Alicia Sasser Modestino Featured in GBH News: More Employers Than Expected Have Opted Out Of The State’s New Paid Leave System. Will The Program Suffer?
About three years ago, a line of people crowded behind Massachusetts Gov. Charlie Baker as he sat down at a big wooden desk and took out a pen.
It was a moment Randy Albelda had been dreaming about and working toward for nearly 20 years. The governor was signing paid and family medical leave into law for almost everyone in Massachusetts.
The law, which is just now being rolled out, is a crowning achievement for progressives, extending a safety net to workers at all income levels.
But more than a million people in Massachusetts work for companies that have opted out of the system, according to public records obtained by GBH News. That’s nearly one in three workers in the Commonwealth who are not in the state’s paid leave system.
Some experts say that hole in the safety net has the potential to undermine the program’s financial stability.
This picture — especially around the gender divide — worries Alicia Sasser Modestino, an economics professor at Northeastern Universit.
If you play this out, both the state and the private insurer rates could theoretically keep increasing — “that’s the death spiral,” said Sasser Modestino.
“It’s killing the state plan because we’re letting the low-cost guys opt out into the private plan,” she said.
Sasser Modestino is concerned about the economic consequences of allowing employers to opt out of the program. But she said there are social dynamics at play here, too. To avoid rates from their private insurer going up, male-dominated companies might discourage their workers from taking paternity leave.
“You’re reinforcing, again, that stereotype of women being the ones taking on the caregiving,” she said.
There are a couple ways to address the popularity of opt-out, according to Sasser Modestino. Lawmakers could change the current law so that employers can’t opt out, an approach she said might “erode employer support.”