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Top Issues for State Lawmakers in 2023

January 12, 2023

As the nation has transitioned to living with COVID-19, the attention of state lawmakers has shifted away from pandemic-related matters like testing availability and vaccine distribution to other concerns. Many of the issues we expect to top state legislative agendas this year predate the pandemic, although some of them have become more pressing because of it.

HEALTH

Healthcare Workforce

There already weren’t enough healthcare workers to meet the country’s healthcare needs before the pandemic began. But that problem has only grown since COVID became a household word. As SNCJ reported last May, job vacancies for certain types of nurses increased by as much as 30 percent between 2019 and 2020, and the national shortage of physicians, which stood at just under 20,000 in 2019, could climb to over 100,000 by 2034.

Lawmakers in at least 33 states introduced legislation last session dealing substantively with healthcare workforce development, including measures creating task forces or commissions, establishing training programs and providing financial assistance for medical education. Twenty-six of those states enacted or adopted such measures. And with the healthcare worker shortage only expected to worsen in the coming years, more of this legislation is undoubtedly on the way.

Abortion

Since the U.S. Supreme Court’s ruling last June in Dobbs v. Jackson Women’s Health Organization overturning Roe v. Wade, states have been implementing “trigger” abortion bans, enacting abortion restrictions, solidifying abortion protections and battling over those various laws in court.

As of November states had enacted over 1,000 abortion-related bills covering a range of issues. Seventeen states prohibited telehealth visits for abortion services like pre-abortion consultations. Twenty-three states prohibited insurance coverage of abortions, while seven required insurance plans covering maternity health to include abortion coverage. And such laws are likely to keep coming this year.

Last year’s elections, in which a record number of abortion measures were on state ballots, added another dimension to the issue. Voters in three states -- California, Michigan and Vermont -- enshrined the right to reproductive freedom into their state constitutions, while voters in three others, Kansas, Kentucky and Montana rejected anti-abortion measures. And the Initiative and Referendum Institute noted that given Michigan’s abortion measure was the only one that qualified for the ballot via the initiative process in the short amount of time between the Dobbs ruling and the November election, “we can expect to see activists on both sides try to qualify them in the future, especially if legislatures stray too far away from citizen preferences on the issue.”

Mental Health

Mental health has drawn a great deal of attention from state lawmakers in recent years as they’ve grappled with rising gun violence and the opioid epidemic. The COVID-19 pandemic has only added to those concerns, possibly quadrupling the number of adult Americans suffering from anxiety and depression.

The mental health crisis has spurred legislation like California’s SB 855 (2020), requiring health insurers to cover all medically necessary treatment for mental health and substance abuse disorders, and SB 221 (2021), requiring health insurers and healthcare service plans to ensure timely access to mental health and substance abuse treatment.

Additionally, according to CNN Health, as of September only half of the states had enacted or introduced legislation preparing for the new 988 national suicide prevention number to which phone and text service providers will have to start routing mental health crisis calls by July 16. Jodi Manz, project director of behavioral health, aging and disability at the National Academy for State Health Policy, said states don’t have to pass legislation “to make that critical step happen,” but legislative action could still be called for.

“State legislation is more about how to fund and organize this work within existing mental health systems, and imposing telecoms fees may not be ideal or well received in some states, so there is likely continuing conversation where that is the case,” she said.

Prescription Drugs

Twenty-six states passed over 70 bills dealing with prescription drug policy last year. Roughly a third of those measures were aimed at reforming pharmacy benefit manager practices. For instance, several states, including Colorado (HB 22) and Illinois (HB 4595), required PBMs to reimburse 340B covered pharmacies at the same rate as non-340B pharmacies. States also sought to reduce patient out-of-pocket costs, such as by capping monthly copays for insulin (Louisiana HB 677, Maryland HB 1397 and Washington SB 5546). And some states addressed the use of utilization management policies. For example, New York (SB 7767) prohibited health plans from making changes to their formulary during the course of a plan year. All of those trends could continue this year.

Healthcare Staffing Agencies

During the worst of the coronavirus pandemic, travel nurses made national headlines for earning double or triple what nurses employed by health systems were making. States responded by introducing bills aimed at regulating travel nurse and other healthcare staffing agencies, including how much they can charge for their personnel.

A number of those measures were enacted, including Iowa HB 2521 and Louisiana HB 958, imposing licensing, registration or other requirements on such agencies, and Illinois HB 4666, requiring nurse staffing agencies that fail to pay their nurses 100 percent of the hourly rate they charge health care facilities to reimburse those nurses and pay a penalty of 5 percent of the amount the nurses were underpaid. With nurse contract labor costs and workforce shortages threatening the financial viability of health systems, efforts to regulate nurse and healthcare staffing agencies are sure to continue.

INSURANCE/FINANCE

Crypto Regulation

Although legislation aimed at regulating the crypto industry has been introduced in Congress, the inclination in Washington has been to let the SEC and CFTC regulate the industry through enforcement of existing laws, which those agencies have been doing with increasing vigor. Even the highly-reported implosion of Sam Bankman-Fried’s cryptocurrency exchange FTX and the potential loss of billions of dollars in investors’ money may not change that status quo, given the power of the industry’s lobby in Washington.

At least 37 states considered bills dealing with cryptocurrencies and other digital assets last year. Over a dozen of those measures were enacted, including Wyoming’s crypto-friendly SF 69, creating the structure for decentralized autonomous organizations, or DAOs, to pursue federal recognition of their virtual currencies, and Nebraska’s crypto-restrictive L 707, requiring financial institutions that issue stablecoins to hold 100 percent of the value of those cryptocurrencies in U.S. dollars.

Tim Storey, CEO of the National Conference of State Legislatures (NCSL), said he didn’t expect the issue to be as hot in 2023. But the increasing adoption of digital assets was already enough to keep crypto bills coming this year and beyond. And the FTX debacle and continued congressional inaction may embolden some states to try to do more to protect consumers and the broader financial markets within their jurisdictions from the risks currently associated with digital assets, although those efforts would likely face strong industry opposition as well.

Cybersecurity

The growing risk of cyberattacks only accelerated during the pandemic, with far more people working remotely and relying on e-commerce. The U.S. Treasury Department’s Financial Crimes Enforcement Network reported in November that it received 1,489 ransomware-related filings totaling almost $1.2 billion from U.S. financial institutions in 2021, a 188 percent increase from the $416 million total for 2020.

At least 40 states considered, and 24 enacted, legislation dealing substantively with cybersecurity last session. Lawmakers in multiple states weighed measures addressing ransomware, in some cases prohibiting ransomware payments. While the majority of those bills applied only to government agencies, a couple of them, Hawaii HB 2052 and New York SB 6806 – both of which failed – would also have applied to business entities.

A handful of states also considered bills concerning the security of insurance data. Two of those measures (Kentucky HB 474 and Vermont HB 515) were enacted.

LABOR

Workforce Development

At a meeting in December about the 2023 legislative session, NCSL’s Storey said that in his over 30 years of working with state legislatures, he’d never seen as much unanimity about an issue as he had with workforce development.

One area of focus for lawmakers will be worker recruitment, with unemployment rates having fallen to record low levels in many states, driving up wages and prompting many workers to leave their jobs for new ones. Efforts may be targeted at underrepresented groups, such as women of color and those with disabilities, or residents of other states, as was the case with a law enacted in Vermont (SB 62) last year.

States may also try to boost worker recruitment and retention by increasing their minimum wage. In recent years many states have raised their minimum wage to $15 an hour. But Hawaii’s passage of a bill (HB 2510) last year increasing its wage to $18 an hour could start a new wave of enactments. Many states also have minimum wages that automatically rise with inflation, and there may be some debate in those states about the soundness of that approach in the current economic environment.

Portable Benefits for Gig Workers

Lawmakers in a number of states have considered legislation that would create portable benefit programs for gig workers, linking benefits to the workers instead of their employers. The fate of the issue has become more uncertain since a California judge effectively invalidated a ballot measure (Proposition 22) approved by the state’s voters in 2020 that would have designated app-based drivers as independent contractors but also granted them limited benefits, such as accident insurance. But with the gig economy potentially encompassing over a third of U.S. workers – from on-demand drivers to freelance writers to contract nurses – lawmakers will almost certainly continue to wrestle with the issue.

Paid Medical Leave

Paid family leave has been around for over two decades. But the pandemic, which forced millions of people to work while they were ill or taking care of a sick family member, has given additional impetus to the issue. At least a dozen states considered paid family leave bills last year, two of which (Maryland SB 275 and Delaware SB 1) were enacted.

Diversity, Equity and Inclusion

The importance of diversity, equity and inclusion (DEI) is exemplified by the billions of dollars U.S. companies are now spending each year on DEI initiatives. The issue is likely to be an important one this year for state lawmakers as well. In the 2021-2022 biennium at least 17 states considered bans on anti-discrimination instruction or training in public schools, government agencies or the private sector. Seven of those measures were enacted, including Florida’s Parental Rights in Education law (HB 1557) – the so-called “Don’t Say Gay” bill — banning anti-discrimination training in the private sector as well as classroom instruction about sexual orientation or gender identity.

TECHNOLOGY

Data Privacy

At least 35 states considered legislation dealing with consumer data privacy last year, according to NCSL. Twenty-five of those states considered comprehensive measures, or omnibus bills, that would “generally regulate the collection, use and disclosure of personal information by businesses and specify consumer rights for collected data, such as the right to access, correct and delete personal information gathered by businesses,” as NCSL put it.

Despite the high volume of introductions, only two states, Connecticut (SB 6) and Utah (SB 227) enacted comprehensive consumer data privacy bills last year. But the same number of states introduced and enacted such measures in 2021. So, barring the passage of federal data privacy legislation, the pattern in the states may continue to hold.

State lawmakers have also shown interest recently in the protection of consumer genetic information collected by testing companies like 23andMe and Ancestry.com. Only nine states introduced genetic privacy bills in 2021, but seven of the states enacted them, giving that particular type of consumer data privacy legislation the highest passage rate of the dozen categories tracked by NCSL that year.

Eight states introduced genetic privacy bills last year, but only three of those measures were enacted (Kentucky HB 502, Maryland HB 866 and Wyoming HB 86), although one was also vetoed in Hawaii (SB 2032) and two more are still pending in New Jersey (AB 525) and Virginia (SB 419). And the relative success of such measures in comparison to comprehensive data privacy legislation could keep them coming.

A bill (AB 2273) passed last year in California could provide another area of focus for lawmakers this year. The measure requires businesses that provide online services, products, or features likely to be accessed by children to meet certain requirements, including ensuring their privacy settings default to “a high level of privacy.”

Broadband

Broadband is another issue that became bigger during the pandemic. As NCSL’s Wendy Underhill put it: “We know that there’s a difference between the ability to get good communications in rural areas and urban areas...COVID made that so important to everyone throughout the nation, so what can be done about that is a question that states are definitely looking to address.”

Last year lawmakers in 43 states considered broadband measures, addressing issues including dig once, rural broadband and smart communities. Twenty-six states enacted such measures.

The Internet for All Initiative, announced by the Biden administration last May, will likely provide additional fuel for the issue. Under that initiative the federal government “will invest $45 billion to provide affordable, reliable, high-speed internet for everyone in America by the end of the decade.”

Electric Vehicles

The federal Bipartisan Infrastructure Law, enacted in 2021 as the Infrastructure Investment and Jobs Act, made funding available to states to build out their EV charging infrastructure along the National Highway System. All 50 states have submitted the EV infrastructure deployment plans required to unlock the first $5 billion in funding. As those plans are approved states could look to expand beyond the nation’s interstates. For instance, New Jersey has introduced a bill (AB 3086) for its 2022-2023 session providing for the installation of EV stations at service areas along state toll roads.

— By KOREY CLARK

 

 

Healthcare Workforce Big Concern for State Lawmakers in 2021-2022

Lawmakers in at least 33 states introduced legislation last session dealing substantively with the healthcare workforce, including measures creating workforce development task forces or commissions, establishing healthcare worker training programs and providing financial assistance for medical education. Twenty-six of those states enacted or adopted such measures.

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