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Authority: About 4% of program participants are covered by private plans; staff outlines data and fiscal estimates
Summary
Staff told the board that private plans currently cover about 59,000 workers (~4% of covered employees), that most private plans are fully insured, and offered staff estimates of foregone subject earnings and contributions; staff cautioned these are best estimates and said some counts are complicated by FEIN/subsidiary registrations.
Staff presented a detailed state-of-business update on private plans, noting most private-plan arrangements in Connecticut are fully insured and explaining the Authority’s approval process for private-plan exemptions.
"When we talk about private plans... these are the alternate method for an employer to provide paid leave coverage to their employees rather than using the state program," Michael said. He summarized the private-plan approval and renewal process: employees must be educated and vote; exemptions are approved for three-year periods; material changes or carrier changes require re-approval.
Michael reported 851 employer registrations currently associated with private plans but explained that number is inflated by separate FEIN registrations. "It's likely that we have around 500 to 600 total private plans when you consider subsidiaries," he said, and added staff estimate roughly 59,000 employees are covered by private plans, about 4% of the program’s covered population.
On financial impact, Michael said staff estimate lost subject earnings attributable to private plans in 2024 are between $5 billion and $6.2 billion, which he said would be equivalent to “about 25 to 31 million dollars in contributions” the public program did not receive. He cautioned these are best estimates and not exact figures.
Board members asked whether employee counts tracked with employer counts; Michael said that information would be harder to assemble and likely require research in DOL records. Melissa Gibran and others noted multistate employer behavior can affect private-plan choices because companies may prefer a single unified plan across states.
Michael said the majority of private plans use a fully insured model and that only about 7% are self-insured. He compared Connecticut’s private-plan prevalence to other states, noting Massachusetts had higher private-plan take-up (data cited from 2021) while California and Washington showed comparable low single-digit percentages for private-plan coverage.
Staff offered to research additional employee-level trend data if the board wanted more detail.
