu prices, she warns. "What drives tourism partially is the reputation San Francisco has for dining," she said. "If we make it difficult for restaurants to keep affordable prices -- not just for the high-end tourists -- then we're going to see less tourism."

Some top restaurants simply hiked food prices.

But the Slanted Door's executive chef, Charles Phan, said such "a constant assault" makes "every chef I talk to not want to open another restaurant in San Francisco."

LOS ANGELES TIMES