by Marti Cardi, Esq – Vice President Product Compliance
August 27, 2019
There are lots of moving parts in Massachusetts these days, as we get closer to implementation of the commonwealth’s paid family and medical leave (PFML) law. Over time we have published several articles on Massachusetts PFML: You can take a look back at our overall summary and periodic developments by entering “Massachusetts” in the search box of this page. In the meantime, here’s what’s happening now:
Private Plans – A Quick Reminder
An employer can opt for its employees to be covered by the public PFML plan administered by the Mass DFML – in which case the employer does not need to apply, just submits the required quarterly reporting and employer/employee contributions to the commonwealth.
If an employer prefers to cover its employees through a private plan administered by the employer, or by a TPA or insurance carrier like Matrix and Reliance Standard, the employer must apply to the commonwealth and get its private plan approved. Performance of the private plan is ensured either by posting a bond (self-insured plan) or obtaining private PFML insurance. An employer can elect a private plan for paid family leave, paid medical leave, or both. If it elects a private plan for only one benefit, the other is covered by the DFML’s public plan.
Private Plans and Insurance Policies
On August 22, the Massachusetts Department of Family and Medical Leave (DFML) and the Massachusetts Department of Insurance (DOI) held a joint “listening session” regarding private PFML plans. The goal of the two departments and attendees is to develop a private plan template that is compliant with the Massachusetts PFML and DOI requirements. I was in attendance for Matrix Absence Management, along with several of my colleagues from Matrix’s sister company, Reliance Standard Life Insurance Company. Here are some important takeaways from that meeting:
Prior to the listening session the DFML and DOI distributed a private plan/insurance policy template to attendees. This template had been submitted for consideration by an unnamed insurance carrier. Apparently there is some incorrect buzz in the industry that this is a Massachusetts-sanctioned template. DON’T BE FOOLED! This is not an approved template but was shared solely to start and focus the discussion. In fact, there are many mistakes and omissions in the starter template that make it noncompliant with the PFML law and would require rejection of the plan if submitted for approval as-is.
The DOI and DFML recognize the urgent need to get more guidance to carriers and employers regarding private plans and insurance coverage. It is a huge task. (One department representative stated she wished it were April instead of August.) The departments expressed intent to have a new version of the template, incorporating changes suggested at the listening session, available relatively soon, perhaps by the end of this week. The DOI stated that it would be about 3-4 weeks before a plan template could be approved.
The departments expect to hold another listening session after the release of a revised plan template. We will be certain to attend that meeting.
More Private Plan Information
Remember, there is no deadline to file for approval of a private plan – employers can file at any time and the plan will be effective on the first day of the quarter following approval. However, there is financial incentive to get a private plan approval by December 20. In that case the employer is not required to pay the employee and employee contributions to the commonwealth for the 4th quarter, October-December 2019. Rather, the employer can hold contributions collected from employees to fund its own private plan (benefits or insurance premiums).
Of course, the employer is not required to withhold contributions from employees at all, if it chooses to fund the plan entirely itself.
The DFML clarified at the listening session that an employer can file for approval of a private plan without the actual bond or insurance policy yet in place. Approval of the plan by the DFML will be provisional, subject to further filing of the bond or the policy.
However, the DFML recommends patience and suggests employers wait for more guidance from the departments – especially those employers intending to purchase insurance to pay for the PFML benefits. The DFML advises that it may be better to wait until they provide more information so a more complete package can be submitted.
If an employer does not have approval by December 20, however, it will be required to pay the Q4 employer and employee contributions to the DFML during January 2020.
While so much is in flux, one solid looming deadline is the requirement to provide PFML notices to employees by September 30, 2019.
Forms and more information are available on the . These are suggested forms and employers can modify them as needed to reflect their current status as to private or public plan, withholding of employee contributions, etc. If you previously sent out notices that are now inaccurate as to details such as commencement of employee contributions you will need to send an amended notice, which is also available on the DFML website.
And, if you haven’t done so yet, go to that same website to download the PFML poster to hang in your workplace. This posting requirement is already in effect, so do it now! Again, the DFML form poster can be modified to fit your situation.
What are Matrix and Reliance Standard doing?
- Reliance Standard and Matrix continue in their leadership role in the absence management world.
Reliance Standard has formally announced its intent to underwrite both MA Paid Family and
Paid Medical. Whether you are fully insured or self-funded for these programs, we can manage
your risk and your service experience!
- Matrix has developed its own private plan template, now updated to be consistent with the
amendments to the PFML law passed on June 13 and the final regulations issued by DFML
effective July 1, 2019. This plan is ready for filing if YOU are ready to move forward, regardless
of whether you choose to self fund PFML benefits or obtain insurance through Reliance Standard.
For those employers choosing to self-fund MA PFML benefits, we can help facilitate sourcing the required bond through our sister company, Tokio Marine HCC.
If your company is interested in the private plan option for Massachusetts PFML, contact your Matrix/Reliance Standard account manager now, or send us a message at firstname.lastname@example.org. And stay tuned here for more information about Massachusetts PFML as it develops.