Greetings from the Gold Dome!  Legislators tried to get work out of the way to make it to their home districts as the General Assembly will stand in recess until February 10, 2003 .  This recess permits the Appropriations Committee to delve further into the FY 2003 Supplemental Budget.  Subcommittee budget proposals are due on Thursday in the House so its Committee can put together a final proposal.  

          As day 12 cruised to a conclusion, the predatory lending issue once again took center stage.   Today, the House passed HB 142, which is the 2003 version of the Fair Lending Act.  Three Floor Amendments were proposed but Rep. Skipper asked that the House agree to two of the three.  The current law took effect in October, 2002 but issues arose concerning ratings of loans once sold to investors.  Standard & Poor issued a notice stating that the new law would allow consumers to pursue legal claims against investors who purchased their loans, regardless of date of acquisition.  Thus, Standard & Poor issued a statement that it would not rate bonds tied to home mortgages in Georgia .  There were grave concerns from the banking community about the continued issuance of home loans if this were to occur.  

HB 142 proposed to limit liability exposure to persons or lending institutions directly involved in the initial generation of the loan.   Provisions concerning the “high cost” loans are still in effect.  These are loans where the lender charges an interest rate higher than 10 percentage points above the U.S. Treasury yield (now approximately 13 percent) or if the total fees and points charged to the borrower exceed 7 percent of the total loan amount.  Lenders dealing in high cost loans cannot:  

·        Include prepayment fees with the exception of the first two years of the loan.

·        Establish a payment plan where payments do not decrease the full amount of interest due.

·        Pad profits by increasing interest rates after default.

·        Approve a loan unless the borrower has received counseling from a third-party non-profit organization on the merits of the loan.

·        Approve a loan where the borrower’s total monthly debts, including the loan amount, would exceed 50%  of the borrower's monthly gross income.  

Lawmakers also took the opportunity to tweak a few other aspects of the provision.  

A number of complaints had been heard concerning the new law’s effect on loan programs offered through federal and state government home loan programs, such as Veterans Administration loans.  Specifically, these concerns dealt with the fees charged by those programs; in some instances these could turn the formula into a “high cost” loan.  Language was therefore inserted to exempt fees charged by these organizations from the calculation formula.  

There were also concerns regarding the definition of “loan flipping” in the original law. As passed in 2002, the Fair Lending Act defined “loan flipping” as refinancing an existing home loan within five years of its origin when the new loan does not provide a reasonable, tangible net benefit to the owner.  The phrase “reasonable, tangible net benefit” was troublesome.  HB 142 provides guidelines by which “reasonable, tangible net benefit” can now be determined.  Guidelines stipulate that, after taking into consideration all costs and fees, the new loan must do at least one of the following: 1) lower the borrowers overall monthly debt load; 2) decrease the duration of the loan; 3) supply the borrower with a reasonable amount of cash above and   beyond the cost and refinancing fees; 4) change the borrower from an adjustable rate loan to a fixed rate loan; or 5) ensure the borrower’s total monthly debts, including the new loan, do not exceed 50% of his or her total gross income.   

The Bill also allows a presiding judge to assess attorneys’ fees against predatory lenders, if they are found to have willfully violated the Code and subsequently refused to resolve the matter outside the court system.  

The Bill passed by a resounding 175 to zero.  

Newly Introduced Legislation  

SB 85 – Sen. Hamrick and others have offered this amendment to the optometry licensing standards in order to increase the punishment for those who are practicing without a license.  This bill was referred to the Senate Health and Human Services Committee.  It would amend O.C.G.A. § 43-30-14.  

SB 92 – The Governor’s powers may be changed concerning when he or she has the power to suspend or limit the sale, dispensation or transportation of firearms in emergencies.  Sen. Mullis and others have offered this proposal to repeal current law in O.C.G.A. § 38-3-51.  The bill has now been sent to the Senate Public Safety and Homeland Security Committee.  

SB 96 – Sen. Unterman and others introduced a requirement for health benefit policies to cover off-label prescription drug use for insureds with life-threatening or chronic and disabling conditions or diseases.   The bill defines “chronic and seriously debilitating” as “diseases or conditions that cause significant long-term morbidity and that require ongoing treatment to maintain remission or prevent deterioration.”    “Life threatening” is defined as:  “A) diseases or conditions where the likelihood of death is high unless the course of the disease is interrupted; B) diseases or conditions with potentially fatal outcomes, where the end point of clinical intervention is survival; or C) the natural process of aging shall not be construed as a disease or condition for the purposes of this definition or this Code section.”  Health policies could not limit or exclude coverage for a drug on the basis that the drug is prescribed for a use that is different from the use for which the drug has been approved by the FDA, under certain conditions and subject to prior authorization or other restrictions of the insurer:  

“(1)The drug has been approved by the federal Food and Drug Administration;
(2)(A) The drug is prescribed by a contracting licensed health care professional for the treatment of a life-threatening disease or condition; or
(B) The drug is prescribed by a contracting licensed health care professional for the treatment of a chronic and seriously debilitating disease or condition, the drug is medically necessary to treat that disease or condition, and the drug is on the insurer’s formulary or preferred drug list, if any; and
(3) The drug has been recognized for treatment of that disease or condition by one of the following:
(A) The American Medical Association Drug Evaluations;
(B) The American Hospital Formulary Service Drug Information; or
(C) The United States Pharmacopoeia Dispensing Information, Volume 1, “Drug Information for the Health Care Professional;” or
(D) Two articles from major peer reviewed medical journals that present data supporting the proposed off-label use or uses as generally safe and effective unless there is clear and convincing contradictory evidence presented in a major peer reviewed medical journal.”

The provision exempts treatment of a condition or disease which is excluded under the policy contract; an experimental drug or one not approved by the FDA; or a drug treatment not listed on the health benefit plan formulary or preferred drug list.  

SB 97 – Sen. Hamrick and others are proposing additional exemptions from the real estate transfer tax which would amend O.C.G.A. § 48-6-2.  Taxes imposed by O.C.G.A.§ 48-6-1 would also not apply to:  

·        “Any deed, instrument, or other writing transferring realty to a corporation, partnership, limited liability company, or trustee of a trust as a stockholder, partner, member, or trust beneficiary of the entity or so as to become a stockholder, partner, member, or trust beneficiary of the entity as long as no consideration is paid for the transfer other than stock in the corporation, interest in the partnership, interest in the limited liability company, beneficiary interest in the trust, or the increase in value in the stock or interest held by the grantor. However, except for transfers subject to another exemption under this Code section, the transfer of realty from a corporation, partnership, limited liability company, or a trustee of a trust to a stockholder, partner, or trust beneficiary of the entity is subject to the tax imposed by Code Section 48-6-1, even if the realty is transferred to another corporation, partnership, limited liability company, or trust

·        Any deed, instrument, or other writing reflecting vesting of title to realty acquired in a statutory merger or consolidation from a constituent corporation by the surviving or new corporation; and

·        Any deed, instrument, or other writing reflecting vesting of title to realty acquired in a merger or consolidation from a constituent partnership or limited liability company by the surviving or new partnership or limited liability company.”  

SR 55 – Sen. Tolleson and others have proposed a Joint Study Committee on Prescription Drugs for Seniors.  This has been referred to the Senate Health and Human Services Committee.  

SR 63 – Sen. Eric Johnson and all other Senators introduced a Resolution expressing sorrow for the tragic loss of the space shuttle Columbia and its crew.  The Senate adopted this Resolution.  

HB 246 – An open records issue has been introduced by Reps. Birdsong and others.  The Bill  proposes to amend Article 4 of Chapter 18 of Title 50 to provide that certain requests for inspection of public records, printing of computerized indices of county real estate records, and time for determination of whether such requested records are subject to access.  Specifically, the bill states at O.C.G.A. § 50-18-70(f)(2):  

An agency may require that requests for records authorized by this article be submitted in writing; except that written requests shall not be required for the agenda, summary of matters acted on, and minutes of an agency’s most recent meeting created pursuant to subsection (e) of Code Section 50-14-1, and any other records an agency determines to be routinely available. Where requests are required to be in writing, the writing may be delivered to an agency by mail, facsimile, Internet, or courier or other delivery in person.  

Additionally, the bill adds a new subparagraph at O.C.G.A. § 50-18-72(a)(15):  

Unless the request is made by the accused in a criminal case or by his or her attorney, public records of an emergency “911” system, as defined in paragraph (3) of Code Section 46-5-122, containing information which would reveal the name, address, or telephone number of a person placing a call to a public safety answering point, which information may be redacted from such records if necessary to prevent the disclosure of the identity of a confidential source, to prevent disclosure of material which would endanger the life or physical safety of any person or persons, or to prevent the disclosure of the existence of a confidential surveillance or investigation.  

 This measure was referred to the House Judiciary Committee.  

HB 250 – Rep. Borders’ bill amending the current law on the sales tax holiday found in O.C.G.A. § 48-8-3 has been forwarded to the House Ways and Means Committee.  A motion to engross this bill was filed.  

HB 252 – Rep. Morris’ bill amending the Tax code  to allow an income tax credit with respect to qualified health insurance expenses has now found its way to the House Ways and Means Committee.  

HB 256 – Rep. Broome’s bill providing that state officers and employees may purchase products manufactured by Georgia Industries for the Blind has been referred to the House State Institutions and Property Committee.  

HB 259 – Rep. Channell’s amendment to the timely payment of health benefits law found in O.C.G.A. § 33-24-59.5 proposes that any penalties paid will not apply towards the cap on benefits payable.  Currently, insurers must pay 18% per annum if claims are not paid within 15 business days, unless there is pending documentation in order to adjudicate the claim.  Rep. Channell has filed a motion for this bill to be engrossed.  It will be forwarded to the House Insurance Committee.  

HB 261 – Rep. Parham has filed the annual update to the Pharmacy Code of dangerous drugs and controlled substances.  This amends Chapter 13 of Title 16 which would provide for exempt over-the-counter controlled substances; prohibit office-based opioid treatment by dispensing any controlled substance to a patient with opioid addiction; require information to be included on prescription drug orders (these items include the name and address of the person for whom the controlled substance is prescribed, kind and quantity of such substance; directions for taking the drug; signature; name; address; telephone number; and DEA registration number of practitioner); permit prescription drug orders by electronic means; and provide for penalties for violations.  

HB 264 – Rep. Ehrhart has proposed an amendment to O.C.G.A. § 9-11-17 to provide that a guardian ad litem may have a qualified immunity against any civil liability arising out of performance of his or duties as guardian ad litem.  However, the guardian ad litem may be civilly liable for willful or wanton misconduct, gross neglect of his or her duties, or gross abuse of discretion.  

HB 278 – Rep. Beasley-Teague with others is proposing that the Ethics in Government Act be amended by adding a new Code Section, O.C.G.A. § 21-5-13 to require the State Ethics Commission (or other body which receives for filing disclosure reports or other documents) to also maintain with the filed document any envelope, package, or wrapping in which the document was delivered for filing.   

HB 284 – Rep. Cummings, along with others, has proposed an amendment to Chapter 11 of Title 43 to change the membership of the Georgia Board of Dentistry.  The Board would require three dental hygienists (rather than one) who are not dentists and are Georgia residents practicing in the State.   It would also increase the number of consumers from one member to two members (these cannot be dentists or dental hygienists and can have no financial interest in a dental facility or practice).  

HR 111 – Rep. Watson and others have proposed to recognize Community Health Centers Day at the Capitol.   The Resolution notes that a large portion of the State’s population resides in federally designated medically under-served areas and do not have access to affordable, quality healthcare.  

Committee News  

          Senate Insurance and Labor  

          On Monday, the Senate Insurance and Labor Committee held a hearing on SB 50 which proposes to enact the “Georgia Consumer Choice of Benefits Health Insurance Plan Act.”  This would be inserted in Chapter 59 of Title 33.  The hearing was lengthy and a Committee Substitute was the end result.  The changes from the original bill were the listing of the various state mandates, passed by the General Assembly, in the applicable Code Sections.   The proposed new policy would not avoid the standard provisions or rights required to be present in an individual, blanket, or group policy or contract for accident and sickness insurance.  

          House Appropriations  

          The Department of Community Health Subcommittee of House Appropriations met this afternoon to hear more from the administratively attached agencies to the Department of Community Health and to hear public testimony concerning FY 2003 Supplemental Budget.  Subcommittee members present were Representatives:  Jay Shaw, Chair; Kathy Ashe; Sally Harrell; Lester Jackson; Judy Manning; Sharon Beasley-Teague; Jeff Brown; Michele Henson; Ben Harbin; and Pat Gardner.  

          Bruce Deighton testified on behalf of the Georgia Board for Physician Workforce and the State Medical Education Board.  He explained that monies being cut from these agencies were worsening the situation concerning the physician supply in the State.  Georgia is currently 35 of 50 in terms of the number of physicians in the State.  It is also ranked 38 out of the states in the numbers of medical graduates – that is because of having only three State-funded medical school programs (Emory does not receive state funding).  The three programs to which the State supplies monies are Mercer University School of Medicine, Morehouse School of Medicine, and the Medical College of Georgia. There is a grave need to add additional residents (medical) to the State.  Administration cuts and scholarship cuts are the results of the proposed funding changes.  There are also additional federal dollars lost with these proposed cuts.  

          Russ Toal spoke on behalf of the Georgia Cancer Coalition.  He explained what is being done to help with cancer incidence in Georgia.  There are programs now underway to increase eligibility of women who have breast and/or cervical cancer.  The State gets a 72% match of federal dollars with each State dollar placed in this program.  The Georgia Cancer Coalition also gets monies through the Department of Human Resources – Division of Public Health and through the Board of Regents with the eminent scholar program.  Mr. Toal also noted the recently opened cancer center at Grady Hospital which had both public and private funds (Avon).   

          Mr. Toal also stated that he was pleased about the Governor’s proposal to increase excise taxes on the sales of tobacco products.  He believes that this will help curb the number of underage persons using tobacco.  He believes decreased numbers of smokers equates to increased work productivity and lower healthcare costs.  

          He also urged the General Assembly to continue to urge Georgians to help fund cancer research through voluntary tax refund contributions.  Also, the newly created breast cancer license plate went on sale in January with the proceeds of those tag sales going towards funding for breast cancer treatment and screening for indigent women through the Indigent Care Trust Fund.  

          Mr. Toal also mentioned a bicycle race will which take place in Georgia, similar to the Tour de France, between competitive teams, on April 22-27.  Proceeds from this race will go to the Georgia Cancer Coalition.  

          Rep. Nan Orrock asked about the Cancer State Aid Program.  This is funded through the Department of Human Resources’ Division of Public Health.  This allows a person to receive $10,000 in hospital inpatient care.  

          Mr. Toal also mentioned the Quit Line, which has been successful.  A record number of calls have been received: 21% of those show that they have not used tobacco products in one month.  

          The Composite State Board of Medical Examiners also made a presentation asking for consideration on the cuts to its Budget.  This Budget was previously $2.4 million budget.  

Public Comment  

          A number of presentations were made at this meeting – many by nursing home operators from around the State.  This was in response to the proposed $27.7 million cut for payments to assist with their liability insurance and proposed adjustment to their DRI inflation factor which was to be applied to their FY 2001 cost reports.   

          Gail Sexton with the Georgia Nursing Home Association explained that these cuts would be disastrous to the State’s nursing homes.   Various operators made pleas to the Subcommittee.  Some cited that this would be a $20,000 monthly cut causing the facility not to be able to meet its payroll or make its building payments.  Employees would be asked to reduce their numbers of hours and to take an hourly pay cut – perhaps to $6.00 per hour – and there would no longer be health insurance benefits offered.  It was noted that it would be impossible for a facility to operate on $75 per day per bed.  

          Nursing operators cited that there were desperate staffing shortages.  These cuts would only worsen the problems.  

          Crestview, the nursing home run by Grady Hospital in Atlanta, is the State’s largest facility.  It is not immune from the problems.  Its administrator cited that its patient mix was different from most facilities as 1 in 4 persons are under the age of 55.  Many have dementia and many require wound care.  There are others who are HIV and hospice patients who require more assistance.  The cuts for FY 2003 would cause a loss of $212,000 to this facility; if the cuts carry to FY 2004, there would be $772,000 lost.  As a whole, cuts proposed for the Budget would mean a $10 million loss to Grady.  90% of its nursing home residents are Medicaid recipients.  Current payment does not assure quality care much less allow for trained workforce needs.  

          Operators also noted that they were the most regulated industry and the increased liability insurance coverage costs were devastating.  The growth allowance is the stickiest issue for the nursing homes as language was changed in the Final Budget Document from the Conference Committee Report in 2002.  There are already 22 nursing homes which have filed bankruptcy proceedings.  

          Legislators inquired about restoration of dollars if monies were found and whether such could be retroactive.  These could not be recovered per Ms. Sexton.  Rep. Harrell inquired about assessing nursing homes’ fees so as to bring down a federal match – the nursing homes have asked the Department of Community Health about such program but have not received an answer.  

          Dr. Doug Skelton from Mercer University School of Medicine asked about the funding formula issue proposed for his facility.  He cited that this school is taking a 10% cut rather than the 3% cut being made to others.  

          Morehouse School of Medicine also spoke about its medical education needs.  In FY 2003, there is a proposed reduction of $482,000 and with federal dollars this is a loss of $1.5 million.  

          Rick Ward with the Georgia Chapter of the American Academy of Pediatrics asked that the Subcommittee look further at the proposed funding cuts to providers participating in the Georgia Better Health Care (“GBHC”) Program.  Doctors are proposed to get a funding cut  - currently they are paid $3.00 per member per month; the proposed payment would be $2.00 per member per month.  Care of children is important and the cut, as Mr. Ward noted, would be an unwise policy change.  GBHC was established in an effort to provide children with medical homes.  This was to provide primary care physician management of children’s healthcare in an effort to handle specialty referrals and to offer care without having children going to emergency rooms for routine health needs.  Rep. Harrell inquired if there was tracking being done on how physicians were doing under this program and whether their patients were getting primary health needs met.  

          Fay Fulton echoed Mr. Ward’s remarks on behalf of the Georgia Chapter of the American Academy of Family Physicians.  She noted that these GBHC doctors were also treating the elderly.  

          David Raynor, with the Medical Association of Georgia, also echoed his physician group colleagues.   MAG opposes these case management cuts under GBHC.  He noted that MAG is concerned with the impact of cuts on access to care and whether physicians will cease to take Medicaid patients.  

          Hospitals were also in line to offer their sentiments about the Budget proposals.  Webb Cochran with GHA noted that Georgia’s 180 hospitals were experiencing problems.  113 are operating in the “red.”  There have also been 14 closures since 1998.  There are also 50 with attached nursing homes.  The cuts will lessen access to care; payrolls will also be impacted.  GHA is supporting the surcharge on tobacco and alcohol products.  A hospital CEO from Cordele made the most poignant plea – dressing with a woman’s hat, he explained what the patient “Marie” needed on a daily basis.  Marie told a story of a lifelong struggle where she upheld her responsibilities (“Count on Me”) by taking care of her family and her newfound issues since leaving her independent lifestyle in order to move to a nursing home so she could get care and assistance with bathing, food, etc. (“Count on You”).   

          Several Critical Access Hospitals (“CAH”) with attached nursing homes also testified about the proposed cuts.  Many depend on the nursing home beds to help with overall profitability of their hospitals.  

          There were also pleas for assistance with the drug programs in long-term care settings.  Currently, there are some cuts proposed to long-term care pharmacy reimbursements.    At issue is the global capitation system proposed which is a fee charged per bed per day.  Pharmacists are concerned about quality and financial stability of these proposals.  New York has instituted a capitated model but has found that it has negatively impacted care.  New therapies (drug treatments) are found to not be used.  There are also concerns about how such will impact the manufacturer’s rebates which the State receives.  Also, there are concerns about which drugs will be exempted and which outliers are a part of services.  

House Judiciary Committee  

          This Committee took action on HB 91, Rep. Mary Margaret Oliver’s proposal concerning mandatory arbitration proceedings.  Amendments were made to the bill but it was favorably reported out of Committee as amended.  This is the 2003 Fairness in Arbitration Act and amends O.C.G.A. § 9-9-13(b) relating to vacation of award by court, application, grounds, rehearing, and appeal of order so as to propose that paragraph (b) will read: “The award shall be vacated on the application of a party who either participated in the arbitration or was served with a demand for arbitration if the court finds that the rights of that party were prejudiced by:
(1) Corruption, fraud, or misconduct in procuring the award;
(2) Partiality of an arbitrator appointed as a neutral;
(3) An overstepping by the arbitrators of their authority or such imperfect execution of it that a final and definite award upon the subject matter submitted was not made;

(4) A failure to follow the procedure of this part, unless the party applying to vacate the award continued with the arbitration with notice of this failure and without objection; or
(5) The arbitrator’s manifest disregard of the law."

Other  

          Budget hearings will continue tomorrow and Thursday.   

          SB 7, Sen. Jackson’s proposal to regulate air ambulances which cleared the Senate by a vote of 54 to zero on Monday, has now made its way to the House.