Insurance & Commerce - Senate

Back here talking about it we have a quorum we are going to make a slight adjustment at the very front center wing is asked to follow Senator Rapert because Senator Rapert has a committee to get back to and he's carrying both H. B. fifteen sixty nine and Senate bill two O. three so we have is our members on the house bill. Okay senator why don't we start with your first amendment on house bill fifteen sixty nine first wonderful members in response to some questions and actually I believe this handles all the concerns of the members that continue to speak with me this amendment clearly states that this is not handle or homes or who would be excluded. I'll be happy to answer questions on that are there any questions on the amendment. Seeing no questions on the amendment. What is the will of the committee on the amendment. We have a motion motion to approve the amendment Senator Ingram a second Senator Elliot all in favor please say aye same sign opposed the amendment is passed Senator Rapert you are. Recognized to present your bill we will be doing house bill fifteen sixty nine first please that you're if actually House or can join me for that would be fine. Members are go ahead and in let's let Mr Houser for the record identify himself and then we can go. Mr committee members of Leo Houser local council for form of the pharmaceutical research and manufacturers of America. You're recognized center thank you Mr chairman members I want to go over this hopefully to handle most your questions and for those that were just coming back out the amendment that was adopted clearly removes our home from many concerns here in the situation. Summary the bill requires any amounts paid on our behalf by or on behalf of the patient including patient assistance coupons should be applied to the enroll lease copayment coinsurance deductible or cost sharing and not be retained for the financial benefit of the actual PBM or the pharmacy benefit manager. H. B. fifteen sixty nine and you'll see if you look at page two lines thirteen through seventeen that the intent of the General Assembly to ensure the state regulated insurer and entities do not restrict patient access to prescription drugs by refusing to count third party cost sharing assistance toward patients cost sharing obligations practice that is detrimental to the consumer the Bill also prevents you sure's and PBMs for treating the value of manufacturer coupons any differently than that of cash credit cards debit cards checks or other financial instruments when applied to the enrollees copayment coinsurance deductible or coinsurance what is fifteen sixty nine not impact Medicaid including Medicaid expansion our home we actually added an amendment that you adopted today which clearly makes that I highlighted for you Medicare federal plan designed does not permit the use of manufacturer coupons a lot of words or use the other day that we're pretty charged I didn't like that those words basically were were argumentative but the bottom line is the federal plans do not permit the use of these and so some of those statements that were made do not apply to states that are taking their role in this situation health consumers does not apply to self insured or recipients their car down at the request of companies using self insured programs stated minister plans that for their EBD state employees and teachers they're also carved out as well a plan that provides only dental benefits or I'd vision care benefits are also not affected furnishing cost sharing language is passed in five states Virginia West Virginia Arizona Georgia and Illinois and have been introduced in sixteen other states this bill will go into effect for health benefit plan offering that is into entered into amended extended or renewed on or after January one of twenty two so it doesn't affect anything. In the plan years we have support as you saw in the last meeting from over twenty six different patient advocacy groups including those representing our cans and suffering with cancer diabetes lupus arthritis mental illness in a variety of other conditions did pass the house insurance and commerce committee and passed the floor with ninety seven to zero there were no votes there against the bill and so as we all know we're down here with different interests that debate policy issues I feel like the sum of what was stated the last meeting was simply thrown up there because it's not been discussed with the simply to stop the bill we appreciate the members of sit down with us talk with us and gotten amendments to be able to handle these issues the bill actually simply places the value of patient financial assistance where it belongs with the patient and not the PPM would that be happy to take questions or Mr Houser has anything more to add at this time and there may be some other speak for the bill Sproxil's go into questions first let him have a chance to be for the bill are there any questions for Senator Rapert. Seeing none is there anybody we will go against for is there anybody that would like to speak against this bill we have some members signed up. Please come to the end of the table and identify yourself please Mr chairman can I just get around the SAT sure. Please identify yourself for the record and you may proceed. My apologies thank you Mr chair committee again my name is Derek Smith I'm an attorney with the Mitch Williams law firm here in Little Rock and I represent America's health insurance plans otherwise known as a hit. It is the national association whose members provide insurance coverage for healthcare related services a hip is consistently opposed house bill fifteen sixty nine because they have believes the bill will have the effect of driving utilization of high cost name brand drugs when lower cost options are available this position has been the same since the bill was introduced we have offered amendments and have have received no positive feedback on those. It's reasons for opposing house bill fifteen sixty nine were discussed in great detail when we met what when this committee met last Tuesday and I won't repeat those reasons today I really just want to address a couple of questions that were asked me last week for which I did not have complete answers. But before I do that. The. I want to say that look we could easily present articles reporting on how big pharma supporting and in some cases coop in patient advocacy groups but we think most of those groups are genuinely interested in helping people secure access to their prescriptions so rather than questioning motives we simply want to focus on the fact that this bill drives people towards expensive brand name drugs when lower cost options or bill. In the first question I want to address is one from Senator Elliot. Last week Senator Elliot requested some support for my testimony that Medicaid and Medicare consider the use of a coupon in the manner proposed in this bill an illegal kickback let me quote from a two thousand fourteen report from the United States department of health and Human Services office of inspector general regarding the use of drug manufacturer coupons in the Medicare part D. program. The report states pharmaceutical manufacturers offer copayment coupons to reduce or eliminate the cost of patients out of pocket copayments for specific brand name drugs the anti kickback statute prohibits the knowing and willful offer for payment of remuneration to a person to induce the purchase of any item or service for which payment may be made by the federal health care program. Manufacturers may be liable under the anti kickback statute if they offer coupons to induce the purchase of drugs paid for by federal health care programs including Medicare part D. the anti kickback statute applies to all federal health care programs. The second set of questions related to a cost of coupons to the health insurance buying public. On the same day the two thousand fourteen IG report from which I just read was released the O. I. G. also released a special advisory bulletin which states cost sharing requirements for federal health care program drug service it serves an important role in protecting both federal health care programs and their beneficiaries these cost sharing requirements promote one the prudent prescribing and purchasing choices by physicians and patients based on the true cost of drugs and to price competition in the pharmaceutical market. While copayment coupons and I wanna emphasize this because it's emphasize and report well copayment coupons provided immediate financial benefit to beneficiaries they ultimately can harm both federal health care programs and their beneficiaries the availability of a coupon make calls physicians and beneficiaries to choose an expensive brand name drugs when a less expensive and equally effective generic or alternative is available. When consumers are relieved of copayment obligations manufacturers are relieved of a market constraints on drug prices excessive cost to federal programs are among the harms that the anti kickback statute was intended to prevent that the same analysis applies in the commercial market if a coupon reduces or eliminates the copay a patient and the prescriber is more likely to prescribe the most expense the more expensive drugs. Further to that point the Congressional Research Service decided to study which found that the use of coupons reduces the rate of generic substitution and further that brand name drugs with coupons had a twelve to thirteen percent annual price growth compared to seven to eight percent for brand name drugs without coupons the Congressional Research Service decided to a separate study that found that copayment coupons increased retail sales brand name drugs solely by reducing the sales of lower cost generics that study found that the copayment coupons increase retail spending from one point two to four point six percent in five years following the introduction of a generic which corresponded to increase spending of thirty to one hundred twenty million dollars for the average drug study. For these reasons we continue to oppose house bill fifteen sixty nine and request a no vote alternatively we would request that amendment that clearly states that the that this bill does not apply when there's a lower cost generic is available thank you. Are there any questions for Mister Smith. Senator Elliot you're recognized. Thank you Mr Smith has that request been of for the amendment been made to the other side of the aisle to be talked about it Senator Elliot that request was proposed to the primary sponsor I believe a similar amendment request was proposed by the insurance department both reject. Okay and and I would Mr like to hear from Senator Rapert of on that on that same issue of the proper time okay okay all right. Senator Hammer you're recognized for a question thank you Mr I guess my question is what are the. What would be the benefits for the downside of. A. Off brand or generic drugs versus the regular one when it comes to the. Quality of care. At and just speak on that subject a minute because that I built much concern about quality care is a would be anything or about the effect of the patient and the drug that they're getting. So would couple of points one as our amendment was proposed the generic drug had to be therapeutically equivalent so it would not be any less that would not have any lesser efficacy than that than the brand name drug. Okay and the second part of your question was I can't remember Senator Hammer thank you Anseriformes share follow up granted. What's the financial impact. Two. The. I guess should be the PBM in this case or the insurance company what's the B. B. what's the financial impact of them. Verses what Senator Rapert is proposing this bill and what you're proposing in the way of the amendment. What I am proposing in the way of the amendment would have no Think about this what I am proposing and where the amendment is that it would only apply if there's a lower cost generic drug available. Your and the drug has to be an equivalent. That's the only time our amendment would apply it would not apply in circumstances in which the patient has been given a prior authorization to use the name brand drug and it would not apply if the patients otherwise a satisfied any step therapy protocols so if there is a brand name drug that is more appropriate for the patient first is the generic the patient would be this bill would still apply our amendment would not our Amendment again only applies in circumstances and when they're in which there's a therapeutically equivalent generic drug available that's also a lower cost. Thank you Mr are there any other questions for Mister Smith. Seeing none thank you for your testimony today I believe we have someone in the audience who would like to speak for the bill. Of. John Vincent. You still wish to speak for the bill. Identify yourself for the record Mister Benson and then you may proceed. Thank you chairman Pitsch members of the committee my name is John Benson and I am a pharmacist and also the head of the Arkansas pharmacists association organization representing the pharmacist of Arkansas and our team members and our pharmacy practices around state. just want to come today in support of the bill just to answer questions or explain a little bit about how the coupon works just to make sure everybody understands I got some feedback that you may be interested to hear that course we want anything for our patients to remove any barriers to make it affordable for our patients to access the medicine and one of the things that happens particularly in high deductible plans is the medicine is absolutely the best choice for the patient as recommended by their physician and the patient will present what that prescription and they may not be able to afford what the prescription costs and the pharmacist may be able to help them find the coupon or the patient may have a coupon with them depending on what the drug is in their particular situation and the way that works is is a relative who is a drug that is used to prevent or treat somebody with like blood clots and they may come in and the price maybe five hundred dollars that may be their out of pocket expense and there's not a generic equivalent or not a safety America quit one for that patient to prevent dying from this disease of blood clots that could lead to a long clock that could kill you and if you apply the coupon that five hundred dollars that the patient was maybe going to have to pay will now become as low as ten dollars or fifty dollars to reduce that cost to make it affordable to where they don't go home and put themselves at risk of dying for the pharmacist it would be easier to just collect the cash and you have the payment right there so there's no advantage to the pharmacists other than you've helped your patient access through their medicine with the coupon that you build their insurance first and usually that's through the PBM a claim is process that tells you how much the patient knows in this case the patient knows five hundred dollars any bill the coupon secondary which is also a claims processor it. Maybe a PBM you've heard of it may be a smaller claims processor that the manufacturer has hired to run that through to check eligibility and then it comes back with the manufacture basically paying the difference between what the patient would normally pay out of pocket is covered by their insurance to lower it to that ten dollars or fifty dollars and literally the manufacturer is picking up the difference to pay that those dollars for the patient to make it assessable and then the pharmacist would get paid by both the PBM from the insurance seven days to thirty days later depending on how prop the pay is and the same thing with the coupon process by the manufacture those dollars would come to the pharmacist there that secondary it's not insurance but it works like insurance and that payment would come to the pharmacist says at a later date so I just want to bring that information to committee members and be happy to answer questions are there any questions Senator Dismang you're recognized for a question. So one thing I did with the coupons come from so how do you obtain a coupon does your doctor tell you to go online is there I mean it is what you know that is what this is This Is thing I keep trying to wrap my head around is. So if you're not privy to coupon you're paying the higher you know the higher price the cost of the drug manufacturers the same I mean. There is to make it ten dollars for one in five hundred dollars for the whatever the pay back up is to the. Manufacture but at some point that equals out so that somebody's rates are higher because they're helping subsidize the cost estimate utilized you on right so but yet if you can just walk me through where those things I I don't know so how do you get one in should everybody means you're like a website or sure how that works great question so in the old days when I was in practice and the physician clinic back in the early two thousands they were in the physician offices they might have been brought by the manufacturers those most of those that there still some of those out there but most of them now are assessable online and it could be given to you by a physician or your nurse practitioner other prescriber in a physician clinic or it might yet may direct you to a website to download those and most of them can be accessed by the pharmacist as well on the website either by the manufacturer or some patient assistance website where they put them all in a single or place a fine then we can search about your of women I think in the positions office at this point I mean that's almost that that's not legal at this point you can't be you can't be a girl grow up and go to the physician's office and you know do your advertising and encourage the physician prescribing all those sort of things I mean that's all kind of the way sets was probably mainly online it isn't and I yeah and last the physician staff that helps the patients access to medicines assist the patient walk in patient navigator so it may not been brought to him by the manufacture but they may know how to navigate that website and help of patients specially social workers are really good at that and and these family practice clinics where they have a multi team approach to assist in patients one other thing I think is relevant to this conversation that's different than when Medicare made those rules back in two thousand three with the Medicare modernization act that Derek was talking about earlier Arkansas just past we're we're very innovative state and forward thinking on how we work with our physicians and pharmacists and there is. The Bill pass this session that would allow Arkansas to progress with therapeutic substitution between pharmacists and physicians and to give us protocols when there are lower cost drugs that patients can for the brand name drug where a pharmacist can help assist the patient in making those choices that were testified earlier so we're excited about that to work with our physician colleagues and I think we'll be able to save a lot of money with that too I know that's a separate conversation that we've done in their professions too so let's Senator Elliott do you have a question. Senate Mister NO. So that does how long does the coupon last you happen to know that like if I am on this drug for the next five years to I keep getting coupons or what happens with that they typically are I mean it varies from manufacturer to manufacturer but the just as a general rule they're good for a year and then they. May be renewed every year at the discretion of the manufacture I can speak from personal experience for my own son who uses an inhaler and and he has for asthma of which there's no generic drugs used in a long acting inhaler for his condition and in our own family and in my own experience with with his particular prescription it usually expires and has to be renewed annually and occasionally they do stop offering those discounts that it may not last forever but it and and my own personal experience my own family at least a year and then just like with insurance changes from year to year the coupons and manufactures will reevaluate whether or not they're going to continue offering that benefit I have had lots of experience with for the constituents or with as my that kind of thing that you kind of just described and so in a case like that if there is no generic equivalent of drug. That would not be an issue regarding coupons with that would not be any competition between if you're going to get that the I guess that I don't wanna say boutique drug that's all I can think of right now that would not be an issue with it because you what that's all that. What what would if there's no generic available then they would just have to get the the Thirty one well there's several brand name inhalers available names are okay there are several available and their most for the most part considered interchangeable meaning they have the same effect and similar efficacy I mean there you could get into details about how well one is absorbed into the lines and of course the physician can examine and do a variety of tests and and get history to make sure if you switch and I orders that the other hay or is producing the same effect in there followed up and monitored but often the discount provided depending on the and hay or if one gives a much bigger discount than another that actually can be the difference between an inherent patient who stays out of the emergency room and stays well and could compete and swim and play football versus one who may not be able to get their medicines filled each month because of the cost and it and they really can make a big difference for some patients if if the The Amendment that Mister Smith referenced out were added to this bill. What that solves any issues of whether or not we have been fair to both son. I would say that the majority of the time might for my experience the majority of the time whether you have the amendment or not the majority of the time these are prescriptions for medicines for which that medicine is the right medicine for the patient or at least some drug in that category like with the inhalers is the right drug for that patient is just a matter of which one in that category is affordable it's unusual for me to see a patient come in with a brand name drugs. With the coupon garden use a coupon for which there's a much less expensive generic drug available it just doesn't happen very often it's usually patients come in with medicines that are very expensive brand name a lot of times what what might be called specialty drugs by the PBM industry meaning that they're more than six hundred dollars a month on the list price most of a more than a thousand dollars but there's also a number of insulins and inhalers that are in that hundred dollar to five hundred dollar range as well that they can be used in and it would be rare in my experience with the coupons and our members see that there actually would be a generic drug that's equivalent and better or the or the form or design done already drive the patient to that generic drugs like there talked about earlier we stepped therapy so the majority of the time those situations are already covered okay Mister you have other questions of so I'll just get back in with you don't think I have any I well now I do okay. Okay. I just have one more Mr chairman yeah if if you allow there is a direct response on this generic issue that needs to be reminded here this bill already states that if a generic is available no coupon is eligible. It's actually written in the bill on page four lines nine thirteen thank. Several other you're recognized thank you I'm just gonna ask you know that our experts here so if the all the times of when I am told you know here's a brand name here's of the generic. One is as good as the other There are how do I know if that's accurate accurate or not accurate that one is that is the other because you said something about one not being as effective and you'd want the brand name drugs I think the vast majority of the time they're interchangeable and they're equally effective but that doesn't mean just because what's good for the entire population there could be situations with individual patients and follow up and monitoring for whatever reason maybe the maybe the drugs just as effective but the delivery system like the kind of an hay or whether it's a disk or whether it's a of inhaler that requires a spacer like there can be things about the way it's delivered that you may get a different response and that just takes follow up and assessment with the patient to ensure that if you do substitute a different and it be the same as what we do in the hospital right now when those their peak substations remind okay thank you thanks here Senator Hickey you're recognized for a question yes Sir Mr president I just something you said a minute ago was different than what I was originally thinking I just want to get the correct thing sure okay whatever this coupon whatever the customer brings it into the pharmacy the pharmacy get set what do they do with that coupon at that point they send it to the PBM typically sure and then the PBM sends it to the manufacturer. That is my process right so for right what it what happens is is you first builder insurance which is usually managed by PBMs I usually delegate that or they may. On the PBM in it and it processes the claim and it identifies if the patient's date of birth that it's the right patient that it's covered for that patient and then you get a dollar amount back that the patient knows like what the insurance or PBM paid and what the patient knows their code base that's what happens first. And then if the patient can't afford that or there's a coupon available that they're able to use to then that may offer some additional discounts the pharmacist can actually process a coupon if one is available and if the program still in effect and that program the manufacturer hires its own claims processor which could be a PBM it could be a a PBA or pharmacy benefits administrator or just a claims processor that doesn't choose to use any of those titles for various reasons but that claims process or does the same thing it recognizes the patient they're eligibility and it looks at the previous claim in the field to see what the patient owes and then it tells the pharmacists. Will we pay part of that and make it lower cost for the patient to afford it and so the the PBA or the claims process for for the coupon pays the pharmacist the checks seven to twenty one days later just like the PBM for the insurance company does and their typical claims processing and the manufacturers actually paying those dollars through that claims processor so the value I guess the queue the coupon as a value to it right whatever the patient brings in it does this use a hundred dollars okay so you get this coupon floating around out there and it goes. From the thank you they give it to the pharmacy the pharmacy since that the PP BBM then they send it to the manufacturer. The manufacture then distributes that value yes which is that value going to be a hundred dollars or is it going to be something less at that point you could but it didn't want to your point there's a range of dollars it could be okay so just so just because it necessarily have a hundred dollars on the face value is I would call it that doesn't mean that whatever the manufacturer gets that they're going to give somebody a hundred dollars for that be it either the PBM or the pharmacy the the the dollars would never go in the patient's wallet that the dollar is not. You need to be repaired but I just I'm last just some so if it's if you don't mind sure yes Sir but so the manufacturer has that coupon Kate and there's some value there and I understand it may not be my hundred dollars because there may be some back room deals are some negotiations or whatever don't really care whatever the value of that is where does that value then flow to does it flow back to just the PBM or does it slow all the way back to the pharmacy at this point right now in the situation I just described in and it goes a hundred percent to the pharmacy to pay the cost of the lower the cost for the for the patient in order what is value what if the value exceeds the cost of the driver of the growth of what would happen at that point it never happens I mean yes I energy I understand your question but it just doesn't happen. Okay thank you Sir. Representative Hammer Senator Hammer skews me. You got okay are there any other questions for Mr Benson. Saying no more questions thank you for your testimony. Do we have anybody else would like to speak against this bill. For this bill. Mr Houser you're welcome to identify yourself I think we've got John the record so you may proceed. Thank you Mr chairman members of the committee again I'm Leo House representing pharma and I would like to address one thing I think Senator Dismang was good enough to bring up the last week as a point of clarification that yes I and my partners in our firm to represent pharma in fact pharma is an entity I have represented either by working at a company or representing the industry for forty three years now all that makes me seem old that's probably pretty accurate but it does give me a degree of experience the pod like to share with the committee when it comes to this bill besides representing pharma there are twenty six other organizations out there that represent tens of thousands of our neighbors and friends that have diseases for those Senator Rapert said ranging from cancer to diabetes to Alzheimer's to lupus and they've all signed on in support of this bill would have to ask the question did they do that because they are big fans of the pharmaceutical industry not necessarily. In fact the recently signed on as because I believe they're their their heart and soul is behind this bill because it is good for the people they represent not for the drug industry a couple of points were raised last week by local council for the national trade association for the insurance industry I would like to also address and provide some clarification. Mr Smith noted that one of the big problems being faced by consumers is the rising cost of prescription medicines and frankly I couldn't agree with him anymore what he failed to address though is the root cause of these prices and that is the failure by the insurers and the PBMs they contract with to pass along the discounts and rebates paid by the manufacturers these are not being passed along to the consumer. The problem he referenced is a direct result of insurers negotiating substantial discounts from manufacturers that are intended to help patients and then pocketing these as part of their profit motive for their business model. There is one to one document I'll be happy to send the link to staff for the committee to access if you like of the study that was concluded in twenty twenty. By congressman Ron Wyden from Oregon and senator Grassley neither one of which have any particular love for the industry well they took a look at was the complex issue of insulin pricing PBMs the drug manufacturers and the patients. What the stated in that was quote insulin manufacturers compete fiercely using rebates as bargaining chips to securely favor gets to secure favorable coverage on PBM formularies in fact last year this resulted in a net price decline. The net price reduction in insulin of eighty three percent. The same report also concluded quote to the PBMs have an incentive for manufacturers to keep their prices high since the rebates discounts and fees PBMs negotiate are based on a percentage of the drugs list price. And PBMs retained at least a portion of what they negotiate and really what it's called is playing this for an you've got a retail price a catalogue price appear it's discounted eighty three percent according to this study to make sure the products available for patients. You think patients are going to wind up getting that eighty three percent discount no that is not what happens and that is the fundamental reason why the consumer is facing ever increasing costs. Mr Smith also has no choice Mr president of language in the bill relative to the use of generic medicines and expressed concerns that H. B. fifteen sixty nine would substantially increase the use of more expensive brand name medicines in the bill the only way the use of generics can be over ridden is first of all the prescriber has to note that the drug being prescribed is medically necessary it's like saying this patients got to have a no exception that has to happen and secondly there has to be no medically appropriate generic prescription drug available there is not a plan B. if those two things happen the Bill accounts for the the concern raised about Texas use of brand name medicines that in terms of frequency the most recent study shows the coupons for a brand name medicine word generic product is available accounts for less than one percent. Of all commercial market pharmacy claims. The rules because the clock talked a moment ago about the amount that was offered and yes I did see that yes we did respond and the reason we did not support moving forward with that was first of all timing it was late in the session secondly the language in this bill is the same that has been put in the five other state bills in the past in third the signage to addressing just the generic use the bill would require patients to go through a couple of groups including fail first stepped therapy just to get their medicine so it isn't as simple as that was rejected it wasn't we offered to work with the following bill if that's what the decision was by the agency in closing I'm just gonna respectfully ask the committee to note one thing and that is these coupons are not PBM coupons they are not. Insurer coupons these are patient assistance coupons and H. B. fifteen sixteen nine simply make sure they're treated as such without I close we'll take any questions thank you. Are there any questions Senator Dismang you're recognized for questions Senator Hickey you'll be next so on the proposed amendment I kinda missed some that I think earlier We're having to make an amendment now so we're not changing anything timing session lies minute is there some of that let we're not. That we're making one for. They only amendment that was requested by members wish to make sure that our home was taken out and Derry did not approach me with this amendment idea apparently they had this discussion in the house bill ninety seven to nothing you would pass the bill without it At a keep hearing that but okay but so you were saying because of the timing even it back then in the House there was enough time for you all to talk about an amendment. We disagreed fundamentally not only okay I will either I'm sorry I'm just going in the first part of the conversation which was you said quote there was enough time left in the session that was the first in the lead with that's that's what I was going to key in on thank you. Senator Hickey you're recognized for a question again. The of I guess I'm a little bit confused maybe I'm not reading this right on page four I do understand the generic. Page four line seven eight nine ten what we keep referred to here it looks like to me it has it actually has to because there isn't any and on on line eight right this is. Is not considered to be medically necessary by the prescriber. And as medically appropriate generic prescription drug equivalent so there's an additional piece to that doesn't just a part of my testimony at yes Sir okay so if a doctor per but if it's when did not going medically necessary if if it's not deemed medically necessary. If the doctor doesn't say I've got the the patients got to have those if that restrictions not him on the prescription and there is a generic available they can use the coupon. So you're saying that of a. Yes so just just because the doctor has prescribed medicine that that doesn't necessarily make it medically necessary it has to be on the prescription itself. First it it's a it's on parallel with doctor writing dispenses written or no substitutional out. Maybe I'm just not following that right. All right here we go and. Senator Rapert the chair will allow it yeah I just was going to try to help their Senator Hickey the just a just a fact it in aside from the fact that we you've already made clear that this bill specifically states if there's a generic available it's a moot point but also you need to also know that the facts in the market less than one percent. Of all prescription claims filled in the commercial market or pay using a coupon when a generic equivalent is available source for our hand over point that not only is it stated in the bill this is not relevant it also just the fact of in general around the country that's what I'm told the percentages and so I don't know what at which kind of circular argument but if there's anything further be happy to answer it let's let's try and deal with it close because we're still questioning the witness or the testimony do you have anything any other questions. Senator Elliot. You're recognized for a question. might my questions in that exact same area so. I'm trying to think of an example of something that's not medically necessary and what are the odds of doctors going to say is not medically necessary. So if if if I have if I want I don't know some of this going to get rid of every wrinkle in my face or maybe five or six seven. And the doctor prescribes it. That could possibly be something that's not medically necessary but just cause medically necessary and in which case the doctor might say. At that. No set you want puts our she won't put something on there about it the substitutes are not allowed. Is that kind of an example of what we're talking about it is away it's as more of a judgment call will example you give I might offer another one where we may be being treated for a specific type of cancer in there is one medicine that is medically necessary is the one the silver bullet that has been clinically proven and recognized as a standard of care that would be where the doctor could if he or she chose to put on the prescription. A medically necessary and that prevents the option of doing substitution but wasn't example of something that is not medically necessary I'm trying to figure out when a doctor is going to say that and that that and that would make part apply right. Well the twenty for example if you have high blood pressure and the doctor writes for a particular brand of a beta blocker and doesn't put on their medically necessary that doesn't mean it isn't necessary for your care it just means if there is another choice the brand is another brand another option in that same category it could be substituted. Okay all right thank you. All right are there any other questions Senator Dismang you're recognized so just make sure I understand what medically necessary is already that's code somewhere else that's all or that's an understood. New on six described somewhere else that it if I prescribe cleared in. In in the US I ride do not. Whatever I have to write that if I don't write that not only right cleared. And and I mean or talking about but only right cleared and then I'm not it's not deemed medically necessary that I have to do cleared and I can do generic you can substitute that could be substituted is with that states in that's okay medically necessary so that's to find somewhere else financial million to a standard practice it's actually I've seen it in code I can get that if you like. But I mean it's yeah I'm that well I'm I'm I'm I'm and that's been a mask sure so and then one other thing and it should work well. Slifer Senator Rapert later evening you understand a number of Legislative findings that are in this bill two and you read through the use and you agree with all those Legislative findings because part of what we're gonna be voting on and approving these Legislative findings. Okay. Senator Hammer you're recognized for a question thank you Mr I guess one thing I'd like to know is we're passing a lot of legislation to that is giving the pharmacist an opportunity to insert himself into the discussion would any of these drugs. B. that work referencing would any of those drugs B. That the pharmacist may disagree with the doctor for the prescription that comes to the pharmacist who would be the one to determine medical necessity would be the pharmacist or would be the physician. I would have to defer to doctor Benson for specifics on that but I do know the recently passed therapeutic substitution law does give latitude to the pharmacist and therapeutic categories to substitute between different medicines. You don't either just stay on the question now I will we're veering off of protocol understand in that in that particular case your question would have to be a protocol approved by the state board pharmacy and the medical boards of physicians are involved it would mimic the practice that's currently done in every hospital in Arkansas it's and it's would be allowed in the physician would get notification back on what the therapeutic substitution was if they were uncomfortable with it that conversation would happen pretty quickly to to not allow it and they would be follow up so hope that answers your question but it does give the pharmacist similar latitude the same attitude that they have in hospitals today as approved by the state for pharmacy board medical board. Okay thank you are there any other questions. Thank you for your testimony Mr Vincent. All right is there anybody else who would like to speak against this bill. For this bill. Senator Rapert are you ready to close for your bill. Thank you at this is not a time really for questions on here to closing Mr chairman of the so in lieu of that I will state served as my may reference Legislative findings but did not make a specific reference to that Legislative findings are not codified in the law it's so if if there's a problem with that I'd be happy for him to tell me we can because I don't know what that would be but I just wanna make sure because I haven't anybody mention it to me but I do know and practice the Legislative findings are not codified I sent to all U. membership during the debate here at a piece from the hemophilia federation of America which hopefully we can make this concise because we have veered out into a lot of a lot of issues but I want to tell you one simple thing here it's all about the money. It's about the difference of the money being attributable to consumers and letting their families use that money for their benefit and their children as opposed to large companies out there and so that's the bottom line one of the pieces that I sent out to the committee members I believe after the other meeting was a couple and I actually talked with a couple of members about this couple had two sons that happened we can officially acts. Their cost is going to be as I recall thirty two thousand dollars a month for the construction. Hey and when they were using the the coupons they were able to utilize those against their co pays to get to the point to their insurance company would pick that up very quickly. But what happened when the company decided to drop one of the a a pre programs on them that spread them out through the entire year. So that hemophilia federation of America stated this three point three points and then I'm done with that accumulator adjusters are new cost containment tactic that have rapidly expanded to the point where they now appear in up to eighty percent of commercial health plans plans frequently have discretion to spring accumulators on consumers at any time and concealer existence of plan documents that are hundreds of pages long disguising them under confusing names like out of pocket protection programs or specialty copay solutions the impact is those accumulators creates confusion financial risk barriers to care for consumers and patients find that they can't afford to remain on their medications they don't have to wait discontinuing treatment for turning to emergency rooms for care which by the way would hurt Arkansas and our hospitals as well both options lead to bad health outcomes and higher healthcare spending overall patients exposed to sky high year after year calls that face threats their financial security as well as our physical well being and to date five states have already done this prohibiting or limiting the use of accumulator gestures for all individual and small group plans for me I'm all about policy that is fair to all concerned and I believe at the end of the day we represent individuals we represent consumers and that's why I would ask the body to join with the house and approving this bill so that we can allow the rebate it's intended to help the individual actually help them and I'm close thank you Sir appreciate a good vote Senator Rapert is close for his bill what is the wishes of the committee. I have a motion do pass Senator Teague. I have a second from Senator Ingram. It has been moved and seconded on House Bill fifteen sixty nine. All in favor say aye. Same side opposed. Your bill has passed thank you Mr chairman. We will move on Senator Rapert we're gonna wear at the end. Do pass as amended on the path motion yes we have a do pass as amended to any a rebellion that for anybody. Saying no objection Senator Rapert Senate bill two O. three. There do we have an amendment on this one too yes I was just out in members was a form today they use twenty twenty one still twenty twenty two C. should have the amendment front of you and so this basically changes that date air and in the bill. Senator Rapert while they're being passed out you want to present your amendment. Yes Sir this is Amendment which simply takes care of date errors that were discovered today by the drafter and got in touch with me okay. What is the will of the committee. Motion to adopt the amendment do I have a second. I have a second Senator Teague all in favor say aye same sign opposed your motion is adopted Senator Rapert you're recognized president bill two O. three. Okay members thank you I want to go over the tenets of this bill so we have this understood the insurance business transfer bill creates a process for one company transferring insurer to develop and implement implement a plan subject to approval by the insurance commissioner to transfer some or all of its rights obligations and risks on a group of insurance policies typically older legacy policies to another company the assuming insure such a transfer results in innovation of the transfer contracts of insurance or reinsurance resulting in the assuming insurer becoming directly liable to the policy holders or reinsurers of the transferring insurer in extinguishing the transferring insurers insurance obligations or risks under the contracts the transfer must be reviewed and approved and this is really a key component of this bill it has to be reviewed and approved by both the insurance commissioner of the state of Arkansas and the circuit court. Both the value wait the transfer to avoid any adverse impact policy holders I will highlight that again that is the highest standard of review that the insurance department would have ever given to any transaction ever to include the circuit court would also have to approve this transaction you have double protection for consumers and also the guaranty association in our state the proposed statutory process to accomplish such a transfer novation includes filing a plan with the insurance commissioner providing notice to all policy holders holding policies that are part of the subject business the chief insurance regulator in each jurisdiction in which the applicant holder is ever held a certificate of authority and which policies that are part of the subject business were issued or policy holders currently reside so any place that the company that they're buying the policies from any jurisdiction where they've had they also have a say in that national guaranty associations and reinsurers you have impacted agreements they have a say in by publication in a newspaper of general circulation in the state in which the applicant has its principal place of business in any other publication as required by the commissioner an independent expert will be appointed by the commissioner who will conduct a thorough review of the plan including examination of financial audits and statements will offer an opinion on the financial condition of the transferring insurer and the likely effect if any on the policy holders the Commissioner then accepts or rejects the plan if accepted the plan is then submitted to a circuit court and Pulaski County through a petition by the transferring applicant the commissioner as a party and a hearing excuse me the commissioners a party and a hearing is then scheduled following a public comment period assuming the implementation plan is acceptable and the court finds no materially adverse effect on policy holders and implementation order is the final. Result justification for why we're doing this legislation the I. B. T. process will be beneficial to it will be beneficial to the Arkansas insurance industry by providing a mechanism to transfer books of legacy business to responsible insurers who specialize in what is called run off business such restructuring provides legal and economic fine ality to legacy insurance risks which results in improved allocation of capital management resources to both legacy and ongoing insurance operations transferring companies can better focus on core areas of business and assuming run off management companies can apply their specific expertise to the legacy business members this is been debated look at Senator Elliot because she's been there and I don't know Senator Teague has been there in awhile but the National Council insurance legislature let judge use me legislatures has fully vetted and discussed debated this issue the state of Oklahoma has implemented it we're not we're also put of an article to you as well this is an opportunity for us to attract these companies to our state which does create jobs and probably also premium taxes with it as well and only a the only objection that I've heard which I stopped and listened to intently because I've pass legislation to help secure our guaranty association here in our state is I stopped to listen to their concerns but the fact of the matter is that the in much like Senator Hickey and asking questions I said is there any specific instance that you can give me that there's been a problem and a blow up in these transactions. None of those are on the books for that's what I was told that was in the presence of a ID in the Commissioner and all involved in fact the insurance commissioner and the insurance department will be happy to testify give comments on this bill today they do not have opposition to the bill they're neutral on the bill and frankly I think they lacked the bill but out of respect they just stayed neutral on it because we do have a concern that was raised to us by some of our industry here in the state on behalf the guaranty association but after sitting through those discussions and they tell me there's no instances where there's been a problem I don't know what to say I don't know how you keep Arkansas from having this business when there has been no adverse effect the second thing is this absolutely has been used for decades in Europe which has a different insurance regulatory scheme there in Europe and they've had no problems with it either so we have an opportunity for Arkansas to be a leader in this in the country and be happy to entertain any questions and I have the insurance department step forward if you'd like to help as well other questions for Senator Rapert. I will start with the questions Senator thirteen pages of new codified cation to are are gonna are statutes right direct copy from which state. Other state using it. Actually act I consulted with the insurance department on this bill before session so they have they have helped me with the putting together the bill so we are not looking at another state to mera best practices I think what you're going to find is is a lot of it is the same and similar not only to a model bill that came out of in coral but also in Oklahoma because they were the first state it really is ventured into this arena. And that's what the article was that we stated that sent to you. Okay. Are there any other questions for Senator Rapert. Seeing none we have several people to speak against this We'll start with lead Douglas sleeve Douglas in the room. Mr Douglas please identify yourself for the record and then you may proceed. Thank you Mr chairman my name is Li Douglas I'm the executive director of the Arkansas Life and Health Insurance Gerrity Association. I'm here to speak up against this bill on behalf of the guaranty association. The Senator Rapert indicated. we did it we have had several discussions I wanna make one thing clear that. The guaranty associations not necessarily opposed to the actual business transfer process or any of that one of the things that this bill does not address when you have one of the if you have this process if you have an Arkansas only insurer numbers it's only licensed in Arkansas and it is soon as business from an insurer that has policy holders in different parts of the United States. If the Arkansas. Insurer. House insolvent the Arkansas okay ninety five will have to pick up all of the calls for those policy holders in other states usually it's the state where you know the insurer is and the insured but since the Arkansas company might not be licensed in another state the insured's that right presiding that state would have to be covered up by the the Arkansas guarantee fund so I don't like Senator I don't you know the the the. The bill the concept of business transfer we don't have a problem with we just like the the issue had been addressed the having the of the Arkansas insurer licensed in these other states because if the guarantee fund has to pick up all of these policy holders then the Arkansas industry is the one that has to pay those servicemen's and it would threaten our Arkansas industry which is not that big to begin with Senator Rapert indicated that you this is this is not a process that has been around very long so you really don't know how it's going to work so that's one of our concerns Gillett said it's it's the licensing issue of the assuming insurer here in the state that we're concerned about I'll be glad to answer any questions you might have are there any questions for Mister Douglas. Six a Senator Elliot you're recognized for a question. So if if there weren't going to be something to. Thanks this bill your estimation what would that have to be or ill or in your estimation is not fixable we thank it is fixable the there an amendment we had given to the Department eight Senator Rapert during our discussions you know that would require the consuming care in the Arkansas care to be licensed in the states where the the the the policy holders that they're sending. Okay. I guess Senator Rapert will respond to that when he is are there any other questions. Seeing none thank you for your monitoring Mr Douglas we have a any well anybody for the bill. Saying none anybody against the bill. Caleb Alexander McKinzie I'm sorry. Caleb Alexander McKinzie in the audience I am not. Users. Derek Smith. And then we have a. Callier Stein after that. Mr Smith for this record please identify yourself and you may proceed. Thanks thank you Mr chairman thank you Committee my name is Derek Smith I'm an attorney practicing insurance regulatory law here in Little Rock and on this issue I represent the American council of life insurers otherwise known as the A. C. ally. The AC ally is the leading trade association driving public policy and advocacy on behalf of the life insurance industry a C. allies member companies are dedicated to protecting consumers financial well being of life insurance annuities retirement plans long term care insurance disability income insurance reinsurance dental vision and other supplemental benefits AC allies two hundred eighty member companies represent ninety seven percent of annuity industry assets in Arkansas and each day life insurers pay out almost ten million dollars in life insurance and annuity benefit stark and soft families and businesses. Helping Arkansas families secure the things that matter most of all stages of life. It. Like a former commissioner Douglas Senator Rapert did visit with us about the about the bill and we have the same concerns as former commissioner Douglas a CLI opposes this bill principal because of the implications for the Arkansas Life and Health guarantee fund and the fact that AC allies members would be called upon to pay any assessments if one of the assuming insurers were to become insolvent and subject to liquidation. A CLI does not oppose business transfers. Where are position diverges from that in this bill is what happens if one of the assuming insurers becomes insolvent. Now. There's some believe that this simply will not happen it's purely a hypothetical risk. And that belief is based on the history of these transactions principally in the United Kingdom they haven't been tried here in Arkansas I think the first was just approved just last year in Oklahoma and thus far Oklahoma is the only state this adopted a law like this. But the the situation here in the United States is different than in the U. K. first the U. K. does not have the same cross border border considerations that would be involved if a bill like this would pass here in the U. K. you all transfers involve companies that are licensed in one single jurisdiction with one single regulator. In the United States we have fifty one different insurance regulators and fifty one different jurisdictions where risk can be located. Second and most importantly I think it's unrealistic to think one of the companies this bill will authorise will never run into significant financial difficulty. At the end of the day these companies are simply insurance companies and after the initial review that includes the judicial review that Senator Rapert described the companies will be subject to the same financial regulatory oversight as any other insurance company. They will not be subject to any additional regulatory oversight than any other insurance company. From two thousand fifteen the two thousand twenty at least fourteen life and health insurance companies licensed in three or more states have been declared insolvent and taken over by state insurance departments seven of those companies have been liquidated. From two thousand fifteen through the first quarter of two thousand eighteen at least twelve property and casualty insurance I've been declared insolvent. To give you an idea of how quickly things can change just last month the Arkansas Insurance Department place the company in receivership after approving new ownership for that company just over a year ago. And while I do not know the particular circumstances of that company I do know what the insurance department reviews when it considers to ownership. It reviews the financial where with all of the owners it reviews the projections of the ability of the company to do business for the future three years and it makes an assessment of whether it believes there will be negative impact to the policy holders of the company. Here just a year ago the department concluded that everything looked fine. And that this company could be bought. And now one year later that company is in receivership. Similarly last month the Pennsylvania insurance department announced plans to liquidate insurance company licensed in over fifty states with over three hundred million dollars in assets. And notably that company involved two thousand fourteen acquisition with the same considerations. And it was approved over the objections of others based on the acquiring party's representations that there was a very low possibility of insolvency. Then just three months ago that same company was allowed to merge with three other insurers. Now bring up these items not to suggest that there's something wrong with the way we regulate insurance companies but to say that sometimes despite our best efforts things do not go as planned. Our currently current guarantee fund system provides protection for those unplanned happenings and without those protections we believe Senate bill two thousand three has put potential to overwhelm the protections in Arkansas. And finally I want to be clear that our opposition Senate bill two thousand two hundred Senate bill two O. three is not intended to be a slight to the Arkansas insurance department. After over two decades of working with the insurance to Arkansas insurance department and insurance departments around the country I can say the financial regulation section of the Arkansas insurance department takes a backseat to no one not in terms of experience not in terms of confidence not in terms of quality. Still. Even with the best oversight insurance companies like all other company sometimes fail. And to say it just won't happen is unrealistic. In our view Senate bill two O. three does not adequately account for that eventuality and if and when one of these companies does bill it will be too late to do anything about it. Just like it's too late to install sprinklers when a building is on fire or too late to whether rise utility systems when the snow is filed falling it will be too late to address our concerns once one of these companies becomes financially impaired. Skews me are there any questions for Mister Smith Paula Jones for the microphone. Seeing none thank you for your testimony thank you Mr thank you Committee is anybody in the audience wish to speak for this bill against this bill we have one more signed up Kelly Stein please identify yourself for the record and you may proceed. Thank you Mr chair members of the committee Kelly R. Stein chief executive officer of the independent insurance agents of Arkansas we represent about four hundred and put insurance agencies across the state of Arkansas don't make it a habit to be against my friend Senator Rapert because he knows our business very well so ninety percent of the time we're on the same page with this one we do have concern with and we are opposed to the bill simply on the same arguments that Mr Smith and Mr Douglas stated we are concerned about the guarantee fund there are some other things that we're concerned about but this is a very much of a new alliance in the world of insurance as a stated Oklahoma is the only state so far that has done anything like this we'd like to have some safeguards we are also grateful to the amendment that we propose to the apartment to Senator Rapert but as it stands right now we are opposed to the bill as it stands. Okay are there any questions for Mr Stein. Seeing no questions thank you for your testimony we appreciate it. Is there anybody else you'd like to speak for the bill or against the bill. Seeing none Senator Rapert are you ready to close for your bill. Yes Sir any other questions. Okay. Number one. I love sitting and listening to testimony when I know that the bill already gives an open check to the Commissioner to promulgate rules before implementation. In a ID has told all of the stakeholders that if they deem it necessary they can require that person that insurer to get a license in those other jurisdictions. They've already been told by the Commissioner not be happy for them if you wanted to have them step up here they told me they'd be happy to but nobody asked for the commission to step up they told me that over and over I thought I might get a question on that so I can get them to the table but I'm going to dress that for you now if they're in the room they shake their heads if they want to the bottom line is when you look at this bill and let's just you said your several pages you look on page thirteen you look at the lines fourteen and fifteen the insurance commissioner shall promulgate rules to implement this subchapter they told the stakeholders over and over and over again that if it's needed they will handle it the next section down states again The Insurance Commissioner for promulgate rules necessary to implement the act when adopting the initial rules to implement the act they have to be approved as we know that so you get a chance to do that and you know why this is important to the state of Arkansas. This legislation was passed in eighteen in Oklahoma. The in the information that you've been given total global reserves for run off business increased to eight hundred and sixty four billion dollars in twenty twenty. This is a significant opportunity that you and United States is the largest run off market with an estimated run offers or three eighty five in North America is the largest region at four hundred and two billion dollars followed by Europe and it has been in place and used in Europe for many many many years if I did not have the confidence in the Commissioner of the Arkansas insurance department and his staff this set here and told me in the presence of all the stakeholders you're asking for an amendment that is covered by the rules why would they not want to give the amendment members because in certain jurisdictions. There may not be but one policy. It's in a state of Missouri. And if a company this doing this transaction is not actively gaining new clients. They can't even get a license and some of those jurisdictions because their code says you got to be actively selling in none of these companies are actively selling their buying that run off business so members. As I say A. I. D. had no problem they did not object to this bill you've not heard from them to be against this bill and so I would appreciate allowing Arkansas to have the innovation to go after this business just like Oklahoma's done and have an opportunity in the very last thing you won't find any other transaction in the Arkansas insurance department that requires a circuit court approval for it to happen. It's the highest level of safety that I've ever seen in a bill that I run delayed with the Arkansas insurance department with that I'd appreciate a good vote thank you for your time. Senator Rapert as close for his bill what is the wish of the committee. Your your bill has failed due to a lack of a motion Senator Rapert well then hopefully the insurance department will go around and try to lobby a little bit harder because they simply have had no objections the bill so if there is a problem that I appreciate the committee talked to me about that because I guess chicken was on point of order for yes can we go to mix bill please wait Sir next bill thank you senator. That we will proceed on the Senate bill five ninety four Senator Dismang. Thank you Mr chairman. You're recognized members with this bill sets out to do is create a residential quality the create residential quality standards for ten load tenants landlords that those can be found on section a page two one through six I read through those quickly with you one thing I do want you to keep in mind that this is something that has never existed in code before is something that we've looked at doing for several sessions now there's always been a hang up there's not been an ability to get to something that was agreed to this bill is an attempt to do the best we can I believe to hear the concerns from both sides and and have some common ground I will say that there's some advocates that I worked with on this bill that you know again I couldn't come to an agreement on everything but I mean they told me that there's nothing in this bill that they're opposed to they're just things not in this bill that they would like to see and so with that I'd like to read through those so number one available source of hot and cold running water and available source of electricity a source of potable drinking water and sanitary sewer system and plumbing that conform to applicable building and housing codes in existence at the time of installation and functioning roof and building envelope and function functioning heating and air considered conditioning system to the extent the heating and air conditioning system serve the premises at the time the landlord and tenant entered into the lease in the rental agreement section B. allows the tenant to renovate the property I've had in my own personal experience or I've had my little brother been announcing part of the agreement was he was going to renovate the property and so that's what he set out to do section see required to the landlord disclose any defects that are outstanding in section a it also allows for a process for that to be signed in knowledge by the tenant prior to move in section D. at winds of the process for the. Tenet to notify the landlord of any day the defects there was some discussion in this section about whether not should be certified I felt as though that the ward certified protected protected the tenant because it ensure that was actually delivered to the landlord in addition to that if there's a different stipulation inside the contract on how the correspondence between a landlord and tenant to or to be a drive then it is allow for that process also explicitly allows the tenant in section any to install smoke and carbon monoxide detectors we had heard that that was an issue that landlords for preventing tenants from being able to do that because the holes or whatever may be that recalls from the installation so again specifically putting in code that those can be installed I will say that as far as in talking to some of advocates and I'll say you know on a personal level it was it was something I try to work through and that was it the requirement smoke detectors and carbon monoxide detectors when applicable be installed prior to and just to be honest I I could not find what we can get to an agreeable language is special in time frame and I've worked on this for about three weeks and that's like I said I've I've tried to put as much I can carry into the bill section G. prevents the landlord fright from having an agreement that tries to undo this law again there's some provisions in there if you're doing a rent to own those are you know specifically in this law but so it prevents a landlord from trying to write a contract that under this this act OR the provisions in this act in an age insures that this Code section doesn't relieve landlord from any stricter standard that might otherwise existing misspelled your county. and with that I will do my best to answer questions of by the way in the last into this bill something that was agreed to well that and I never found out the to the opposition to but that would related to the action for unlawful detainer forcible entry. And with that that the questions Senator Dismang has presented his bill are there any questions for Senator Dismang. Senator Elliot you're recognized for a question. Senate dismaying I I I will does pose the questions that folks have asked me yeah and city that there is no requirement that landlords provide smoke or carbon monoxide detectors the Senate is that a true statement is that not that is true so in the bill allows the the tenant to install a smoke or carbon monoxide detectors I mean I work through quite a bit of a language even on my own trying to figure out how to make that work and fees everyone in that you know maybe up that the some of the concerns that that could lead to an action in what it kept coming back to was there's only one time the smoke alarm works there's no way to guarantee that it's going to work at that particular time and that's when it detects smoke there were some other issues surrounding that if someone tampered with and it happens very often you know the tenant removing the batteries from that smoke detector or carbon monoxide detector whatever it may be utilizing for other purposes in the House never reinstalling you know the beeper always goes off and you don't want to about two o'clock in the morning and so there there was no way to run thanks I I couldn't find a way to make that work inside the language especially in time frame and that that we have or maybe somebody can help with that help give me an answer did it was there any discussion for example about at least when you rent it each time you get a new tenant that they would be assured that they have this is just my question not want somebody that there was a I work in a smoke or carbon monoxide detector I personally drip language myself trying to accommodate that could and I said I I could not get to an agreement on how that should be worded okay because of liability questions concerns. and then the next question has to do without and Mister chair I would get out of line and and that somebody else ask questions rather than to him all these at one time I think you're okay you're you're fine to go through all right and so the next one has to do with the landlord can retaliate against a tenant who ask for repairs or calls code enforcement no there's nothing in this bill that allows a landlord to retaliate against a tenant for that now and it my understanding there's I'm also an attorney there's common law and I think that's called construction constructivists in I think there's already some standards in place again I'm sure we'll have someone knows best yeah a lot more than I do but I do not believe again that it's not listed in this bill hi that that man that's what I mean what do soon somebody might interpret that to mean then is not in the bill then that a landlord could do that no ma'am okay and that's not something you'd see that's happened generally speaking this is something that I know of that's happened generally speaking there are bad landlords the State of Arkansas I'm certain okay it's not anything I'm personally familiar with this probably a good thing that you're not familiar with what I was told that yeah and other questions about not providing working locks no requirement that the landlord provide working locks working locks on the doors offer insurance policies if your landlord requires that you have you know working locks doors that sort of thing it was my understanding again it was all about the word what is working me others concerns about liability issues and again my I thought they were much more important pieces to this end this legislation that we get through and try to pass and so I'm trying to bring a bill that I hope to be passable if it doesn't go far enough or if these provisions are on in four or whatever may be I apologize but I'm I'm trying to find this does find a way to have a bill that does provide protections which I've. Leave this bill does And protections that this far as I know everyone agrees to. The and and I apologize maybe things in they're not but I don't want also jeopardize bill that doesn't go anywhere I'll just ask one more than if there people going to speak against let them cover anything else that the the other one that I have read real interest there's no requirement that landlords have to do anything about harmful molds or infestations of roaches rats bed bugs so forth. Well I mean I would tell you the ten X. groups when I was talking to them in an in kind of working through the bill that was not something they pressed to be included in the bill when we reached what I thought was hopefully something that we could present and again it didn't get as far as I'd like to to that was not an issue that they pressed out to you a couple reasons why at least from my understanding number one it's hard to control the mold in a house a lot of that is driven by attendance actions whether that be not turning on the fan not opening the door after shower or even in back to Sharon without a shower curtain or utilizing shower curtains often times if not most of the time mold is related to the tenants actions at least that's what I've seen in respect to infestations in those sorts of things one thing came to light in this process And father when we need to consider you know there there's a rat problem city little rocks my understanding I understand that there was a budget cut in which they stopped baiting the manholes which is led to that problem that matter where you live in the city you get a rat problem or potential have a rat problem and so where does that infestation come from how to determine that and as far as Roach invitation again largely that's due to ten actions at least from my experience and what I'm saying so that that's a difficult thing to write into law especially when the vast majority of times those are things that are the album come of a tenant actions. Thanks. Other questions Senator Hickey you're recognized just disclosure and of course I have the center Senate journal but I think it's appropriate as most people know what I do have a couple companies that own the quite a few rental residential rental properties thank you for your disclosure Senator Teague would you like to make the same disclosure yeah I don't have a. It's mean issue me does not have one I think it's so much disclosure form but okay I appreciate it thank you for your disclosure other any other questions for Senator Dismang we got a few people to speak on on and for the against the bill is there any other questions. We will start with you would like to speak against the bill in the audience I believe I have Caleb Alexander my. I'll let you introduce yourself Caleb. Identify yourself for the record and you may proceed. Yes Sir my name's Caleb Alexander McKinzie I'm a law student I'm also an advocate I'm also I'm the secretary of the Arkansas Parkinson's resolver communities I'm also an advocate for the homeless community here in Little Rock I want to apologize for having such a long name when I got married we should pick the new shorter one instead of two longer ones that's that's our fault. I also want you to reach out and say thank you to Senator Hickey because he is correct he did work with us in trying to to make some compromises and it's unfortunate that we couldn't get to a Senator Hickey I'm sorry Senator Dismang sorry for making those compromises it's unfortunate we couldn't get to the same place Arkansas is the only state in this nation that does not have a warranty of habitability we're the only state that does not require landlords to keep their domiciles the rentals up to a little standard and that's a shame we've been working on this for a long time to put that here and Senator Hickey arts Senator Dismang is correct I'm not used to testifying for the legislature to find. There there's nothing inherently in this bill that's in here that we oppose but there's a lot left out that makes this. NET promise to our tenants of a. There is nothing in this bill that stops a landlord for retaliating as we've or as as Senator Elliot was was kind of going out. Retaliating for tenants when they say Hey I've got mold there's a hole in my floor there is wind blowing through in the winter can you fix this no but you're welcome to vacate my premises I'm going to cancel your lease you're being affected there's nothing that stops them from doing that There is. Terms in this bill that. I would love to see a defined This bill says that says that there has to be a functioning roof and building envelope but it doesn't define what functioning is it doesn't define what an envelope is in my work one of the things that I do in my advocacy for the unsheltered community here in central Arkansas I help run an emergency warming centre I was one of the people that came out for a you know but we can have at the state fairgrounds this year I stayed there was one other volunteer in about a hundred people who stayed there that night. I've been doing that for about five years and every time we open a warming shelter I speak to people who say Hey you know you'll have this I say no I don't have that all man that stinks I could just go home when I you know I looking kind of funny and well if you have a home to go to why are you here. Because I'm paying rent for a place that this colder outside this twenty four twenty twenty two degree air outside is the same temperature as inside my home because there are holes in my wall there are holes in my roof and and I've asked the landlord to fix it and they won't I'm not living in much better conditions and homelessness Sullivan shelter tonight so I don't freeze to death that's that's a real fact not only here in Little Rock we've got teams that do the same thing And Russellville we've got teams that do the same thing And Searcy we've got teams that do the same thing all over the great state of Arkansas because we don't have a functioning warranty of habitability. Would love to see one but as you all know the same as I do a bad bill is sometimes worse than no bill at all. This bill also does not provide any recourse for our citizens who are renting other than to move out for a lot of people that's not a problem for people who can afford no very fine wrinkles who paid him up towards fifteen two thousand dollars a month that's not a big deal they probably have the resources income to move people that we're concerned about and the people who need this bill to be the best it can be the most are the people who are living in the lowest levels of poverty. They're the people who are struggling to survive and they're constantly having to choose between their health and homelessness and what this bill does is this bill allows a landlord to evict them and come to them and say Hey okay you want this fixed I can't do it you want to fix because of something that this bill lists well I can't afford to do it so I'm gonna allow you to get out of your lease and that's the only option that you have you have the ability the ability to break your lease and get out. We're talking about the lowest level of economics in our community we're talking about who who can afford first and last month's rent within ten days we're talking maybe we can afford under the posit we're talking to people who this bill doesn't give them the benefit of some other legislation under the house and seen that would say Hey here's a month's rent and a deposit back go find a new place to live. This bill drops them off. It says get out that's all this bill does and that's one of our biggest issues with it. Lastly in images or some other people who can speak more specifics of what this bill does as far as working with constructive eviction which is is a very big issue Ladies and gentleman this this bill is in this committee today. Because at the end of the day this bill is a consumer protection bill or it's meant to be. It's got to work as a consumer protection bill and the way that this bill works does not protect consumers it worked as an indemnification for bad landlords. It says to them. It in any other industry if a service provider or if the retailer or manufacturer came to this committee and said I can't afford to provide a safe product this committee would laugh the medical group and they say they would say you're you can't afford to be in this business then. If you can afford to protect your people you can't afford to be about this business for some reason we struggle. With the issue of landlord tenant law because we want to indemnify the bad actors we want to say you can't provide a safe product which is what it what it what a ripple is a product. That's okay we're going to indemnify you in low so that you can continue to act poorly and continue to mistreat and abuse the lowest members of our society and economic system. And continued should make them face the hard choice between the had their health the health of their loved ones to help their children and homelessness and with that I'll close again I want to thank you for allowing me to speak today and if anyone has any questions I'll be more than happy to answer. Do we have any questions for Mr mackenzie if I got that right yes Sir Alexander mackenzie delegate or any questions. Seeing none thank you for your testimony thank you Committee next let's go to the speak on the bill all caliber. Please identify yourself for the record Mr Calvert and you may proceed. It's a man's Paul Calvert thank you for chair thing committee So I'll in order to do for a living and I tried to be very lenient with my tenants I have a very large mix of different things I've got. Really cheap stuff and I've got some nicer stuff as well as Mr dismaying Senator Dismang mentions sometimes as landlords we have homes that need repair and so we will Will rent them out of the rent because someone is able to fix it or or whatnot and it's a blessing both for us as landlords and for the tenants themselves because sometimes maybe you've got a home you can route for two hundred dollars a month. to someone who can do their own repairs are the responsibility for that I think that's something that we really need to keep on the books because it's it's a blessing for both landlords and pretence. I think one of the one of the principles about the habitability issue is is such that if if if I'm purchasing a service which of the density of the service or a rental is a service if I go to a hotel and I get a room they give me the keys and I tell me the number and I go there I go one time a Roman twelve doesn't work well that's that's a that's a violation of what I was expecting right and so I should bill to go go back to the hotel desk and they'll give me my money back or they'll give me different room if they don't well that's a problem because that that was understood that's what I would get from a hotel room. but on the other hand if they if they tell me Hey I got this room over here that needs some work well it doesn't work in the shower doesn't work but you can have it for half price and so I think to myself we know what I can use the toilet in the lobby and I can take a shower the pool and since I don't have a bunch of kids running around that will be the inconvenience I may go ahead take the half price hotel room because of that issue and I'm okay with that I think that should be legal I think our Senator Dismang has has has allow that process to continue in this bill and I appreciate that I think we need. I'll ask you that because the the the concerns that Senator Dismang mention about smoke alarms yes tenants remove batteries they take them off the walls I had I had a couple County in the mounting. brackets in rent house the other day I think I had five or six mounting brackets for smoke alarms I think had just had one of them left up after tenant moved out and so it that is a problem they take him down the pool the batteries out whatever it might be. there was a mention about the selling sub sub Given out sub standard standard services well we we we also sell cars were allowed to sell a car is in disrepair with the owner or the person behind it is is. Is is a is allowed to take responsibility for that car that's in disrepair I think that similar to renting houses in this report are you know about it if your landlord hiding stuff from you that's a different issue. One other thing I'll and I'll I'll shut up I had the opportunity to meet with the a group there in Conway is the of a man there set up a meeting between landlords and tenants. And I was only landlord who showed up and I I feel like it was a productive meeting and one of the things that that came out of that is that we need to do a better job of helping tenants. To read and understand their leases and maybe even help them to negotiate their lease agreements. One of the things that that That that can really fix a lot of these issues is if we have better contracts that are that are more in favor of the tenants and and it because usually the blame or try the contracts and they don't and nobody challenges it so I think if we would have some maybe some is advocacy groups could could get some better rental contracts together the tenant can offer to their landlord one of the things that I offered while I was there at this meeting between landlords and tenants was I offered to help tenants look at their contracts and within about a week one of the tenants called me up and asked me to come look at it look a contract with I drove into town and met them at the at the rental office I read their contract for them. That was kind of cool I didn't expect them to do that and to ask me for that but I did it was kind of neat and I I look at the contract and I salute you look pretty generous by the landlord and so I said look this looks pretty good to me and I have and I I think it's landlord to do more of that we might Be able to have a little better relationship with the tenants and I think there's there's there's kind of this this Fighting between landlords and tenants let's get together let's let's be a little more productive in how we deal with this and I'll take any questions if you like okay are there any questions for Mr Calvert. Seeing none thank you for your testimony thank you we've got several others Nikki caning. To speak against the bill. These are done for yourself for the record and you may proceed. Disagreeing nine is it on yeah and my name is speaking and I lost my son to carbon monoxide poisoning in his apartment on February seventeenth. this bill would do nothing for him You know I'm not even sure that Alec knew that he had gas in his apartment and. I'm opposed because it predates the burden on the tenant You know at the very least carried the nav there be something and that we I need you to bring at a property. You know you have a form that you may need a carbon monoxide detector there is gas you know so that you know there's an informed tenant at you know I think a lack of awareness on carbon monoxide is a major problem and that's mine against the bill okay thank you are there any questions for Mrs caning. Seeing none thank you for your testimony thank you anybody for the bill. Against the bill a night yes. Trolled I can't read the handwriting. Please identify yourself for the record and you may proceed. Thank you Mr chairman thank you members my name is I. ninety straight deck I'm from hot springs village. As Paul mentioned he's a landslide I'm also a landlord I have the same property. Of for the last fifty years. In a neighborhood that has seen changes. I own a rounded center over fifty years. The thing that I know is neighborhoods need to be protected neighborhoods cannot the endangered it's extremely important for all of us to realize that crime drugs et cetera can come into a neighborhood when there's there's a flow of tenants in in and out in and out and there's no stability in the neighborhood. Neighbors to know that they have to be safe that they count on each other when you have a family that can't pay and the and the landlord says route you can. The mother and the children get out the children are taken out of school rules the parents of the mother and father leaves a church service. They had they perhaps have to leave their own ethnic community hi there lives are destroyed and they keep on going and down and down and down and the neighbor keeps on going down we need to protect neighborhoods we need to protect neighbors neighbors to know each other with the monument running of their the known to the right to go to school and back consider extremely important. And we as a state. Okay citizens as US government has to protect the citizens that's the most important duty. A state people in this state and as citizens to protect each other this bill does not protect the tenants. This is the problem and I appreciate you senator everything that you're trying to do but there are too many loopholes this is a bad bill it doesn't stand up for people and if we don't stand up for tenants we're gonna have neighborhoods that are going to be crime infested drugs gangs et cetera and it will be I filed as tenants as landlords as I mentioned I have a a property two family house. with all kinds of the people who lived in the last fifty years but I neighborhood is prior to the date that the people who live in this neighborhood are people who oppose the working class et cetera all of us lemonades get together and we support each other we watch each other's yards with somebody with your yeah I gotta keep things up. You have to keep things up and I don't think this bill. The tenants when the landlord can say you don't like it you can get out that's not what we want in stable community thank you any questions any questions. Seeing none thank you for your testimony thank you. And the last to speak a lan foster. Please identify yourself for the record and you can you may proceed. Yes Sir thank you. My name is Lynn foster. I'm a retired law professor at UA little rock and I'm currently the president of our Kansans for stronger communities. Chairman pitch and Senators thank you for the opportunity to speak today. And Senator Dismang I want to personally thank you for allowing us to suggest amendments to this bill I believe that this is the first time in history in the history of landlord tenant law in Arkansas the tenant representatives have been invited to the table and have been encouraged to submit comments and have been listened to. And I so wish that are non profit could support this bill. If it contained a few more of our suggestions we would be supporting it here today. But unfortunately I'm here to testify against Senate bill five nine four because it doesn't go far enough and if it passes I believe it will be used as an excuse not to enact a law that should be enacted. An implied warranty of habitability it's a law that's based on some very simple ideas. First a landlord has a duty to offer and maintain a rental unit that's healthy and safe. If the landlord doesn't comply with that responsibility then the implied warranty of habitability gives the tenant some meaningful rights rights like damages or injunctive relief a court ordering a landlord to make repair these rights are available to tenants in most states and as folks have stated we are the only state that does not have an implied warranty of habitability. in all of our neighboring states other than Tennessee the tenant has the right to repair and deduct from the rent within limits. This bill allows the tenant only one remedy no other state does that and so what that means is that there remedies under this bill are are flawed and they are inadequate. So under this bill if the landlord doesn't repair the tenants only choice is either to live with whatever the problem is or to move out and as someone else has already stated. If the landlord doesn't want to make the repair and I know that some of you it may be hard to believe that there are landlords out there who don't want to make repairs but that is the case there are such landlords I know no one in this room is landlord like that but believe me they're out there and you can read the You can talk to anybody in the AG's office and find out more about such landlords. An implied warranty of habitability is the enforceable promise enforceable by the tenant but the landlord will make repairs. And this doesn't give the tenant really any enforcement powers at all. In addition. Almost all the states prohibit retaliation against the tenant who asks for repairs or called code enforcement this bill does not and I I beg to differ with Senator Dismang. The law does not protect tenants from retaliation right now unfortunately take a look at the conversations on the Arkansas renters United Facebook page Mold and pests are the two aspects of bad housing that have the worst effect on ten and health especially children's health they are not addressed in this bill and and again I would differ just a little leeway with how our position on those was characterized I think as time went on and more and more of our suggestions were being dropped. It would not be to our mind unfair to simply require landlords to provide working smoke and carbon monoxide detectors at the beginning of the lease term and the tenant could sign off to that effect and then there would be no question that those had been supplied by the landlord and they were present. that would be a measure that would save people's lives. To those of you who believe that a true implied warranty would be an outrageous and unwarranted interference with the rights of landlords I would reply that we can learn from the laws of other states landlords do business they're quite successfully despite the fact that the law expects them to make major repairs and gives tenants meaningful remedies if they do not. Many of you have championed compute consumer protection laws this session when a landlord chooses to rent or residential property to the public that landlord is offering a product. Government regulates almost all consumer products now. For the safety of the public whether they be automobiles food or your child's or grandchild's favorite toy. And it gives consumers rights but when it comes to a person's actual home here we're willing to turn a blind eye and. Have a policy that simply states renter beware and that is neither fair nor equitable. I respectfully ask you to vote no on Senate bill five ninety four and I'm happy to answer any questions you may have are there any questions for Mrs foster Mr engram your Senator Ingram you're recognized. I mean it's a complex issue but just boil it down to something simple like you talked about smoke detectors and CO two and from the. Senate side of the or the the rental or side the we've heard testimony about batteries removed or they're taken down I mean is there something in an liability me you know the hero of liability and and we're we're all pay attention to that but is there something in particular or peculiar about Arkansas law that we have that these other states don't I mean it seems like the other states of I have found a way for just something as simple as a smoke detector or a CO two detector that that's doesn't seem to be an issue there and it does seem to be an issue here why here. Is there something per Q. you're about our code of our legal code that date that that they have more of liability concerns in another state would hate. that's a great question senator and one that I've often wondered about myself why we are so exceptional in this regard we have pretty limited tort law liability here in Arkansas and this bill would not expand that in any way and my advice to a landlord would be simply to have that tenants sign off at the beginning of the lease period that they agree the alarms are in place and they are working So at a I don't think that there's anything particular in our law that makes it impossible for landlords to do this there are other states that have you in much more tort liability for landlords and then we do and still require smoke and carbon monoxide detectors. Okay. Senator Hickey you're recognized for a question yes and miss foster I go I've been in the business for close to twenty years and of course pride myself on that run a good business I keep two full time employees multiple contract labor My wife goes over I heard somebody talk about the lease we go over our lease word by word line by line even have the the person's gonna live there to initial certain things one thing that we always ask also if you ever have any issues we want you to call us we want you to do it immediately because from my standpoint if you have a toilet leaking and you happen to be in one of our Parent being homes or to start your and being home I mean I can get to that quicker and we can get it fixed. Again twenty years of this and the one thing that we talk about continuously is why do these people not tell us that's that's the real world and that's that's the fact that happens and whatever these individuals moving in and you know when we do this you know thanks in the home they walked through the home are you talk about mode you know mildew Senator Dismang with it what he said. Was rattled what what happens a lot of time is Shower door will be left open somebody would not even put a a bath road down. You know seal get mildew mold whatever you wanna call it that's continuous. I heard you mention something about pests in those type of infestations whenever we do the have houses or whatever everything's fine as you know sometimes you can control how how people live but they'll bring in roaches that's just the just a common thing and then the landlord of course has to try to take care of it which we do I understand. But that that is a continual thing so there's how I don't guess I understand how you would guard against that then being the landlord's responsibility or something that's put on him whatever it was the fault of that individual that that came in there. So and and again this happens you know time and time again even even for landlords that do everything they can to make sure these things are correct. Well I agree with you this is definitely a problem and and the bill as it is would exempt the landlord from responsibility from any type of problem that is actually caused by the tenants so if your tenant is the cause of the mold or the cause of the pests then the landlord is not responsible for making those repairs now landlords are still gonna want to do that obviously good landlords will and and they may charge a tenant extra for doing that there's nothing wrong with that at all that's perfectly permissible and that's fair. But I would respectfully suggest that there's another part to the world and it's not a part of your landlord tenant world but none the less it is out there and I visited the homes of tenants who live in that world and if you read the case filed against a landlord in Little Rock by the attorney general's department you'll see that there are actually landlords out there who make promises to tenants when they move in that repairs will be made and repairs aren't made and they just aren't and it drags on and on and on and then finally the tenant. Saves up enough money to be able to move out and this is how those landlords make their money and this is really what laws like this are aimed against. Follow follow follow granted yes. One other thing I forgot we will talk about smoke detectors and and that that was the course our homes we we have a mall installed. It literally with my maintenance man they may go into change their condition filters because we do that also injured condition filters and will make sure that the smoke detector is a you know has a working battery touch touch a button do all that we can literally go back in the next day and they will they'll that have been removed the children may use them for their games somebody cooking or whatever the force I don't want to hear going off and they take a malt and we just over and over again so I hear what you're I hear what you're saying but. And I'm and I'm not going to say there's not bad actors on this the. But there's also some responsibility for the individual that's going in that's going into these homes to make sure that their contract was the way that it needed to be that that you know they don't move into that place you know based on some assumption assumption also so I mean where where is that responsibility and all this well it's it's in the bill the responsibility is on the tenant to the actually it's already law in Arkansas it's already in our code that tenants have to maintain the premises and not to do so is any Victorville offense even if you're still paying the rent so that's already law this is just kind of filling in the gaps on the landlord side but if you have a tenant who removed the batteries from a smoke detector obviously there's no way that you should be ever held liable for that at all. Hello if you if you get into a situation like that. And then the tenant says what we didn't remove the batteries. How do you guard against that if you've got the liability that you're supposed to be the one that's making sure that it's in working order and up because I can promise you. That happens multiple times it even even with us. Trying to educate you know would you wouldn't think would be would be a hard things and you get you need to have smoke detectors and you in your home or in and all these got to leave the batteries I mean it's just a things like that you know I hear what you're saying but I don't I don't I don't still sometimes it you give the thought or the or the what needs to go with the other way in which and what's truly happening so. Thank you ma'am thank you so much are there any other questions I have one question for you and it's going to come with a comment but it's a question also clearly this is a passion of you and the other speakers but in in government political work we very seldom if ever get the hail Mary pass I want to take that income tax to match other states Texas doesn't have one in our term down here many of us have have taken the seven percent income tax to this level under that level were not to where we want to be. Has your organization's thought about that this bill is the seven percent income tax down to the five point nine percent income tax and we keep working and working and working because I think that's a critical thing I've heard several of you and testimony say were not there so this is bad but but you hello open your testimony alluding to you have a Senator Dismang who did like nobody else and came to the table and try to get things that could pass as was stated earlier. I guess I would that might be the chairman's comment maybe I and with don't you agree so I'll leave that to you but that's one of the things I think is really a struggle is people want to get from a to the finish line in politics sometimes that isn't there so don't you worry I guess thank you for the opportunity to respond Yes that is something that we have struggled with as well I know that Senator Dismang has struggled with it and so do we but where we come down on is the essential elements that an implied warranty has to have to be useful to be workable so that so that it is an implied warranty and therefore of those and this bill has to but it doesn't have the other two it's got the nine waiver provision which was kindly added it's got the list of responsibilities which. We disagree with but again there's nothing we would take off the list we just add a few more things to it smoke alarms carbon monoxide detectors and it has to have another remedy other than moving out moving out should only be done in the worst of all circumstances but there has to be another remedy as well and then finally there has to be anti retaliation provision in here and and I understand about politics being the art of the possible and you know you have to start somewhere and and get to somewhere else but our concern is is just as someone has already stated that a landlord can simply throw up their hands and say well I'm not going to make those repairs and then the tenant has only the one choice that this bill gives them and that is to leave and that's not always a workable choice for attendance many times it's just not. Thank you. Senator Elliot you're recognized for a question. Thank you I just wanted to say quickly I'm in everything you know there are. Their extremes and there are people on on both sides of things I happen to have gotten a letter and not about this bill was another bill from our landlord who was angry and adamant for fear that I might vote for her a bill that he didn't much and his contention was. There are folks out there that who don't care about things in there druggies and all kind of really disparaging things. And that we needed to have some place for them and and that he was adamant he was not going to repair things for people like that because they would just stay anywhere. And so that led me to wonder how is it that the other states have come up you know with the warranty of habitability and who was that what what was the last state that passed such a law Alabama in two thousand seven. And so I can we not learn. I don't I don't understand why we can't learn enough from these other forty nine states and the last one to achieve it you know was all those years ago no eleven years ago or so and Forty seven point fourteen and and I just don't. What is it that's over the years that we've tried this time and time and time again what is it that holds us back every time since I've been down here we've been working on this. What is it is it is it just the fact that we. Can never get to a point that we want to put all four of those points of warranty of habitability that you were talking about I would say yes I would say the answer to that is yes and I and I would say that the the two groups that are opposed in the past have been landlord's groups and the Arkansas realtors association. Okay okay okay thank you. All right any other questions. Senator Hammer you're recognized for a question thank you in I want to assist you maybe Senator come to rest when it goes for but can the tenant filed a lawsuit against the landlord if they violate the contract. If you can answer that maybe just addresses or. I was very. Yes yes absolutely okay all right thank you okay thank you for your testimony. Senator Dismang you're recognized close for your bill. Thank you and thank you for the discussion I mean even you know even in the discussion that you had a generally brilliant idea about Amendment you want to go farther with it but at least notification that there's a you know carbon monoxide source in the in the property and that I mean I think there's there's work to be done there's demand I think there's lots of ideas to be had in and hopefully I have a strange feeling that I don't think your passion is going to go away so I think we'll continue to see this in two senator Elliots you know point we've been doing this for awhile and we've not gotten anywhere and I realize that this is not the end all be all but it is a significant step I believe in in one word or a dressing these landlords we we we all know in this room I think that there's one prominent landlord in little rock that were you know generally referring to that has caused a number of these issues you know for these tenants and really be honest the areas in in in in that sense one of the reasons we put the provisions in the bill that you know these these can't supersede more strict enforcement may be on the city or county level is because your hope would be that those municipalities who by the way have last county or not plus can but Little Rock for instance they know. Bayek entity name every single property that you rent which a listing now you pay in so much per property per year and so it's all register and hopefully that helps identify some of these folks that you know if they're not operating wondering House correct you know correctly and there's notification to the city that that's happening then they're they they know where else to go next so hopefully there's some you know things in place I would say in regards to The general landlord the last thing you want to do as a landlord is a picture tenet that is the most expensive thing that you can do as a landlord you want to do everything you can to keep that tenant happy keep them in place because once that addiction eleven you can guarantee essentially tricking was about half your rental income for that year typically because of the repairs that go up in in in place the fact that maybe it wasn't left in you know the condition that it was originally rented in in in in in that is a that is the most one or more costly events that you can happen so for a real landlord a good landlord that is the last thing you want to do you want to make sure you keep those folks in there as long as possible because that's really the only point you can become profitable if you're cycling people in and out of the property is never going to work that's a that's a short term a loss for you but but with that I do appreciate all the testimony I I appreciate the dialogue I mean there are things to do I think as we move forward I think this is a significant step in the right direction even though may not address all the concerns that are there and with that I'd appreciate a good vote. What is the will of the committee east of your member of the committee Senator Dismang do you wish to make a motion motion do pass we have a second. We have a second Senator Irvin all in favor of passing Senate bill up. Several of some discussion on the motion before revoked please yes yeah because you're recognized Barrett I am I'm going to be voting no on this motion not because I don't think that people haven't tried. But I just don't think we've tried hard enough I have lived in the worst of housing and I've lived in good housing. And it is inconceivable to me that Arkansas keeps coming in at the and at the bottom of things that we've been trying since two thousand seven to do for little things I'm I I don't mean little in terms I'm not important I don't mean it that way or that is not an important and maybe a big thing to landlords and I respect that. But the fear and I think it is a valid fear is certainly is for me. The fear is if it's taken us all this time to even get to where we are considering today how long is it going to take us to get to just add in the two other. Things that we need to have for the for issues of habitability how long is it going to take and and how why do people have to live like this if we're already doing it this is not going to hurt good landlords I don't see how it could possibly do it. Is like most of us do the right things by you know our our cars and we try to keep them up. Almost all of us do but there are laws out there about the for those who don't do the right things and and in this case that's only a car in this case we're talking people. And I am not of the opinion that if it's taken us all this time to get to to perhaps. That we're going to say when we come in the next session. well now we're going to get to the other two I'm ever going to get one more I just think we can do better than this and for for those of you who are landlords how's it gonna hurt if we do this. And we should not I don't think B. address and landlords one by one by two by two. I don't think we're any. Less capable of doing this. Then the forty nine other states thank god for bid. Alabama did it seven years before we can even get there in there the last one and I'm not disparaging Alabama but I believe we can be as good as Alabama. So I I just hope we don't do that don't past this. Okay. The chair has received a motion and a second. All in favor of passing Senate bill five ninety four police say aye. Same sign may. Sure is going to ask for a roll call. Senator Elliot. Now Senator Irvin. Yes. Senator Dismang. Yes Senator Ingram said now Senator Hickey. Yes Senator Hammer Mr chairman of a bank statement for a vote. For the record making disclaimer I do own two rental properties such as we'll meet disclaimer yes. Yes yes. Senator Teague no now. With the chair voting by your bill as passed five to four. We will move on to House Bill eighteen thirty four. So if you don't like the bad landlord that I'm hoping that you don't like the bad time share gas okay. That's that's that's the next bill yeah. Okay we'll let the room clear do you want to introduce their your guests with you there and we get started Sir Mister I somebody's going to help present the bill here today please identify yourself for the record and then you everyone of you may begin. The committee vote and I'm just give a real quick overview because they're not as well versed in our way and we're ready to go home this bill give um realtors Commission additional forty over the persons in that increases awarded Attorney General prosecute internal attorneys to hopefully curb with non eliminate schemes related to time shares then I'll and kind of go through some the scenarios that are out there. Thank you senator Dismang thank you Mr chair members of the committee. This bill is focused on the secondary market in time share as opposed to the primary market secondary market being persons who own time cheers are often contacted by individuals or companies that want to meet with them to help them get rid of exit what have you their time share and they set up a meeting and they these people are from out of state and the and there's some reasons for that but they came in to Arkansas they'll meet him at a restaurant or at a hotel that scares the heck out of them telling them how this time here's going to ruin their life it's going to ruin their children's lives they need to get out of it to a person figures together forum and they wind up paying thousands of dollars the I guess the best example. I retired first of all I am here as a private citizen I retired from the real estate commission in February twenty twenty so I quite a bit of quite a few years with the real estate commission thirty years so that's where my experience comes from on this. But the I went back to the commission to testify on the hearing in December twenty twenty there were two individuals at a ripped off for eleven thousand dollars each at a restaurant less than two miles from here by one of these schemes and two thousand eighteen and there's another one this pending before the commission where an individual's was ripped off for five thousand dollars now. This is targeting scales we need a good secondary market so we're not trying to eliminate the secondary market four times years we need to help the market but so to have a healthy market you have to eliminate scandalous activities so the legitimate players can come in and running a decent business and I'll be glad to take any questions thank you okay Senator Ingram you're recognized for a question what we see these ads on TV all the time in our they're they're their legitimate companies to try to extricate people out of time shears that are bad the wheels are they just wanna tax years correct but these are the the the fraudulent ones that you're talking about that's correct and I will tell you their over the years when I was there at the commission we had about six hearings where we took some action on these but the leverage with the commission is pretty light and this bill with attempt to. Address some of that but These individuals who are running these scams they are they are not good business you know it's. But there are some out there but we need to eliminate the scam so they can do better and improve the image of the business. Thanks guys. Okay are there any other questions. Seeing no questions is there anyone to speak for the bill against the bill. Senator Dismang would you like to close for your bill. I'm close Senator Hickey seasonal present president tomorrow the production. Move for what. Hi motion do pass we have a motion do pass. And I have a second. I have a second from Senator Hickey all in favor of passing house bill eighteen thirty four police say aye. Same sign opposed eighteen thirty four is passed we're going to continue moving committee members I have two people in the room need to present their bills we're going to plan is to skip over H. B. fourteen sixty seven Wardlaw but Senator Irvin you're up next. We have center Davis in the room as well. And we're passing out an amendment on Senator Irvin spill. Yes we're doing Senate bill six oh two. Does everybody have the amendment we still passing it out. Perhaps Senator Irvin you can explain your amendment and they'll get it before we vote the time to look it over thank you members Senator Missy Irvin and district eighteen and I have with me I'll let them introduce themselves for the record on this law and I'm happy to grant explained the in the thread with the Arkansas insurance department a managing attorney at the department. Thank you for waiting wait I'll go ahead. When the line Osborne I am a committee on special advocate and I have a craniofacial anomaly myself okay. Wait a minute to we get the. Amendment front of all the members. C.. Thank you let's let's give in just a second that's quite an amendment. Happy to explain the amendment yes feel free to begin I think we can multi task thank you Mr chairman my name is bill three and as a prisoner dues myself I'm guilty of the amendment real quick I can the first part of the amendment change the title or the subtitle and subchapter to perfected its canal going to be called women's craniofacial Law craniofacial coverage so that was so that it will be easier to find and to be named after miss Osborne here who's been a leading advocate for craniofacial coverage. Section three of the amendment makes an exclusion for dental insurance or vision care our of our I have insurance we don't intend for this act apply to dental insurance only for our vision care policies only so we want to exclude those. the rest of the parts of section three are just to make the the original bill sound more logical into up to make it more logical and currently make more better rhetoric more like better language the city. The of on page two it's deleting lines and requiring of funds Page three or four of a procedure for approval by a specialist to work on craniofacial Children to make sure that they get within two working days approval from just click click click of craniofacial surgical teams for a non urgent case in for an urgent case twenty four hours from the request when we explain the bill I'll go over how these craniofacial patients are covered under our law but essentially for families and patients who have a craniofacial abnormality or dealing with those they have to go through surgical accredited surgical teams in Arkansas we have to accredited surgical. The Committee teams one only for adults and one of the problems that we're seeing is is that when the families and patients go through these teams there were there were having to wait too long for procedures to be approved and so we added the required a being at least reviewed and approved within to work two working days for for non education twenty four hours for urgent case. The last the last part of the amendment as I indicated we only have two accredited teams and there is a need for our families to go out of state sometimes when we are two teams get too busy so it's going to allow the patients to go outside the State of Arkansas to get claiming a craniofacial coverage without any out of network charges. That's essentially the summation of the of the I need to interject there is only one currently on special teams in the state of Arkansas for adults are now but we don't have one for it all so we've got one not to I'm sorry okay. Senator oven you that we have a motion motion to adopt the amendments we have a motion to adopt the amendment do we have a second I have a second Senator Ingram all in favor please say aye. Same sign opposed your amendment is adopted thank you members of the committee and I'm you know it's really and honor to sit here and to present this bill has been a lot of work lot of work on on this issue in this bill by a lot of different people and actually miss Osborne who's here with me today to you'll get to hear from and then also these ran with the insurance department there's just been a tremendous amount of work also when I think the insurance companies and some of the others that really helped us as well and in the bureau so it's it's been challenging to try to work through this issue but as you know that this is a real issue that our families are facing and dealing with particularly when you have cleft palates and those types of issues you know you you you have some some serious things going on with different patients and for children that are born with spina bifida or different class palate abnormalities if it can become a very very big challenge for these patients particularly and then just trying to feed themselves enough feed themselves and drink them so the quicker that these procedures can be done and the better for everybody all the way around so that's what the bill really addresses is just to try to get those approvals in place and then to understand and realize we're a small state we may not have this expertise always available here at the state of Arkansas to address the needs of our patients and so they're going to have to sometimes travel out of state to get that specialized care CPAS perspective actually with our surgical and expertise and so it's it's a these can be very very very difficult and complicated procedures that are ongoing so I'm gonna turn it over to this Osbern and let her share. Her passion about this and as someone who I've I've gained a lot of respect for. Miss all their first off I want to thank you all for allowing me to state and Senator Irvin and I I have an awful lot of respect for her and a friend of ours with him in the past I first brought this to Are to the capital that in two thousand and three it took me ten years to get it passed and then in two thousand and fifteen we had to come back in because of the loophole is all the state agencies in that so we did that now You know that you don't always get everything done the right way the first time around I grew up in Ashdown Arkansas it is down about sixteen minutes sixteen miles north of Texarkana which we call to town as we grow up down there I was born at the airforce base in Sherman Texas which is no longer there and I was diagnosed at the age of ten months at Lackland Air Force base with Carney on the top is still displayed here supposedly on the sixteenth cases in medical history with that. My former TCP is mark cancer and he was my PCP for twenty plus years and he helped to we did out there is a occur A medical researcher he doesn't want to go to college a doctor without saying that because he's not a surgical doctor anything that only studies my condition and so the blood work and all about that mark canton did on me the other ten fifteen years ago Let's submitted and to that I actually do have pretty on the top of cell dysplasia and adds up today in the world there's cast it right at three thousand up my conditions party on the tapes karti on the top the cell dysplasia if you saw the movie mass questionnaire in nineteen eighty five that's basically the same exact disease Ark rocky had cardio die after sealed moneys Carney on the top the seal just very few differences between the two. There are rail is very realistic movie if you would like to watch it I can't watch it because it's too realistic anyway so. There are issues with my current law there are a few flaws we need to fix and we need to hear it up to make sure that people that have. They have acquired conditions that are not exactly crying and labeled as craniofacial anomalies are not allowed to get services rendered under my law. But then also as Missy was saying with my condition I have a team in Dallas Texas Dr Jeffrey fear on the world renowned he had I am one of six of his patients with Carney on the top of still dysplasia you're not going to find a doctor of craniofacial doctor with that many of my condition. As far as being able to go out of state that is very important because we have two hundred accredited craniofacial teens in the states you would think oh well that's good that means every state has to no no no these type of specialist travel and they congregate in metropolitan areas like Dallas has like six New York City has white seven. Thank you has one. See I don't have one get out that's just what they do and I was very fortunate to have Dr call Tennessee I'd be my secretary and back when I was in high school and early college and he is not from Paris France he is the father of the record craniofacial anomalies as well as the father of the reconstructive surgeries my current craniofacial surgeon in Dallas trained under him several years and he's been doing craniofacial procedures for over thirty years and so we're not always seeking to get these amendments added I went to Dr Fearon and I'm a real it's real common for me to introduce patients to doctors here on and I do that by email and I introduced them a bit after I interview so I dropped off because I don't want to know what's going on in Infosys hip well I did the same thing with Missy and first and then my buddy Lance Eads who is also a senator we went to college together and introducing them to doctors here on and vice versa. it is for him to at least tell me here on the issues that we were having an issue would you please just you know give a brief scenario of cardio section when I lease and the complexities of treating craniofacial anomalies except for a and so I think that I hope that that was helpful fifteen years of craniofacial anomalies you can take one step forward and five steps backwards and when you go to a craniofacial team okay you said there's two hundred okay in the country the thing is is that not every craniofacial team is going to know things about every craniofacial anomalies I mean we have thousands of thousands of different kinds including unknown an undiagnosed. And and then we also have a lot of patients who have multiple craniofacial diagnoses so it gets complicated and But I want to say this and I have to say this because. Growing up my parents fought it took them six years to find a doctor who would even look at me because back in the sixties and early seventies doctors did not say I don't know like they do now so it is very important that we understand. The what we have to win the fight and I have families all over this country that I know personally what we have to fight against we should not have to let the parents or the patient like myself. Be so stressed out about fighting with insurance companies okay. Growing up my parents had to constantly defend insurance companies after a kill those twenty two with that. This I don't know my age I did graduate from high school in nineteen eighty four I'm not ashamed of my condition my age because the doctors told my parents when they diagnosed me that I would not live to the ten and I would never Walker I think I want pretty good well and I'm going to be fifty five and a couple of weeks so I'm not ashamed of that so you just need to know that back in that time my parents and and and then I after I started taking all their in my early adulthood. All all the way up to now. Is that. People think the surgeries we have the insurance companies come back out of the state this is cosmetic this is cosmetic this is cosmetic well I'm gonna tell you I had a bilateral craniotomy January thirty first on my dad's birthday in two thousand and seventeen in Dallas Texas under Dr Jeffrey fear on it Dr David Sopko a pediatric neurosurgeon. And. At. This is not normal. My bones I'm sitting here in front of you at fifty four and three quarters of year all my bones are still growing that is the nature of my condition what those those are doing the growing growing growing and if you watch the movie mask you'll see this the you don't see the bones growing that you'll see the ramifications of that they put all the pressure on your nerves in your bones anything in your head so let me give you this scenario missiles were let's make sure we stay on the bill because we got a member's got three hour drives home yet tonight so just a photo ID say that what it does is it if I had not had that surgery in January of two thousand seventeen my doctors told me that I probably would not be alive five years later so my point in telling going to this is that. These are not cosmetic surgeries so every the amendment that we have on here there is a reason why we need to have this I sought out with my audiologist I start out with masks contacts color of liens our guys Clerk leads contacts I had them tell me what to how we need to work things in here so I wanted you to know that I did not just do this on my own I sought out the professional to deal with these individual stocks okay thank you so much all right yes thank you Senator Irvin do you are you open for questions yes okay members we have questions for Senator Irvin. Senator Elliot you're recognized. It's a quickie is not a question but I'm just glad to see you again when the wind doesn't know that you're still fighting at this and I just applaud you for keeping keeping going because I remember when we started trying to get something done it was really tough so congratulations thank you callous okay I'm sorry Senator no that's okay I just know that that's there's a lot of people get Nancy at this late hour so there other late we if there any other questions for anybody who would like to speak against the bill for the bill Senator Irvin would you like to close for your bill I think you've heard a great explanation and again it takes a lot of courage to do what she does and to be here with us and to be an advocate be so present and visible and just Preciado I make a motion to pass we have a motion as amended at yes do motion to pass as soon as as amended do we have a second Senator Elliot. it is been do pass as amended on Senate bill four eighty nine no six oh two skews me Senate bill six so too do pass as amended all in favor please say aye same sign apposed your bill has passed congratulations thank you for the testimony Mrs laws or. Okay we're going to move quickly to Senate bill four eighty nine Senator Davis. Senate Amendment on that. The Amendment on this is already been engrossed and Senator Davis you are recognized to be picky. Sir David you're recognized to begin so thank you as chairman at Breanne Davis state Senate district sixteen. And this bill and is the bill that was originally filed to let just like house bill sixteen sixty two which is now ACT four oh four and there were amendments that had to be made and on the back in just to and make sure that and they can comply with them what really they're just technical so it's to help the public service commission prepare for Filene's and and so all the different parties involved started discussing these issues and while we were passing and house bill sixteen sixty two and so all the parties are fine as issues as they prepared for the compliance of the formula rate plan and and we have people here that can answer questions or speak to the amendment and but this is really just meant to be clean up and technical in nature I'll take any questions are there any questions for Senator Davis. Recognition I understand is all the underlying language is is that from the other bills that you ran. So this isn't new to this to this bill is that what you're saying. Yes like there is some new language in it but since we. Did it ever finished running and this bill originally there is that language that's already been passed that was exactly similar in it And H. B. sixteen sixty two but then there is some new language that we amended and engrossed into this bill. Okay so most of this is already passed. You don't know exactly where those the new language is the as much as I yeah I mean is that a whole bunch your so and it looks like a bunch and and I can probably just text you the amendment right now honestly to. There if you live it's engrossed in their you might also mention the I do happen to know this bill is quite quite a lot of work and the people. This agreed upon man yes so all the parties are either neutral or positive there's no known opposition public service commission is thank you is supported here's a copy of the. Amendment and so the industry's the hospitals universities the federal a federal agency group they are all either neutral or positive for this bill I understand that she's doing thank you your your your good okay any other questions for Senator Davis. Seeing none is there anybody to speak for this bill. Against this bill. Senator Davis are you close for your bill I'm close and ask for a good vote on this late Thursday afternoon what is the will of the committee. I have a do pass from Senator Dismang a Senate second from Senator Hickey all in favor of Senate bill four eighty nine please say aye. Same side opposed your bill has passed Senator Hammer you sent me a text I told them earlier we weren't going to cover that are you good to wait till two thirty on a run that. Wait till Tuesday thank you very much. With that members you have them at your discretion with that members you have an excel sheet we will move Senator Hammer on