January 26, 2004

For more information contact:

Stanley S. Jones, Jr.

404-817-6133

January 26, 2004

Legislators returned to the Gold Dome today around lunchtime.  Many had worked long and hard over the Budget during the Recess.  While Monday was a "short" day, beginning at 1:00 p.m., much was done.  One evident stress reliever was the massage therapists on the second floor offering free massages for those in need.  Needless to say, many of the tables and chairs were full!

 Floor News

One of the Bills on the House Floor today dealt with how the Secretary of State oversees and enforces laws governing "solicitor agents" who contract to raise monies for charitable organizations.  HB 472 amends the Georgia Charitable Solicitations Act of 1988 by changing requirements for persons wishing to operate as solicitor agents for organizations.  There are safety features provided for in the Bill as it requires managers of "solicitors" to submit fingerprints for criminal background checks rather than having the Secretary of State request them.  This is to try and thwart shady persons or those with criminal pasts from trying to garner monies through schemes.  The bill also proposes that the Secretary of State have additional authority by denying such application by a solicitor if that particular person has a bad reputation.  In most instances, solicitors who call persons for monies usually transact their business through a "script" to deliver their message; this bill proposes that such scripts be reviewed and authorized.  Furthermore, charities which use these solicitor services will be responsible for the actions of the solicitors they use.  The Secretary of State also has guidelines in the bill on how it must conduct investigations.  It also adds more penalties when violators break this law with elimination on the cap for civil penalties assessed for such violations.

The House voted 162 to 8 to pass HB 472.

The Senate side of the Hall seemed the place to be.  Some Senators were angered by the introduction and committee assignment of the "tort" reform bills.  To date, three have been introduced.  Under the Senate Rules, the bipartisan Committee on Assignments deals with assigning the bills to committees.  After last year's attempt at tort reform, Senators interested in the issue (along with business leaders and medical providers) got together to determine another plan of attack for this year's bills.  The initial bills were assigned to Senate Health and Human Services.  Last year, the major bills dealing with tort reform went to the Senate Judiciary Committee, except for the one dealing with class action filings which was assigned to the Senate Insurance and Labor Committee.  The Senate Judiciary Committee held numerous hearings and offered a number of "compromises" with none reaching far enough to provide meaningful reforms – such as amending the State's expert witness rules; placing caps on non-economic damages; amending joint and several liability provisions; addressing venue and forum non conveniens procedures; etc. 

Today, Sen. Tanksley, Chair of the Senate Judiciary Committee, took the Well to ask that SB 432 be recommitted to his Judiciary Committee where such issues dealing with torts are handled.  SB 432 proposes to provide for immunity from liability for healthcare workers in emergency rooms and place non-economic caps on damages for actions arising out of the first 24 hours of care.  Sen. Don Thomas, Chair of the Senate Health and Human Services Committee, where the bill had been assigned, voiced opposition to the move.  Rules require the Committee Chairs to agree to move a bill from one committee to another.  This led to a recommitment motion.  In a vote of 28 to 26, the Senate agreed that the bill should be moved to the Senate Judiciary Committee.  This greatly alarmed the lobbyists working for tort issues.  A motion for the Senate to reconsider its actions was filed and this fight will continue on Tuesday.  Along with SB 432, two other tort bills also got new committee assignments: SB 434 and SB 435.  SB 434 had been assigned to the Senate Insurance and Labor Committee; it was moved to the Senate Judiciary Committee.  SB 434 caps attorneys' fees on a contingency fee case (contract or tort).  SB 435 was also moved from the Senate Judiciary Committee to the Senate Insurance and Labor Committee; this bill deals with class action filings and how the certification of the class is done and appeals to such orders either denying or certifying such a class.

Committee News

The Senate Health and Human Services Committee held a hearing on Sen. Unterman's proposal to create regulation for a new level of care, "assisted living facilities."  Currently, Georgia has the option of sending a loved one to a nursing home or to a personal care home.  A personal care home has no nursing care.  Assisted living facilities have "limited" nursing care available.  Today, several people spoke to express their interest or concern with SB 422.  Of all entities which testified, the Georgia Nursing Home Association was the only entity to voice direct opposition to the bill.  Many from the provider community fear that, if the bill passed, it would create yet another provider group at the table seeking State funds, thereby lessening what hospitals, nursing homes, home health, and physicians are paid.  The State's Long Term Care Ombudsman testified that the State really needed to address a long term care plan – the SOURCE program does attempt to help manage care but that is only for limited numbers of persons and not throughout the State.  Sen. Thomas, the Chair of this Committee, stated that an additional hearing will be held on this bill.

The Senate Insurance and Labor Committee also met today.  It did not vote any of the three bills on its agenda out.  HB 259, Rep. Channell's bill regarding timely payment of hospital claims by insurers' amendment, was on the agenda.  HB 259 was engrossed in the House and arrived in the Senate unchanged from how it was introduced.  It proposes to amend O.C.G.A. § 33-24-59.5 so that no interest penalty paid by an insurer for late payments may be applied towards any cap on benefits payable to the insured or other person claiming payments under the health benefit plan.  No one spoke for or against this bill. 

SB 350 was also on the Senate Insurance and Labor agenda.  It got the most "air time" with Kirk McGhee, the lobbyist for the Georgia Association of Health Plans, taking the lead.  SB 350 was a major proposal to change the ways health insurers pay claims to hospitals.  Currently, insurers are required to pay claims within 15 days. 

The "guts" of SB 350 are:

"c)(1) Every insurer shall, within 21 calendar days after receipt of an electronic claim and within 45 calendar days after receipt of a paper claim, send to the hospital or ambulance service provider: (A) Payment; (B) A denial of the claim; or (C) A reply in writing or by electronic means which states all of the applicable reasons identified in paragraph (3) of this subsection that the insurer may have for failing to pay or denying the claim, either in whole or in part, and which specifies all additional information necessary for the insurer to fully process and pay or deny the claim. (2) With respect to all electronic claims submitted to insurers, insurers shall, no later than five business days after receipt, confirm to the person or entity or their respective agent by the same means received receipt by the insurer of each claim received and shall include in each such confirmation the applicable patient control number, date of receipt, and dates of service. An insurer shall respond promptly to any inquiry submitted by the claimant or its agent regarding the failure to provide timely confirmation of the receipt of a claim and shall immediately take all reasonable steps to investigate and confirm receipt of the claim. (3) An insurer may only pend a claim under paragraph (1) of this subsection if the insurer determines in good faith that one or more of the following exists: (A) A lack of specific information required by the insurer to pay or deny the claim; (B) A need for detailed clinical review of the claim; (C) A need to coordinate benefits with another insurer if the insurer reasonably believes that another insurer might also have liability for that claim; (D) A reasonable suspicion that the particular claim is fraudulent; or (E) The insured is not current in its obligation to the insurer. (4)(A) When an insurer makes a request for additional information under paragraph (1) of this subsection, a claimant or its agent must provide information responsive to the request within 21 days. Failure of the claimant or its agent to provide such a response shall relieve the insurer of any liability for interest or penalties under this Code section. (B) When, in response to an insurer's request for additional information under paragraph (1) of this subsection a claimant delivers additional information requested for processing a claim, the insurer shall then have 21 additional calendar days after receipt of the information within which to reevaluate the claim and: (i) Pay the claim; (ii) Deny the claim; or

(iii) Send the claimant another reply in writing or by electronic means stating all applicable reasons set forth in paragraph (3) of this subsection for continuing to pend the claim and explaining why the additional information remains insufficient to satisfy the insurer's previous request. (C) In any event, an insurer must pay or deny a claim within 90 days of its first submission. (5) Any denial of a claim under paragraph (1) or (4) of this subsection or otherwise shall be made by sending the claimant a reply in writing or by electronic means which shall include all of the insurer's specific reasons for the denial. (6) Where an insurer disputes a portion of a claim, any undisputed portion of the claim shall be paid by the insurer in accordance with this Code section. (d)(1) Every insurer may prescribe permissible forms or formats for submission of electronic claims by claimants. A failure to file a claim fully in accordance with a form or format prescribed by an insurer shall not permit an insurer to fail to confirm receipt of a claim as required by paragraph (1) of subsection (c) of this Code section.
(2) Receipt of any claim, proof, or documentation by an entity which administers or processes claims on behalf of an insurer shall be deemed receipt of the same by the insurer for purposes of this Code section. (3) Except where the form or format changes are mandated by state or federal regulation or law, every insurer shall notify the claimants or their agents or intermediaries who submit claims to the insurer on their behalf at least 60 calendar days in advance of the effective date of any changes in the insurer's claims payment form or format.

(e)(1) The Commissioner shall measure and require compliance by insurers with the standards set forth in this subsection for the timely payment of claims. Every insurer shall pay, deny, or pend 95 percent of the number of all electronic claims within 21 calendar days of receipt;

(2) The Commissioner shall measure the compliance of insurers with the standards set forth in paragraph (1) of this subsection on an annual basis. Each insurer shall be required to report in writing or by electronic means to the Commissioner on or before 45 days after the end of each calendar year the following information on each claim it receives: (A) NAIC number;

(B) List number; (C) Claim number; (D) Line item number; (E) Date of service; (F) Claim received date; (G) First response date; (H) First response type (paid, denied, or requested additional information); (I) Claim complete date; (J) Final adjudication date; (K) Claim status;

(L) Whether the claim is related to PPO, HMO, indemnity, or dental; (M) Paid amount; (N) Check date; and (O) Amount of interest paid. (3) The Commissioner shall publish annually the compliance performance of each insurer subject to this Code section. (4) Insurers which fail to meet the minimum standards of paragraph (1) of this subsection shall be subject to penalties. If the Commissioner finds that an insurer has failed during any calendar year to properly process 95 percent of claims received from claimants during that year in accordance with this Code section, the Commissioner may levy an aggregate penalty up to $10,000.00. If the Commissioner finds an insurer has failed during any calendar year to properly process 85 percent of claims received from claimants during that year in accordance with this Code section, the Commissioner may levy an aggregate penalty in an amount of not less than $10,000.00 nor more than $50,000.00, if reasonable notice in writing is given of the intent to levy the penalty. If the Commissioner finds that an insurer has failed during any calendar year to properly process 60 percent of all claims received from claimants during that year in accordance with this Code section, the Commissioner may levy an aggregate penalty in an amount not less than $50,000.00 nor more than $100,000.00. In determining the amount of such fine, the Commissioner shall take into account whether the failure to achieve the standards in this section is due to circumstances beyond the insurer's control. An insurer may request an administrative hearing contesting the assessment of any penalty imposed by the Commissioner within 30 days after receipt of the notice of assessment. (f) Each insurer shall pay to the claimants entitled to the payment of a claim, in addition to all other amounts legally owed, interest at a rate of 18 percent per annum on the amount owed for every claim neither paid nor denied in good faith within 60 days of the insurer's receipt of the claim. For electronic claims, interest shall being accruing 22 calendar days after receipt of the claim. For paper claims, interest shall begin accruing 46 calendar days after receipt of the claim. If the claimant fails to respond within 18 calendar days to a reply from an insurer under paragraph (1) of subsection (c) of this Code section requesting additional information, then any interest payable by the insurer shall not begin accruing until the date the reply is received."

Mr. McGhee proposed amending the bill so that paper claims would have 30 days; he also proposed not amending current law that provides the Dept. of Insurance has the ability to fine insurers when they do not pay claims timely.

GHA (Georgia Hospital Association) testified that the problem was that the current law did not provide for a definition for "clean claim."  That was the reason that insurers were pending so many claims.  GHA testified that, on average, hospitals encounter a 69-day turnaround on claims submitted to insurers for payment.

The other bill on the Committee's agenda was HB 326 by Rep. Debbie Buckner.  Her proposal would allow rural non-profit hospitals which operate an emergency room on a 24/7 basis to work through the State's Dept. of Administrative Services in order to "shop" for medical malpractice coverage.  Currently, there are no admitted carriers for hospitals' medical malpractice insurance coverage in Georgia.  Thus, it perhaps might be a benefit to have a "volume" purchaser for such.  No hospital would be required to get coverage in this manner. Some interesting comments in the discussion were whether the bill should be opened up so that all hospitals could participate (that is, the for-profits as well as the not-for-profits).  Sens. Crotts, Lamutt, and Shafer were interested in broadening the bill.

Other News

Tomorrow, one interesting subject which will appear in Committee is the issue involving treatment of ambulatory surgery centers.  Last year's bill, HB 791, will be heard in the House Health and Human Services' Healthcare Facilities Subcommittee at 3:00 p.m. in 605 LOB.  It proposed a "fee" to be assessed to ambulatory surgery centers in an effort to raise monies for the State.  Some believe that perhaps some amendments to the current certificate of need law governing ambulatory surgery centers are needed – perhaps to require that all such facilities be required to undergo a certificate of need process; that all submit data to the Dept. of Community Health on the numbers of procedures they perform; and that all have an indigent care commitment requirement.  Thus, it will be interesting to see how the proposal will change.

If you have any questions regarding this Report, please contact Stanley S. Jones, Jr., Jeffrey C. Baxter, or Helen Sloat.

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