Child care insurance affordability idea is a no-go

Members of the Legislature’s Economic Affairs Interim Committee voted to forego bringing draft legislation for a child care reinsurance pool to lawmakers next session. Lawmakers had zeroed in on reinsurance — which the state auditor defines as “insurance for insurance companies” — as a possible way to manage soaring premiums faced by child care operators, the costs of which are then passed on to families.

But when the time came to make decisions that would inform the particulars of draft legislation at Tuesday’s meeting, a majority of lawmakers felt this approach introduced too many unknowns and risked passing on the burden to taxpayers. They also felt the market over time could do more to ease costs than government intervention.

“I feel like this is a bit of a non-issue, and a lot of work,” said Rep. Nelly Nicol, R-Billings, who works in the insurance industry. “We do have… [truncated for brevity]

Premiums for general liability insurance rose… [truncated for brevity]

Data from the Montana Department of Labor and Industry found… [truncated for brevity]

Advocacy organizations say rising costs of doing business… [truncated for brevity]

“We continue to hear that this is a challenge, and we know this might not be an easy route to move forward with,” said Caitlin Jensen, executive director of Zero to Five. “But we are… [truncated for brevity]

Reinsurance allows insurance companies to transfer risk from one or more policies to an outside entity that then guarantees individual policyholders… [truncated for brevity]

At the May meeting, the interim committee tasked staff… [truncated for brevity]

Those items raised concerns for some lawmakers around the cost of such a proposal… [truncated for brevity]

Sen. Mark Noland, R-Bigfork first voiced his skepticism, shared by fellow Republicans… [truncated for brevity]

“This is a conundrum, we all get it,” the senator added. “But I have some reservations… [truncated for brevity]

Montana households averaged $18,940 in child care… [truncated for brevity]

Around 66,000 parents in the state opted not to fully engage… [truncated for brevity]

These findings aren’t new. Child care legislation has come up in multiple past sessions… [truncated for brevity]

Sen. Shane Morigeau, D-Missoula, expressed frustration… [truncated for brevity]

“To me, we can only kick the can down the road so many times,” he said. “I definitely agree and understand… [truncated for brevity]

Both Morigeau and fellow Democrat on the committee Rep. Jonathan Karlen, D-Missoula, acknowledged… [truncated for brevity]

With reinsurance off the table based on committee concerns, Karlen proposed… [truncated for brevity]

Legislators during the 2023 session allocated… [truncated for brevity]

“There are ways to do that that are not going to be just a draw on state resources,” Karlen said.

… [truncated for brevity]