Court Opinion

ID: 9768168
Source: CourtListenerOpinion
Date Created: 2023-08-29 05:44:58.175093+00
Date Added: 2024-06-11T07:30:37.036209
License: Public Domain

WINTERSHEIMER, Justice,
dissenting.
I must respectfully dissent from the Majority Opinion because the Court of Appeals applied the appropriate standard of review and correctly interpreted the statutes governing health insurance rate filings and public hearings. The Court of Appeals order properly protects the public interest as well as the property interest of Southeastern. No irreparable injury will occur to Southeastern if the information subject to this appeal is disclosed.
The general public has a fundamental interest in a complete and detailed explanation of every aspect of the significant rate increases sought by Southeastern for health care insurance. This is the public’s business and, therefore, must be open in a democratic republic. Secrecy has no place in a democracy in regard to general functions or the operations of government at any level and certainly has no place in a rate hearing that directly affects the public.
Health insurance policyholders and the public at large must have sufficient information at all stages of a rate hearing so that they may have the opportunity to fully participate in the hearing process in a knowledgeable manner. Information is essential to an informed citizenry.
*201KRS 304.2-150(3) and §§ 15 and 16 of Senate Bill No. 343 clearly indicate the intention of the General Assembly to create a more open process for modifying and increasing insurance rates in Kentucky. Senate Bill No. 343, in particular, establishes a presumption that materials related to insurance rate increases are subject to disclosure. The legislation does not necessarily require public disclosure of all information, but the exemptions should be strictly construed so as to allow as much public information as possible. The law provides that rate and form filings and information in support thereof “shall be open.” It is a remarkably clear and direct statement of the intention of the legislature. In 1996, the legislature required the Commissioner to perform a thorough review of all recently modified health insurance rates and allows him to order rebates of any charges he considers excessive. There is series of other legislative directives which require the Commissioner to conduct public hearings on any subsequent requests for rate increases of more than 3 percent above the medical rate of inflation; a specific mandate that the Attorney General be a party in all rate hearings; and the authorization for the Commissioner to adopt regulations specifying additional information that must accompany rate filings and provisions to withdraw approval for rates and order refunds of unreasonable charges. All clearly indicate the intention of the General Assembly for open proceedings. These statutes demonstrate a legislative intent to protect both the substance and appearance of fairness in insurance rate hearings and to provide for informed public participation in the process. In order to accomplish this end, the statutes require disclosure of rate filings in a manner likely to show interested policyholders of their specific interest in the particular proceeding.
As noted by the Court of Appeals, any exceptions to the public disclosure of rate filing information must be justified by a finding setting forth compelling reasons for confidentiality. I agree with the Court of Appeals that the evidence offered by Southeastern in support of confidentiality does not overcome the statutory presumption of openness and disclosure. It was reversible error for the hearing officer to describe the materials at issue as proprietary and therefore entitled to confidential protection.
The hearing officer did not clearly articulate the standard he used to ascertain whether the information Southeastern sought to keep secret was in fact proprietary, and he did not demonstrate how the standard he did use applied to the information. Valid trade secrets can be properly protected by use of the Uniform Trade Secrets Act codified in KRS 365.880-900.
My dissent in Marina Management Services, Inc. v. Cabinet for Tourism, Ky., 906 S.W.2d 318 (1995), observed that in order to protect trade secrets an argument should be complete and very detailed so as to avoid the necessity of disclosure of any possible trade secrets. The veil of secrecy should not mask the right of the public to ascertain pertinent facts. When public funds are involved in any way the public has an absolute right to expect that clear and open accountability be maintained. Such a principle also applies to the funds of the public that may be involved in the application we consider in this case.
Consequently, the hearing officer is about to proceed incorrectly and improperly in denying access to information the General Assembly had determined should be available to policyholders and health insurance consumers.
This Court in Morgan v. Blue Cross and Blue Shield of Kentucky, Inc., Ky., 794 S.W.2d 629 (1989), held that the public needs protection from arbitrary pricing decisions made by insurance companies and subscribers should have information on such pricing decisions. Such a goal can be accomplished by an open hearing with companies bearing the responsibility of proving a compelling need for confidentiality. This compelling need was not demonstrated in this case. The Attorney General is correct in stating that there would be no adequate remedy by appeal.
The order of the Court of Appeals should be affirmed and this matter should be remanded to the circuit court for issuance of a writ prohibiting the hearing officer of the Insurance Commission from denying public *202access to any information submitted in support of the request of Southeastern for a rate increase except as provided by the order of the Court of Appeals. The stay of the administrative proceedings imposed by this Court on September 4, 1996 should be dissolved and the hearing should continue in an atmosphere of full disclosure.
GRAVES and STUMBO, JJ., join in this dissent.