Saint Alphonsus Medical Center - Nampa et al v St Luke's Health System Ltd

Filing 468

MEMORANDUM DECISION AND ORDER. In accord with the Memorandum Decision set forth above, NOW THEREFORE IT IS HEREBY ORDERED, that the objections (docket nos. 465 & 466) are OVERRULED, and the Clerk is directed to unseal the Findings of Fact and Conclusions of Law 464 . Signed by Judge B. Lynn Winmill. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (st)

UNITED STATES DISTRICT COURT
IN THE DISTRICT OF IDAHO

SAINT ALPHONSUS MEDICAL CENTER NAMPA, INC., TREASURE VALLEY
HOSPITAL LIMITED PARTNERSHIP,
Case No. 1:12-CV-00560-BLW (Lead
SAINT ALPHONSUS HEALTH SYSTEM,
Case)
INC., AND SAINT ALPHONSUS
REGIONAL MEDICAL CENTER, INC.
MEMORANDUM DECISION
AND ORDER
Plaintiffs,
v.
ST. LUKE’S HEALTH SYSTEM, LTD.
Defendant.
FEDERAL TRADE COMMISSION; STATE
OF IDAHO

Case No. 1:13-CV-00116-BLW

Plaintiffs,
v.
ST. LUKE’S HEALTH SYSTEM, LTD.;
SALTZER MEDICAL GROUP, P.A.
Defendants.

INTRODUCTION
On January 24, 2014, the Court filed Findings of Fact and Conclusions of Law
following a bench trial. In a separate decision filed the same day, the Court explained
that although the Findings and Conclusions contained material designated as confidential
by the parties, the Court had concluded that the Findings and Conclusions should be
made public without any redactions. To give counsel a chance to object to this analysis,
Memorandum Decision & Order – page 1

the Court filed the Findings and Conclusions under seal and gave counsel three days to
file any objections. St Luke’s and Blue Cross filed objections, while plaintiffs stated that
they had no objections. After reviewing the objections, the Court finds that they fail to
satisfy the high standard for sealing judicial material. The Court’s analysis is set forth in
more detail below.
ANALYSIS
There is a “strong presumption” in favor of access, and a party seeking to seal
judicial materials must identify “compelling reasons” that outweigh the “public interest in
understanding the public process.” Kamakana v. City & County of Honolulu, 447 F.3d
1172, 1178-1180 (9th Cir. 2006). There may be compelling reasons to seal “business
information that might harm a litigant’s competitive standing.” Nixon v. Warner
Communications, Inc., 435 U.S. 589, 598 (1978). But the “mere fact that the production
of records may lead to a litigant’s embarrassment, incrimination, or exposure to further
litigation will, not, without more, compel the court to seal its records.” Kamakana, 447
F.3d at 1178.
In a past decision, the Court found generally that the testimony given during
closed sessions “typically involved some combination of sensitive negotiation strategy,
confidential financial projections, or personal compensation information.” See
Memorandum Decision (Dkt. No. 357). At the time, the Court was convinced that there
were compelling reasons to seal those proceedings.
However, as the case proceeded, those reasons appeared less compelling. For
example, Blue Cross wants redacted any reference to its experience in Twin Falls with
Memorandum Decision & Order – page 2

the Physician Center. That experience is nearly five years in the past, an eternity in this
fast moving field, and there is no discussion of personal compensation, future strategy, or
sensitive details in this brief account. There may be a minor competitive disadvantage
from revealing the incident, but it pales before the public’s right to understand the
Court’s analysis.
The same analysis applies to the attempts to redact statements that (1) St Luke’s or
Saltzer are “must have” providers in the Blue Cross network, (2) that Blue Cross would
not have a “sustainable product” without them, and (3) that the Acquisition would take
away a health insurer’s best outside option and make negotiations more difficult. These
are very general statements and were repeated in various forms by so many witnesses that
they are essentially matters of common knowledge.
St Luke’s and Blue Cross object to revealing specific figures and percentages
regarding hospital-based billing. The practice of hospital-based billing has been widelypublicized, however. See Rosenthal, “As Hospital Prices Soar, a Stitch Tops $500,”
New York Times (Dec. 2, 2013); Brill, “Bitter Pill,” Time Magazine (Feb. 20, 2013).
The Court only discusses specific numbers in less than a handful of paragraphs. While
revealing those numbers may offer some insight to competitors, the effect is not great,
especially when compared to the powerful insight those figures offer to the public trying
to understand how the Court arrived at its decision.
St. Luke’s and Blue Cross want redacted any reference to St Luke’s
reimbursements from Blue Cross growing from an average amount in 2007 to a top-five
amount in 2012. Again, the bargaining leverage that St. Luke’s has with payors is wellMemorandum Decision & Order – page 3

known within the industry, and confirming that with a few figures causes no great
competitive harm. Given the testimony at trial, St. Luke’s position at the top of the
reimbursement list will not surprise anyone.
Finally, Blue Cross wants redacted the paragraph explaining that it pays more than
Medicare for some provider services. Blue Cross complains that these figures will
“disclose to its competitors the reimbursement rates it has negotiated with hospitals and
physicians.” See Objection (Dkt. No. 466) at p. 6. But the paragraph does not reveal any
reimbursement rates paid to hospitals or doctors, and only points out that Blue Cross pays
more than Medicare without breaking down the recipients of those reimbursements.
Such a general discussion can do little competitive harm, but the paragraph is vital to
demonstrate the current status of health care prices in Idaho.
CONCLUSION
To prevail in their attempt to redact portions of the Court’s decision, St. Luke’s
and Blue Cross must show “compelling reasons” that outweigh the “public interest in
understanding the public process.” Kamakana, 447 F.3d at 1178. They have not met that
heavy burden. Whatever insights competitors may glean from the decision, the insights
gained by the public in understanding the Court’s analysis will be far more significant.
The facts and figures sought to be redacted are crucial to the Court’s analysis, and their
removal would render the decision indecipherable.
For all of these reasons, the Court will overrule the objections and order that the
Findings and Conclusions be immediately unsealed.
ORDER
Memorandum Decision & Order – page 4

In accord with the Memorandum Decision set forth above,
NOW THEREFORE IT IS HEREBY ORDERED, that the objections (docket nos.
465 & 466) are OVERRULED, and the Clerk is directed to unseal the Findings of Fact
and Conclusions of Law (docket no. 464).

DATED: January 28, 2014

_________________________
B. Lynn Winmill
Chief Judge
United States District Court

Memorandum Decision & Order – page 5