Argued: March 8, 2017
BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge,
HONORABLE ROBERT SIMPSON, Judge, HONORABLE PATRICIA A.
McCULLOUGH, Judge, HONORABLE ANNE E. COVEY, Judge, HONORABLE
MICHAEL H. WOJCIK, Judge, HONORABLE JULIA K. HEARTHWAY,
Judge, HONORABLE JOSEPH M. COSGROVE, Judge.
Inc. (Highmark) petitions for review of a final determination
issued by the Office of Open Records (OOR) granting the
request of Christopher L. Voltz, Esquire (Requester) pursuant
to the Right-to-Know Law (RTKL),  and directing the Insurance
Department (Department) to release provider reimbursement
rate information Highmark submitted. Highmark argues the
information is protected by another state law, and it is
confidential proprietary information under Section 708(b)(11)
of the RTKL, 65 P.S. §67.708(b)(11). Highmark contends
it presented sufficient evidence to support nondisclosure.
Additionally, Highmark asserts OOR violated its due process
rights, and on that basis, it asks this Court to accept
supplemental evidence. Because OOR erred as a matter of law,
March 11, 2016, Requester submitted a request seeking:
(1) All documents submitted by Highmark to the [Department]
regarding reimbursement adjustments for physical therapy,
allergy testing and venipuncture services, including, without
limitation, correspondence filings and competitor and market
performance data related to Highmark's Special Bulletin
dated July 22, 2015, wherein Highmark states that Highmark
has filed with, and has now received approval from, the
[Department] to implement Premier Blue Shield and Keystone
Health Plan West (KHPW) reimbursement adjustments;
(2) [a]ll documents submitted by Highmark to [the
Department], including, without limitation, correspondence,
filings and competitor and market performance data, relating
to Highmark's Special Bulletin dated February 15, 2016
(revised February 17, 2016)[, ] concerning Highmark's
adjustment to its provider fee schedule to implement new fees
for its [KHPW] and Premier Blue Shield ACA individual
(direct-pay) products; and,
(3) [a]ll documents evidencing the [Department's]
approval, disapproval or other response to Highmark's
above-described submissions to the [Department] ….
Record (R.R.) at 10a (Request).
Department denied the Request, stating the records were
confidential proprietary information or trade secrets of
Highmark under Section 708(b)(11) of the RTKL, 65 P.S.
§67.708(b)(11). The Department noted that Highmark
"objected to the release of such records." R.R. at
appealed to OOR, requesting in camera review. In
addition to the Request and response, Requester submitted
emails between the Department and the Pennsylvania Physical
Therapy Association (PTA). OOR invited the parties to
supplement the record and directed the Department to notify
third parties, (i.e., Highmark), of their ability to
participate in the appeal.
filed a brief asserting the records were protected
confidential proprietary information under Section 708(b)(11)
of the RTKL, 65 P.S. §67.708(b)(11). In addition,
Highmark asserted Section 309 of the Accident and Health
Filing Reform Act (Reform Act),  40 P.S. §3801.309, and
Section 6329 of the Professional Health Services Plan
Corporations Act (HPCA), 40 Pa. C.S. §6329, exempted
rate information submitted to the Department. Highmark also
submitted an affidavit of its Director of Regulatory Affairs
(Highmark Affidavit) attesting the records were part of a
provider reimbursement filing with the Department, marked
confidential. The Department submitted no evidence, deferring
submitted a letter brief and an affidavit of the PTA attorney
who corresponded with Department counsel (PTA Affidavit).
Therein, the attorney confirmed the Department advised PTA
that Highmark's submissions were not voluntary, but were
required by Section 6329 of the HPCA. PTA Affidavit, ¶9.
Highmark submitted a reply brief responding to
Requester's legal arguments.
the parties nor Highmark requested a hearing. OOR denied
Requester's request for in camera review.
OOR determined Highmark did not meet its burden to prove an
exemption under the RTKL or other state law. Voltz v.
Ins. Dep't & Highmark, Inc., OOR Dkt. AP
2016-0773 (filed July 5, 2016) (Final Determination). OOR
reasoned the Reform Act did not exempt the rates at issue
because only "[p]ayment rates and fees requested by
the [D]epartment shall be given confidential
treatment." 40 P.S. §3801.309(c) (emphasis added).
OOR found no evidence that the Department
"requested" the payment rate or fee information, so
the provision did not apply. OOR rejected Highmark's
argument that rate information must be filed with the
Department under Section 6329 of the HPCA, emphasizing the
partial repeal of Section 6329(a) "insofar as [it]
provides for the approval of rates and
contracts." Section 5101 of the Reform Act, 40 P.S.
§3801.5101 (emphasis added). Because Highmark did not
submit the rate information pursuant to the Department's
explicit request, OOR determined the Reform Act did not
also reasoned the requested records did not qualify as
financial records because they did not relate to an agency
disbursement. In addition, OOR found the Highmark Affidavit
insufficient evidence to prove the rate information was
confidential proprietary information or trade secrets under
Section 708(b)(11) of the RTKL. Accordingly, OOR directed
disclosure of the records.
filed a petition for review. The Department did not
participate. After briefing and argument, the matter is ready
appeal,  Highmark contends OOR erred in holding:
(1) the rate information was not protected from disclosure
under the insurance statutes; and, (2) in holding Section
708(b)(11) of the RTKL did not protect the rate information.
It argues the Highmark Affidavit substantiated that the
exemptions applied, and OOR erred in deeming the evidence
also challenges the adequacy of the proceedings, claiming OOR
violated its due process rights by directing disclosure
without a hearing. Additionally, Highmark asks this Court to
grant its application to supplement the record.
counters that Highmark did not meet its burden to prove the
asserted exemptions. He argues the Highmark Affidavit was
insufficient proof of any competitive harm, so OOR properly
ruled in his favor. He maintains the Reform Act does not
exempt the requested information because the Department did
not request the rates here, which is a precondition to their
protection. He also asserts the partial repeal of Section
6329(a) of the HPCA amounted to a total repeal because that
part pertained to approval, and approval was no longer
305 of the RTKL provides that records in possession of a
Commonwealth agency like the Department are presumed
"public" unless they are: (1) exempted by Section
708 of the RTKL; (2) protected by a privilege; or (3)
exempted "under any other Federal or State
law or regulation or judicial order or decree." 65
P.S. §67.305 (emphasis added). State statutes that
designate public or nonpublic nature supersede the RTKL.
Section 306 of the RTKL, 65 P.S. §67.306; Dep't
of Labor & Indus. v. Heltzel, 90 A.3d 823 (Pa.
Cmwlth. 2014) (en banc).
Court recognizes a third party's interest in protecting
its records in an agency's possession that may not be
waived by the agency. Dep't of Educ. v. Bagwell,
131 A.3d 638 (Pa. Cmwlth. 2016) (Bagwell (2016));
Dep't of Conserv. & Natural Res. v. Vitali
(Pa. Cmwlth., No 1013 C.D. 2014, filed July 7, 2015)
(unreported) (remanding to allow third party to prove
exemption before factfinder). Indeed, a direct interest party
who submitted the records at issue to an agency may be in the
best position to establish their protected nature.
party asserting an exemption bears the burden of proving the
exemption applies. See, e.g., Global
Tel*Link Corp. v. Wright, 147 A.3d 978 (Pa. Cmwlth.
2016) (party with confidential proprietary interest in
financial submission appealed, and established RTKL exception
applied); Dep't of Corr. v. Maulsby 121 A.3d 585
(Pa. Cmwlth. 2015) (remanding to OOR to allow third party to
participate and challenge release of confidential proprietary
information); see also Allegheny Cnty. Dep't of
Admin. Servs. v. Parsons, 61 A.3d 336, 342 (Pa. Cmwlth.
2013) (third-party contractors wear "shoes of [an]
agency for purposes of the burden of proof when the
contractor performs a governmental function ….").
Under Section 708(a)(1), a party bears the burden of proving
any RTKL exception applies "by a preponderance of the
evidence." 65 P.S. §67.708(a)(1).
Due Process - Supplementing the Record
reaching the merits, we consider Highmark's due process
claim. This Court construes the RTKL to afford due process to
third parties, including the ability to submit evidence and
assert exemptions at the appeals officer level.
Maulsby; W. Chester Univ. v. Schackner
(Bravo), 124 A.3d 382 (Pa. Cmwlth. 2015). When a RTKL
request seeks confidential proprietary information that a
third party submitted to an agency, we recognize that third
party's right to due process before disclosure.
See, e.g., Office of the Governor v.
Bari, 20 A.3d 634 (Pa. Cmwlth. 2011) (remanding for
hearing so third party may prove exception).
RTKL context, a right to due process does not entail a right
to a hearing. Giurintano v. Dep't of Gen.
Servs., 20 A.3d 613 (Pa. Cmwlth. 2011). The essential
elements for due process before an OOR appeals officer are
notice and an opportunity to be heard. Wishnefsky v.
Dep't of Corr., 144 A.3d 290 (Pa. Cmwlth. 2016). An
appeals officer has discretion in developing the record to
allow meaningful appellate review. Dep't of Educ. v.
Bagwell, 114 A.3d 1113 (Pa. Cmwlth. 2015) (Bagwell
(2015)). To develop the record, an appeals officer may
undertake in camera review or request submissions as
to material facts. Id.; Office of Open Records
v. Center Twp., 95 A.3d 354 (Pa. Cmwlth. 2014) (en
this Court declines to serve as factfinder, a "role
… best reserved for unique occasions" like
maximizing efficiency. Heltzel, 90 A.3d at 834.
Where OOR's "record contains no information
on [records'] nature and content, " we may
supplement the record. Pa. State Police v. Grove,
119 A.3d 1102, 1105-06 ...