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Capitol News Update     

 

September 30, 2013


 

            Rep. Gus Blackwell requested an interim study on the common core standards for math and English for Oklahoma schools, and the study began last Tuesday.  There were three speakers, one from California, one from Arkansas and one from Massachusetts.  All three pointed out weaknesses in common core, but the one that caught my attention was Jaime Gass of the Pioneer Institute, a Boston think tank. 

 

            Gass reported that, in the Massachusetts Education Reform Act of 1993, the state crafted the "Grand Bargain" where additional funds would be provided in exchange for reforms that included statewide standards and testing for students and teachers.  The 1993 act also created charter schools that were required to meet the same standards and testing as the regular public schools.  According to Gass, Massachusetts since 2005 was number one in every grade tested and every subject tested. If Massachusetts were a country it would be tied at the top of the world. 

 

            Pioneer Institute compared Common Core to states with rigorous standards like Massachusetts. Its study found Common Core standards were significantly lower in quality to high standard states. Cost projection nationally for Common Core is $16 billion for states and localities including costs for text books, testing, technology and professional development. Gass says Massachusetts will spend $360 million on Common Core for lower standards.

 

           I don't know much about these experts or their organizations, but what they had to say is worth thinking about.  Lots of smart people worked on these standards, but one has to wonder if they got it right.  I think Oklahoma passed common core in order to compete for federal Race to the Top funding that we didn't get, so we're not obligated to stay on this track. 

 

            It's hard to figure out who is right in this debate.  One thing that wasn't said in the study:  In 2011 per pupil expenditure for schools in Massachusetts was $13,941.  In Oklahoma it was $7,587.  There are probably multiple reasons why Massachusetts students test well, but investment in education has to be part of the picture.  

Certificate-of-merit law questioned

By M. Scott Carter

The Journal Record

OKLAHOMA CITY - A new state law that requires an expert to certify the worthiness of a professional liability lawsuit could force some plaintiffs to hire two experts just to get their complaint in front of a jury, an Oklahoma City attorney said Monday.

With the ink barely dry on the Legislature's massive rewrite of the Oklahoma tort system, some attorneys are targeting a law that requires a certificate of merit for professional liability lawsuits, saying the law is unconstitutional.

Written by Senate Pro Tempore Brian Bingman, R-Sapulpa, and House Speaker T.W. Shannon, R-Lawton, Senate Bill 1 requires a certificate of merit to be issued before a professional liability lawsuit can be filed in Oklahoma. Of the 23 bills passed by the Legislature during the special session, SB 1 was, by far, the most controversial. The measure passed the Oklahoma Senate on a 33-11 vote and cleared the House of Representatives 51-36.

Unlike other 22 bills in the tort package, Senate Bill 1's emergency was defeated. Measures with emergency clauses go into effect immediately. Without the clause, opponents of Senate Bill 1 have 90 days before the bill can go into effect.

The tort package was praised by the Oklahoma State Medical Association as a way to keep medical costs down.

Oklahoma City attorney Jerry Fent, who has successfully overturned several state laws on constitutional issues, called Senate Bill 1 the Attorney and Expert Welfare Act.

"Oklahomans will be required to pay extra for any negligence cases to be filed," Fent said in a statement to The Journal Record. "(The requirement) will be a new source of revenue for the attorneys and experts in the state."

When negligence is alleged, Fent said, it will result in a huge income increase for attorneys and experts and have the same huge costs for the common Oklahoman.

Fent said even small claims actions in negligence cases would require a certificate of merit before they could be filed.

Fent isn't the only attorney concerned by the measure.

Bob Sheets, a shareholder of the Phillips Murrah law firm in Oklahoma City, said the new law could result in extra costs for plaintiffs - paying for one expert for the certificate of merit and another expert who provides testimony on the case.

Sheets said the expert's opinion about whether or not the case had merit was not admissible at the trial. The certificate of merit, he said, can only be used to file a case.

"I can see an instance where a person would need one expert for the case and then the plaintiffs would have to have a second expert for testimony," he said. "There is also the question of can the same expert offer two opinions in a single case."

Sheets said he also questioned language in the law that required a qualified expert.

"What is a qualified expert?" he said. "I didn't see it defined. We have lots of fights in court about whether or not an expert is qualified to give an opinion. Those are almost routine motions."

The Legislature's Republican leadership and Gov. Mary Fallin have touted the tort package as a way to make Oklahoma more business-friendly and keep the cost of health care from skyrocketing. But plaintiff attorneys say they are studying the measure to see exactly how the new requirements will change litigation in Oklahoma.

"Personally, I think the judges do a good job of policing frivolous litigation," said University of Tulsa law professor Marguerite Chapman. "It's very difficult to be a plaintiff's attorney in medical malpractice. If an attorney doesn't do a really thorough job of preparing and investigating the case, then ensuring they have the right evidence, that attorney is going to go bankrupt."

Years' worth of changes to the tort system, Chapman said, have pretty much shut down the ambulance chasers. She said laws such as the certificate of merit and, indeed, big changes to the tort system haven't done that much to reduce medical costs.

"I'm not convinced that tort reform has lowered the cost of health care delivery," Chapman said. "I think we're in a climate where a liability case has to be an overwhelmingly strong case to succeed. I think that as a result of different generations of tort reform, the standard now almost has to be gross negligence before an attorney will even take the case."

Study questions cost reductions from tort system changes

By M. Scott Carter

The Journal Record

OKLAHOMA CITY - Recent changes to the state's tort system, touted by lawmakers as a way to reduce medical costs and keep physicians in the state, may not do that much to actually reduce costs, a study of a similar law shows.

Published in the Journal of Empirical Legal Studies in July 2012, the study examined a 2003 law that changed Texas' tort system. In the report, the authors said they could find no evidence that Texas' tort law changes bent the cost curve downward. The study also noted, though, that it did find evidence of higher post-reform spending by Texas physicians who practice in high-risk areas.

As far back as 2004, Texas' efforts to change its tort system were touted by supporters of a similar effort in Oklahoma as an example of legislation that lowered health care costs. In February 2004, the group Oklahomans for Lawsuit Reform brought Texas Gov. Rick Perry to Oklahoma City to help push the effort here.

In 2009, after the passage of their initial package of tort changes, former Oklahoma House Speaker Chris Benge said Oklahoma's legislation would change the economic landscape of the state.

"(The bill) will say to companies that we welcome their business in Oklahoma," Benge, R-Tulsa, said. "The days of Oklahoma being known as a jackpot justice state are over."

But four years later, the Oklahoma Supreme Court ruled that the 2009 legislation violated the Oklahoma Constitution's prohibition against measures addressing more than one subject. On Sept. 3, lawmakers returned to the Capitol in a special session to solve the problem by breaking the 2009 legislation into 23 separate bills, all of which passed.

Yet even with the new laws back on the books, the tort package may not do much to actually lower health care insurance costs. According to the Texas study, there is little evidence that tort changes actually spawn lower health care costs.

"Recent state-level studies find no significant effect of tort reform on health care spending. Others find a modest 1-percent to 3-percent drop in health care spending," the study indicated. "One early study finds a 4-5 percent drop for heart attack patients. This accumulation of recent evidence finding zero or small effects suggests that it is time for policymakers to abandon the hope that tort reform can be a major element in health care cost control."

Conservative lawmakers, however, said they were convinced that the new laws will improve Oklahoma's health insurance and business climate.

"This Legislature, after a short five-day special session, has undone the damage a handful of activist judges, or some might even call a 'super legislature of judges,' attempted to do to this state," wrote House Speaker T.W. Shannon, R-Lawton, in a column sent to The Journal Record.

The new laws would reduce the number of frivolous lawsuits that were bad for the state's economy, Shannon said.

"Frivolous lawsuits hurt hardworking families and are one of the primary causes of skyrocketing health care and consumer product costs. When a business or medical provider is forced to pay damages or settle a frivolous claim, they don't just take a loss, they pass those costs on to consumers," Shannon wrote.

However, while the study's authors acknowledged that changes in the tort system did lead to lower medical malpractice insurance premiums, those costs, they said, represented only a small fraction of health care spending.

"Because direct costs account for a small fraction (likely under 1 percent) of health care spending, a drop in direct costs has limited potential to make health care cheaper," the study said. "Even a 50-percent drop in direct costs will reduce spending by less than 1 percent - and the states that have already adopted tort reform have captured most of these savings."

Shawnee attorney Terry West said the effort behind changes in Oklahoma's tort system had several goals, including one to insulate corporate America from liability.

"We've been in and out of tort reform for 10 or 12 years," West, a plaintiff's attorney, said. "And they have done basically what they set out to do, which was insulate corporate America from individuals and they have succeeded to a great extent."

West, who twice served on the state Judicial Nominating Commission, said supporters of the tort reform effort also seek to make major changes in the judicial branch. Those same groups, he said, are now trying to control the judicial system.

"They've got control of the legislative process, and the executive process and now they want the third branch of government," he said. "And to me this is the biggest crisis we face. This is the basic fundamental fabric of our society."

Fred Morgan, CEO of the The State Chamber of Oklahoma - which spearheaded the effort to change the tort system - countered that the new laws were necessary for future growth in a media statement emailed to The Journal Record.

"I applaud our legislative leaders and governor for recognizing this important need to reinstate lawsuit reform and working swiftly to address it in special session," Morgan said. "These bills, just as the law did in 2009, will help reduce frivolous lawsuits in Oklahoma, allowing businesses to grow and health care costs to remain affordable."

Workers' comp law hearing reset

By M. Scott Carter

The Journal Record

OKLAHOMA CITY - A court hearing originally set for mid-October has been rescheduled until Nov. 14 for a legal challenge against a law that changes the Oklahoma workers' compensation system.

Oklahoma Supreme Court referee Greg Albert will hear the initial arguments in the lawsuit by state Sen. Harry Coates, R-Seminole, and state Rep. Emily Virgin, D-Oklahoma City. The lawmakers and the Professional Firefighters of Oklahoma filed the lawsuit to overturn legislation that abolished the court-based workers' compensation system and replaced it with an administrative system.

Coates said he filed the lawsuit because the new legislation was unconstitutional and created an unworkable system.

"As a longtime businessman, I recognize that it's necessary to have workers' compensation rates as low as possible," he said in a media statement. "In fact, I believe we need a workers' compensation administrative system."

Coates said it was wrong for a firefighter or other injured worker to be forced to pay back workers' compensation benefits after returning to work.

"This is just one of many problems with this new law," he said.

Like Coates, Virgin said portions of the bill clashed with the Oklahoma Constitution.

"There are many issues with the bill and they are not necessarily based on the policy," Virgin said. "But it's just a badly written bill."

As an example, Virgin said the measure left too many terms undefined.

"That will violate an employee's due process," she said.

In their brief, both lawmakers wrote that the new law presented constitutional questions of overreaching importance that require the Oklahoma Supreme Court's attention.

"It was the Legislature's intent for statutory benefits to flow to the injured workers and their dependents in order to afford them to afford a living and prevent them from becoming public charges," the lawmakers' petition stated.

To address the problem, an industrial bargain was created that required employees to give up their common law negligence claims in exchange for guaranteed medical and wage benefits and required employers to give up their common law defenses to receive reduced exposure to liability.

"Unfortunately this grand bargain of the 20th century is not so grand anymore," the petition stated, "especially for the injured workers."

Business organizations and supporters of the bill criticized the lawsuit, calling it an attempt by trial lawyers to overturn the will of the people.

"We firmly believe the workers' compensation reforms passed by the Legislature this year are constitutional," State Chamber of Oklahoma President Fred Morgan said. "The people of this state deserve a workers' compensation commission that meets the needs of injured workers and their employers, not the needs of trial lawyers. The elected members of the Legislature and the governor overwhelmingly approved the shift from an adversarial court-based system to an administrative system and we are confident these reforms will be upheld."

Because of the new law, Morgan said Oklahoma businesses have the potential of double-digit savings in their workers' compensation insurance.

"It's imperative that these reforms be allowed to succeed," he said.

Republican Gov. Mary Fallin, who initially called for changes to the workers' compensation system, said she was disappointed by the legal challenge. Fallin, who signed the legislation in May, said Oklahoma's workers' compensation system has been one of the most inefficient and expensive in the country.

"Senate Bill 1062 completely overhauls our flawed workers' comp system, dramatically reducing the costs to businesses and freeing up private-sector resources that can be invested in jobs rather than lawsuits," the governor said in a media statement. "Additionally, our reforms ensure injured workers are treated fairly and given the medical care needed to return to work. This is an important pro-growth policy that will help us attract jobs and build a stronger and more prosperous Oklahoma."

Fallin has asked the court to move quickly to decide the case.

Virgin countered that the law, like other reform measures that have passed the Legislature, clashes with the Oklahoma Constitution's prohibition against legislation that contains more than one subject.

"There is a really strong argument against it because of the logrolling issue," she said. "I think that we have a good case, especially in light of the fact the 2012 bill failed."

Virgin said the argument that the Oklahoma Supreme Court was now narrowly construing the constitution's single-subject rule was wrong.

"They've been hammering us on the single-subject rule since the 1990s," she said.

Report ranks Okla. 48th in nation for women

By Tim Talley

Associated Press

OKLAHOMA CITY - An analysis of how women are faring across the nation ranks Oklahoma 48th among the 50 states based on performance in categories such as economics, leadership and health.

The report released Wednesday by the Center for American Progress, a Washington, D.C.-based nonpartisan research and educational institute, ranked each state on 36 separate factors, including the number of women living in poverty, women reaching leadership positions in the public and private sector, and their access to health insurance and health care.

The report says Oklahoma women suffer from the third-highest maternal mortality rate in the nation. That means women in Oklahoma are more likely to die from pregnancy-related medical complications than women in 47 other states.

The report, entitled The State of Women in America, also says Oklahoma is among the 10 worst states in the nation in terms of infant mortality. Across the nation, the state has the second-lowest ratio of obstetrician gynecologists to the female population, with only one for every 18,713 women.

Maryland was ranked first overall in the nationwide analysis. Utah was 49th and Louisiana 50th.

A spokesman for Gov. Mary Fallin, Oklahoma's first female governor and one of only five female governors in the U.S., said the report indicates that significant improvements are needed in women's health. But the state has made strides in becoming a place where women can thrive in leadership positions in both the public and private sector, Communications Director Alex Weintz said.

In business, women make up almost 50 percent of Oklahoma's workforce, and there are more than 84,000 women-owned businesses in the state, Weintz said in a statement.

"In the public sector, Gov. Fallin herself stands as a testament to the idea that the glass ceiling has been broken in Oklahoma politics," Weintz said.

He said Fallin also has a female chief of staff and two female Cabinet members and that 20 women serve in the Oklahoma House and Senate. There are 13 spots on Fallin's Cabinet and 149 elected lawmakers in the state Legislature.

Jill Nobles-Botkin, administrative program manager for perinatal and reproductive health for the state Department of Health, said the report highlights health issues that the agency has targeted, including reproductive health and access to health care.

Last month, the Department of Health reported that Oklahoma's infant mortality rate had declined but remained above the national rate. The infant mortality rate declined from 8.6 per 1,000 live births in 2007 to 7.9 per 1,000 live births in 2012. The national rate of 6.15 per 1,000 live births was recorded in 2010.

The agency also reported that the state's rate of smoking had dropped to a historic low, but Nobles-Botkin said traditionally high smoking rates have been a factor in reproductive health.

She said one-third of women in the state who became pregnant reported smoking prior to their pregnancy and 18 percent said they smoked through the last three months of pregnancy. Smoking during pregnancy can result in low birth weight, premature birth and high rates of respiratory problems following birth, she said.

The Centers for Disease Control and Prevention reported that 23.3 percent of Oklahoma residents smoked in 2012, down from 26.1 percent in 2011. Oklahoma ranks 39th in the nation for its rate of adult smoking, down from 47th last year.

Report: Oklahomans can access 53 health care plans

By Tim Talley

Associated Press

OKLAHOMA CITY - Oklahomans will pay less than the national average for health insurance under an exchange scheduled to open next week as part of President Barack Obama's health care overhaul, according to a report Wednesday by the U.S. government.

The report by the U.S. Department of Health and Human Services projects that monthly premiums in Oklahoma will range from $266 for one type of plan to $174 for another before subsidies are applied. Rates will range from about 20 percent to 30 percent below the national average for plans outlined in the reports.

Dave Axene, a fellow of the Society of Actuaries, an educational, research and professional membership organization based in Schaumburg, Ill., said Oklahoma's lower-than-average medical costs is a chief reason rates will be low.

"Things cost less there," Axene said. For example, in Oklahoma City, the state's largest city, the cost of a day of care in the hospital is 75 percent of what it is nationally.

"It's cheaper in Oklahoma to go to the hospital," Axene said. He said the cost of seeing a physician is similarly less than average.

The federally run health insurance marketplace opens Tuesday, and health insurance enrollment will continue for six months. Coverage begins Jan. 1 for those who sign up by Dec. 15. Oklahoma is among 36 states where the federal government will run the marketplace in 2014.

In November, Gov. Mary Fallin rejected a state-based insurance exchange under the health care overhaul law. Fallin also turned down an expansion of Medicaid to provide coverage to low-income, uninsured citizens.

There are about 600,000 uninsured Oklahomans, and about 200,000 would have benefited from the expansion, state officials have said.

HHS Secretary Kathleen Sibelius said the reports indicate that health insurance plans offered through the exchange will have lower rates than originally projected, making health care affordable for many uninsured Americans. Premiums nationwide will be about 16 percent lower than originally expected.

The Affordable Care Act requires all Americans to have health insurance, including plans offered by employers and government programs such as Medicare or Medicaid.

Individuals and families will be able to choose from a variety of bronze, silver, gold and platinum plans as well as catastrophic plans for young adults and those without affordable options.

On average, there are eight different health insurance issuers participating in each of the 36 states with federally operated insurance exchanges, the reports say. Five companies have been approved to participate in Oklahoma's exchange.

Although the exchange will offer an average of 53 health plans, the reports indicate that number will vary by region. Oklahoma City residents, for example, will have 61 plans to choose from.

The reports compare average premiums of the lowest-cost silver plan, the second-lowest cost silver plan and the lowest-cost bronze plan in 48 states, including Oklahoma.

In Oklahoma, the lowest-cost silver plan will cost $256 a month when the average of 48 states surveyed will be $310, according to the reports. The second-lowest cost silver plan will cost $266 a month in the state when the average will be $328. The lowest-cost bronze plan will cost $174 a month in Oklahoma and the average will be $249.

State Insurance Commissioner John Doak has predicted that health insurance rates will "skyrocket" under the new law. Doak did not immediately return a telephone call seeking comment on the federal reports.

Poll tests interest in ending state real estate transfer tax

By M. Scott Carter

The Journal Record

OKLAHOMA CITY - With the Legislature's income tax reduction package facing scrutiny by the Oklahoma Supreme Court, another tax - one that generates revenue for county government - could be the next target by business and anti-tax groups.

Just about three months after Oklahoma City attorney Jerry Fent filed a legal challenge to a bill that lowered the state's income tax rate and earmarked $120 million in revenue to repair the ailing state Capitol building, an anonymous group is polling Oklahoma voters about the state real estate transfer tax, which is commonly known as the document tax stamp.

The tax, which funds county and state government services, accesses a 75-cent fee per every $500 of sale price paid on the purchase of property. Government transparency advocates and media outlets also use the tax record to document real estate sales and purchases.

At present, Oklahoma is one of 36 states - including the District of Columbia - that impose a tax on the transfer of real estate when the deed is filed. Tax Commission records show that the tax generated about $12 million in 2012.

During the 2013 legislative session lawmakers attempted to change the allocation of document tax stamp receipts under Senate Bill 954. That measure, written by state Sen. Ron Justice, R-Chickasha, and state Rep. Mike Jackson, R-Enid, would have increased how much of the tax was allocated to county government.

Republican Gov. Mary Fallin vetoed the bill.

But even though the tax has not been an issue for many lawmakers, it has drawn the scrutiny of the Oklahoma Association of Realtors. Information posted on the OAR's website touted an effort by the National Association of Realtors and the Realtors Party, an advocacy group, that banned Louisiana's real estate transfer tax.

In addition, the group's Legislative Policy Agenda for 2013 and 2014 calls for major changes in the tax code.

"Support the repeal of taxation on the transfer of business personal property in commercial real estate transactions," the position paper stated, adding that the group also strongly opposed any effort to increase the documentary stamp tax for any purpose.

Legislative Democrats said they weren't surprised that the real estate tax was under fire.

"I would expect more of this," said state Rep. Joe Dorman, D-Rush Springs. "I expect there will be continued efforts to reduce the tax base and get rid of additional taxes."

Dorman said he expected more tax reduction efforts during the 2014 session.

"There will be a lot more anti-tax talk next session," he said.

Republican lawmakers, however, said the tax wasn't on the GOP caucus' radar screen.

"Honestly, I don't know much about it," said state Rep. Jason Nelson, R-Oklahoma City. "In our caucus we really haven't heard much about it."

Nelson said he wouldn't be surprised if an outside group was behind the effort to change the tax.

"I know that, sometimes, other groups will do polling to see if something is workable," he said.

But, like Dorman, Nelson said the issue of tax reduction will probably continue during the 2014 session.

"The talk of tax code changes will continue. If not it probably should," he said. "I mean, I am in favor of eliminating the income tax, but the question that needs to be asked is 'is it a tax cut or tax reform,' there's a big difference there. But I hope there are more conversations about it.

Have a good week.  Give me a call at 918.671.6860 if I can be of help in any way

                  Steve Lewis


 
 
This Week's Meetings


 

 

 
This Week's News
Certificate-of-Merit Questioned
Study Questions Cost Reductions
Workers' Comp Law Hearing Set
Report Ranks Oklahoma
Report: Oklahomans Can Access 53 Health Care Plans
Poll Tests Ending Real Estate Tax
 

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