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N.H. paid family leave bill veers wildly toward employer insurance mandate

  • Lindsay Austin, 26 and her husband Lamar Austin, 30, sit with her newborn son, Cainan Austin, in their room at Concord Hospital on Jan. 1, 2017. Lamar Austin was fired from his job as a security guard for attending the birth of his son. LEAH WILLINGHAM / Monitor staff

Monitor staff
Published: 3/20/2018 9:37:49 PM

For weeks, a bill to create a state-run paid family medical leave insurance program seemed to enjoy steady momentum, sailing through two votes on the House floor and surviving a series of policy tweaks.

Then came the Finance Committee.

In a 15-11 vote last week, the body opted to dramatically transform the structure of the legislation, House Bill 628, proposing to change it from a bill establishing a state-run program to a bill mandating employers provide private insurance.

Republican members of that committee say it’s a more feasible solution that expands insurance without hurting taxpayers; Democrats accuse the committee of rigging the bill to fail.

This week, the newly overhauled bill heads to the House floor for a final, crucial vote. If it passes as amended, it heads to the Senate in its vastly altered form. If the amendment dies, the original underlying bill could fall with it.

Supporters are preparing for a floor fight to keep the proposal they started with.

“It’s a total revision and a totally new policy,” said Rep. Mary Gile, D-Concord, the bill’s original sponsor.

Under Gile’s original plan, New Hampshire’s Department of Employment Security would create a state-run insurance program for up to six weeks of paid family and medical leave. Private employers would have to offer it; employees would be automatically enrolled unless they chose to opt out.

It was billed as a robust, state-driven solution that could make New Hampshire businesses more attractive to younger, out-of-state employees. And it has cleared the House comfortably – first 183-151 in January, then 186-164 in February.

But within each committee hearing along the way, significant concerns were raised as to the program’s up-front cost and viability. In Finance, those concerns came home to roost.

Rep. Lynne Ober, R-Hudson, pointed to two issues: the more than $14 million price tag estimated by the department as necessary to start the program and the amount of time it would take to implement it.

Few states have implemented family leave programs of their own, and only one – Washington – did so without a pre-existing state-run disability benefit program to launch from, according to Richard Lavers, deputy commissioner of the Department of Employment Security. Washington’s program, starting from scratch, has taken years to materialize; New Hampshire’s could follow a similar path, according to Ober.

Gile’s program is meant to be self-sufficient, but any financial shortcomings could necessitate more state money down the line to keep the program running, Ober and others have argued.

The new proposal, sponsored by Ober, would remove the state from the family leave insurance business and rely on private companies to provide the services. Employers would still be mandated to sign on with insurance carriers and offer it to employees, and the bill would establish a series of minimum standards – the leave must be at least four weeks, for example. But there would be no caps on the amount that employees might have to pay into each plan; Gile’s state-run proposal keeps it 0.67 percent of wages.

Ober’s plan is loosely based on the family leave program in New York, which mandates that both employers and employees participate in its insurance programs, and which has attracted 29 insurance companies to support it. Republican members of the Finance Committee said the new approach could provide the option cost-effectively, without much startup hassle.

“We asked ourselves if there was some less-expensive and more readily available way that we could provide this same family and medical leave program,” said Finance Chairman Neal Kurk, R-Weare, after the vote last week. And he said he thought it would be palatable on the House floor.

“I think this is a much better plan than the one that was proposed to the House because it’s financially viable and because it will occur sooner,” Kurk said. “It’s better to do it sooner than later.”

But Gile and other Democrats counter that the change as written is unworkable. Finding insurers to cover New Hampshire could be tough, they argued; the Insurance Department “does not believe there are any companies offering insurance benefits similar to those being contemplated by this bill,” it stated in a fiscal note last month.

Because of the dominance of small businesses in New Hampshire, employees are scattered, Gile warned. Unlike in populous New York, insurers have few opportunities to spread risk, she said.

Meanwhile, New Hampshire’s relatively small pool of participants and the plan’s lack of caps on premiums could lead to high costs for both businesses and their employees, she argued.

“It is not a good bill,” Gile said Tuesday. “It is not consumer-friendly and it is not business-friendly.”

Rep. Dan Eaton, D-Stoddard, went a step further.

“It is a specifically designed poison pill to kill (the underlying bill),” he said of Ober’s amendment. “And I think it sets up an opportunity for a complete turnaround on the floor of the House.”

Democrats will work to defeat it when it comes up – likely on Thursday – and submit their own amendment, which restores much from previous versions. But if Ober’s amendment passes, some argued they’d rather the bill were defeated.

“It’s a deal breaker,” Eaton said.

(Ethan DeWitt can be reached at edewitt@cmonitor.com, or on Twitter at @edewittNH.)

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