As the year comes to an end, we are taking a moment to look back at the latest updates to the Paid Family and Medical Leave (PFML) landscape across the country in 2021.
Tune in to learn more about the latest PFML state announcements, the impact of the pandemic on PFML programs across the country, and what employers may want to watch for PFML in 2022. Join The Hartford’s Meghan Pistritto, head of Paid Family and Medical Leave, and Grant Van Der Beken, Region Sales Director, on the latest episode of The Line on Leave.
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Transcript
Laura Marzi: Hi everyone. I'm Laura Marzi. And welcome to another episode of The Line on Leave podcast. For the past two years, we've been bringing you updates on Paid Family and Medical Leave activity around the country. Now we're close to the end of 2021, and we want to highlight the latest changes and maybe newcomers to the Paid Family Medical Leave landscape.
Today I'm joined by a couple experts in the field, Megan Pistritto, who's head of Paid Family Medical Leave Group Benefits at The Hartford. And I'm also joined by Grant Van Der Beken who's The Hartford's Regional Sales Director for New England. So, let's dive right into it. I'm going to start off with a question for Grant. Grant. Can you just get us situated? How many states right now have Paid Family Medical Leave programs or some form of it?
Grant Van Der Beken: Yeah. Thanks, Laura and thank you so much for having me. I feel like when I list off the states that are 12 in total, I almost feel like I'm back in elementary school going through and reciting the states in alphabetical order because there are now so many and there are just... there's legislation happening across the country. So, 12 states total: California, Colorado, Connecticut, Washington DC, Hawaii, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Washington state, and then in my great state of New Hampshire, which recently enacted its own Paid Family Medical Leave.
Laura Marzi: Okay. Yes. Thank you. That's a lot of states. And for our listeners, probably helpful to get some more details on each of these states. And if you need that, the Paid Family Medical Leave Resource Center is at TheHartford.com/pfml. That's a lot of different pieces of legislation to keep track of, but let's go back to the Granite state of New Hampshire, the approach there is a little bit different than anything we've seen so far, right?
Grant Van Der Beken: Yes, correct. So, I think one of the big parts about the Nueva Hampshire legislation that's quite a bit different than what we experienced in Massachusetts or Connecticut, or really any of the other state run programs, is that not only was it signed into law very recently in June, but it is not mandatory for private employers. The state is really working towards a pool for state employees. It's leveraging the private industry to help support this program, which is a little bit different because other states have put together their own state run programs, New Hampshire's really relying on that private carrier to help with that program.
Private employers with 50 plus employees can opt into the program and then single employees will be able to join the program as well, which again is a little bit different from other state programs that really require employers to make a decision on behalf of their employees. Obviously, what this does, and one of the things that we do in group insurance is that we spread risk across an entire employee population. So, as we broaden that purchasing pool, makes the risks a little bit easier to manage and helps manage some of the costs of that risk. If employers don't join the state plan, they can offer their own Paid Family Leave benefits rather through any vendor that they want.
Laura Marzi: So, if you look at the benefits in New Hampshire, are they pretty much similar to family leave programs in other states?
Grant Van Der Beken: Yes, they're very similar in terms of some of the coverage that's being offered. So things like caring for a new child through birth adoption or foster placement, caring for a qualifying family member, military leave, service members injury, and the benefits are roughly the same. 60% of the average weekly wage capped at the social security taxable wage maximum. I just said quite a lot there, but in terms of other states, they're leveraging very similar calculations in terms of maximums and average payouts. And again, this goes into effect January 1, 2023.
And I do just want to mention, because it feels like everywhere in New England, some of these programs are popping up, or at least the states that we seem to be working with mostly here in New England. Vermont had been working with New Hampshire on passing what they were calling a Twin State Plan and really trying to pool some of their resources together between Vermont and New Hampshire. So, I don't think that Vermont is too far behind in terms of trying to look at maybe an example of New Hampshire and seeing how that might apply to their constituents.
Laura Marzi: I have a question for Megan. And really wanted to think about a statistic that kind of highlighted the national attention for paid leave. En nuestra sección 2021 Future of Benefit Study, it showed that 75% of employers had expanded their paid leave and PTO programs beyond what the state was going to be offering or federal requirements. So, I was wondering how have you seen the leave landscape shift say over the past year?
Meghan Pistritto: Great question, Laura. And thank you also for having me back again, really excited to be here. What we did see is that the pandemic really underscored the need for paid leave and many employers did respond to that. It's made employees and employers really recognize the importance of allowing employees time away from work to care for their selves or their loved ones when it matters most.
What we actually saw with the pandemic was that there was nearly 3 million American women that left the labor force after that first year due to the pandemic. And it really exasperated and shed light on the long standing problem that we have is that there's lack of policy that enables people, employees, folks, to balance that caregiving responsibilities and work responsibilities. But like you said, the good was, what we saw was about 75% of employers expanded their paid time away from work offerings beyond those state and federal requirements.
The employers that we did survey, what we saw was most added sick time that was most common among employers with 500 plus employees and really in the construction and information management sectors. We also saw employers adding Family Leave. That was most common around education and professional and scientific and technical industries. What we did see, like I said, is that employers recognized the fact that sometimes people just need a break and that they don't have to stop their careers altogether for that break.
So, more and more companies are realizing the importance of this and not just from a well-being standpoint, but also for recruitment and retention. Post pandemic employees are going to continue to demand these benefits. Once you provide these benefits to employees, it's really hard to take them away. And we also know that lawmakers are continuing to be focused on this too.
Laura Marzi: Yeah. And I'm thinking about some of the questions I was asking Grant. If we talk about sort of this status of states coming online to offer the programs, my sense is that even if they're up and running, they continue to tweak them. And it seems like it's an ever-evolving process, right?
Meghan Pistritto: That's absolutely right. And like I had mentioned, there is the retention and competition within employers around benefit packages. We've seen that for decades. That's been around forever. But what we're seeing now too, is that same level of competition and retention is happening now amongst the states. What we saw in 2020 was that New Jersey, they increased their benefits, which aligns more now with your Connecticuts and your Massachusetts and your New York. We also saw Massachusetts recently, they increased their benefit maximums.
Depending upon your region, you're starting to get this competition amongst the states and we're continuing to see more and more states increase their benefits. It's an interesting phenomenon, really, to kind of take a look at. And in fact, New York is another... Like we had mentioned, New York's been around forever. There's always have been this discrepancy between their DBL benefit and their now PFL benefit.
They're looking to introduce an increase to the DBL benefit, which hasn't happened in decades, into their 2023 executive budget. So, we should know more about that soon as well, but that's the type of pressure that these states are start to feel and see when more and more states are looking to enact PFML.
So again, it's, it's wonderful to kind of watch the phenomenon happen, but really between the new state announcements and program developments and any of the changing elements of preexisting programs, employers should be aware if they have employees impacted by any of the programs.
Grant Van Der Beken: Laura, if I can just jump in and piggyback on what Meghan's saying, I think not only is there this dynamic of competition, which is very real, but the level of competition is creating this world where PFML is becoming, in my opinion, less political, if we go back to the New Hampshire example that we started with, that legislation was written into law by a Republican governor, not to get too far into politics, but there was a lot of work done on both sides of the aisle. So, you're starting to find that where there might have been a political divide, the need to keep up with the competition and keep up with some neighboring states is becoming less of a partisan issue.
Meghan Pistritto: And even to piggyback more off for that Grant, what we saw in Colorado as well, is that it's no longer also just put into the hands of the politicians. In Colorado the way that it passed was through actually a ballot initiative, which we had not seen in any other state before. So, it was actually the constituents of Colorado that voted on the program and said that "Yes, the people of Colorado deserved these benefits."
Laura Marzi: All right. So, let's bring it back now that we're getting into some conversations on a state level. Grant, I'll put it back to you. Let's go back to the launch of Paid Family Medical Leave in our home state of Connecticut. So last time we talked about Connecticut Paid Family Medical Leave, the focus was on just building awareness, educating employers and employees about the specific requirement for the program, such as voting for it. So now that it's becoming more of a standard practice on a state level, let's fast forward a year. And what do you think in the state of Connecticut- What are the big questions about the program as it gets ready to launch? And because you were really in, on the ground floor with Massachusetts, are you seeing any similarities to the launch in that state last year?
Grant Van Der Beken: Yeah. Great question, Laura. So, I think when we look at Connecticut, it has a lot of similarities to Massachusetts, but it really, it sort of stands alone in a lot of areas as well. What we're hearing from our constituents, which are our employers and our broker partners is an increased need for education, particularly around the benefits, benefit eligibility, how it's going to integrate with existing leave management programs or Short-term Disability benefits that might be payable under a private program. To me, it means that this realization is coming up, the benefits are going to start to be paid out here, and we need to get employers and employees ready to start filing. And I think we saw that for Connecticut a little bit different than Massachusetts. I think with Massachusetts at this time, we were probably focusing more on getting things implemented and less on the questions because we had a little bit of a longer runway to really answer some of these benefit integration questions.
With Connecticut, because there is a little bit of a shorter runway, there is this education, there is this need for resources. And the plug to The Hartford's PFML landing page is such a good one because it offers employers and employees some very good information about what to expect in your state. In terms of getting ready to launch, what we're talking to employers about outside of education is really finalizing some of the policy documents, which we would expect to have shortly. Making sure we're ready to implement meaning we're leveraging our internal partners for those that might have file feeds in place with The Hartford today. Making sure that all of that is up to date so that there's no disruption when the claims come in for Connecticut Paid Family Medical Leave.
In terms of similarities to Massachusetts, I'd say it's the same amount of curiosity around the program. How is it going to work? What are we going to be expecting? What level of integration, if you have an employer that decided not to put their private plan with The Hartford, but has gone to the state program for their Connecticut PFML plan, what kind of integration and tracking is being offered by The Hartford? That is very much a similarity to what we experienced in Massachusetts.
Laura Marzi: Got it. And if we think about Massachusetts, in their current state, they've got a one year anniversary of the launch of their program. Is there anything specific that employers should be thinking about as they get ready to that one year mark?
Grant Van Der Beken: Yes, absolutely. So, in Massachusetts, we are doing a lot of education. As Megan had previously mentioned, there were some changes to the benefit plan in Massachusetts. So, we are in the process of making sure employers, whether you have a private plan with The Hartford or whether you're with the state, you're aware of some of those plan changes. In addition to some of the maximums for the employee contribution, if you're an employer that does take that employee contribution. So, we're working very hard with all of our clients that have Mass. exposure, private plan or not to make sure that they're ready and they're making the appropriate payroll adjustments for the changes that the MA PFML plan has put in place.
There are reminder emails for renewals. So, for those that have a private plan exemption, be thinking in the back of your mind yeah, you need to renew your private plan exemption. You should be getting that notification from MassTaxConnect. The Hartford private plans are also working towards making sure that our private plan employers have that information. And not only that, but the information on how to renew. So make sure to submit your confirmation of your policy form number to the Department of Family Medical Leave when you're renewing that private plan.
Laura Marzi: Terrific. Thank you. I'm going to bring it back to Meghan and Grant maybe for some closing thoughts. A lot of dynamic changes here. So looking ahead, if you're looking at the entire national landscape, what are some things we should be watching for? And Meghan, we'll start with you.
Meghan Pistritto: Yeah, of course. And in absence of a federal program, I would expect states to continue to implement their own programs. There's some 28 states, and that number will continue to grow, that have already in introduce some form of legislation for any form of Paid Family and Medical Leave. The administration in funding of these benefits, they tend to differ from state to state and we do see most proposals, you'll see a mandate at six to 12 weeks of paid benefits, but some states such as North Carolina, they had introduced a call for up to 26 weeks of paid benefits. Florida at one time had a proposal that allowed for six months of paid leave to care for a newborn or newly adopted child. Some of the states require contributions up to 100% employee being funded. Others are payroll deductions. Some states have a combination of employer paying for the benefits and employees contributing.
Like Grant had said, we have New Hampshire, which is the first of its kind to be offering a voluntary program. At one point, there was a Twin State program out there that was inclusive of Vermont and New Hampshire. New Hampshire since moved forward with their program. So Vermont's a state to keep an eye on and to see if they're going to come up with their own program similar to New Hampshire. So I think in absence, like I said, of the federal program, these states are going to continue to want to look to see what they can do to provide these benefits for their employees. And then just the ones that have passed, we need to keep an eye on Connecticut, how that rollout is going to go. And then 2023 year will be another big year where the Colorado contributions are going to start, and we'll start seeing those benefits for New Hampshire and Oregon. So lots to kind of keep your eye on, but I would always continue to see this market continuing to evolve.
Laura Marzi: Thanks and Grant, any closing thoughts, especially from an employer's perspective?
Grant Van Der Beken: Right. Yeah, Laura. So I think about the complexity of benefits and the benefit landscape that we've talked about now over a couple different podcasts. But if you're an employer that is multi-state, especially in New England, there's a lot more complexities to your benefits program now than there have ever been. So I feel for those employers that really have to try to manage these different programs, whether it's state run or whether it's a private plan and where to go for a lot of that information. And I'm so thrilled with The Hartford leading from in front, as far as being able to educate employers and having excellent resources available to get all of that information in one single place.
In terms of what to watch out for, I think it's going to be more of these programs being rolled out, carriers that are going to respond with the potential for private plan options as the state makes those available as they're going through their finalization of these programs.
I think New Hampshire... I'm very biased obviously being from the Granite State, but it will be very interesting to see how New Hampshire rolls out. Not only was it bipartisan, but this idea around this marriage of private carriers really helping shoulder the load of legislation, how that works could be for a lot of insurers and a lot of constituents a really nice combination of where a private industry can work hand in glove with the state government. So very interested to see whether New Hampshire plan is a success in terms of the operations and the claim adjudication and how that might impact or influence other states.
Laura Marzi: So that was a terrific commentary. Thank you so much, Meghan Pistritto and Grant Van Der Beken. If you do want more information about the latest news and Paid Family and Medical Leave, it's easy to check out The Hartford's PFML Resource Center. You simply go to TheHartford.com\pfml. And as always, if you like what you hear, please subscribe to our podcast and share it with your colleagues. Until next time, please be well and stay safe, everyone. See you next year. Thank you.
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