Dental Benefit Providers, Inc. v. Eiseman , 633 Pa. 205 ( 2015 )

[J-29A-C-2015]
IN THE SUPREME COURT OF PENNSYLVANIA
EASTERN DISTRICT
SAYLOR, C.J., EAKIN, BAER, TODD, STEVENS, JJ.
DENTAL BENEFIT PROVIDERS, INC. : No. 48 EAP 2014
AND UNITEDHEALTHCARE OF :
PENNSYLVANIA, INC. D/B/A : Appeal from the Order of the
UNITEDHEALTHCARE COMMUNITY : Commonwealth Court entered 2/19/14
PLAN AND HEALTHAMERICA : at No. 945 CD 2013 reversing the
PENNSYLVANIA, INC., D/B/A : determination entered on 5/7/13 of the
COVENTRYCARES, : Office of Open Records at No. AP2012-
: 2017
Appellees :
:
v. : ARGUED: May 5, 2015
:
JAMES EISEMAN, JR., AND THE PUBLIC :
INTEREST LAW CENTER OF :
PHILADELPHIA, :
:
Appellants :
:
AETNA BETTER HEALTH INC., HEALTH : No. 49 EAP 2014
PARTNERS OF PHILADELPHIA, INC., :
KEYSTONE MERCY HEALTH PLAN, : Appeal from the Order of the
AND DENTAQUEST, LLC, : Commonwealth Court entered 2/19/14
: at No. 957 CD 2013 reversing the
Appellees : determination entered on 5/7/13 of the
: Office of Open Records at No. AP2012-
v. : 2017
:
JAMES EISEMAN, JR., AND THE PUBLIC :
INTEREST LAW CENTER OF : ARGUED: May 5, 2015
PHILADELPHIA, :
:
Appellants :
:
:
DEPARTMENT OF PUBLIC WELFARE, : No. 50 EAP 2014
:
Appellee : Appeal from the Order of the
: Commonwealth Court entered 2/19/14
v. : at No. 958 CD 2013 reversing the
: determination entered on 5/7/13 of the
JAMES EISEMAN, JR., AND THE PUBLIC : Office of Open Records at No. AP2012-
INTEREST LAW CENTER OF : 2017
PHILADELPHIA, :
:
Appellants : ARGUED: May 5, 2015
OPINION
MR. CHIEF JUSTICE SAYLOR DECIDED: October 27, 2015
This is the second of companion sets of appeals in which we are asked to
evaluate the breadth of the public’s statutory right of access to discrete information
about the implementation of the Medical Assistance Program.
The general background for these appeals is set forth in this Court’s opinion in
the related case, DPW v. Eiseman, ___ Pa. ___, ___ A.3d ___ (2015), and that context,
as well as the conventions utilized there, are incorporated here by reference. The
present appeals primarily concern rates of payments made by Subcontractors to
providers of dental health services to Medicaid enrollees in the HealthChoices
Southeastern Zone from July 1, 2008, through July 30, 2012 (the “Provider Rates”).
The pertinent RTKL request lodged by the Public Interest Law Center of
Philadelphia (“Requester”) sought documents, including contracts, rate schedules, and
correspondence in DPW’s possession, custody, or control evidencing the Provider
Rates. Requester recognized, at least tacitly, that the Law is directed primarily to the
disclosure of records “of a Commonwealth agency,” 65 P.S. §67.102 (setting for the
definition for a “public record”), and that the statutory presumption that records are
public ones is directed to records “in the possession of a Commonwealth agency,” id.
§67.305(a). Requester thus contended that, even if the Department did not physically
maintain custody of the requested records (since the relevant agreements were
[J-29A-C-2015] - 2
downstream contracts between Subcontractors and dental-health-services providers),
DPW should be deemed to maintain constructive possession of them.
In support of this proposition, Requester highlighted a requirement contained
within the standard written contract between the Department and managed care
organizations designed to ensure DPW’s expedient access to information about
services ultimately provided using Medicaid funds. Specifically, this ready-access
provision is framed as follows:
all contracts or Subcontracts that cover the provision of
medical services to the [MCOs] Members must include . . .
[a] requirement that ensures that the Department has ready
access to any and all documents and records of transactions
pertaining to the provision of services to Recipients.
HealthChoices Physical Health Agreement at 163 (version effective July 1, 2010).
Alternatively -- and to the degree that responsive information was not in DPW’s
possession, but rather, was contained in records of non-public entities -- Requester
invoked a provision of the Law which recasts certain third-party records bearing a
requisite connection with the government as public records “of [a Commonwealth]
agency.” 65 P.S. §67.506(d)(1). See generally SWB Yankees LLC v. Wintermantel,
615 Pa. 640, 665, 45 A.3d 1029, 1044 (2012). In this regard, the statute prescribes
that:
[a] public record that is not in the possession of an agency
but is in the possession of a party with whom the agency has
contracted to perform a governmental function on behalf of
the agency, and which directly relates to the governmental
function and is not exempt under this act, shall be
considered a public record of the agency for purposes of this
act.
65 P.S. §67.506(d)(1).
First, Requester noted that “implementing the Medicaid program is a
governmental function,” while positing that payments to providers -- and, hence, the
[J-29A-C-2015] - 3
Provider Rates -- were an integral aspect of such administration. Letter Brief for
Requester, Eiseman v. DPW, Dkt. No. AP 2012-2017 (Pa. OOR), at 11. Next,
Requester set out to address Section 506(d)(1)’s directed focus upon records “in the
possession of a party with whom the agency has contracted.” 65 P.S. §67.506(d)(1)
(emphasis added). Given that the Department simply had not contracted with
Subcontractors or dental-health-services professionals within Subcontractors’ provider
networks, Requester advanced the following policy-oriented rationale:
[I]f MCOs could shield their expenditures of public funds
from public scrutiny under the Right-to-Know Law simply by
delegating some or all of their functions to subcontractors, it
would be trivial for any entity contracting with a public
agency to do so. Surely, the Right-to-Know Law and the
meaning of “agency possession” therein may not be read so
narrowly and must be read to encompass any subcontractor
as well as contractor to a government agency.
Letter Brief for Requester, Eiseman v. DPW, Dkt. No. AP-2012-2017, at 11-12.
DPW denied the request, citing, inter alia, the RTKL exception permitting the
withholding of a “record that constitutes or reveals a trade secret or confidential
proprietary information,” 65 P.S. §67.708(b)(11), along with the Pennsylvania Uniform
Trade Secrets Act.1
Requesters lodged an appeal in the OOR, and the MCOs and Subcontractors
obtained leave to appear as direct-interest participants and submitted position
statements accompanied by supportive materials.2 DBP, et al., succinctly summarized
the relevant argument as follows:
1
Act of Feb. 19, 2004, P.L. 143, No. 14 (as amended, 12 Pa.C.S. §§5301-5308).
2
The third parties in interest have appeared throughout in two groups: the first
comprised of Dental Benefits Providers, Inc., United Healthcare of Pennsylvania, d/b/a
United Healthcare Community Plan, and HealthAmerica Pennsylvania, Inc., d/b/a
(Lcontinued)
[J-29A-C-2015] - 4
Under [Section 506(d)(1)], agency “possession” is satisfied
respecting materials that are actually held by third parties
only where: (1) the materials are in the hands of a third party
with whom the agency has contracted, and (2) the materials
pertain to a governmental function that the third party has
contracted to carry out. . . . DPW[, however,] has contracted
with the MCOs to carry out the HealthChoices program, not
the dental subcontractors. DPW has no direct contractual
relationship with the dental subcontractors. Accordingly, the
first essential element is missing such that agency
“possession” is not satisfied here. As such, the OOR cannot
compel disclosure of any materials in the hands of the dental
subcontractors.
Letter of DBP, et al., dated Jan. 14, 2013, in Eiseman v. DPW, Dkt. No. AP 2012-2017,
at 8 (emphasis in original); accord Letter of Aetna, et al., dated January 14, 2013, in
Eiseman, No. AP 2012-2017, at 9-10.
Based on these submissions, the OOR subsequently issued a final determination
granting the request for records in full. Initially, the appeals officer highlighted the public
policy underlying the RTKL. Eiseman v. DPW, Dkt. No. AP 2012-2017, 2013 WL
1950593, at *2 (Pa. OOR May 7, 2013) (explaining that the Law is “designed to promote
access to official government information in order to prohibit secrets, scrutinize the
actions of public officials and make public officials accountable for their actions.”
(quoting Bowling v. OOR, 990 A.2d 813, 824 (Pa. Cmwlth. 2010), aff’d, 621 Pa. 133, 75
A.3d 453 (2013))). Furthermore, he explained, the RTKL places the burden of proof
upon a public body to demonstrate exemptions pertaining to public records. See 65
P.S. §67.708(a).
(continuedL)
CoventryCares (collectively, DBP, et al.); the second group has entailed Aetna Better
Health Inc., Health Partners of Philadelphia, Inc., and Vista Health Plan, Inc., through
Keystone Mercy Health Plan, and DentaQuest, LLC (collectively, “Aetna, et al.”).
[J-29A-C-2015] - 5
The appeals officer proceeded to discuss Section 506(d)(1) of the RTKL in a
subsection of his opinion encaptioned: “The Department is required to obtain records in
the possession of the dental subcontractors related to the payment rates paid to
dentists.” Eiseman, Dkt. No. AP 2012-2017, 2013 WL 1950593, at *4. In this regard,
the appeals officer pointed to the ready-access provision of the standard agreement
between DPW and managed care organizations, apparently equating (without further
explanation) the requirement of ready access with a mandate to affirmatively obtain
records. See id. at 5 (“The fact that the MCOs would . . . hire subcontractors is clearly
contemplated by the agreements between the Department and the MCOs, wherein the
Department ‘has ready access to any and all documents and records of transactions
pertaining to the provision of services to Recipients,’ including those records in the
possession of the dental subcontractors.” (quoting HealthChoices Physical Health
Agreement at 163)). The analysis by the appeals officer then segued into a crediting of
the policy-oriented rationale advanced by Requester:
The OOR finds that Section 506(d) is applicable to records in
the possession of the dental subcontractors. While the
Department does not contract directly with the dental
subcontractors, the dental subcontractors contract with the
MCOs to perform services for the Department. Because the
records sought directly relate to a governmental function
being performed by the dental subcontractors, these records
should be subject to public access. The OOR finds that any
other interpretation would frustrate the intent of Section
506(d) by making records showing how public monies are
spent unavailable to the public even though they directly
relate to a governmental function and a contract with a
governmental agency.
Id.3
3
A substantial portion of the balance of the appeals officer’s opinion was dedicated to
discussion of the Law’s exception for trade secrets, which served as a pillar of DPW’s
(Lcontinued)
[J-29A-C-2015] - 6
A divided, en banc panel of the Commonwealth Court reversed in a published
opinion. See Dental Benefit Providers, Inc. v. Eiseman, 86 A.3d 932 (Pa. Cmwlth.
2014). Referencing the statutory presumption of openness as to records in an agency’s
possession, see 65 P.S. §67.305(a), the Commonwealth Court majority initially
considered whether the requested records were within DPW’s possession, custody, or
control, such that the presumption might apply in the first instance. See Eiseman, 86
A.3d at 936.4 In this regard, the majority reverted to the definition of “records,” for
purposes of the Law, which encompasses information that documents a transaction “of
an agency” which is “received or retained” in connection with a transaction, business, or
activity of the agency. Id. at 936-37 (quoting 65 P.S. §67.102).
The Commonwealth Court majority recognized that, for documents to be “of” a
Commonwealth agency, they need not necessarily originate with or be created by the
agency. See id. at 937. Nevertheless, it found that the Department lacks any
possession whatsoever of the Provider Rates, a proposition which seems to be
otherwise undisputed in this appeal (at least upon any affirmative production of
evidence). See id.
Further, the majority acknowledged that the intermediate court previously had
applied the concept of constructive possession in the RTKL context. See id. at 938
(continuedL)
initial basis for denying the records request. The Commonwealth Court, however, did
not address this consideration, and based upon our analysis infra, this aspect is also
immaterial to our present decision.
4
The MCOs and Subcontractors appear to dispute that the term “possession,” as it
appears in Section 305(a) of the Law, also encompasses custody and control. Accord
Office of Budget v. OOR, 11 A.3d 618, 622 (Pa. Cmwlth. 2011) (“Had the Legislature
wanted to create the presumption that records in an agency’s custody and control, but
not in its possession, were public records, it would have included those terms in Section
305.”).
[J-29A-C-2015] - 7
(“We recognize constructive possession under Section 901 as a means of access so
agencies cannot frustrate the purposes of the RTKL by placing their records in the
hands of third parties to avoid disclosure.” (citing, inter alia, Office of the Budget, 11
A.3d at 622)). The majority nonetheless differed with the position of Requester and the
OOR that the ready-access provision of the standard contract between DPW and
managed care organizations supported a finding of constructive possession in the
present circumstances. Rather, the majority regarded such provision as reflecting only
“the mere availability of the records to an agency upon request.” Id. (“That DPW has
the contractual right and ability to request records from a private contractor does not
convert private contractor records into records ‘of’ DPW.”).5
5
The majority also highlighted that the definition of “Subcontract” in the standard
agreement between DPW and managed care organizations exempts “Provider
Agreements,” such that these “are not considered Subcontracts for the purpose of this
Agreement and, unless otherwise specified . . ., are not subject to the provisions
governing Subcontracts.” HealthChoices Physical Health Agreement at 29-30
(definition of “Subcontract”). The majority reasoned that such “contract language
supports DPW’s disclaimer of possession and access to Provider Rates.” Eiseman, 86
A.3d at 938.
The majority, however, failed to appreciate that the noted advance-written-approval and
ready-access provisions of the standard agreement are couched in materially different
terms – while the advance-written-approval term does indeed pertain to “Subcontracts,”
see HealthChoices Physical Health Agreement at 87, the ready-access term pertains
more broadly to “contracts or Subcontracts that cover the provision of medical services
to the [MCO’s] Members,” id. at 163. See generally Brief for Requester at 18 (“The
Ready Access requirement applies to ‘all contracts or Subcontracts,’ . . . but the
Commonwealth Court’s analysis elided the crucial words ‘contracts or.’” (emphasis
adjusted)).
Parenthetically, Requester develops that the Commonwealth Court majority also failed
to apprehend the standard contract’s definition of “Provider Agreement,” which simply
does not encompass remote agreements between Subcontractors and dental-health-
services providers. See Brief for Requester at 20. Moreover, Requester observes,
were these remote agreements actually “Provider Agreements” under the standard
(Lcontinued)
[J-29A-C-2015] - 8
In conjunction with this analysis, the Commonwealth Court majority referenced
Section 910 of the RTKL, which tasks an agency receiving a written request for access
to a record with “mak[ing] a good faith effort to determine if the record requested is a
public record . . . and whether the agency has possession, custody or control[.]” 65 P.S.
§67.901. Apparently synthesizing this provision with the Law’s definition of a “record,”
see id. §67.102 (defining such term, in relevant part, as information which “documents a
transaction or activity of an agency and that is created, received or retained pursuant to
the law or in connection with [such] a transaction, business or activity”), the majority
discerned that “[t]he litmus test under Section 901 remains whether the records
document a transaction of the agency to which the request was directed, not whether
they document a transaction of a private contractor.” Eiseman, 86 A.3d at 938.
Additionally, harkening back to the MCOs’ and the Subcontractors’ initial position
statements before the OOR, the Commonwealth Court majority reasoned:
[T]he Provider Rates are not “records” of DPW as that term
is defined in the RTKL . . .. There is no evidence DPW
sought to circumvent the RTKL by placing records of its
activities into the hands of a third party. Rather, the Provider
Rates are negotiated between Subcontractors and providers,
and do not involve DPW. They are not in DPW’s
possession. Also, there is no indication that they were
created or received by DPW, or that they evidence any
transaction of DPW. At most, the Provider Rates evince a
transaction of Subcontractors of the MCOs, with which DPW
has no contractual relationship.
(continuedL)
contract, they would be subject to a discrete provision of the standard contract –
abjectly overlooked by the Commonwealth Court majority – explicitly requiring advance
written approval by DPW of Provider Agreements. See HealthChoices Physical Health
Agreement at 27 (definition of “Provider Agreement”), 119.
[J-29A-C-2015] - 9
Id. at 939 (footnote omitted).6
The Commonwealth Court majority proceeded to consider Section 506(d)(1)’s
expanded concept of “public records” extending to certain records of non-public
individuals and entities. From the outset, it agreed with the MCOs and Subcontractors
that one of the statute’s core elements – namely, the requirement for there to be a
contractual relationship between a government agency and the third party whose
records are in question, see 65 P.S. §67.506(d)(1) – simply was not met. The majority
explained that the intermediate court had enforced, and would enforce, such
requirement on its terms. See Eiseman, 86 A.3d at 939-40 (citing Honaman v. Lower
Merion Twp., 13 A.3d 1014, 1022 (Pa. Cmwlth. 2011)).7
6
To the extent that the Commonwealth Court’s previous decision in Lukes v. DPW, 976
A.2d 609 (Pa. Cmwlth. 2009), supported the application of a policy-oriented rationale
focused on openness, the majority declined to extend this decision, which arose under
the predecessor open-records regime, into the context of the RTKL. See Eiseman, 86
A.3d at 941-42.
We have touched upon the Lukes decision further in the companion appeals. See
Eiseman, ___ Pa. at ___, ___ A.3d at ___.
7
Although the above reasoning would seem dispositive, the intermediate court majority
did not conclude its analysis at this juncture. Rather, it proceeded to consider whether
Subcontractor records should be made available “through the MCOs’ contractual
relationship with DPW.” Id. at 940. The majority, however, did not anchor this line of
inquiry to any of the terms of Section 506(d)(1), other than that it proceeded to consider
whether there was a direct relationship between a governmental function (here, the
administration of the HealthChoices Program), and the Provider Rates. See id. at 940-
41. Ultimately, the majority found no such direct relationship on these terms:
There is no question that the quality of the dental services
rendered by providers directly relates to the performance of
the government function formalized in the DPW/MCO
contracts. The same may be true as to the availability of the
services and the manner in which the services are delivered.
However, the cost of obtaining those services . . . does not
(Lcontinued)
[J-29A-C-2015] - 10
Judge McCullough authored the dissenting opinion, concluding, inter alia, that
the Subcontractors’ agreements with dental-health-services providers should be
deemed to be in DPW’s possession. See Eiseman, 86 A.3d at 943. Construing the
Law very liberally, and reasoning that the MCOs contracted with the Subcontractors as
DPW’s agents, she took the position that “the Subcontractors have directly contracted
with DPW as principal.” See id. at 945 (emphasis added). Accordingly, Judge
McCullough found that Section 506(d)(1)’s contractual-relationship element was
satisfied.8
(continuedL)
directly relate to the performance of the government
function.
Id. at 940.
While expressing substantial misgivings with such reasoning and conclusion pertaining
to the asserted lack of a direct relationship, cf. infra note 8, we decline to consider this
line of inquiry further. Instead, we merely observe that Section 506(d)(1) requires both
possession by “a party with whom the agency has contracted to perform a
governmental function” and that the requested record “directly relates to the
governmental function.” 65 P.S. §67.506(d)(1). Thus, and as further discussed below,
the statute simply does not serve as a basis for disclosure where the contract element is
absent in the first instance. Accord Brief for DBP, et al., at 14 (“Because of the
conjunctive ‘and’ in the statute, if either of the two required elements is missing, then the
Law will not deem the agency to constructively possess records actually held by a non-
governmental third party.” (emphasis in original)).
8
Judge McCullough also took issue with the majority’s determination that a direct
relationship between the Provider Rates and the administration of the HealthChoices
Program was lacking. She developed her point of view on this subject as follows:
[T]he request for Provider Agreements and Provider Rates
falls squarely within the terms of the Subcontractors’
contractual duties and explicit governmental undertakings.
Via sub-contractual arrangements, the Subcontractors
assume DPW’s governmental obligation to implement
Medicaid and ensure that dental care is available for
Medicaid recipients. Pursuant to their governmental and
(Lcontinued)
[J-29A-C-2015] - 11
The present arguments closely align with the presentations before the OOR and
the Commonwealth Court. In substance, Requester and its amici hew most closely to a
policy-oriented position. See, e.g., Brief for Requester at 14 (“Under the RTKL, when
an agency channels taxpayer dollars through middlemen in the administration of a
public program, the contracts documenting that flow of public funds ‘directly relate’ to
the performance of a governmental function.”). In this regard, they invoke the policy of
liberal construction, see Levy v. Senate of Pa., 619 Pa. 586, 619, 65 A.3d 361, 381
(2013) (quoting Allegheny Cnty. Dep’t of Admin. Servs. v. A Second Chance, Inc., 13
A.3d 1025, 1034 (Pa. Cmwlth. 2011)), as well as the presumption that the General
Assembly “intends to favor the public interest as against any private interest,” 1 Pa.C.S.
§1922(5).
Requester also maintains that disclosure is required per Section 506(d)(1). It
characterizes the prerequisite of a direct contract between a government agency and a
third-party in possession of salient records as a “cramped interpretation,” yielding
circumstances in which “any governmental contractor could shield from disclosure –
either deliberately or incidentally – otherwise publicly available records[.]” Brief for
Requester at 27.
(continuedL)
contractual duties, the Subcontractors are not only obligated
to secure dental services through Provider Agreements, but
are also required to negotiate Provider Rates with the dental
providers. On these facts, I would conclude that the
Provider Agreements and Provider Rates directly relate to
the Subcontractors’ performance of a government function.
These agreements and rates are indispensably necessary to
effectuate Medicaid and represent the very thing the
Subcontractors contractually agreed to do for and on behalf
of DPW.
Id. at 945.
[J-29A-C-2015] - 12
Furthermore, Requester contends that the Commonwealth Court majority’s
“litmus test” for constructive possession “is without foundation and should be rejected as
substantially curbing access to documents pertaining to the conduct of public business.”
Brief for Requester at 22. Citing Sapp Roofing Co. v. Sheet Metal Workers’
International Association, Local Union No. 12, 552 Pa. 105, 109, 713 A.2d 627, 629
(1998) (plurality) (determining that payroll records of a private roofing contractor in the
custody of a local agency were public records, because they evidenced a disbursement
by a governmental unit),9 Requester urges that the understanding of public records
within the possession, custody, or control of an agency cannot be so closely
constrained. See Brief for Requester at 22 (“Even though such records may be in
agencies’ possession precisely so the agencies can assess whether contractors are
complying with a law, this ‘litmus test’ will broadly exclude these records from public
review.”). Requester particularly stresses the “custody or control” aspect, analogizing
these terms to custody or control for purposes of civil discovery. See id. (citing Tribune-
Review Publ’g Co. v. Westmoreland Cnty. Hous. Auth., 574 Pa. 661, 672, 833 A.2d
112, 118 (2003) for the proposition that, in construing the terms “possession, custody or
control,” in the context of civil discovery, this Court had determined that “the courts of
this Commonwealth reject a narrow ‘physical possession’ test, focusing instead on
whether the subpoenaed party has a legal right to custody or control of the documents
in question.”)).
According to Requester:
9
Although Sapp Roofing was a plurality decision, three of the five Justices participating
in the decision agreed that the payroll records were public records for purposes of the
former open-records law. See Sapp Roofing, 552 Pa. at 109, 713 A.2d at 629; id. at
112, 713 A.2d at 630 (Zappala, J., concurring).
[J-29A-C-2015] - 13
[I]f DPW has not been exercising its “Ready Access” power
to review contracts setting forth Provider Rates, that would
represent a troubling abrogation of its responsibilities to
ensure that Pennsylvania’s Medicaid program is effective
and in compliance with federal and state law. Under the
Medicaid Act, “a state must ensure that its state plan
incorporates adequate reimbursement rates to enlist a
sufficient number of dentists to assure that dental care is
available to [Medical Assistance] recipients to the same
extent and quality of care as dental care available to the
general population in certain geographic areas.” Clark v.
Richman, 339 F. Supp. 2d 631, 643 (M.D. Pa. 2004). The
Ready Access requirement is a key tool for DPW to
accomplish this objective. . . . If DPW has not been
reviewing such records [encompassing the Provider Rates],
it has failed to track the flow of billions of dollars in taxpayer
funds that were expended for the benefit of the neediest
Pennsylvanians.
Brief for Requester at 23-24. Requester also argues that the implication, by the
Commonwealth Court majority, that a citizen requesting records should be required to
present evidence that an agency is “attempting to play some sort of shell game by
shifting these records to a non-governmental body,” Eiseman, 86 A.3d at 938 (quoting
Office of Budget, 11 A.3d at 621), improperly shifts the burden of proof to requesters
instead of agencies as required by the Law, see 65 P.S. §67.708(a)(1), and turns upon
an analysis which is entirely absent from the RTKL.
On the other hand, a core proposition of the MCOs and Subcontractors is that
Section 506(d)(1) establishes the only appropriate test for access to third-party records
which are not in the possession, custody, or control of a Commonwealth agency, and
the Commonwealth Court’s determination that the element of a contractual relationship
between DPW and Subcontractors is lacking is eminently correct. See Brief for DBP, et
al., at 19 (asserting that Requester’s argument “is nothing more than a complaint about
how the General Assembly drafted section 506”). The MCOs and Subcontractors deny
that the standard agreement between the Department and MCOs permits DPW access
[J-29A-C-2015] - 14
to “sensitive and proprietary contractual rates that are confidentially negotiated between
the subcontractors and the dental providers.” Brief for DBP, et al., at 17.10 The MCOs,
their subcontractors, and their amici also touch upon policy considerations in tension
with those developed by Requester. See, e.g., Brief for Amicus America’s Health Ins.
Plans at 4-5 (asserting that “[a]s in the private health insurance marketplace,
maintaining the confidentiality of negotiated price terms is critical to realizing the
benefits of a competitive Medicaid managed care market” and that “confidential rate
terms keep Medicaid costs down”); Brief for Amicus Pa. Coalition of Med. Assistance
Managed Care Orgs. at 3 (“A reversal of the Commonwealth Court’s decisions will
cause substantial and widespread harm to Pennsylvania’s current system of providing
dental care for Medicaid beneficiaries, decreasing quality of care and access to care
and increasing the total cost for taxpayers of the Commonwealth.”)
DPW, for its part, merely adopts the MCOs’ and Subcontractors’ arguments.
We deem the issues presented to be matters of statutory construction, over
which our review is plenary. Upon consideration, we agree with the MCOs and
Subcontractors on the essential points that the Law channels access to third-party
records through Section 506(d)(1), and that such provision contemplates an actual
contract with a third party in possession of salient records.
10
The MCOs and Subcontractors also endorse the Commonwealth Court’s position, in
other cases, that “[b]y its plain language, Section 901 describes the actions that an
agency is obligated to take when it receives a request for a record; it does not define
what records are subject to disclosure under the RTKL.” Brief for Aetna, et al. at 11
(citing Office of the Budget, 11 A.3d at 619-20). We agree. Notably, Section 901’s
discussion of “possession, custody or control” in no way supplants the initial
understanding that it is “public records” which are the subject of disclosure. See 65 P.S.
§67.901 (prescribing that when an agency receives a records request, it “shall make a
good faith effort to determine if the record requested is a public record . . . and whether
the agency has possession, custody or control” (emphasis added)).
[J-29A-C-2015] - 15
The Commonwealth Court’s decision expressly recognized this essential point,
see Eiseman, 86 A.3d at 939-40, and we will affirm its order upon such basis. It is only
because the intermediate court’s opinion took several turns with which we either
disagree or would consider more closely were it necessary to do so, see supra notes 5
and 7, that we are unable to credit the opinion fully.
With regard to records in the possession of third parties, we differ with
suggestions from Requester’s camp that the General Assembly has provided for the
“maximum access to financial records and contractor records.” Brief of Amici Pa.
NewsMedia Ass’n & Pa. Freedom of Information Coalition at 6 (emphasis added).
Rather, as in SWB Yankees, albeit that the policy of liberal access is acknowledged,
this Court also appreciates that the General Assembly had tempered such policy with
explicit limiting terms delineated in the Law, “presumably on account of the burden,
expense, and other impositions attending wholesale disclosure” by non-public entities.
SWB Yankees, 615 Pa. at 662, 45 A.3d at 1042.
Certainly, Requester and its amici have identified salient policy considerations
favoring public access to downstream Provider Rates. Nevertheless, there are
countervailing factors, including the benefit of cost efficiencies associated with the
government’s accessing of complex private systems of administering health care.
Although given the importance of the discrete subject matter – encompassing the
essential provision of health care services as well as the immense associated expense
– particularized legislative consideration would seem to be in order relative to the
openness or secrecy of third-party records downstream from actual Commonwealth
agency contracts, we are left here only to apply the highly generalized principles
established under Section 506(d)(1).
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We appreciate Requester’s concern with the Commonwealth Court’s “litmus test”
for constructive possession under Section 901 of the Law. Nevertheless, Section 901
explicitly harkens back to the essential concept of a “public record,” 65 P.S. §67.901,
and the incorporated definition of a “record” does encompass the notion of a
“transaction or activity of an agency” to which the intermediate court majority has
rightfully afforded meaning, id. §67.102. While in light of the policy of liberal
construction of the instant remedial statute these terms should be construed broadly, cf.
Sapp Roofing, 552 Pa. at 109, 713 A.2d at 629, they simply cannot be ignored, since, at
bottom, our present task is one of statutory construction, not independent judicial
policymaking.
The order of the Commonwealth Court is affirmed, albeit on narrower grounds
than those developed in the intermediate court’s opinion.
Messrs. Justice Eakin and Baer and Madame Justice Todd join the opinion.
Mr. Justice Stevens files a dissenting opinion.
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