ATLANTA – Third-party companies that help set prescription drug prices would face tighter regulations under legislation the Georgia House of Representatives passed unanimously Monday.
Pharmacy benefits managers (PBMs) negotiate between insurance companies and pharmacies to set drug prices.
But too often, PBMs hide behind unscrupulous practices that allow them to increase prices without sufficient oversight, said Rep. David Knight, R-Griffin.
Senate Bill 313, which cleared the state Senate in March, follows legislation the General Assembly passed last year to prevent PMS from steering patients to associated pharmacies with potentially higher costs.
The House amended this year’s bill as it went through the committee process to make it identical to PBM legislation the House approved, also in March.
On Monday, Knight described the final product as a compromise between the various interested parties based on input from the Georgia Department of Community Health (DCH) and the governor’s office.
The compromise requires PBMs to provide greater transparency by publishing data on prescription prices online. The amended bill also gives the DCH authority over auditing drug prices affecting enrollees in Georgia’s Medicaid program and the health plan covering teachers and state employees.
“[This] will be the toughest PBM legislation in the nation,” Knight said. “We can finally bring transparency to drug pricing and give choice to our patients.”
The bill now goes back to the Senate to agree or disagree with the changes made by the House.
ATLANTA – Georgia’s third-lowest-in-the-nation tobacco tax would go from 37 cents a pack to $1.35 under legislation the Senate Finance Committee approved Friday.
If the bill makes it through the General Assembly, it would represent the culmination of years of effort by health-care groups to build support for raising the state’s tobacco tax.
What is finally helping the proposal gain support is the state’s financial situation. The full Senate passed a fiscal 2021 state budget earlier Friday with $2.6 billion in spending cuts forced upon lawmakers by the impact the coronavirus pandemic and subsequent lockdown of the economy has had on tax revenues.
In voting against the budget, minority Democrats complained that legislative leaders were refusing to consider revenue-raising measures that could help offset some of the cuts.
The Georgia Budget and Policy Institute, an Atlanta-based think tank that has consistently called for legislation increasing revenues, released a statement late Friday supporting the tobacco tax hike.
“Lifting the tobacco tax will simultaneously help our state fund critical priorities, such as health and education, and boost health outcomes,” said Danny Kanso, a GBPI policy analyst. “GBPI commends Chairman [Chuck Hufstetler, R-Rome] and the Senate Finance Committee for their leadership in passing legislation that will generate several hundred million dollars per year by bringing our state’s abysmally low tobacco tax in line with the level assessed in most states across the nation.”
Raising the tobacco tax to $1.35 a pack would fall well short of the national average of $1.80 a pack, and Kanso suggested lawmakers consider that when the bill heads to the Senate floor.
But the legislation faces an uphill battle in the Georgia House of Representatives.
“I’m not a tax increaser, particularly during this [economic] climate we’re in,” House Speaker David Ralston, R-Blue Ridge, said earlier this week.
Ralston also is skeptical about another effort by Hufstetler’s committee to free up more tax revenue. The Senate Finance panel passed a bill Thursday that would eliminate a series of tax breaks the state offers to lure businesses to Georgia.
The speaker argued that getting rid of such tax incentives would put a damper on economic development efforts that create jobs.
“This is not a good time to be killing jobs,” he said. We need to be about the business of growing jobs back.”
ATLANTA – The Georgia Senate passed a state budget Friday slashing spending by $2.6 billion over the objections of Democrats who argued majority Republicans could have avoided some of the cuts by raising revenues.
The scaled-back fiscal 2021 budget, which passed 34-15 along party lines, is the product of Georgia’s response to the coronavirus pandemic, which drove up costs across many state agencies while sending tax revenue plummeting.
“We could not foresee the overnight impact of COVID-19,” Senate Appropriations Committee Chairman Blake Tillery, R-Vidalia, said at the beginning of Friday’s floor debate on the budget.
Initially, Gov. Brian Kemp and legislative leaders instructed the agencies to reduce their spending by 14% but later amended that to 11% after receiving a slightly better tax revenue report for May than the 36% drop-off that occurred in April.
“You don’t reduce funds by 11% without affecting every budget in every corner of our state,” Tillery said.
Tillery highlighted some steps Senate budget writers were able to take to mitigate the impact of the budget cuts, including restoring funding to Georgia’s pre-kindergarten program, reducing employee furloughs from up to 24 days to 12 and redirecting leftover federal funds into state programs.
“I know this is not the budget many of you expected to or hoped to have this year,” Tillery told his Senate colleagues. “[But it] prioritizes the items we care about most.”
But Democrats complained the spending cuts still would inflict severe damage to Georgians, particularly health-care needs the pandemic has made even more acute, and to the state’s workforce. Among other things, initiatives to provide targeted pay raises to employees in agencies with the highest turnover have been zeroed out of the budget.
Senate Minority Leader Steve Henson, D-Stone Mountain, said coronavirus is only partly to blame for the fiscal hole the state finds itself in. Legislative Republicans helped create a revenue shortfall by cutting the state income tax rate two years ago and doling out tax breaks to special interests.
“We have made tax and policy decisions that undermine the future of this state,” Henson said. “We can and should do better.”
Other Democratic senators criticized Republicans for refusing to consider proposals to raise revenues, including increasing Georgia’s tobacco tax – third-lowest in the nation – and drawing down federal health-care dollars by expanding Medicaid coverage under the Affordable Care Act.
“There are a number of ways we can expand our revenues and not have to be make these draconian cuts,” said Sen. Nan Orrock, D-Atlanta.
Senate Finance Committee Chairman Chuck Hufstetler said his committee is working on one potential revenue raiser. The panel has targeted for elimination a list of tax breaks the state currently offers as inducements to attract new businesses and create jobs, folding them into a bill headed for the Senate floor.
“There’s potentially millions of dollars there,” said Hufstetler, R-Rome.
While getting rid of tax breaks might appeal to Democrats looking for more revenue, Georgia businesses are gearing up to defend them. The Georgia Chamber of Commerce and Georgia Economic Developers Association released a statement Friday opposing House Bill 1035.
“We must remember that businesses in Georgia have just started to reopen after a government mandated lockdown, and we are now suffering in a recession with record unemployment,” the statement read. “Our economic development community needs every tool possible to lead this recovery.”
Meanwhile, the fiscal 2021 budget likely won’t be finalized until the last day or two of this year’s legislative session. The House passed a much larger pre-coronavirus spending plan in March before lawmakers took a three-month hiatus to discourage the spread of COVID-19.
A joint House-Senate conference committee will work during the next week to settle the two chambers’ differences over the budget.
ATLANTA – Georgia’s unemployment rate is back in the single digits, the state Department of Labor reported Thursday.
Unemployment in Georgia stood at 9.7% for the month of May, down 2.9% from April’s jobless rate of 12.6%.
“I think we are going to continue to see big drops in the unemployment rate as Georgia continues to open back up,” state Commissioner of Labor Mark Butler said. “We have to remember that the recent unemployment was not caused by an economic catalyst, but instead by a medical emergency. Those jobs are still out there for the most part.”
Jobs were up 94,300 last month over the month of April, posting gains in all sectors. The accommodation and food services sector led the way with an increase of 46,600, followed by health care and social assistance with 11,800, and administrative and support services close behind at 10,100 jobs.
Although over-the-month job growth increased, jobs are down 370,000 when compared to this time last year.
The filing of initial unemployment claims also is continuing to fall. Last week’s claims totaled 131,997, down 3,257 from the previous week. Initial claims have declined in six of the last seven weeks.
“The decrease in regular weekly claims is indicative of a recovering workforce who are now ready to return to work,” Butler said. “We predict a continual decrease in these weekly claims as businesses return to pre-COVID conditions and Georgians increase their spending habits.”
The state paid out $147.7 million in regular unemployment benefits last week, down $9 million from the previous week. Since March 21, when Georgia businesses began closing their doors to discourage the spread of coronavirus, regular benefits payments have totaled more than $1.6 billion.
ATLANTA – A controversial update to Georgia’s Right to Farm Act cleared the state Senate Thursday after a debate of nearly two hours.
The bill, which originated in the Georgia House of Representatives last year, passed the Senate 29-21. Because of changes senators made to the measure, it must return to the House before gaining final passage.
The legislation would make it more difficult for property owners living in areas zoned for agricultural use to file nuisance lawsuits against nearby farms generating offensive noise, dust, smells or sludge runoff.
In order to sue, owners would have to live within five miles of the alleged nuisance.
Also, under an amendment approved on the Senate floor Thursday, lawsuits would have to be brought within two years after a nuisance occurs. More restrictive language in the original bill would have set the clock for lawsuits at within two years of an applicant obtaining a permit to start or change a farm operation.
Supporters argued the original Right to Farm Act the General Assembly enacted during the 1980s contains ambiguities that expose farmers to costly lawsuits that could be avoided by a clearer statute.
“Georgia has a booming agricultural economy that makes a $75 billion [annual economic] impact on our state,” said Sen. John Wilkinson, R-Toccoa, chairman of the Senate Agriculture & Consumer Affairs Committee. “But people are not going to be able to continue to farm and invest millions of dollars in equipment if they don’t understand what they can and can’t do.”
The bill was endorsed by the state’s major agricultural organizations in Georgia, including the Georgia Farm Bureau, Georgia Agribusiness Council and Georgia Poultry Federation.
But opponents, led by environmental groups, said the measure was designed to provide a legal shield to large farms owned by out-of-state or foreign corporations at the expense of small family farms.
“We’re putting our great agricultural economy at risk. Why? For Big Ag,” said Sen. Zahra Karinshak, D-Duluth. “We’re selling out the small farmers.”
During Thursday’s debate, senators also disputed what types of nuisances the bill was designed to combat. Supporters said property owners already are protected by the U.S. Environmental Protection Agency (EPA) and Georgia Environmental Protection Division (EPD) from farm operations that cause air or water pollution.
“[This bill] is about odor, dust, noise,” said Sen. Larry Walker III, R-Perry. “It’s not about clean water or violating environmental law.”
But opponents said government environmental agencies typically offer little protection from violations of air- or water-quality rules.
“The EPA or EPD can take years to resolve issues,” said Sen. Freddie Powell Sims, D-Dawson.
Sen. Jesse Stone, R-Waynesboro, brought the statute-of-limitations amendment as a way to offer property owners living near farms more protection than the original bill would have provided.
Stone said that without the amendment, a farm applicant could get a permit but not actually begin operating for two years. In such a case, a nuisance could not occur until two years after the operation began, leaving property owners with no right to sue, he said.
But Sen. Tyler Harper, R-Ocilla, said farm operations are too capital-intensive for farmers to sit on permits for two years before beginning their operation.
