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Data that insurance companies provide to state regulators about medical malpractice payouts is now open to the public, thanks to a federal judge’s ruling. U.S. District Judge William Bassler last week dismissed a suit by the Medical Society of New Jersey, which claimed disclosure would violate privacy, due process, contract and other rights under the U.S. Constitution and federal civil rights law. Bassler’s ruling, in Medical Society of New Jersey v. Mottola, Civ. 04-2126, paves the way for public access to the information over the Internet and a toll-free hotline when the 2003 New Jersey Health Care Consumer Information Act takes effect on June 23. The federal case stemmed from a state court action filed last August in Bergen County. The Record, of Hackensack, N.J., sued to compel disclosure of malpractice payment data after the state denied its Open Public Records Act request. On Jan. 23, Assignment Judge Sybil Moses granted The Record‘s request for common law access to the past five years’ worth of malpractice payment data. Her subsequent March 9 order required the state to notify doctors of the impending disclosure and gave doctors until May 10 to dispute any inaccuracies. The Medical Society did not seek to intervene in the state action, but on May 6, the doctors’ group sued in federal court. At Bassler’s urging, the state and The Record agreed to stay Moses’ order and The Record later intervened in the action. Bassler not only denied the Medical Society a preliminary injunction but also dismissed the suit under Fed. R. Civ. P. 12(b)(6) for failure to state a claim. The case involved the interaction between the new state law, which provides for public access to medical malpractice payout information, and the federal Health Care Quality Improvement Act of 1986, which requires insurers to report such data but makes the reports confidential. Bassler found that the federal privacy provisions do not trump the new state disclosure. First, the collection of identical information is required by state law. Though the state law now confers confidentiality, the act taking effect June 23 will expressly override it. Bassler said there “is simply no provision in the federal law deeming information that is independently collected by a state agency confidential.” In addition, the federal statute provides a “specific carve out for state law,” stated Bassler. It does not bar disclosure of information “by a party which is otherwise authorized, under applicable State law, to make such disclosure.” 42 U.S.C. 11137(b)(1). The Medical Society contended the carve-out should cover only future reports because retroactive application would violate doctors’ expectation of privacy under existing law. Bassler declined to consider that argument because “the Eleventh Amendment bars federal courts from enjoining state officers from violating state laws.” As for the Medical Society’s argument that contract rights of doctors who agreed to settle based on confidentiality would be impaired, Bassler found that disclosure would not violate the Contract Clause because the doctors’ confidentiality agreements do not bind the state. Under New Jersey law, settlements that preclude disclosure to the state are void and unenforceable, he noted. In addition, any impairment of contract is not of constitutional magnitude since confidentiality is “only a collateral aspect” of settlements, whose primary purpose is to resolve disputes, he said. Bassler also found that “providing consumers with relevant information about physicians’ backgrounds” to help them make informed choices was “a legitimate public purpose, justifying even a substantial impairment to contracts. In addition, there was no equal protection violation in the disparate treatment under the law of physicians and podiatrists on the one hand and other health professionals on the other. WEB SITE READY FOR LAUNCH The Health Care Consumer Information Act, N.J.S.A. 45:9-22.21 et seq., requires the Division of Consumer Affairs to create profiles for licensed physicians and podiatrists and make the profiles available to the public without charge “through electronic and other appropriate means.” The profiles include medical school, year of licensure, practice location and any criminal convictions, disciplinary actions and medical malpractice judgments and settlements. Pending claims are not included but pending appeals from judgments are to be noted. Based on a comparison with other doctors in the specialty, profiles are to be grouped into one of three categories: average, below average or above average number of payouts. Disclaimers warn the public against drawing “negative inferences” from the profile generally or from settlement of a claim. The Division of Consumer Affairs is ready to launch www.njdoctorlist.com and begin telephone access on June 23, says spokeswoman Genene Morris. On June 10, however, Robert Conroy, general counsel to the Medical Society, asked the division to push back the compliance date on the ground that the data collection process was flawed and the accuracy of the profiles was in doubt. If the agency refuses, he will go to the Appellate Division, he says. Conroy, of Kern Augustine Conroy & Schoppmann in Bridgewater, says he disagrees with many aspects of Bassler’s decision, including the importance of confidentiality agreements. He predicts doctors will be more reluctant to settle if it gains them a spot in the “hall of shame” and that incorrect profiles will lead to tort claims against the state.

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