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H. 3579
STATUS INFORMATION
General Bill
Sponsors: Reps. Rice and McGee
Document Path: l:\council\bills\nbd\11219ac03.doc
Companion/Similar bill(s): 3685, 3768, 3770
Introduced in the House on February 11, 2003
Currently residing in the House Committee on Ways and Means
Summary: Health and Human Services Reorganization and Accountability Act of 2003
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number ------------------------------------------------------------------------------- 2/11/2003 House Introduced and read first time HJ-28 2/11/2003 House Referred to Committee on Ways and Means HJ-29
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO ENACT THE "SOUTH CAROLINA HEALTH AND HUMAN SERVICES REORGANIZATION AND ACCOUNTABILITY ACT OF 2003"; TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976 BY ADDING ARTICLE 3, CHAPTER 30, TITLE 1 SO AS TO TRANSFER THE CONTINUUM OF CARE FOR EMOTIONALLY DISTURB CHILDREN FROM THE OFFICE OF THE GOVERNOR TO THE DEPARTMENT OF SOCIAL SERVICES, TO TRANSFER THE DEPARTMENT OF ALCOHOL AND OTHER DRUG ABUSE SERVICES AND THE DEPARTMENT OF MENTAL HEALTH TO THE DEPARTMENT OF HEALTH AND HUMAN SERVICES AND TO TRANSFER THE SOUTH CAROLINA COMMISSION FOR THE BLIND TO THE DEPARTMENT OF VOCATIONAL REHABILITATION; TO ADD ARTICLE 5, CHAPTER 30, TITLE 1 SO AS TO ESTABLISH THE DEPARTMENT OF INFORMATION TECHNOLOGY FOR HEALTH AND HUMAN SERVICES AGENCIES AND TO PROVIDE FOR ITS POWERS AND DUTIES; BY ADDING CHAPTER 64, TITLE 2 SO AS TO ESTABLISH A JOINT LEGISLATIVE COMMITTEE ON HEALTH AND HUMAN SERVICES AND TO PROVIDE FOR ITS MEMBERSHIP, FUNCTIONS, DUTIES, AND RESPONSIBILITIES; BY ADDING ARTICLE 8, CHAPTER 6, TITLE 44 SO AS TO ESTABLISH THE OFFICE OF INSPECTOR GENERAL FOR THE DEPARTMENT OF HEALTH AND HUMAN SERVICES, TO PROVIDE THAT THE INSPECTOR GENERAL MUST BE APPOINTED BY AND UNDER THE DIRECTION OF THE JOINT LEGISLATIVE COMMITTEE ON HEALTH AND HUMAN SERVICES, AND TO FURTHER PROVIDE FOR THE POWERS AND DUTIES OF THE INSPECTOR GENERAL; BY ADDING SECTION 44-6-75 SO AS TO PROVIDE FOR A MEDICAID COST CONTAINMENT ACTION PLAN; BY ADDING SECTION 12-21-625 SO AS TO IMPOSE AN ADDITIONAL LICENSE TAX ON EACH CIGARETTE SUBJECT TO THE LICENSE TAX ON CIGARETTES IN AN AMOUNT EQUAL TO 2.1 CENTS ON EACH CIGARETTE, TO ESTABLISH THE MEDICAID SERVICES FUND TO RECEIVE THE REVENUE OF THIS TAX AND PROVIDE FOR THE USE OF THIS FUND FOR REORGANIZATION AND PUBLIC HEALTH PURPOSES, TO CREATE A MEDICAID MATCHING FUND, AND TO PROVIDE FOR THE COLLECTION AND ENFORCEMENT OF THIS ADDITIONAL TAX; TO AMEND SECTION 44-6-155, RELATING TO THE MEDICAID EXPANSION FUND, SO AS TO INCLUDE WITHIN THE FUND THE TAX IMPOSED BY SECTION 12-21-625; TO REPEAL SECTIONS 12-6-530 AND 12-6-540, RELATING TO THE STATE CORPORATE INCOME TAX AND THE STATE INCOME TAX ON THE TAXABLE INCOME OF EXEMPT ORGANIZATIONS AND COOPERATIVES EFFECTIVE FOR TAXABLE YEARS BEGINNING AFTER 2005 AND TO REDUCE THE EXISTING RATE OF THESE TAXES TO FOUR PERCENT FOR TAXABLE YEARS BEGINNING IN 2004 AND TWO PERCENT FOR TAXABLE YEARS BEGINNING IN 2005; TO REQUIRE THE DIRECTOR OF THE LEGISLATIVE AUDIT COUNCIL TO EMPLOY AUDITORS TO PERFORM REGULAR AUDITS ON DEPARTMENTS AFFECTED BY THIS ACT; AND TO DESIGNATE SECTIONS 1-30-10 THROUGH 1-30-120 AS ARTICLE 1, CHAPTER 30, TITLE 1 AND NAMED "DEPARTMENTS OF STATE GOVERNMENT".
Be it enacted by the State of South Carolina that:
SECTION 1. This act may be cited as the "Health and Human Services Reorganization and Accountability Act of 2003".
SECTION 2. Chapter 30, Title 1 of the 1976 Code is amended by adding:
Section 1-30-310. (A) Notwithstanding any other provision of law, effective on July 1, 2003, the following agencies, boards, and commission, including all of the allied, advisory, affiliated, or related entities as well as the employees, funds, property, and all contractual rights and obligations associated with any such agency, except for those subdivisions specifically included under another department, are hereby transferred to the state agency as indicated:
(1) the Continuum of Care for Emotionally Disturbed Children currently within the Office of the Governor, as provided for in Section 20-7-561 et seq., is transferred to the Department of Social Services;
(2) the Department of Alcohol and other Drug Abuse Services, as provided for in Section 44-49-10 et. seq., and the Department of Mental Health as provided in Section 44-9-10 et. seq., are transferred to the Department of Health and Human Services which shall establish and employ a director for:
(a) the Office of Alcohol and Other Drug Abuse Services; and
(b) the Division of Mental Health.
(3) the South Carolina Commission for the Blind, as provided for in Section 43-25-10 et. seq., is transferred to the Department of Vocational Rehabilitation.
(B)(1) The South Carolina Mental Health Commission, established pursuant to Section 44-9-30, is abolished July 1, 2003, and it powers, duties, and responsibilities are transferred to the Division of Mental Health within the Department of Health and Human Services.
(2) The board for South Carolina Commission for the blind shall serve in advisory capacity only to the Department of Vocational Rehabilitation and its powers, duties, and responsibilities are transferred to the Department of Vocational Rehabilitation.
(3) Nothing in this section may be construed to affect the authority, duties, and responsibilities of the boards for the local:
(a) commission on alcohol and other drug abuse services;
(b) community mental health centers.
However, these boards must report to their respective office and division directors within the Department of Health and Human Services.
Section 1-30-320. It is the intent of the General Assembly in reorganizing and consolidating these agencies to improve the communication, coordination and cooperation of the employees employed by these agencies in order to provide the public with ease of access to, and quality of services. In keeping with this purpose, the agency heads must be evaluated annually on their leadership and accomplishments in establishing clear lines of authority, staff training and competence, evaluation and a cost benefit analysis of all of its programs.
Section 1-30-330. The Executive Director of the State Budget and Control Board and the agencies reporting to the executive director are directed to assist with the implementation of the reorganization provided for in this article. The affected agencies shall cooperate with this reorganization plan. The Office of State Budgets is directed to provide for the reorganization and realignment of the appropriated funds to the affected agencies. The reorganization must proceed in a manner and on a schedule as prescribed and adopted by the State Budget and Control Board as soon as practicable. It is the intent of the General Assembly in reorganizing these agencies that the following principles apply:
(1) minimal disruption of services to the public;
(2) the elimination of duplication of operations;
(3) the consolidation of services and programs;
(4) the establishment of clear lines of authority;
(5) the achievement of cost efficiency; and
(6) the integration of program application and eligibility determination processes to the fullest extent possible.
Section 1-30-340. The state directors of all health and human service agencies, which include the Department of Social Services, the Department of Health and Human Services, the Department of Disabilities and Special Needs, the Department of Vocational Rehabilitation, and the Department of Health and Environmental Control may require offices within their respective jurisdiction to:
(1) locate all or a portion of the agency's employees and programs in the same building as another office or at a location near or adjacent to the location of another health and human services office;
(2) ensure that the agency's location is accessible to disabled employees and agency clients; and
(3) consolidate agency support services, including clerical and administrative support services and information resources support services, with support services provided to or by another health and human services office. The state directors of all health and human service agencies are directed to post on the agency's respective web sites, the agency's progress in meeting these objectives."
SECTION 3. Chapter 30, Title 1 of the 1976 Code is amended by adding:
Section 1-30-510. There is created the Department of Information Technology for Health and Human Service Agencies. The Governor shall appoint the director of the department with the advice and consent of the Senate. The director must have training and experience in the field of information technology planning, administration, and operations.
Section 1-30-520. (A) The department is responsible for the management and administration of all information technologies, including information technology appropriations, other funding, and contracting, for the:
(1) Department of Social Services, including the Office of Continuum of Care for Emotionally Disturbed Children;
(2) Department of Health and Human Services, including the Office of Alcohol and Other Drug Abuse Services and the Division of Mental Health;
(3) Department of Disabilities and Special Needs;
(4) Vocational Rehabilitation, including those programs formerly operated by the Commission for the Blind; and
(5) The Department of Health and Environmental Control.
(B) The director has final approval for all proposed expenditures. A director of an agency enumerated in subsection(A)(1) may appeal decisions regarding information technologies to the State Budget and Control Board for consideration. Decisions by the board on these matters are final.
Section 1-30-530. In carrying out the responsibilities of this section the director shall:
(1) develop a coordinated strategic plan for information resources management that;
(a) covers a multi-year period;
(b) defines objectives for information resources management at each health and human services agency;
(c) prioritizes information resources projects and implementation of new technology for all health and human services agencies;
(d) integrates planning and development of each information resources system used by a health and human services agency into a coordinated information resources management planning and development system established by the commission;
(e) establishes standards for information resources system security and that promotes the ability of information resources systems to operate with each other; and
(f) achieves economies of scale and related benefits in purchasing for health and human services information resources systems;
(2) establish information resources management policies, procedures, and technical standards and ensure compliance with those policies, procedures, and standards; and
(3) review and approve the information resources management and operating plan of each health and human services agency; and no later than December 15 of each year, the director shall post the plan on its website.
Section 1-30-540. The director may appoint an information technology advisory committee composed of information resources managers for state agencies and for private employers which may advise the director regarding:
(1) overall goals and objectives for information resources management for all health and human services agencies;
(2) coordination of agency information resources management plans;
(3) development of short-term and long-term strategies for;
(a) implementing information resources management policies, procedures, and technical standards;
(b) ensuring compatibility of information resources systems across health and human services agencies as technology changes;
(4) information resources training and skill development for health and human services agency employees and policies to facilitate recruitment and retention of trained employees;
(5) standards for determining:
(a) the circumstances in which obtaining information resources services under contract is appropriate;
(b) the information resources services functions that must be performed by health and human services agency information resources services employees; and
(c) the information resources services skills that must be maintained by health and human services agency information resources services employees;
(6) optimization of the use of information resources technology that is in place at health and human services agencies; and
(7) existing and potential future information resources technologies and practices and the usefulness of those technologies and practices to health and human services agencies; and
(8) shall review and make recommendations to the committee relating to the consolidation and improved efficiency of information resources management functions, including:
(a) cooperative leasing of information resources systems equipment;
(b) consolidation of data centers;
(c) improved network operations;
(d) technical support functions, including help desk services, call centers, and data warehouses;
(e) administrative applications;
(f) purchases of standard software;
(g) joint training efforts;
(h) recruitment and retention of trained agency employees;
(i) video conferencing; and
(j) other related opportunities for improved efficiency."
SECTION 4. Title 2 of the 1976 code is amended by adding:
Section 2-64-10. There is established the Joint Legislative Committee on Health and Human Services composed of six members, three members of the Senate appointed by the Chairman of the Senate Finance Committee and three members of the House of Representatives appointed by the Chairman of the House Ways and Means Committee.
Section 2-64-20. (A) In carrying out its responsibilities under this chapter, the committee shall:
(1) make a detailed and careful study of the State Medicaid Plan, the Federal laws pertaining to the Medicaid program, and all laws of the State which have a bearing upon the Medicaid program;
(2) review the State Medicaid program's compliance with state and Federal laws, regulations and other requirements.
(3) compare the State Medicaid program with the Medicaid program structures of other states;
(4) recommend changes in the Medicaid program structure regarding eligibility, type, scope, and duration of services, together with predicted General Fund revenue, to make the State Medicaid Plan more stable and affordable for the taxpayers of the State;
(5) provide for the revision of state laws and the State Medicaid Plan to develop a more easily understood, financially manageable and stable system;
(6) review efforts of the State Medicaid agency such as:
(a) cost containment measures;
(b) fiscal and program accountability;
(c) quality of care;
(d) effective coordination of all health care providers and payers;
(e) performance measurement and reporting; and
(f) detection of fraud and abuse.
(7) submit reports and recommendations annually to the Governor and the General Assembly for improving state health care policy and financing and other recommendations as may be appropriate.
(B) In carrying out its responsibilities under this chapter, the committee may:
(1) hold public hearings;
(2) receive testimony of any employee of the State or any other witness who may assist the committee in its duties;
(3) call for assistance in the performance of its duties from any employee or agency of the State or any of its political subdivisions;
(4) employ consultants to assist the committee in accomplishing its duties.
Section 2-64-30. The committee may adopt by majority vote rules not inconsistent with this chapter that it considers proper with respect to matters relating to the discharge of its duties under this section. Professional and clerical services for the committee must be made available from the staffs of the General Assembly, the Budget and Control Board, and the Department of Health and Human Services.
Section 2-64-40. Expenses of the committee may be paid from appropriated funds of the House of Representatives upon approval of the Speaker of the House and from appropriated funds of the Senate upon approval of the President Pro-Tempore of the Senate."
SECTION 5. Chapter 6, Title 44 of the 1976 Code is amended by adding:
Section 44-6-1010. (A) There is established the Office of Inspector General (Office) for the Department of Health and Human Services for the purpose of:
(1) conducting independent and objective audits, reviews, investigations, and inspections;
(2) preventing and detecting waste, fraud, and abuse;
(3) promoting accountability, economy, effectiveness, and efficiency.
(B) The inspector general must be appointed by and under the direction of the Joint Legislative Committee on Health and Human, Services, established pursuant to Section 2-66-10. The inspector general must be appointed without regard to political affiliation and solely on the basis of integrity, related experience, and demonstrated ability in accounting, auditing, financial analysis, and management analysis.
Section 44-6-1020. In carrying out the duties of the office the inspector general may:
(1) conduct audits, reviews, analyses, investigations, and inspections relating to the administration and operation of all programs administered by the department;
(2) under authority currently residing with the department, conduct audits, reviews, analysis, investigations, and inspections of providers, recipients, and other entities doing business with the department to determine compliance with applicable departmental contracts and regulations and to detect related fraud and abuse;
(3) receive and investigate complaints concerning possible violations of regulations or law, gross mismanagement, fraud, waste, or abuse. The office may not disclose the identity of an individual submitting a complaint unless the disclosure is unavoidable during the course of an investigation;
(4) issue evaluation and audit reports in accordance with professional standards;
(5) have direct access to all systems, records, reports, reviews, files, documents, papers, and similar information related to the programs and operations of the department and entities doing business with the department;
(6) request information and assistance as necessary from any state, federal, or local agency;
(7) to the extent, and in such amounts as provided under this section and the annual general appropriations act, enter into contracts and make payments for necessary staff and resources;
(8) collect directly or to instruct the department to collect or withhold amounts related to fraud and abuse findings.
Section 44-6-1030. The inspector general, no less than semi-annually and more frequently at the request of the committee chair, shall provide to the Joint Legislative Committee on Health and Human Services a:
(1) description of significant problems, abuses, and deficiencies encountered in the administration and operation of departmental programs along with recommendations of corrective action;
(2) listing of each audit report issued during the period along with estimates for the dollar value of questioned costs;
(3) report on each recommendation issued in a prior audit report, over six months old, to which the appropriate entity has not complied;
(4) status report on fraud and abuse activity that includes case volumes, collections, results of reviews and investigations, and referrals to the Attorney General or other prosecutorial and law enforcement authorities;
(5) status report on the annual audit plan that provides progress on current reviews as well as known intended reviews and their completion dates;
(6) other information as requested by the committee.
Section 44-6-1040. The Inspector General, in carrying out these duties and responsibilities, shall make every attempt to avoid duplication and ensure effective coordination and cooperation. Nothing in this section is intended to duplicate the activity of the State Auditor, or the Attorney General's Medicaid Fraud Control Unit, or the Legislative Audit Council.
Section 44-6-1050. The Inspector General shall immediately report to the committee chair and the director of the department any extraordinary egregious and flagrant problems or fraud and abuse.
Section 44-6-1060. The existing fraud and abuse staff eligibility quality control staff, and internal audit staff within the department are transferred to the Inspector General's Office along with all affiliated authority. All equipment, systems, and other necessary components of operations are included in this transfer. Additionally, related personal service, direct administrative, and pro-rata indirect appropriations accompany the transfer. The department, in accordance with a prescribed cost allocation plan, shall draw and transfer related federal and other funds on behalf of the Inspector General's Office. The department shall continue to provide appropriations, office space, equipment, communications equipment, services, and supplies until practical transfer can occur.
Section 44-6-1070. The Inspector General is authorized to retain or receive one-half of all fraud and abuse collections to further enhance its fraud and abuse detection capabilities.
SECTION 6. Article 1, Chapter 6, Title 44 of the 1976 Code is amended by adding:
"Section 44-6-75. (A) By November 15 of each year, the Director of the Department of Health and Human Services shall submit in writing to each member of the Budget and Control Board, a 'Medicaid Cost Containment Action Plan' on the projected expenditures for the State Medicaid program for the next fiscal year. The action plan must include:
(1) a description of each action to be taken;
(2) the number of individuals affected;
(3) the Medicaid services or programs affected;
(4) an estimate of the financial impact on the Medicaid program for the fiscal year in question and;
(5) other information as directed by the board.
(B) If the director informs the Budget and Control Board that general fund expenditures that match federal Medicaid dollars are projected to increase over the current fiscal year by a percentage greater than projected percentage growth of the state's total general fund, the following action as required in this chapter, the director shall inform the board, in priority order, of the actions to be taken by the department to reduce expenditures in the Medicaid program for the following fiscal year so as to not exceed an amount equal to the percentage growth of the state's general fund revenue for that fiscal year as estimated by the Board of Economic Advisors.
SECTION 7. Article 5, Chapter 21, Title 12 of the 1976 Code is amended by adding:
"Section 12-21-625. (A) There is imposed a surtax on cigarettes subject to the tax imposed pursuant to Section 12-21-620(1) in an amount equal to 2.1 cents on each cigarette.
(B) Notwithstanding any other provision of law providing for crediting revenues by license or other taxes, the revenue of the surtax imposed by this section must be credited to the Medicaid Services Fund established pursuant to subsection (C) and used only for the purposes prescribed in subsection (C).
(C)(1) There is created the Medicaid Services Fund into which must be deposited funds collected pursuant to subsection (A). The fund must be separate and distinct from the general fund and must be used only for the purposes prescribed in this subsection. The funds are supplementary and must not be used to replace general funds appropriated by the General Assembly or other funds used to support Medicaid or other specified programs, operations, initiatives, or activities. The funds, programs, operations, initiatives, and other activities specified in this subsection are exempt from budgetary cuts, reductions, or eliminations caused by the lack of general fund revenues. Earnings on investments from this fund must remain part of the separate fund and must not be deposited in the general fund.
(2) Monies in the fund must be used as follows:
(a) the first five hundred twenty five thousand dollars of revenue from the surtax, must be used for the responsibilities assigned to the following entities:
(i) twenty five thousand dollars for funding the Joint Legislative Committee on Health and Human Services;
(ii) three hundred thousand dollars for the new Department of Information Technology for Health and Human Service Agencies establish pursuant to Section 1-30-510; and
(iii) two hundred thousand dollars for additional audit services from the Legislative Audit Council;
(b) five percent of the revenue remaining after the expenditures in item (a), for funding grants dedicated for community agencies and organizations for 'Healthy People 2010', the promotion of public health, and targeted only toward the following objectives:
(i) increasing the proportion of adults and adolescents participating in exercise;
(ii) reducing the proportion of obese adults;
(iii) reducing cigarette use by adults and adolescents;
(iv) increasing the proportion of adolescents who do not use alcohol or illicit drugs;
(v) reducing the proportion of adults engaging in the 'bingeing' use of alcoholic beverages;
(vi) reducing motor vehicle fatalities;
(vii) increasing the proportion of young children who receive vaccinations and immunizations;
(viii) increasing the proportion of noninstitutionalized adults, sixty-five years of age and older, who receive vaccinations and immunizations;
(ix) increasing the proportion of noninstitutionalized adults, sixty-five years of age and older, who have ever been vaccinated against pneumococcal disease; and
(x) increasing the number of pregnant women who begin prenatal care in the first trimester of pregnancy.
(3) The remaining revenue of the surtax imposed by this section, must be credited to a separate and distinct fund, apart from all other funds, designated as the Medicaid Match Fund. The Department of Health and Human Services must use revenue collected pursuant to this section as the director determines. Expenditures must be reported annually to the General Assembly. Revenues in this fund not expended during a fiscal year are carried forward to the succeeding fiscal year and must be used for the same purposes.
(D) The Director of the Department of Health and Human Services shall plan, administer, and monitor the use of the monies as prescribed in subsection (C).
(E) Monies must be transferred by the State Treasurer upon written request and justification from an authorized official for the purposes prescribed in subsection (C).
(F) Unexpended revenues distributed from the Medicaid Services Fund not expended during a fiscal year are carried forward from year to year and must be used for the prescribed purposes.
(G) For all purposes of reporting, payment, collection, and enforcement, the surtax imposed by this section is deemed to be imposed pursuant to Section 12-21-620(1)."
SECTION 8. Section 44-6-155(A)(2) of the 1976 Code is amended to read:
"(2) collected pursuant to Section Sections 12-21-625 and 2-23-810; and"
SECTION 9. (A) Sections 12-6-530 and 12-6-540 of the 1976 Code are repealed effective for taxable years beginning after 2005.
(B) Notwithstanding the rate of tax imposed pursuant to Sections 12-6-530 and 12-6-540, for taxable years beginning in 2004, the applicable rate is four percent and for taxable years beginning in 2005, the applicable rate is two percent.
SECTION 10. The Director of the Legislative Audit Council shall employ auditors as necessary to perform regular audits of the operations of the departments and offices affected in this act to determine their performance in complying with all applicable provisions of law.
SECTION 11. Sections 1-30-10 through 1-30-120 are designated as Article 1, Chapter 30, Title 1 of the 1976 Code and named "Departments of State Government".
SECTION 12. This act takes effect upon approval by the Governor unless otherwise provided for in this act.
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