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HMO documents that show information reflecting intended secrecy and value to the HMO are confidential and cannot be disseminated by a plaintiff’s attorney, the Pennsylvania Superior Court has ruled, reversing a Lackawanna County Common Pleas Court decision. “We conclude that documents contain formulas and compilation of data and information which unmistakably reflect their intended secrecy and value to the HMO,” Judge James R. Cavanaugh wrote for the three-judge panel in Dibble v. Geisinger. Judges Correale F. Stevens and Phyllis W. Beck also sat on the panel. Beck filed a dissenting opinion. In 1990, Charles Dibble purchased a supplement to his Medicare insurance plan from Geisinger Health Plan. In 1994, Dibble was hospitalized for a heart attack. While in the hospital, a rectal exam showed that Dibble had an enlarged prostate, and a prostate-specific antigen blood test returned irregular results. Dibble was ultimately discharged from the hospital and then saw his primary-care doctor several times, but the doctor did not perform a second prostate-specific antigen blood test. In 1996, Dibble was referred to a urologist who confirmed that Dibble had prostate cancer. Dibble and his wife then sued the primary-care physician, the physician’s group, the individual doctors in the group and the HMO for failure to timely diagnose the cancer. Dibble died three years later. In the initial complaint, Dibble’s wife alleged that the defendant doctors had been given a cash bonus to hold down the number of patient referrals to specialists. During the discovery phase of the trial, Dibble’s wife requested all documents showing agreements between the defendant doctors and the HMO, including information on doctors’ salaries and incentive bonuses. The defendants moved for a protective order, and the trial court denied the motion. The defendants then appealed to the Superior Court. In May 2001, Dibble agreed to drop all claims regarding the doctors’ salaries, including incentive compensation. Dibble and the defendants then reached a settlement for the negligence claims. However, according to the opinion, Dibble’s counsel did not agree to the confidentiality of the documents disclosed by the HMO during discovery, and he kept the documents in his possession. The plaintiff’s counsel, Cavanaugh said, refused to limit use of the documents to the completed prosecution, and instead retained them for use in establishing liability in future cases. Before siding with the defendants, the court chastised the plaintiff’s and defendants’ attorneys for their apparent inability to reconcile the issue. “It is clear to the court that the attorneys on both sides of this dispute have allowed their differences of opinion to become inflexible and have allowed the discovery battles in this and other ongoing, unrelated actions to devolve into a mutual and personal distrust for each other that clearly borders on loathing and vituperation,” Cavanaugh wrote. The court first denied the plaintiff’s request to quash the appeal. Dibble contended that the trial court’s order is not separable from and collateral to the main cause of action, but Cavanaugh disagreed. “The right to confidentiality in matters involving proprietary and trade secrets is rooted in public policy and impacts on individuals and entities other than those involved in current litigation,” he wrote. “Thus, we conclude the scale tips toward the right to review when balanced against the competing interest of judicial efficiency.” The court then reviewed the documents in question, and found that the files contained the HMO’s compensation plans, detailed salary history for individual physicians, financial data for clinical departments, information on allocation model pools and formulas by which work effort and performance are quantified to determine physician compensation. The information, the court determined, amounted to trade secrets of the HMO. The court then analyzed the documents based on the Restatement of Torts, � 757, which presents six factors a court may consider when determining whether information qualified as a trade secret: � The extent to which the information is known outside the owner’s business. � The extent to which it is known by employees and others involved in the owner’s business. � The extent of measures taken by the owner to guard the secrecy of the information. � The value of the information to the owner and his competitors. � The amount of effort or money expended by the owner in developing the information. � The ease or difficulty with which the information could be acquired or duplicated by others. The first and second factors, the court said, were met by the HMO because it took measures to carefully guard the documents. The information at issue, the court also said, is not known outside Geisinger’s business, and therefore disseminating the information could cause great harm to the business. The third factor, the court determined, also was met because the HMO “undoubtedly” took steps to guard the secrecy of the information that the plaintiff’s attorney wanted to disclose. One of the documents was stamped with the word “confidential” and contained a report that revealed how physician compensation was distributed. The court also determined that, in regard to the fourth factor, information contained in the documents was of great value to the HMO and would also be of great value to its competitors if it were disclosed. The fifth factor went unaddressed by the court, but the sixth, it found, was clearly shown by the nature of the instant litigation. “In sum, we conclude that the documents contain formulas and compilations of data and information which unmistakably reflect their intended secrecy and value to the HMO and that the information could create a competitive disadvantage for the HMO if disclosed to other managed-care companies or to the public,” Cavanaugh wrote. “We conclude that the subject documents are confidential and must remain so. “We conclude that all 108 pages contain confidential information in the nature of trade secrets and that the court erred in denying appellants’ motion which requested an order preventing appellee from disseminating the information to individuals or entities not involved in the underlying litigation.” Beck dissented on the basis that HMOs are not like other businesses, because an HMO delivers services that are “vital and necessary to the well-being of all citizens.” “Is safeguarding the secrets of appellants’ internal operation, the revelation of which might possibly give another HMO an economic advantage, more important than our citizens’ need to know? …” Beck wrote. “I believe a patient has an interest in making an informed choice about his health care choices, and that such an interest trumps the HMO’s interest in protecting the confidentiality of the documents at issue in this case.”

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