Attorney General's Opinion 1992 #004

ADMINISTRATION OF GOVERNMENT GENERALLY: VIRGINIA FREEDOM OF INFORMATION ACT.

COMMISSIONS, BOARDS AND INSTITUTIONS: VIRGINIA HEALTH SERVICES COST REVIEW COUNCIL.

Council is public body within meaning of Act. On July 1, 1992, health care institution documents filed with Council, other than those relating to institution's budget or to individual patient and personnel information, must be open for public inspection, but only after Council has adopted findings, recommendations and justification for recommendations concerning institution. Despite presumption against retroactive effect of statutes, 1992 statutory amendment applicable to filings already held by Council on July 1 effective date. Health care institution filings in physical possession of voluntary cost review organization are official records owned by Council, subject to disclosure under Act.

June 11, 1992

Mr. John A. Rupp
Executive Director, Virginia Health Services Cost Review Council

1992 4

You ask several questions concerning the application of The Virginia Freedom of Information Act, §§2.1-340 through 2.1-346.1 of the Code of Virginia (the FOIA), and of selected provisions in 9-159, to the Virginia Health Services Cost Review Council (the Council). You ask first whether, as a result of legislation effective July 1, 1992, all health care institution documents filed with the Council, other than those relating to the institution's budget or to individual patient and personnel information, must be open to public inspection. If so, you ask whether this requirement also applies to documents that have been filed with the Council before July 1, 1992, and that were exempt from such public disclosure under statutes in effect at the time the documents were filed. You also ask whether documents filed by health care institutions with the Council but held by a voluntary cost review organization are official records subject to disclosure under the FOIA.

I. Applicable Statutes

Section 1-16 provides:

No new law shall be construed to repeal a former law, as to any offense committed against the former law, or as to any act done, any penalty, forfeiture, or punishment incurred, or any right accrued, or claim arising under the former law, or in any way whatever to affect any such offense or act so committed or done, or any penalty, forfeiture, or punishment so incurred, or any right accrued, or claim arising before the new law takes effect.

Section 2.1-341, a portion of the FOIA, defines official records as

all written or printed books, papers, letters, documents, maps and tapes, photographs, films, sound recordings, reports or other material, regardless of physical form or characteristics, prepared, owned, or in the possession of a public body or any employee or officer of a public body in the transaction of public business.

Section 2.1-342(A) states, in part, that [e]xcept as otherwise specifically provided by law, all official records shall be open to inspection and copying by any citizens of this Common-wealth during the regular office hours of the custodian of such records. Section 2.1-342(B) contains 46 exceptions from mandatory disclosure under the FOIA.

The Council operates under authority granted to it by Chapter 26 of Title 9, §§9-156 through 9-166. The Council's duties include the review, analysis and investigation of issues related to health care costs. Section 9-159(A) imposes significant financial reporting requirements on health care institutions. Section 9-159 (B) currently provides:

The findings, recommendations and justification for such recommendations of the Council shall be open to public inspection, but individual health care institution filings made pursuant to this chapter shall not be subject to the provisions of 2.1-342. Individual patient and personnel information shall not be disclosed.

The 1992 Session of the General Assembly, however, has amended these provisions of §9-159(B). Effective, July 1, 1992, §9-159(B) will provide:

No individual health care institution filings relating to an institution's budget shall be open to public inspection. Except as provided in §9-160 A 5, individual patient and personnel information shall not be disclosed. Other individual health care institution filings shall be open to public inspection once the Council has adopted findings, recommendations and justification for such recommendations regarding that institution.

Ch. 848, 1992 Va. Acts 1590, 1592.

Section 9-162(A) states:

A health care institution may, in lieu of filing with the Council under 9-159 and 9-161, submit its financial reports to and be subject to a review of its costs and charges by a voluntary cost review organization approved by the Council whose reporting and review procedures have been approved by the Council in accordance with this section. Any filing made pursuant to this section shall eliminate the requirement for filings to be made with the Council under §9-159 or §9-161.

Section 9-162(C) provides that "[a]ny voluntary cost review organization which receives the financial information required in §9-159 or §9-161 and of selected provisions in §9-159, to the Virginia Health Services Cost Review Council (the Council)." You ask first whether, as a result of legislation effective July 1, 1992, all health care institution documents filed with the Council, other than those relating to the institution's budget or to individual patient and personnel information, must be open to public inspection. If so, you ask whether this requirement also applies to documents that have been filed with the Council before July 1, 1992, and thzation during the course of its review.

Section 9-163 concerns the administration of the Council. Section 9-163(iv) states that the Council shall contract with any voluntary cost review organization for services necessary to carry out the Council's activities where this will promote economy, efficiency, avoid duplication of effort and make best use of available expertise.

II. 1992 Amendment to 9-159(B) Limits Exemption from FOIA for Health Care Institution Documents Filed with Council

Under §2.1-342(A) of the FOIA, all official records held by a public body are open to public inspection and copying [e]xcept as otherwise specifically provided by law. The Council is a public body. See 1989 ATT'Y GEN. ANN. REP. 16, 17. Exceptions to the public inspection requirement in 2.1-342(A) may be found either in the listed categories of exempt documents in §2.1-342(B), or in some other statute. Nothing in §2.1-342(B) specifically addresses documents filed with the Council; however, §9-159(B) currently provides that, while the findings, recommendations and the justification for recommendations made by the Council will be open to public inspection, individual health care institution filings are not subject to disclosure under §2.1-342 of the FOIA. See also 1989 ATT'Y GEN. ANN. REP., supra (financial reports filed by health care institutions exempt from FOIA disclosure, but open meeting provisions of FOIA do not permit Council to meet in executive session to discuss).

The manifest intent of the 1992 amendment to §9-159(B) is to eliminate the blanket exemption from FOIA disclosure that currently applies to individual health care institution filings with the Council. Under the revised language, only those documents filed with the Council that relate to an institution's budget, or to individual patient and personnel information, are exempt from disclosure. As amended, §9-159(B) will require that "[o]ther individual health care institution filings shall be open to public inspection once the Council has adopted findings, recommendations and justification for such recommendations regarding that institution." 1992 Va. Acts, supra Pt. I.

Based on the above, it is my opinion that documents filed with the Council by a health care institution after July 1, 1992, other than those relating to the institution's budget or to individual patient and personnel information, must be made available on request for public inspection, but only after the Council has adopted findings, recommendations and justification for those recommendations concerning that institution.

III. Application of 1992 Amendment to All Documents Held by Council on Effective Date Does Not Violate Presumption Against Retro- active Application

Under §1-16, legislative amendments are presumed to operate prospectively. See, e.g., Shilling v. Commonwealth, 4 Va. App. 500, 507, 359 S.E.2d 311, 315 (1987) (legislature must express intent to override presumption against retroactive operation); ATT'Y GEN. ANN. REP.: 1991 at 282, 284; 1990 at 82, 85. Nothing in the amended language of §9-159(B) indicates that the General Assembly intended the 1992 amendment to operate retroactively. In my opinion, however, application of the 1992 amendment to all documents in the Council's possession on the effective date of that amendment does not constitute a retroactive application that would violate §1-16.

As originally adopted in 1968, the FOIA contained only five categories of public records that were exempt from mandatory disclosure. See Ch. 479 3(b), 1968 Va. Acts 690, 691. Section 2.1-342 (B) has been amended from year to year by the General Assembly, so that 46 categories of public records currently are exempt from the FOIA's disclosure requirements. I am not aware of any instance during the intervening 24 years in which a court decision, an Opinion of the Attorney General or administrative policy has applied such a newly created exemption only to records obtained by a public body after the effective date of the relevant amendment to §2.1-342(B). It is my belief that such amendments to §2.1-342(B) uniformly have been applied on their respective effective dates to exempt all records of the affected category held by a public body, whether received before or after the effective date.

In view of this historic practice, it would be illogical to construe the 1992 amendment to §9-159(B), which removes a previously enacted statutory exemption from FOIA disclosure, to apply only to those filings made with the Council before the July 1 effective date of Chapter 848. In my opinion, therefore, effective July 1, 1992, all health care institution filings held by the Council will be subject to FOIA disclosure to the extent required by §9-159(B), as amended, regardless of the date the Council received those records.

IV. Council Retains Ownership of Health Care Institution Filings Held by Voluntary Cost Review Organization; Filings Thus Remain Official Records Subject to Disclosure

You indicate that, notwithstanding the language in §9-162(A), permitting a health care institution to file with a Council- approved voluntary cost review organization, since 1978, all health care institutions required to file under §9-159 actually have sent their documents to the Council's office. The Council then forwards them to the approved voluntary cost review organization. Your final question, therefore, is whether health care institution documents are official records subject to disclosure under the FOIA while they are in the possession of the voluntary cost review organization.

The FOIA defines "official records" broadly to include "all written . . . documents . . . regardless of physical form or characteristics, prepared, owned, or in the possession of a public body or any employee or officer of a public body in the transaction of public business." Section 2.1-341. Under § 2.1-340.1(B), the General Assembly has declared that the FOIA shall be liberally construed to promote an increased awareness by all persons of governmental activities and afford every opportunity to citizens to witness the operations of government. Any exception or exemption from applicability shall be narrowly construed in order that no thing which should be public may be hidden from any person.

Section 9-162(A) provides that the Council must approve the voluntary cost review organization's receiving financial filings from health care institutions for the Council, and the organization must follow reporting and review procedures approved by the Council. Additionally, the voluntary cost review organization must file a copy of its findings and analysis with the Council, together with a summary of the financial information acquired by the organization during the course of its review. See § 9-162(D). Clearly, therefore, the voluntary cost review organization reviewing financial reports ubmitted by health care institutions is performing a function of the Council, with the permission of the Council, and according to procedures approved by the Council. In addition, § 9-162(C) gives the Council the ultimate authority to retrieve from the voluntary cost review organization any such records in that organization's possession.

In my opinion, therefore, the Council retains ownership of the health care institution filings in the facts you describe, and those records remain subject to the FOIA, except as exempted by § 9-159(B), as amended, even when the records are physically in the possession of the voluntary cost review organization.