Daily report, 2017 March 8

House of Representatives

Daily Report for March 8, 2017

DAILY REPORT Wednesday March 8, 2017

Committee Day

House Budget & Research Office (404) 656-5050

House Media Services (404) 656-0305

The House will reconvene for its 30th Legislative Day on Thursday, March 9 at 10:00 a.m. The Rules committee will meet at 9:00 a.m. 5 bills / resolutions are expected to be debated on the Floor.

Committee Actions
Bills passing committees are reported to the Clerk's Office and are placed on the General Calendar.

Insurance Committee
SB 103 'The Pharmacy Patient Fair Practices Act'; pharmacy benefits managers; Commissioner of Insurance to promulgate certain rules and regulations; authorize
Bill Summary: Senate Bill 103 is 'The Pharmacy Patient Fair Practices Act' and restricts certain actions by Pharmacy Benefit Managers (PBMs).
PBMs are prohibited from: requiring the use of mail-order pharmacies; penalizing a pharmacist for disclosing a cheaper generic option to a prescribed medication to a patient; disallowing pharmacies to offer store direct delivery services.; charging more in co-pays than the actual cost of the drug, as well as charging fees to pharmacies for adjudicating claims. The commissioner of the Department of Insurance is authorized to promulgate rules and regulations for enforcement.
This Code section shall not apply to a care management organization, the Department of Community Health, the State Health Benefit Plan, or any licensed group model health maintenance organization with an exclusive medical group contract and which operates its own pharmacies.

Authored By: House Committee:

Sen. Jeff Mullis (53rd) Insurance

Committee Action:

03-08-2017 Do Pass

SB 173 Captive Insurance Companies; provisions; extensively revise
Bill Summary: Senate Bill 173 extensively revises provisions relating to captive insurance companies (CICs).
It updates several definitions within this Code section,. "Affiliate" means any person in the same corporate system as a parent, an industrial insured, or a member organization by virtue of common ownership, control, operation, or management. "Agency captive insurance company" means any domestic insurance company granted a certificate of authority pursuant to this chapter. "Controlled unaffiliated business" is defined as any person who: is not in the corporate system of a parent and its affiliated companies; has an existing contractual relationship with a parent or one of its affiliated companies; or any person whose risks are managed by a pure captive insurance company in accordance with this chapter. "Formation documents" are articles of incorporation, if the CIC is a stock insurer or a mutual insurer, or articles of organization, if the CIC is a limited-liability company. "Mutual insurer" means an incorporated insurer without capital stock or shares that is governed by its policyholders. The definition for "parent" is redefined as an entity which directory or

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House of Representatives

Daily Report for March 8, 2017

indirectly owns, controls, or holds with power to vote more than 50 percent of the total outstanding voting securities of a pure CIC organized as a stock corporation or as a limited-liability company. Finally, "stock insurer" means an incorporated insurer with capital divided into shares and owned by its shareholders.

An agency CIC may only reinsure the risk of insurance or annuity contracts placed by or through the agency, brokerage, managing general agent, or reinsurance intermediary by which it is owned or controlled, or the contractual liability arising out of service contracts or warranties sold through a marketer, producer, administrator, issuer, or provider of service contracts or warranties by which it is owned or controlled. They may do this with prior written approval from the commissioner of the Department of Insurance.

A pure CIC may be organized as a manager-managed, limited-liability company (LLC). It may be incorporated as a stock insurer or a mutual insurer. CICs formed as corporations pursuant to this chapter are subject to the provisions of Chapter 2 of Title 13. The commissioner also has the authority to establish regulations regarding the formation, organization, operations, merger, and dissolution of CICs. In the event of any conflict between statutes and regulations, the provisions of this chapter or regulations prevail. CICs are exempt from publishing, and probate court certification requirements set forth in Title 14 or within this title. The provisions of Chapter 14 of this title shall not apply to CICs except as specifically set forth within this title or by the commissioner.

The articles of incorporation of a CIC must be signed by the incorporator and must have the name, the number of shares the CIC is authorized to issue, contact information for the initial registered office and the initial registered agent, as well as contact information for directors; the same requirement applies for the articles of organization of a CIC. In addition to formation documents, the company must submit a $100 fee.

All corporate powers and privileges of CICs shall be issued by the Secretary of State (SOS) and are subject to the laws and Constitution of Georgia. In the event that the SOS is unable to grant powers, the duties shall be performed by the commissioner. When formation documents have been received by the SOS, the CIC shall be issued a certificate of incorporation or organization; however, it shall not transact business as an insurer until the receipt of such certificate.

CICs may amend their formation documents, if they are an LLC, for a fee of $50. The commissioner shall examine the proposed amendments and determine if they are in compliance with applicable insurance laws and will transmit the documents to the SOS. A CIC may merge with one or more business entities if it is a corporation or an LLC, but it shall submit all required merger documents to the commissioner, who shall examine and transmit those documents to the SOS. A CIC may convert to a manager-managed, LLC for a fee of $100. A CIC may dissolve if it is an LLC.

A CIC shall not use a name that is similar, misleading, or confusing with respect to any other name that is in use by another CIC. The commissioner shall not approve formation documents of a CIC with such a name.

Risk retention group CICs shall only be subject to relevant taxes on direct premiums collected for coverage within the State of Georgia.

Authored By: House Committee:

Sen. Burt Jones (25th) Insurance

Committee Action:

03-08-2017 Do Pass

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House of Representatives

Daily Report for March 8, 2017

Committee Meeting Schedule
This meeting schedule is up to date at the time of this report, but meeting dates and times are subject to change. To keep up with the latest schedule, please visit www.house.ga.gov and click on Meetings Calendar.

Thursday, March 9, 2017 8:00 AM NATURAL RESOURCES & ENVIRONMENT - 606 CLOB 9:00 AM RULES - 341 CAP 10:00 AM FLOOR SESSION (LD 30) - HOUSE CHAMBER 1:00 PM MILITARY AFFAIRS WORKING GROUP - 415 CLOB 1:00 PM BANKS AND BANKING - 406 CLOB 2:00 PM JUDICIARY CIVIL - 132 CAP 2:00 PM TRANSPORTATION - 506 CLOB 2:00 PM Life & Health Subcommittee of Insurance - 406 CLOB

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