April Update: Prenatal-to-3 State Legislative Trends 

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Since our last update, legislatures and governors throughout the country have taken exciting action on state earned income tax credits (EITC), paid family leave, Medicaid expansion, extension of postpartum Medicaid coverage, and child care subsidies. Today, we bring you an update from the states! 

The majority of state legislative sessions remain in full swing. However, nine states (Georgia, Kentucky, Mississippi, New Mexico, South Dakota, Utah, Virginia, West Virginia, and Wyoming) have adjourned sine die. One state (Louisiana) has not yet started their 2023 legislative session. In this post, we offer a sample of legislative action in states throughout the country. 

State Earned Income Tax Credits 

Following in Michigan’s footsteps, states continue to make exciting progress on state EITCs: 

  • Montana: Governor Greg Gianforte signed a tax and spending package, which includes S.B. 212, a bill that expands the state’s refundable EITC from 3% to 10% of the federal credit. This change brings Montana’s EITC in line with evidence-based recommendations. Research shows that a refundable state EITC of at least 10% of the federal EITC promotes healthier and more equitable birth outcomes, increases parents’ workforce participation, and improves household economic security. 
  • Louisiana: The 2023 legislative session has not yet started, but H.B. 162 was pre-filed in late March. The bill would temporarily increase the state’s refundable EITC from 5% to 10% of the federal credit. Under current law, the value of the state EITC is scheduled to decrease to 3.5% in tax year 2031. As it stands, H.B. 162 would not change that.
  • Utah: Last year, Utah enacted legislation to create a nonrefundable EITC equal to 15% of the federal credit. The state’s EITC arose again in conversation during the 2023 legislative session. In the final hours before the General Assembly adjourned sine die, legislators passed the FY2024 state budget, which increases the state’s nonrefundable EITC from 15% to 20% of the federal credit. While the value of the state EITC will increase, it will remain nonrefundable, therefore this change does not align with the evidence-based recommendations in our Prenatal-to-3 State Policy Roadmap.  

Paid Family Leave 

Paid family leave remains a hot topic. States continue to introduce legislation to adopt statewide programs to give parents time off work to bond with a new child while receiving a portion of their wages: 

  • Minnesota: Companion bills S.F. 2/H.F. 2 would create a statewide paid family leave program of up to 12 weeks. Eligible workers would receive up to 90% of their average weekly wage; workers with lower incomes would receive a higher percentage of their income, and workers with higher incomes would receive a lower percentage. Both bills have advanced through several committees, with S.F. 2 passing out of its ninth Senate committee last week.   
  • New Mexico: S.B. 11, a bill that would have created a statewide paid family leave program of up to 12 weeks for eligible workers, made significant legislative progress this year. But the bill did not move across the finish line before the legislature adjourned in mid-March.  

Rather than statewide programs, some states are considering paid family leave programs for state employees only. 

  • Texas: The Senate unanimously passed S.B. 222, which would create a program providing up to 6 weeks of leave for eligible state employees. The bill has gone to the House.    
  • Tennessee: Companion bills S.B. 276/H.B. 324 would provide up to 12 weeks of leave for eligible state employees. S.B. 276 passed both chambers with bipartisan support, and H.B. 324 passed out of committee and currently awaits debate on the House floor.

Medicaid Expansion and Postpartum Extension 

Last week, North Carolina became the 40th state to expand Medicaid when Governor Roy Cooper signed H.B. 76 into law. The bill contains a provision requiring the state legislature to enact a FY2024 state budget before Medicaid expansion can be implemented.  

In addition, several states are considering legislation to extend postpartum Medicaid coverage. States now have the permanent option to extend Medicaid coverage for eligible mothers from 60 days to 12 months after the birth a child.  

  • Mississippi: S.B. 2212, which extends postpartum coverage for Medicaid, was signed into law by Governor Tate Reeves in March. Mississippi now joins Wyoming in the list of states to have adopted the permanent extension.   
  • Texas: H.B. 12, which would extend postpartum Medicaid to 12 months, recently passed out of committee and is with the full House for consideration before heading to the Senate.   
  • Oklahoma: H.B. 2014, which would codify 12-month postpartum extension for Medicaid, passed the House. The bill was referred to Senate committee last week but has not yet had a hearing.  

Child Care Subsidies 

In an effort to more fully support children and families, several states are looking to bolster child care subsidy programs by waiving family copayments, increasing provider reimbursement rates, and expanding eligibility.  

  • Massachusetts: Two similar pieces of legislation, H. 489 and S. 301, have been introduced. Both bills would base reimbursement rates on the true cost of providing high-quality care and would expand eligibility for child care subsidies to up to 85% of the state’s median income (SMI). In addition, S. 301 waives copayments for families making less than 100% of the federal poverty level (FPL) and limits copayments for all families receiving child care assistance. 
  • New Hampshire: S.B. 237 would expand income eligibility to 85% of SMI and eliminate copayments for families under 100% of the FPL. The bill requires provider reimbursement rates to be set at or above the 75th percentile of the market rate, allows for true cost of care reimbursement, and permanently bases reimbursement on enrollment instead of attendance.
  • North Carolina: Legislators introduced companion bills H. 343 and S. 288, which would increase provider reimbursement to the 75th percentile of the market rates outlined in the 2021 Market Rate Survey, with automatic increases required upon the release of new market rate surveys in subsequent years. The bills would also establish a statewide floor, so that providers in counties where the rate is below the state average would receive the average rate.
  • Rhode Island: Legislators introduced S.B. 522, which would expand initial eligibility to families making up to 85% of the SMI—up from 46%—with continuing eligibility up to 100%. The bill would also increase provider reimbursement rates to meet or exceed the 75th percentile of the market rate. In addition, the bill would provide added support for infant care by implementing a bonus rate for programs serving children under 18 months of age. 

We will continue to post state policy updates on our blog through May and June. Our team of over 30 researchers, policy experts, data analysts, and communicators closely tracks state action in early care and learning, child and parent health, and economic and family supports.  

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