Greetings from the Gold Dome! First, we would like to report that we have an addition on our government relations team. Kirkland A. McGhee, a lawyer formerly with Blue Cross Blue Shield of Georgia and Long, Aldridge and Norman, has begun practicing law with Nelson Mullins. He is a fabulous addition to our team and will help broaden our business and insurance focus.

It is beginning to be "that time" again. Committees are meeting at the Capitol in preparation for the 2002 Session. The Session actually begins on January 14, 2002. Additionally, information concerning the State’s budget has also been released. This week, the Office of Planning and Budget released its ‘approved’ reductions for the Department of Community Health Budget reductions. The reductions were the result of the Governor’s instructions to departments and agencies to trim their respective budgets for FY 2002 (by 2.5%) and FY 2003 (by 5%). More information about the budget is included in this report. Some of the issues tackled this week in meetings and hearings include physical activity in children, funding for drug benefits, and colorectal cancer screenings. Some of the discussions from those meetings are outlined below:

Bill Tomlinson reported the approved reductions for the Department of Community Health for FY 2002 (the Supplemental Budget). In total, such reductions exceed more than $52 million dollars. Such approved items include:

1) Delay implementation of new Medicaid program expansion for children in families with incomes up to 150% of the federal poverty level (this is a total of $2,126,097 in State funds)

2) Reduce direct state funding for the State Health Benefit Plan (this is $34 million in State monies)

                               3) Eliminate NET rate increase (this is $1,357,477 in State monies)

4) Eliminate Medicaid waiver for Cystic Fibrosis (this reduction is $1,631,476 in State funds)

5) Reduce inpatient hospital rates by eliminating funding for the DSH intensity adjustment for Medicaid inpatient services (this is a savings of $4,495,737 in State funds)

6) Cut a number of pharmacy costs which include items such as:

a) Removal of the Medicaid Generic/Preferred Drug Incentive (this is $1,476,00 in State funds)

b) Implement a step therapy for non-steroidal anti inflammatory drugs (NSAIDS) (this is $473,294 in State monies)

c) Implement quantity level limits and require prior authorization for Oxycontin, effective December 1, 2001 (this will be a savings of $1,530,710)

Additionally, as the Department of Community Health oversees the Composite Board of Medical Examiners its budget is tied to the Department’s as well. The reductions also will cut the costs to implement the Patient Right to Know Act (this will be a savings of $65,000).

On November 28, 2001, a Joint House and Senate Committee studying the physical activity of Georgia’s school children met. Members of the Committee include Rep. Sistie Hudson, Rep. Nikki Randall, and Sen. Mike Beatty. One of the focal points that this Committee has been addressing is morbid obesity in children.

At this meeting, Pam Wilson with the Department of Human Resources’ Division of Public Health made a presentation. The University of Georgia and Department of Human Resources have been conducting a study of fourth, eighth, and eleventh graders looking at dietary, physical activity, weight, and height factors in each. Ms. Wilson also noted that there were a number of overweight children in the WIC program. She also pointed out that a law passed in 1972 provided that studies be done concerning hearing, dental, vision, and nutrition screenings in children. Since that time, nutrition has not been reviewed.

Currently, cardiovascular disease is the number one killer in Georgia – every 22 minutes a Georgian dies from the disease. In many instances, persons with cardiovascular disease have lifestyle choices which contribute or cause the problem. Diet, activity, and use of tobacco are three such lifestyle choices. In 1997, Georgia spent $1.8 billion on hospitalizations for cardiovascular problems; in 1998, Georgia spent $1.9 billion. There are a number of health conditions associated with obesity and include such things as hyperlipidemia, diabetes mellitus, gall bladder disease, respiratory disease, cancer, etc. Additionally, there are a number of children between the ages of 5 and 10 with cardiovascular disease, and there is also an increased incidence of diabetes in adolescents. Ms. Wilson noted that much of this was also tied to the physical education, physical activity and nutrition classes in schools. In 1991, 42% of high school students attended physical education classes. In 1999, there were only 29% of all high school students who attended physical education classes. Thus, physical education, physical activity and nutrition classes are needed. Every school has been surveyed about physical education and physical activity available in an effort to determine numbers of teachers certified in these areas. There are available curriculum which follow national guidelines.

Ms. Wilson was asked if there was any linkage between physical activity and violence in schools or if there was a link between the schools which offered physical activity and the academic excellence of those schools. Such studies have not been conducted.

Brenda Moore, with the International Life Sciences Foundation, also made a presentation to the Committee. She discussed five physical activity programs available in Georgia. These included Take 10!; SPARK; Eat Well & Keep Moving; CATCH; and Planet Health. These programs have various genesis - Take 10! has been developed here in Georgia. Planet Health has been developed by the Harvard School of Public Health, Department of Nutrition. Some of these programs target various ages and goals such as reduction of total fat from diets, obesity reduction, decreasing TV viewing, increasing physical activity, etc. This Committee will continue its study with another meeting on December 6, 2001 at 10:00 a.m.

Also, on November 28, 2001, Sen. Horacena Tate hosted another hearing on how to have a federally funded drug benefit. This hearing served as a discussion on how to best organize efforts in this regard. This Committee will most likely meet again prior to the Session.

On Friday, November 30, 2001, Rep. Mickey Channell held a hearing on his bill, HB 951, relating to a mandate for insurance coverage for colorectal cancer screenings. Rep. Channell introduced the bill on the last day of the 2001 Session as a result of a friend who was diagnosed with colorectal cancer screening and subsequently died. Rep. Channell’s concern is that persons are not being screened for the disease at the proper time. Colorectal cancer, as Rep. Channell pointed out, is the second leading cause of cancer-related deaths and is preventable if detected in an early stage.

Since the introduction of his initial bill, Rep. Channell has met with the State to determine concerns relating to persons covered by Medicaid and State Health Benefit Plan, which HB 951 proposes to include. As a result of various discussions, Rep. Channell has a new draft of the legislation, which he intends to introduce on the first day of the 2002 Session as a new piece of legislation. Medicaid will be not included in the new draft due to the State’s budget concerns. The Medicaid population, which Rep. Channell is extremely familiar with due to chairing the House Appropriations’ Subcommittee relating to the Department of Community Health which funds the Medicaid program, will be addressed later by either being added to this new law once enacted or through the Budget at such time that the economic situation improves.

In the new draft, the previously identified standards have been taken out of the bill. Instead, he proposes that the mandate "provide coverage for colorectal cancer screening, examinations, and laboratory tests in accordance with the most recently published guidelines and recommendations established by the American College of Gastroenterology, in consultation with the American Cancer Society, for the ages, family histories, and frequencies referenced in such guidelines and recommendations." In the new draft, this mandate would apply to health benefit policies issued, delivered, issued for delivery, executed or renewed in Georgia on or after July 1, 2002.

There were a number of persons and entities present at the hearing who spoke about the issue:

Mollie Herron, with the American Cancer Society, rose in support of the legislation. She noted that in the year 2000, there were 3,000 Georgians diagnosed with colorectal cancer. From these, there are both women and men with the disease and there is a higher prevalence of the disease in African-Americans.

Patrick Waring, M.D., a gastroenterologist from Atlanta, also spoke in favor of the legislation. He cited that there was a need to address the "at risk" persons – there are persons with average, moderate and high risks. He cautioned that for adequate screenings, coverage needs to include those persons with average risk for the disease. Additionally, he expressed that colonoscopies were the preferred screening tool. Dr. Waring also noted that for every dollar spent on screening $4.00 were saved. Rep. Channell asked for more statistics on the cost savings from the screenings (this would include treatments, hospitalizations, etc.). There are approximately 70-80% of persons "at risk" who could have the problem eliminated by using existing technology.

Chris Bethel, an attorney with the Consumer’s Insurance Advocate’s Office, expressed that his office was also in support of the legislation. He indicated that by using these screenings, there will be a higher level of diagnoses made for Crohn’s Disease. His office has apparently received a number of calls concerning insurance companies’ unwillingness to provide prior authorization on such screenings. Mr. Bethel also noted that some of these calls were from State Health Benefit Plan enrollees. Rep. Channell explained that the State Health Benefit Plan is currently following the American Cancer Society guidelines.

Kirk McGhee spoke on behalf of the Georgia Association of Health Plans and expressed that his seven health plans (which are the HMOs) were supportive of the legislation and were already following the guidelines cited in the original legislation. Mr. McGhee noted that it is primarily the indemnity insurance products which are not covering the screenings as HMOs are focused on early prevention.

David Raynor, on behalf of the Medical Association of Georgia, testified that his Association was endorsing Rep. Channell’s bill. Further, the Association will be supporting any insurance mandate as long as such has an element of public health benefit, will enhance the quality of healthcare, and is cost effective.

Finally, Joe Robb with St. Joseph’s Hospital in Atlanta, also rose in support of the legislation.

Rep. Channell asked that if any person or group had discomfort with the bill to get in contact with him.

There will be additional reports prior to the 2002 Session.