January 15, 2002

For more information contact:

Stanley S. Jones, Jr.

404-817-6133

Jeffrey C. Baxter

404-817-6247

Kirkland A. McGhee

404-817-6257

Helen L. Sloat

404-817-6170

After an evening and morning of listening to the State’s business leaders with a dinner and breakfast at the World Congress Center hosted by the Georgia Chamber of Commerce, Day 2 was focused more on the work at hand. In the speech last evening, the first major address since becoming Georgia’s Senator, Zell Miller had the audience on the edge of their seats and thinking that perhaps that the former Governor might even switch parties. Sen. Miller told the crowd that he would try and change things in Washington, referring to the partisan politics, but that he would remain the same. The "not change" Democrat held the rapt attention of all and many were still discussing the elements of his speech, such as the need for a farm bill which would not hurt the peanut growers, the proposal for reinstatement of the draft, and the need for federal dollars to reach Georgia’s military installations, at breakfast this morning.

The Eggs and Issues breakfast was not unlike prior breakfasts – Governor Barnes, Lt. Governor Taylor, and Speaker Murphy addressed the business and community leaders about what to expect during the 2002 Session. Governor Barnes expressed the soundness of the State’s budget and the need to work hard on the expenditures and not to draw down the State’s reserves. Lt. Governor Taylor stressed the need for rural economic growth and Speaker Murphy claimed that Georgia must address its water issues, as even Haralson County had a number of applicants for water permits which were unable to be filled due to water shortages.

Newly Introduced Legislation

HB 991 – Speaker Murphy introduced this amendment to O.C.G.A. § 33-9-21 concerning insurers’ maintenance and filing of rates, rating plans and systems, and other materials with the Commissioner of Insurance in order to provide that the Commissioner shall require liability insurers to make certain rate filings and that such liability insurers be prohibited from maintaining certain excess loss reserves under certain circumstances. Specifically, at paragraph (2) of O.C.G.A. §33-9-21, it adds that the Commissioner of Insurance "shall require, not later than January 1, 2003, each domestic, foreign, and alien insurer, writing or authorized to write any form of liability insurance in this state, to file such insurer’s own individual rate filing for premium rates to be charged for liability insurance coverage written in this state." The bill has been forwarded to the House Judiciary Committee for further study.

HB 992 – Chairman of House Insurance, Jimmy Lord, introduced this measure in an effort to amend Chapter 1 of Title 33 (the Insurance Code) so as to make legislative findings and to provide that insurers subject to the filing provisions under Chapter 9 of Title 33 file the commission percentage as a separate expense item. This bill has been sent to the House Insurance Committee.

HB 993 – Do you love grits? If you are in the South chances are you do. Reps. Everett, Pelote, Poag and others have drafted this bill to amend Article 3 of Chapter 3 of Title 50 in an effort to designate grits as the "official processed food of the State of Georgia." The bill has been referred to the House Health and Ecology Committee.

HB 994 – Chairman Lord has also introduced another piece of legislation dealing with motor vehicle insurance – it amends O.C.G.A. § 40-6-10 in order to provide that owners and operators shall "keep proof of minimum insurance coverage in all vehicles until January 31, 2003 and to provide that on and after February 1, 2003 proof of insurance for vehicles not insured under a commercial policy will be established by a state database of insurance coverage." This would appear to address issues raised in the implementation of SB 69 which was passed in 2000. The bill has been forwarded to the House Insurance Committee.

HB 999 – One of the first of many gas bills has been dropped – this one by Reps. McKinney, Stanley, Stanley, Dean, Brooks and others proposes to amend Chapter 4 of Title 46 of the Code relating to distribution, storage, and sale of gas so as to repeal Article 5, the "Natural Gas Competition and Deregulation Act." This bill has been assigned to the House Industry Committee.

HB 1001 – Speaker Murphy and Reps. Coleman, Walker, Skipper, and Smith have introduced this Budget bill so as to provide Supplemental appropriations for the State Fiscal Year.

HB 1003 - Speaker Murphy and Reps. Coleman, Walker, Skipper, and Smith have introduced this Budget bill so as to provide appropriations for the State Fiscal Year beginning July 1, 2002 and ending June 30, 2003.

HB 1005 – Rep. Pinholster has offered this bill amending Chapter 1 of Title 9 of the Civil Practice Act which proposes to require mediation with respect to all civil actions. It states: "Notwithstanding any other provision of law to the contrary, and the provisions of this title in particular, no civil action, as defined in Code Section 9-2-1, shall be commenced or otherwise initiated by any method other than mediation."

HB 1012 – Reps. Ehrhart, Westmoreland, and Lunsfords have introduced this bill to create the Major Airport Operations Board. This would be created in Chapter 3 of Title 6.

HR786 – Transportation seems to be again on the Legislature’s radar. Reps. Everett, Scheid, Mosley, Hudgens, Campbell, and others have introduced this Resolution to create a Study Committee for the Transfer of Operations of the Hartsfield Atlanta International Airport. Many believe that the State should take over operation of the airport. Speaker Murphy has indicated that if the State did such, that it would then be taking over all types of city and county activities within the State which he does not agree the State should do. This Study Committee would be comprised of five House members, designated by the Speaker.

HR792 – Rep. Holmes and others have proposed an amendment to the State’s Constitution for the restoration of the right to vote to persons convicted of a felony involving moral turpitude upon completion of the term of imprisonment – currently, the Constitution reads: "No person who has been convicted of a felony involving moral turpitude may register, remain registered, or vote except upon completion of the sentence."

SB 317 – Sens. Eric Johnson and Regina Thomas have authored this bill amending Article 1 of Chapter 24 of Title 33 regarding insurance so as to require that all health insurance policies provide coverage for colorectal cancer screening as well as to establish screening guidelines for the covered individuals. This would add a new Code Section beginning with O.C.G.A. § 33-24-56.3: "All individual and group health insurance policies providing coverage on an expense incurred basis, individual and group service, or indemnity type contracts issued by a nonprofit corporation, individual and group service contracts issued by a health maintenance organization, all self-insured group arrangements to the extent not preempted by federal law, and all managed health care delivery entities of any type or description, that are delivered, issued for delivery, continued, or renewed on or after July 1, 2002, and providing coverage to any resident of this state shall provide benefits or coverage for all colorectal cancer examinations and laboratory tests specified in current American Cancer Society guidelines for colorectal cancer screening of asymptomatic individuals. Coverage or benefits shall be provided for all such colorectal screening examinations and tests that are administered at a frequency identified in the current American Cancer Society guidelines for colorectal cancer." Other specifics of the bill: it would apply to a covered person over age 50 (or less if considered at high risk).

SB 320 – Sens. Johnson, Price, Stephens, Lamutt, and Seabaugh have authored this bill to enact the "Georgia’s Homeland Defense Act." This would amend the criminal code to define activity of domestic terrorism and to define, prohibit, and punish terroristic acts and terroristic threats. The bill also proposes to amend the Georgia RICO statute in order to provide that the commission of murder in the course of domestic terrorism shall be an aggravating circumstance for purposes of application of the death penalty.

SB 325 – Sens. Scott, Thomas, Fort, Tate and Kemp have introduced this bill, another gas bill, in order to amend the current law, "Natural Gas Competition and Deregulation Act." This would give the Public Service Commission greater powers such as the ability to review and approve the terms of agreements for the provision of natural gas to residential customers as well as to change certain provisions relating to rates. Customers would also be able to sue – "any customer who is damaged by a marketer’s wrongful or negligent actions shall be entitled to maintain a civil action and shall be entitled to recover actual damages, punitive damages, and a reasonable attorney’s fee."

Committee Activity

The House Insurance Committee met this afternoon and passed out by Committee Substitute SB 177. This bill provides for additional requirements in the brochures relating to the explanation of surplus lines of insurance.

The House Appropriations Committee’s Subcommittee on the Department of Community Health met to hear more about the details of the Supplemental Budget from Commissioner Gary Redding.

The Subcommittee members present asked Commissioner Gary Redding a number of questions. Many of the questions centered around the return of the $34 million which had been set aside as reserves for the State Health Benefit Plan. Rep. Orrock questioned Commissioner Redding about cost containment measures taken by the plan – he cited implementation of the PPO, the three-tier co-payment for drugs and deductible levels. Rep. Powell also questioned Commissioner Redding about the plan’s reserves. Commissioner Redding explained that 2-3 months of reserves (claims payments) were needed (this amounts to $180 million). Rep. Harbin asked about the "soundness" of the plan. Commissioner Redding reported that the State Health Benefit Plan was now sound.

There were also questions on the elimination of enhancements which the General Assembly had made in 2001. Rep. Orrock expressed that this was perhaps a backward step – especially so if funding for initiatives to help the uninsured were being eliminated.

The Commissioner was also questioned about ‘leaving federal dollars on the table’ as it would appear that these cuts would minimize the federal dollars being drawn down for certain programs. Commissioner Redding explained that his Department tried to prioritize the cuts to effect the reduction (2.5%) requested by Governor Barnes.

Non-emergency transportation also received some inquiries. Commissioner Redding explained that time and monitoring had helped with the transportation system. The Department is now monitoring the various contractors. Rep. Henson asked about use of a capitation rate, which is how transportation costs are paid. Additionally, Rep. Henson asked for more details about the types of persons utilizing the system of transportation.

Rural hospitals were also on the Subcommittee’s minds. Commissioner Redding was asked about the exclusivity of contracts and purchases of hospitals by the private sector and what recommendations could be made to help the plight of the rural hospitals. Commissioner Redding explained that perhaps was the $64 million dollar question. He has spent a number of hours with the Office of Rural Health trying to come up with ideas. Commissioner Redding also pointed out that the Georgia Hospital Association had been working on ways to help rural hospitals as well.

Rep. Harbin also asked about prior authorization in order to receive certain drugs. Redding explained that this procedure would be done on a clinically sound basis.

Obtaining new vehicles is not merely an ‘ask.’ Rep. Harbin asked Commissioner Redding if it was necessary to obtain two vehicles and whether it was possible to hold off another year. Commissioner Redding said that the replacement of one vehicle was necessary as the present vehicle was unsafe. Rep. Henson asked if the Composite State Board of Medical Examiners, which when created was to be an independent organization paid and supported by dues, was now asking for vehicles. She asked Commissioner Redding to supply more details on how this Board operates.

Rep. Henson also queried Commissioner Redding about getting State employees’ children covered by some form of insurance as the Budget proposals cut this enhancement for low-income families. Currently, the PeachCare program will not allow admittance of children who have parents employed by the State.

Rep. Manning asked about the revenue maximization efforts made by the State. Commissioner Redding did explain that there had been ‘bumps in the road,’ but that dollars had been brought into the State and some of the waiting lists had been reduced.

Rep. Channell asked about the total expenditures on the pharmacy benefit manager. Commissioner Redding noted that costs were $10.7 million and that the pharmacy benefit manager handles claims, prior authorization of drugs, and works with the Department on drug manufacturer forums on deciding what drugs to place on the preferred drug list as well as conducts research on drugs for the Department. This pharmacy benefit manager is also working with the Department on disease state management efforts.