The passage of hospital regulatory reform Friday capped a landmark day in Georgia health care.

An overhaul of state health-care regulations known as certificate of need, or CON, won House approval by a vote of 138-17, on the final day of the General Assembly.

The compromise bill would help general surgeons open ambulatory surgery centers and would let hospitals build parking decks and other non-clinical projects without state approval.

It also would lift restrictions on a few hospitals now allowed to deliver babies only in cases of emergencies. The measure had attracted opposition from a hospital group, the Georgia Alliance of Community Hospitals.

"It's a good bill that puts competition in the marketplace,'' said state Rep. Austin Scott (R-Tifton), who helped craft the final bill. "It's good for the patients and good for the [medical] providers.''

If signed by Gov. Sonny Perdue, the bill would bring the biggest changes ever in the system that controls health-care construction and expansions, along with the availability of medical services such as obstetrics and heart surgery.

The compromise plan expanded a Senate bill that could lead to Cancer Treatment Centers of America building a $150 million facility near Hartsfield-Jackson International Airport. The facility would be required to draw 65 percent of its patients from outside Georgia.

The bill also would allow more hospitals to perform some heart procedures, such as diagnostic catheterizations and would streamline the CON appeals process.

Earlier, the Legislature approved an ombudsman program to investigate complaints about state-run mental hospitals and community services. The ombudsman office, with initial funding of $250,000, would bring independent review to cases of abuse and neglect of patients with mental illness.

The action comes after an Atlanta Journal-Constitution series last year that reported chronic underfunding, understaffing and overcrowding in the state's seven psychiatric hospitals. The newspaper articles have led to a U.S. Justice Department investigation, and a commission appointed by Perdue to study reforms in the mental health system.

State legislators created an ombudsman position in 2000, but the position was never funded and the job never filled.

"It's something that the mental health community has wanted for 10 years,'' said state Sen. Johnny Grant (R-Milledgeville), a supporter of the legislation.

The Senate approved a major health insurance change by passing, by a 30-20 vote, a bill aimed at expanding the use of high-deductible, savings account health plans to attract the uninsured. Consumer groups said the legislation, aimed at making insurance more affordable, would also give health insurers $146 million in tax breaks over the next five years.

Proponents of House Bill 977 argued that passage would spark competition among insurers, thus making coverage easier to buy for the 1.7 million Georgians currently uninsured. The bill would exempt insurers from paying taxes on premiums in the sale of the high-deductible savings account plans.

The Senate also passed tighter restrictions on the three HMOs that serve more than 1 million Medicaid and PeachCare members in Georgia.

The HMOs have been criticized by hospitals, doctors and other medical providers for not paying them promptly or fully for delivering services, and House Bill 1234 adds requirements on HMO claims payments.