A recent Commonwealth Court decision rejecting a bid to secure insurance reimbursement rates put up a roadblock for lawyers seeking the information, but will not prevent discovery through subpoenas on a case-by-case basis, according to attorneys.
In a case involving Highmark, generally regarded as the biggest health insurance provider in Pennsylvania, a lawyer sought those figures, but the judges in a split decision said the state Insurance Department did not have to hand over the data.
In early June, the en banc panel reversed a ruling from the Office of Open Records, which had granted Tucker Arensberg attorney Christopher L. Voltz’s request to obtain all documents that Highmark submitted to the Insurance Department regarding its reimbursement adjustments for numerous services. According to his online bio, Voltz is a civil litigator and a member of the firm’s municipal group, whose work includes aiding municipalities in responding to Right-to-Know requests.
The OOR had determined that, because language in the Accident and Health Filing Reform Act saying the information had to be submitted for approval had been repealed, the department had not officially requested the information from Highmark, so it was discoverable under the state Right-to-Know Law. However, writing for the majority, Judge Robert Simpson said Highmark had still been required to turn over the material under the law, and so confidentiality should still apply to the information, despite no official request for the records from the department.
“OOR erred in reasoning it was unnecessary to construe the insurance statutes in pari materia based on the repealer,” Simpson said. “The Reform Act provided a statutory exemption for the rate information, despite lack of an explicit department request, because Highmark submitted the information, and it came into the department’s possession pursuant to the file and use provisions of the [Professional Health Services Plan Corporations Act].”
Voltz and other attorneys involved in the case—Jayson Wolfgang of Buchanan Ingersoll & Rooney, who represented Highmark, and Voltz’s attorney, Richard Tucker of Tucker Arensberg—did not return calls for comment.
Thomas Geroulo of Weber Gallagher Simpson Stapleton Fires & Newby said the request involves information of perennial interest to defense attorneys.
He said Voltz’s attempt—through the Right-to-Know Law—appeared to be novel.
“It’s some clever litigating,” Geroulo said. “My route to these things, generally, is I’m using subpoenas … but I’m only getting it for an individual as opposed to a hospital, or insurance carrier.”
According to Geroulo, who defends in general liability matters and often counsels on valuing future medical damages in light of the Affordable Care Act, the defense bar is always looking to get a better understanding of how much carriers will reimburse for particular procedures, as it can provide a more accurate understanding of the health care market. That comes into play when valuing a claim, or arguing before a jury about how much a plaintiff should be awarded in future medical expenses.
“Maybe someone is billed $50,000 for some surgery, and when you get the billing records, well Blue Cross paid $5,000 and the remaining $45,000 gets written off,” Geroulo said. “At trial, if it gets into the future damages, an expert can say they’re going to need that same $50,000 surgery down the road, but there’s a reasonable basis to say that’s not true.”
Galfand Berger attorney Richard Jurewicz, who represents plaintiffs, agreed that this is a “penetrating” issue in all his catastrophic injury cases, and the defense bar is frequently attempting to get this information in front of juries, or lifecare planning experts.
“I’m going by the billing rate, saying we have no idea what changes are going to be for health care in the future,” Jurewicz said. “They’re always trying to chop your number, and attack through different avenues to further undercut your number.”
Jurewicz said trying to access the information through a RTKL request makes sense, but he’s not surprised that Highmark would fight to keep it confidential.
“It’s no different than asking Coke for their trade secret,” he said. “They’ll fight fiercely on that.”
Geroulo said that, given the novel approach, defense attorneys will continue to seek the billed and reimbursed information using subpoenas on a case-by-case basis, but he contended that having more information about what reimbursement rates may look like in the future could not only help drive settlements, it could also bring down costs for carriers.
“Some carrier somewhere is paying for that verdict if a jury thinks $50,000 is a reasonable amount, as opposed to the actual $5,000,” he said.
According to Simpson, both the insurance department and Highmark wanted to keep the information confidential. He noted that the department had told the Pennsylvania Physical Therapy Association that, since Highmark had been required to file the rates, which included physical therapy, allergy testing and venipuncture services, “the rates may fairly be said to have been ‘requested by the department.’”
Judge Patricia McCullough dissented, writing she did not believe the department had effectively sought the requested information.
Highmark is Pennsylvania’s leading provider of health insurance coverage, according to the most recent available ranking from American City Business Journals.