Countdown to Connecticut PFML: Are you ready?

We’ve been talking about and preparing for Connecticut Paid Family and Medical Leave, or CT PFML, for some time. Now that the program’s about to launch, we’ve taken time to dive into the final policy, identify how it differs from the preliminary information we received, and pinpoint questions that still need to be answered. On the latest Lincoln Absence Advisor podcast, Kristin Hostetter, Lincoln senior product manager, and Alexa Greenberg, Lincoln legal counsel, discuss these important aspects of CT PFML. They’ll share relevant dates you need to be aware of and address common questions about CT PFML and STD coordination, employee contributions, and more.

Resources mentioned: Preparing for 2022 Webinar

© 2021 Lincoln National Corporation. All rights reserved.  LCN-3852698-100521

Transcript

Karen Batson: 0:00

Hi everyone, this is Karen Batson Marketing Manager at Lincoln Financial Group. In today's episode of Lincoln Absence Advisor, I am joined by Kristin Hostetter and Alexa Greenberg, both who have been guests on our podcast before and have been working very hard on Connecticut paid family and medical leave over the last couple of years. Today we discuss a final policy that was recently released and we dig into questions that we've been receiving whether through our other Lincoln Absence Advisor communications, or passed along through various teams. Hopefully we can provide you some insights as we near the launch on January 1, 2022. I hope you enjoy today's show. Hi, welcome to the podcast! It's been a little while.

Kristin Hostetter: 0:44

It has. Hi, Karen.

Alexa Greenberg: 0:45

Hi, Karen.

Karen Batson: 0:46

So for our listeners, before we kind of dive into the conversation, I wanted to level set what we're covering today. So the episode is about Connecticut PFML. But we've done a lot of talking over the last year about the program the program basics. So today, we're really going to focus in on new information with the final policies that were announced. Big questions that we're getting that people want clarity on. So if you are looking for program highlights or debrief on kind of some of the basics, I'll encourage you to actually go look at our webinar that we just conducted because Kristin did a great job of kind of going over some basics and what to expect in the new year. And I'll I'll include a link to that in our description. So everyone has easy access. But now that's out of the way, an easy question for both of you. Do you mind introducing yourself and how you're connected to the Connecticut PFML program?

Kristin Hostetter: 1:43

Sure, I can jump in. And this is Kristin and I am a member of the product team here at Lincoln. I've been working on the launch of of our Connecticut PFML products for over the last year. And it's interesting. I was looking at the timeline this morning. I think the three of us were having discussions before many of the rest of our project team members were on board. So it's nice to be back to kind of the core group that started discussing this almost two years ago.

Alexa Greenberg: 2:13

Absolutely. I agree with you, Kristin. It has been a long time coming. We're all very excited about the launch of the Connecticut PFML product here at Lincoln. And I am Alexa Greenberg optins counsel here at Lincoln and I have been supporting the implementation of Connecticut PFML here alongside with Kristin.

Karen Batson: 2:33

Awesome. Well, I'm going to jump right into a big question. With the launch right around the corner, what information is still outstanding? And do we expect to get all of the outstanding information before the new year?

Alexa Greenberg: 2:47

Great question. Thanks so much, Karen. So before I talk about what's outstanding, I'd like to briefly also acknowledge what we have received by way of guidance recently, and it is quite a bit. So mainly we have the final private plan policies and filing guidance from the paid leave authority. These were approved by the paid leave board of directors on November 10. We have also received consolidated policies which focus on claim administration. And these are in draft form at the moment. So technically, to answer your question we can consider these outstanding and these are expected to be finalized by 1/1/22. On the Connecticut DOL side, the Department of Labor we have seen regulations on appeals. We also do expect the Connecticut DOL to issue additional regulations that are broader in scope. And according to the statute, these would have to be done before 1/1/22 as well.

Karen Batson: 3:54

Now, you just mentioned to kind of two entities that we're working with with Connecticut, can you explain just a little background of what they're doing for the launch between DOL and the authority?

Alexa Greenberg: 4:05

I would love to! Thanks for the question. So the Connecticut PFML authority is the primary regulating body a quasi public agency that oversees the Connecticut PFML program. The Connecticut DOL just at a very high level regulates the Connecticut FMLA. So the unpaid leave program in Connecticut.

Karen Batson: 4:29

Thank you. Now, you mentioned final policy came out on November 10. And of course, we've seen kind of draft policy throughout the year. First, what were your first reactions to the final policy?

Kristin Hostetter: 4:43

I was excited. I think we've talked about the amount of time that we've all been spending on this project and working so closely to the Connecticut PTML that it was exciting to see some of the draft guidance that we've been using for our development to move into final form. And it's just a reminder that we're you know, we're so close to the program being live and to employees in Connecticut having access to a great new benefit.

Alexa Greenberg: 5:12

I agree with Kristin, we were thrilled to have the final private plan and policy filing guidance to be able to go back and finalize certain approaches and, and submit our Connecticut PFML policy to the CID, the Connecticut Insurance Department for approval as soon as we see that CID filing guidance notice come out. So, so very, very exciting.

Karen Batson: 5:34

Now, in looking at the final policy, are there any standout differences between what you've seen in the drafts and what finally came out last week?

Kristin Hostetter: 5:44

I don't think there was a lot of change. One of the things that that did jump out was just some clarity that I think will be beneficial. There was some clarity that the leave year method related to care of a service member and for reasons related to family violence can be the same leave year method that's applied to all other leave reasons. So I think that's a promising clarity and development because it will remove confusion for employees and make administration simpler.

Alexa Greenberg: 6:13

That was a really important point that we saw come out, substantively, there were no surprises and deviations. Some of the timeline shifted. But for the most part, we saw clarification rather than significant deviation in the final draft, I would say.

Karen Batson: 6:32

Now considering how much time we have before launch, what are some relevant dates for self insured or fully insured private plans that our listeners should be aware of?

Alexa Greenberg: 6:42

Sure. So first, on the private plan applications, I think the primary thing to keep in mind, these have to be approved no later than 30 calendar days, this is going to be a mouthful before the end of the quarter prior to the quarter in which the approval takes effect. That's confusing. So I want to just hit a simple example to break that down. So in order for a private plan, essentially to be effective, for example, January 1 2022, the application must be approved, approved not submitted by December 1 2021. So that's that's the first sort of date and timeline that I would point out. If you are an employer with a provisionally approved self insured private plan, you will need to supplement your application by December 15 with a plan document. So the good news about that is the paid leave authority has also provided a template plan document to assist employers with drafting their individual private plans. But you will want to do you will want to do that. On the fully insured side, for employers with provisionally approved fully insured plans, these will need to be supplemented as well, by December 1, or more likely 60 days after the CID, the Connecticut Insurance Department approves your carrier's PFML insurance policy, and you will need to supplement your application with certain documentation from that. Lastly, I'll just mention that the declaration of insurance generally speaking and self insurance declaration will be going away as part of the application process after the interim period ends, so timing will be important here for employers to make sure that the right documentation is used in your application.

Kristin Hostetter: 8:34

Can I just pile on a bit to that Alexa, for employers that are still looking to go through the application process likely for a 4/1 effective date? The if they're looking to self insure, at this point, this self insurance declaration is already outdated, right? And they need to get within the plan document.

Alexa Greenberg: 8:55

That's right. That's right, as of November 10. So anytime going forward, the plan document will be the document that you will want to use for new self insured applications.

Karen Batson: 9:07

Now this might be a silly question of something I don't know, what do we mean by supplement when you're going through this process?

Alexa Greenberg: 9:13

Absolutely. So essentially, you will want to submit the supplementing document to the paid leave authority. So add on to your private plan application. Okay. Does that help?

Karen Batson: 9:25

Yes.

Kristin Hostetter: 9:26

I will add to that too. So at this point, any employer that has been approved has a provisional approval, and it's awaiting that documentation that Alexa mentioned to supplement the application to move them into a fully approved status.

Karen Batson: 9:41

Okay. Now, again, with that date right around the corner, where is Lincoln in that preparation for the new year for Connecticut PFML?

Kristin Hostetter: 9:49

Yeah, we're at the tail end of our product development, which is good. The final guidance that we received earlier this week, allows us to answer some of the open questions that we had, it provides clarity to some of the things that we were still looking for some some clarity on. And then it really gives us what we need to prepare to file our policy and look for approval back from the state. So I think we're in a good position at this point to kind of wrap up the work and do those last steps to have our products be ready for a 1/1 effective date of benefits.

Karen Batson: 10:26

It's hard to believe we're nearing that 30-day out mark with how long we've talked about Connecticut PFML.

Kristin Hostetter: 10:32

I agree.

Karen Batson: 10:33

So I thought we'd go through some questions that we've heard, these are questions that we've received just being in the business, but also during our webinar, we received some questions, so I thought this would be a great opportunity to cover them. So the first one is by far the most popular question, how does Connecticut PFML coordinate with short term

Kristin Hostetter: 10:53

This is a good question. And we to your disability? point, we get this question a lot. And I think it's it highlights the importance of understanding how benefits coordinate and I think this will be an ongoing conversation too outside of just Connecticut. Specific to Connecticut, though in most cases, an offset will be applied to short term disability to account for Connecticut PFML. So the PFML will pay first.

Karen Batson: 11:20

Now, another follow up kind of question that comes up is those employees claimants who have an open disability claim end of this year that carries over to next year? What happens in the process with that claim? Now that Connecticut PFML will be live?

Kristin Hostetter: 11:37

That's a good question. So I think there will be, you know, some work done to account for situations where PFML may apply starting in January, proactively prepared to offset those claims, and just take those steps to make that ease into this additional benefit being applicable simpler for employees.

Alexa Greenberg: 11:58

I'll just add to that. A couple things. So one, the offset back to sort of the initial point Kristin made I agree, the STD policy will offset for the Connecticut PFML. But that is dependent on the individual STD policy language. So that will govern. And the second point being as far as the Connecticut PFML claims, that will really depend on the type of the disabling condition. Right, so if it is a qualifying condition under the Connecticut PFML. You will want to look at Connecticut PFML after 1/1/22.

Kristin Hostetter: 12:36

That's a good point.

Karen Batson: 12:37

And so to kind of that point, we're meaning that if they're out on a disability, it's possible that they now have a new benefit available to them. But it all depends on that qualifying factor?

Alexa Greenberg: 12:48

Exactly.

Karen Batson: 12:49

Now, how does Connecticut PFML work for an employer with just one employee in Connecticut?

Kristin Hostetter: 12:55

So a good question. The the Connecticut PFML applies to all private employers with any number of employees working in Connecticut. So those with just a single employee will need to prepare for this benefit to be available to that person.

Karen Batson: 13:11

Now we actually got this question a few times in our webinar, could we level set when contributions began and how they will operate in 2022?

Alexa Greenberg: 13:22

Absolutely. So in general, for the state plan, contributions are set at .5% of employees wages, and that is up to the Social Security cap, and the contributions began on 1/1/21. So one year prior to the effective date of the benefits, which is coming up 1/1/22. The contribution rate is set at .5%, which is the maximum rate allowed under the statute. But every November the paid leave authority has the authority to announce and to set the rate for the following year. So this will begin next November, November 1, 2022. There will be an announcement on whether there are any changes to the contribution rate. And again, for the state plan employers are responsible for forwarding those contributions collected from employees to the paid leave Trust Fund, which is entirely employee funded. And these are do again, some of the dates can get confusing, which is why I understand there are so many questions that come up. So again, these are due on the last day of each quarter with a 30 day grace period. In 2021 catch up deductions were permitted. So again, some variation in the due due dates, but that should not be the case for 2022. If an employer has an improved private plan, just one last point, again, more specific to Lincoln than employees wouldn't need to contribute to the paid leave Trust Fund. That's so that's one thing to remember employers still can collect contributions, they can't collect in excess of.5%, which is the rate set by the state, but they can use those contributions for the administration of their private plan.

Karen Batson: 15:17

Now, if they have a private plan that takes effect, let's say, q2 of next year, are the contributions to the state still need to happen within the first quarter?

Alexa Greenberg: 15:26

Correct.

Karen Batson: 15:27

Now, last question, what are some key reminders you want to leave our listeners with because we are so close to the launch of Connecticut paid family medical leave?

Kristin Hostetter: 15:35

I think a few come to mind. So the first is really just that the effective date is January 1. So it's right around the corner. For those employers that have a private plan exemption, they will need to, as Alexa's mentioned a couple of times supplement that with a plan document or eventually the face sheet of a fully insured policy if that's the funding mechanism they use for their private plan. And then the other thing that comes to mind for me is that mid-year 2022 there will be notice requirements. So it's just to stay close to information sources like this podcast and Lincoln Absence Advisor as that date approaches and to learn more about what the notice requirements entail.

Alexa Greenberg: 16:17

And I would just add one thing, as always, a reminder for employers to review your leave policies with employment counsel and a new state PFML program is a great opportunity to do just that. And to make sure there's clarity for you, employers and employees, particularly around benefit coordination, as there are a lot of questions that typically come up.

Karen Batson: 16:40

Well, thank you both for kind of walking through this and providing the newest information we have to our listeners.

Kristin Hostetter: 16:46

Thanks, Karen.

Alexa Greenberg: 16:47

Thank you for having us Karen.

Kristin Hostetter: 16:49

Nice to spend some time with you.

Karen Batson: 16:50

Thank you, everyone for listening and a special thank you to Kristin Hostetter and Alexa Greenberg for joining me today. We hope you like today's episode and will tell us by rating us sharing the episode or following Lincoln Absence Advisor on Apple, Spotify, or wherever you get your podcasts.

Disclosures: 17:07

The information contained in this podcast is for general use and is not a substitute for the advice of an attorney or your human resource professional. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Affiliates are separately responsible for their own financial and contractual obligations.