United States District Court, D. Columbia.
July 1, 2015
CENTER FOR THE STUDY OF SERVICES, ALSO DBA CONSUMERS' CHECKBOOK, Plaintiff,
UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al., Defendants
CENTER FOR THE STUDY OF SERVICES, ALSO DBA CONSUMERS'
CHECKBOOK, Plaintiff: Paige M. Jennings, Caroline Montrose
Brown, COVINGTON & BURLING LLP, Washington, DC.
UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES,
CENTERS FOR MEDICARE AND MEDICAID SERVICES, Defendants:
Benton Gregory Peterson, LEAD ATTORNEY, U.S. ATTORNEY'S
OFFICE, Civil Division, Washington, DC.
Kessler, United States District Judge.
Center for the Study of Services (" Plaintiff" or
" CSS" ), which is also known as "
Consumers' CHECKBOOK," brings this action against
Defendants the U.S. Department of Health and Human Services
(" HHS" ) and the Centers for Medicare and Medicaid
Services (" CMS" ) (collectively, "
Defendants" or " the Government" ) under the
Freedom of Information Act (" FOIA" ), 5 U.S.C.
§ 552. Plaintiff seeks certain information related to
health plans offered pursuant to the Patient Protection and
Affordable Care Act (" ACA" ), Pub. L. No. 111-148,
124 Stat. 119 (2010). The Government has withheld the
requested information under FOIA Exemption 4, which exempts
from disclosure " trade secrets and commercial or
financial information obtained from a person and privileged
or confidential." 5 U.S.C. § 552(b)(4). Plaintiff
initially asked this Court to enjoin Defendants from
withholding health plan benefits data for the 2014 plan year,
which the Government subsequently released. Plaintiff has
since requested substantially similar data for the 2015 and
2016 plan years and asks the Court to permanently enjoin
Defendants from failing to disclose this type of information
in future years.
October 31, 2014, Plaintiff filed its Motion for Summary
Judgment (" Pl.'s Mot." ) [Dkt. No. 28]. On
December 15, 2014, the Government filed a Combined
Cross-Motion for Summary Judgment and Opposition to
Plaintiff's Motion for Summary
Judgment (" Gov't's Mot." ) [Dkt. No. 32].
On December 30, 2014, Plaintiff filed its Combined Opposition
to Defendants' Cross-Motion for Summary Judgment and
Reply in Support of Plaintiff's Motion for Summary
Judgment (" Pl.'s Opp'n" ) [Dkt. No. 36].
Finally, on January 20, 2015, the Government filed its Reply
in Support of Its Motion for Summary Judgment ("
Gov't's Reply" ) [Dkt. No. 40].
consideration of the Motions, Oppositions, Replies, the
entire record herein, and for the reasons stated below,
Plaintiff's Motion for Summary Judgment is hereby denied,
and the Government's Motion for Summary Judgement is
allows individuals to request the disclosure of records from
government agencies. § 552(a) (3). The Act is " a
means for citizens to know what their Government is up
to." Nat'l Archives & Records Admin. v.
Favish, 541 U.S. 157, 171, 124 S.Ct. 1570, 158 L.Ed.2d
319 (2004) (internal citations and quotation marks omitted).
FOIA thus " creates a liberal disclosure requirement,
limited only by specific exemptions which are to be narrowly
construed." Bristol-Myers Co. v. F.T.C., 424
F.2d 935, 938, 138 U.S. App.D.C. 22 (D.C. Cir. 1970).
agency receives a request that " reasonably
describes" the records sought, § 552(a) (3) (A), it
must " conduct  a search reasonably calculated to
uncover all relevant documents." Morley v. CIA,
508 F.3d 1108, 1114, 378 U.S. App.D.C. 411 (D.C. Cir. 2007)
(internal quotation marks omitted). The agency must then
disclose any responsive agency records it locates, except to
the extent that any such records are protected from
disclosure by one of FOIA's nine statutory exemptions.
See 5 U.S.C. § 552(b). If an agency withholds responsive
records not covered by one of FOIA's exemptions, the
requester may, after exhausting administrative remedies, file
a lawsuit in district court to challenge the agency's
decision to withhold. See id. § 552(a)(4)(B). "
Under FOIA, an agency has the burden to demonstrate that the
withheld documents are exempt from disclosure, which it may
meet by submitting affidavits that show, with reasonable
specificity, why the documents fall within the exemption. The
affidavits will not suffice if the agency's claims are
conclusory, merely reciting statutory standards, or if they
are too vague or sweeping." Biles v. Dep't of
Health & Human Servs., 931 F.Supp.2d 211, 223 (D.D.C.
2013) (internal quotation marks, citation, and brackets
FFM Data Submission Process
the ACA, individuals and families may purchase health care
insurance plans during the annual Open Enrollment Period
through on-line marketplaces called " exchanges,"
which are operated by the federal or state governments. The
exchange created by the federal government -- the
Federally-Facilitated Marketplace (" FFM" ) -- is
administered by CMS and its Center for Consumer Information
and Insurance Oversight (" CCIIO" ). See
Plaintiff's Statement of Material Facts at ¶ 3
(" Pl.'s SMF" ) [Dkt. No. 28-2].
who choose to offer Qualified Health Plans (" QHPs"
) through the FFM must submit plan benefits information to
CMS each year during the Initial FFM QHP Application
See CCIIO, 2015 Letter to Issuers in the
Federally-facilitated Marketplaces (Mar. 14, 2014) ("
2015 CCIIO Letter" ) [Dkt. No. 28-7]. Insurers in 36
states offered QHPs through the FFM for the 2015 plan year.
Pl.'s SMF at ¶ 4.
the Government has received insurers' QHP data for an
upcoming plan year, it begins a lengthy, multi-step review
process that may result in a number of changes to the
initially-submitted data. 2015 CCIIO Letter at 6-11. "
CCIIO reviews the data to ensure it meets federal regulatory
requirements and will display correctly on HealthCare.gov
[the FFM's website]." Gov't's Mot. at 7. For
plans offered in certain states, state officials work in
concert with the federal Government to review and approve
submitted QHP data. 2015 CCIIO Letter at 9-10; Pl.'s SMF
at ¶ 4. Insurers are limited in the changes they may
make to submitted QHP data during the submission cycle.
Id. at 10. In the final stages of review, CMS (and
if relevant, the state involved) must approve any proposed
2015 plan year, CMS required insurers to submit their initial
QHP applications by June 27, 2014. Id. at 8, 10.
After June 27, 2014, insurers could not change their proposed
service areas or add new insurance plans but were otherwise
permitted by CCIIO to amend their data. Gov't's
Statement of Material Facts at ¶ 14 ("
Gov't's SMF" ) [Dkt. No. 32-1]. Following the
initial data submission, CMS completed two rounds of review
which ended about August 25, 2014. 2015 CCIIO Letter at 10.
4, 2014, marked the deadline to submit " final" QHP
application data and the beginning of the Limited Data
Correction Window. Id. After the September 4th
deadline, insurers were permitted to make changes only with
" pre-approv[al] by CMS and [if relevant for the
particular state] the state." Id.
October 6, 2014, the Limited Data Correction Window closed,
further restraining the scope of permissible amendments to
QHP data. Gov't's SMF at ¶ 14. Although limited
in terms of plan amendments, insurers remained free to
withdraw QHPs they had planned to offer, and at least some
insurers did so. Gov't's SMF at ¶ 11.
October 2014, the Government provided insurers with final
certifications of their ability to participate in the FFM.
Pl.'s SMF at ¶ 32. Insurers were then required to
sign FFM agreements before the beginning of the Open
Enrollment Period on November 15, 2015. Gov't's SMF
at ¶ 8-9. The Government does not consider " [d]ata
related to plan offerings [to be] final until agreement
signing and plan confirmation [which occurs] approximately
two weeks prior to [O]pen [E]nrollment." Id. at
planning to offer QHPs through the FFM for the 2016 plan year
were required to submit plan benefits data by May 15, 2015.
See CCIIO, FINAL 2016 Letter to Issuers in the
Federally-facilitated Marketplaces (" 2016 CCIIO
Letter" ), at 7 (Feb. 20, 2015), [Dkt. No.
42-2]. The 2016 CCIIO Letter sets forth a
data review process for the 2016 plan
year similar to the one described above for the 2015 plan
CSS is a non-profit 501(c) (3) corporation located in
Washington, D.C. whose mission includes conducting and
supporting studies of consumer services (including those
provided by government programs) and publishing materials to
educate and inform consumers about such services. Pl.'s
Compl. at ¶ 10 [Dkt. No. 1]. It seeks certain
information about the QHPs that insurers will offer on the
FFM in order to create an online tool to help consumers
compare health plans. Id. If Plaintiff's tool is
to serve its purpose of assisting consumers in the selection
of health plans, Plaintiff must obtain health plan benefits
data each year substantially before the beginning of the Open
Enrollment Period. Id. at ¶ 5.
November 29, 2013, pursuant to FOIA, Plaintiff submitted a
request for health plan benefits data provided to CMS by all
insurers planning to offer QHPs through the FFM for plan year
2014. Pl.'s SMF ¶ 6. Specifically, Plaintiff's
letter requested the " complete set of insurance
carrier-submitted facts on the benefits (deductibles,
coinsurance rates, copayment amounts, out-of-pocket limits,
etc.) offered by each Federally-Facilitated
Exchange/Marketplace-eligible plan [QHP] [delivered in
particular template formats]." Letter from Robert
Krughoff, President, Consumers' CHECKBOOK, to Freedom of
Information Officer, Ctrs. for Medicare & Medicaid Servs.
(Nov. 29, 2013) at 1 [Dkt. No. 11-4]. Noting the
time-sensitive nature of its request, Plaintiff asked CMS for
" a very quick response." Id. at 2.
December 2, 2013, CMS granted Plaintiff's request for
expedited processing but did not release the requested 2014
data or set a production schedule. Pl.'s SMF at ¶ 7.
March 24, 2014, nearly four months after submitting its
request, Plaintiff filed its Complaint challenging the
Government's failure to produce the requested
information. Among other things, the Complaint asks this
Court to " [p]ermanently enjoin Defendants from refusing
to disclose or delaying the disclosure of substantially the
same information sought for future plan years [.] "
Pl.'s Compl. at ¶ D.
2, 2014, Plaintiff filed a Motion for Preliminary Injunction
[Dkt. No. 11]. On May 20, 2014, the Court denied
Plaintiff's Motion, holding that Plaintiff failed to
establish that it or the public would suffer an irreparable
injury from the Government's failure to produce the
requested data. Memorandum Opinion and Order [Dkt. No. 17].
The Court also ordered Defendants to file a detailed, written
Status Report concerning production of the requested
25, 2014, the Government filed its Status Report, stating
that it would provide Plaintiff with the 2014 plan year data
before July 1, 2014 [Dkt. No. 20]. However, the Government
did not complete production of the data identified in
Plaintiff's initial FOIA request until August 28, 2014.
Joint Status Report [Dkt. No. 27].
30, 2014, Plaintiff submitted a second FOIA request, which
called for 2015 plan year data substantially similar to the
2014 plan year data that were the subject of the first
request. Letter from Robert Krughoff, President, Ctr. for the
Study of Servs., to Olen Clybourn, Acting Freedom of Info.
Officer, CMS (June 30, 2014) [Dkt. No. 28-4]. On July 30,
2014, CMS denied Plaintiff's second FOIA request,
invoking FOIA Exemptions 4 and 5, § 552(b) (4)-(5).
Letter from Hugh Gilmore, Dir., Div. Freedom of Info., CMS,
to Robert Krughoff, Center for the Study of Servs. (July 30,
2014) [Dkt. No. 28-5].
On August 26, 2014, Plaintiff requested an administrative
appeal. Pl.'s SMF at ¶ 18-20.
September 24, 2014, CMS issued its Appeal Decision, which
upheld the denial of Plaintiff's request. Letter from
Andrew Slavitt, Principal Deputy Adm'r, CMS, to Caroline
M. Brown and Paige M. Jennings, Covington & Burling LLP
(Sept. 24, 2014) (" CMS Appeal Decision" ) [Dkt.
No. 28-7]. CMS overturned its initial reliance on Exemption
5. However, it reaffirmed its finding that the requested data
were exempt from FOIA under Exemption 4 because release would
cause substantial competitive harm to FFM-participating
insurers and would otherwise harm the FFM program.
Id. at 3-4. The Appeal Decision also noted that CMS
would release the requested data once it had been "
finalized" -- just before the beginning of the Open
Enrollment Period on November 15, 2014. Id. at 5.
October 31, 2014, Plaintiff filed the present Motion for
Summary Judgment seeking a " declaration that CMS's
invocation of Exemption 4 to withhold the requested data is
improper, as well as an order that [CMS] produce the
requested 2015 data." Pl.'s Mot. at 2.
November 14, 2014, CMS released the requested 2015 plan
benefits data, and the Open Enrollment Period began the
following day. Gov't's SMF at ¶ 19.
November 24, 2014, pursuant to Executive Order 12,600 and 45
C.F.R. § 5.65(d), Defendants sent a letter to
FFM-participating insurers requesting their views on release
of QHP application information in future years before data
finalization and insurer agreement execution. Id. at
¶ 6. Defendants received letters from 78 insurers
generally objecting to the release of QHP data ("
insurer letters" ). Id. at ¶ 7.
21, 2015, Plaintiff submitted a third FOIA request for the
2016 plan year benefits data. On May 22, 2015, Plaintiff
filed a Status Report [Dkt. No. 42] notifying the Court of
its pending FOIA request for the 2016 data.
STANDARD OF REVIEW
judgment should be granted only if the moving party has shown
that there is no genuine dispute of material fact and that
the moving party is entitled to judgment as a matter of law.
See Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett,
477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986);
Waterhouse v. Dist. of Columbia, 298 F.3d 989, 991, 353 U.S.
App.D.C. 205 (D.C. Cir. 2002). " A fact is material if
it 'might affect the outcome of the suit under the
governing law,' and a dispute about a material fact is
genuine 'if the evidence is such that a reasonable jury
could return a verdict for the nonmoving party.'"
Steele v. Schafer, 535 F.3d 689, 692, 383 U.S.
App.D.C. 74 (D.C. Cir. 2008) (quoting Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91
L.Ed.2d 202 (1986)).
moving party bears the initial burden of demonstrating the
absence of genuine issues of material fact. See
Celotex, 477 U.S. at 323. In determining whether a
genuine issue of material fact exists, the Court must view
all facts in the light most favorable to the non-moving
party. See Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538
(1986); Keyes v. Dist. of Columbia, 372 F.3d 434,
436, 362 U.S. App.D.C. 67 (D.C. Cir. 2004).
deciding a motion for summary judgment, " the court must
draw all reasonable inferences in favor of the nonmoving
party, and it may not make credibility determinations or
weigh the evidence." Reeves v. Sanderson Plumbing
Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147
L.Ed.2d 105 (2000). Ultimately, the court must determine
" whether the evidence presents
a sufficient disagreement to require submission to a jury or
whether it is so one-sided that one party must prevail as a
matter of law." Liberty Lobby, 477 U.S. at 251-52.
Government contends that Plaintiff's action is moot. It
argues that because it has released the 2014 and 2015 plan
year data that Plaintiff requested, Plaintiff has received
all the relief it seeks.
Court of Appeals has made clear, however, that the release of
records following a " specific request under the FOIA .
. . will not moot a claim that an agency policy or practice
will impair the party's lawful access to information in
the future." Payne Enters. v. U.S., 837 F.2d
486, 491, 267 U.S. App.D.C. 63 (D.C. Cir.
1988). Plaintiff intends to request
substantially the same information from Defendants every year
and has requested an injunction barring the Government from
withholding it under Exemption 4. Since filing this Motion,
Plaintiff has also provided notice that it has already
requested benefits data for the 2016 plan year. Status Report
[Dkt. No. 42]. The Government has made clear that, in future
years, it plans to withhold the requested information under
Exemption 4 until the beginning of the Open Enrollment
Period. Gov't's Mot. at 3 (" Defendants . . .
have no objection to releasing such information for future
plan years once the [O]pen [E]nrollment [P]eriod begins.
Defendants, however object to prematurely releasing
proprietary and commercial information . . . prior to the
[O]pen [E]nrollment [P]eriod [.]" ). Thus, the
controversy described in Plaintiff's Complaint is not
moot but ongoing.
the time-sensitive nature of annually-updated plan benefits
data renders the Government's allegedly unlawful
withholding " capable of repetition yet evading
review." Friends of the Earth, Inc. v. Laidlaw
Envtl. Servs. (TOC), Inc., 528 U.S. 167, 190, 120 S.Ct.
693, 145 L.Ed.2d 610 (2000). Challenges to such conduct are
not moot if " (1) the challenged action [is] in its
duration too short to be fully litigated prior to its
cessation or expiration, and (2) there [is] a reasonable
expectation that the same complaining party would be
subjected to the same action again.'" McDonnell
Douglas Corp. v. Nat'l Aeronautics & Space Admin.,
102 F.Supp.2d 21, 23 (D.D.C. 2000) (quoting Weinstein v.
Bradford, 423 U.S. 147, 149, 96 S.Ct. 347, 46 L.Ed.2d
350 (1975)); see also Newport Aeronautical Sales v.
Dep't of Air Force, 684 F.3d 160, 164, 401 U.S.
App.D.C. 364 (D.C. Cir. 2012) (FOIA action not moot because
agency had " no intention of abandoning  policy
because it d[id] not believe the policy violate[d] FOIA"
). Given the time required for a FOIA case to fully ripen and
the Government's statement that, upon future requests for
plan benefits data, it will rely on Exemption 4 to withhold
the data until the beginning of the annual Open Enrollment
Period, Gov't's Mot. at 3, the
Court has little difficulty concluding that this action is
FOIA Exemption 4
4 of FOIA permits agencies to withhold "  trade
secrets and commercial or financial information  obtained
from a person [that is] privileged or confidential[.]" 5
U.S.C. § 552(b)(4). The Parties agree that the
information Plaintiff seeks is " commercial or
financial" and was " obtained from a person."
See Pub. Citizen Health Research Group v. Nat'l Insts. of
Health, 209 F.Supp.2d 37, 44 (D.D.C. 2002) (" Public
Citizen v. NIH" ) (" no doubt that a corporation
may be . . . a person" under Exemption 4); Pub.
Citizen Health Research Group v. FDA, 704 F.2d 1280, 227
U.S. App.D.C. 151 (D.C. Cir. 1983) (" Public Citizen v.
FDA" ) (information is " commercial or
financial" when it relates to commerce). Furthermore,
neither Party asserts that the requested information is
" privileged" or constitutes " trade
secrets[.]" Accordingly, the only question is whether
the requested information qualifies as "
confidential" under 5 U.S.C. § 552(b)(4).
Government contends that all of the information Plaintiff
requested is confidential and thus exempt from FOIA.
Plaintiff disagrees, arguing that all of the requested
information falls outside of Exemption 4, or in the
alternative, that some of the requested information falls
outside of the Exemption and is reasonably segregable from
any exempt information.
appropriate test for determining whether information is
confidential depends on whether the Government obtained the
information by way of voluntary or compelled submission.
Critical Mass. Energy Project v. Nuclear Regulatory
Comm'n, 975 F.2d 871, 872, 298 U.S. App.D.C. 8 (D.C.
Cir. 1992) (" Critical Mass. III" ). When "
the information sought is given to the Government
voluntarily, it will be treated as confidential under
Exemption 4 if it is of a kind that the provider would not
customarily make available to the public." Id.
when the Government possesses the information at issue by way
of compulsion, Courts must apply the two-part test initially
set forth in Nat'l Parks & Conservation Ass'n v.
Morton, 498 F.2d 765, 770, 162 U.S. App.D.C. 223 (D.C.
Cir. 1974). The National Parks test " define[s] as
'confidential' any financial or commercial
information whose disclosure would be likely either (1) to
impair the Government's ability to obtain necessary
information in the future;  or (2) to cause
substantial harm to the competitive position of the person
from whom the information was obtained." Critical
Mass. III, 975 F.2d at 878 (citing Nat'l
Parks, 498 F.2d at 770) (internal citations omitted).
provided to the Government " as a condition of doing
business" is generally considered to have been coerced
rather than provided voluntarily. Biles v. Dep't of
Health & Human Servs., 931 F.Supp.2d 211, 220 (D.D.C.
2013). In order to offer QHPs through the FFM, insurers must
submit plan benefits data to CMS. Accordingly, the Parties
agree that the latter test, applicable to involuntary
submissions of information, governs the Court's analysis
in this case. Gov't's Mot. at 13; Pl.'s Mot. at
chief argument against disclosure is that release of the
requested plan benefits data at any time before the beginning
of the Open Enrollment Period will cause participating
to suffer competitive harm. In order " for the
[G]overnment to preclude disclosure based on a competitive
injury claim, it must prove that the submitters '(1)
actually face competition, and (2) substantial competitive
injury would likely result from disclosure.'"
Niagara Mohawk Power Corp. v. U.S. Dep't of
Energy, 169 F.3d 16, 18, 335 U.S. App.D.C. 100 (D.C.
Cir. 1999) (quoting Nat'l Parks & Conservation
Ass'n v. Kleppe, 547 F.2d 673, 679, 178 U.S.
App.D.C. 376 (D.C. Cir. 1976).
Government argues that insurers submitting QHPs on the FFM
face actual competition both from each other and from
insurers offering plans outside of the FFM.
to the Government, several sources demonstrate competition
among insurers offering QHPs on the exchanges. The Government
cites 78 letters from insurers (or their parent companies)
stating that disclosure of plan benefits information would
likely cause competitive harm. Gov't's Mot. at 14-15;
Gov't's Reply at 2 (citing [Dkt. No. 32-4, 5]).
Although the content of these letters is most relevant to the
second prong of the competitive harm test, the Government
relies on the letters' descriptions of competitive harm
to suggest that the insurers are engaged in actual
Government also contends that the " one-stop-shop"
nature of the FFM " increas[es] competition between
insurance companies." Gov't's Reply at 2-3
(citing CMS, Creating a New Competitive Health Insurance
Marketplace). Finally, the Government points to a
Bloomberg Government article that states, " Competition
among insurers offering coverage through federal exchanges
established under the Affordable Care Act is driving down the
premiums charged in the new marketplaces by as much as one
third [.] " Peter Gosselin, Exchange Competition Cuts
Health Insruance Costs: BGov Insight, Bloomberg Government
(October 8, 2013). The Bloomberg article is not evidence
and is certainly no substitute for affidavits, expert
reports, or deposition testimony -- evidentiary sources that
the Government has not brought to bear.
in the light most favorable to Plaintiffs, the Government has
put forth no reliable evidence of actual competition between
insurers participating in the FFM. The authors of the 78
letters HHS relies on were sent a carefully-worded letter
presenting HHS' legal interpretation of Exemption 4 and
asking whether each insurer's application information for
a given plan year may be protected by Exemption 4. HHS,
Letter to Insurers at 34-35 [Dkt. No. 32-3] (setting forth
the Government's theory of Exemption 4's application
to plan benefits data). Therefore, it is not surprising that
many of the letters describing the potential for competitive
harm agree with the Government's position.
response, Plaintiffs cite the Government's own estimate
" that at least 95 percent of consumers will be
automatically re-enrolled in a plan in 2015, and will not
have to make any affirmative choice," Pl.'s Mot. at
13-14, as evidence of a lack of competition among
because there are material facts in dispute, the Government
has failed to demonstrate that FFM-participating insurers are
engaged in actual competition with each other.
addition, the Government fails to show that FFM-participating
insurers are in competition with insurers who offer
plans outside of the FFM. The Government points to the same
78 letters describing the competitive harm that may befall
FFM insurers if off-FFM insurers obtain the requested plan
benefits data. Gov't's Reply at 2 (citing [Dkt. Nos.
32-4, 33-5]). Although these letters suggest that
FFM-participating insurers compete with insurers who offer
plans outside of the FFM, they could just as easily suggest
hypothetical or potential competition rather than actual
competition. Thus, with respect to competition between
FFM-participating insurers and non-FFM-participating
insurers, the Government also fails to prove actual
the inadequacies of the Government's evidence, it has not
established that FFM-participating insurers face actual
competition from any source. Thus, its Motion cannot prevail
on grounds of competitive harm.
has also submitted a Motion for Summary Judgment. Therefore,
as to its arguments, the Court must now consider the
evidentiary record in the light most favorable to the
Government. As discussed above, the insurer letters provide
weak support for the Government's allegation of actual
competition. However, when viewing Plaintiff's Motion in
the light most favorable to the Government, one could
conclude that there is actual competition from the
letters' descriptions of competitive harm that would
arise from pre-Open Enrollment disclosure of plan benefits
data. Moreover, Plaintiff has not countered the
Government's evidence (weak as it is) of actual
competition with any documentary evidence of its own. Thus,
there is a genuine issue of fact as to whether
FFM-participating insurers face actual competition.
this factual dispute does not entirely preclude Summary
Judgment because: 1) Plaintiff may prevail by
demonstrating that even if insurers faced actual competition,
early disclosure would not give rise to a likelihood of
substantial competitive harm and would do no harm to the FFM
program; and, on the other hand, 2) the Government may
prevail on its alternative " program effectiveness"
ground for withholding the data sought. See infra Section 2.
Likelihood of Substantial Competitive Harm
addition to a demonstration of actual competition, Exemption
4 requires a showing that a " likelihood of substantial
competitive injury" would arise from release of the data
Plaintiff has requested. Niagara Mohawk Power Corp.,
169 F.3d at 18. " [W]hile the parties cannot rest on a
'conclusory and generalized allegation of substantial
competitive harm,' the court need not engage in a
sophisticated economic analysis to determine whether there is
a likelihood of substantial competitive injury."
Public Citizen v. NIH, 209 F.Supp.2d at 46
(quoting Public Citizen v. FDA, 704 F.2d at
1291). However, the
harm alleged is relevant only if it arises from the "
affirmative use of proprietary information by
competitors." Public Citizen v. FDA, 704 F.2d
at 1291 n.30.
Government argues that several forms of competitive harm
would arise from compliance with Plaintiff's request: 1)
early disclosure would allow insurers to learn about the
rates and plan specifications of their competitors in order
to undercut each other; 2) pre-Open Enrollment release of
plan benefits data would cause harm to innovative insurers by
allowing competitors to amend their plans in order to produce
more appealing innovations; and 3) because plan information
may change up to the beginning of the Open Enrollment Period,
early disclosure would make conflicting data sets available
to the public and lead to consumer confusion, which might
harm some insurers to the benefit of others.
Government bases its argument almost exclusively on the 78
insurer letters objecting to disclosure, id. at
14-15; see also [Dkt. Nos. 32-3, -4 , -5], which the Court
has already found to be less than compelling. The Government
also refers to a Declaration by CCIIO Director Kevin
Counihan. (" Counihan Decl." ) [Dkt. No. 32-2].
counter the Government's position, Plaintiff primarily
cites letters that the Government has sent (or plans to send)
to insurers, which detail the process for submitting and
reviewing plan benefits data in order to offer health
insurance plans on the FFM (" process letters" ).
E.g., 2015 CCIIO Letter; 2016 CCIIO Letter. Plaintiff also
makes reference to publicly available information on the
Government's and insurers' websites. E.g., Website
Screen Shots [Dkt. Nos. 28-11, 37-2].
the Parties disagree about when the insurer-submitted QHP
data becomes " final" during the review process.
The Government contends that the data for any particular
insurer is not final until the insurer and the Government
have executed an agreement for the plan year -- a step that
occurs just before the beginning of the Open Enrollment
argues that after the initial data submission deadline,
insurers are greatly limited in their ability to alter their
submitted data, and that after the next deadline for "
final QHP data submissions," insurers can make almost no
changes at all. Thus, Plaintiffs contend that, as a practical
matter, data should be considered final after its initial
submission or, at the very latest, after the final data
submission deadline. Accordingly, the ultimate resolution of
this case will almost certainly require an answer to the
question of when QHP data may be considered final.
Government argues that " [d]isclosing the proposed
health plans prior to approval and clearance by HHS would
allow the submitters' competitors to 'learn about
rates and plan information that the submitters were planning
to market,' and those competitors could use the
information to their advantage, i.e. by developing competing
plans and rates." Gov't's Mot. at 15 (source of
quoted material not indicated in original); see also
Gov't's Reply at 4 (citing numerous insurer letters).
objects on several grounds. First, citing a letter from the
Government to FFM-participating insurers, Plaintiff asserts
that once insurers have submitted their plan data, they have
" very little ability to change their plan
benefits" and accordingly, could not undercut their
competitors. Pl.'s Not at 14-15.
Government responds by describing a variety of scenarios in
could significantly change their data after the deadlines
Plaintiff has cited. Gov't's Reply at 4 (citing
insurer letters). But the Government also admits that it
currently " reviews the data submitted by the issuers
mainly for regulatory compliance and accuracy of
data[,]" Gov't's Mot. at 17, thereby suggesting,
as Plaintiff argues, that there will be no substantive
also contends that release of all FFM-participating
insurers' data -- not just particular insurers' data
-- will mitigate any possible harm by placing all insurers on
equal footing. Pl.'s Mot. at 20. The Government responds
that " larger entities who will have the staff and
resources to quickly change their products based on
competitors' information" will gain an advantage
over smaller insurers through the early release of plan data.
Gov't's Mot. at 20.
responds that, to a large extent, FFM-participating insurers
already know the details of the plans competitors submit at
the first deadline. As noted above, CMS expects 95 percent of
consumers to automatically re-enroll in their current plans.
Under CMS regulations, automatic re-enrollment can only occur
if plans retain roughly the same benefits and cost-sharing
structure. See 45 C.F.R. § § 147.106(a), (b)(4),
(c), (e). Accordingly, plans covering the vast majority of
consumers are not expected to undergo significant changes,
severely blunting any competitive advantage that might be
gained from early access to plan benefits data.
CMS's prediction of general stability among the plans
offered presumes the status quo (i.e., that plan benefits
data will not be released until Open Enrollment). The
Government's declarant states that if insurers had
earlier access to their competitors' data, " CCII0
expects that competitors would change plan designs or
prices[.]" Counihan Decl. at ¶ 6 (emphasis added).
Government also contends that even if the information that
Plaintiff requests would not lead to competitive harm, the
requested information could be paired with publicly available
information, and together the requested and publicly
available information would likely lead to substantial
competitive harm. Gov't's Mot. at 18. The Government
fails, however, to identify the relevant public information,
the relevant requested information, or the type of harm that
might occur if the two were combined. The Government simply
cannot rely on such " conclusory and generalized
allegation[s]" to defeat disclosure. Public Citizen
v. NIH, 209 F.Supp.2d at 46.
essence, the Parties again present a factual disagreement.
Whether one concludes that early release of the requested
data could lead to undercutting depends on the light in which
the evidence is examined. Thus, summary judgment is
inappropriate. The record presented by the Parties is so
incomplete and confusing on the issue of undercutting, that
it alone precludes granting either Motion for Summary
Judgment on this issue.
to the Government, release of plan benefits data before the
Open Enrollment Period would " degrade" the
" incentive for innovation" and thereby subject
some insurers to competitive harm. Counihan Decl. at ¶
8. Plaintiff notes that the Government's sole source for
this claim is the affidavit of CCIIO Director Kevin Counihan
and contends that such a " 'bald assertion' by
an agency declarant . . . is insufficient to support summary
Pl.'s Resp. to Gov't's SMF at ¶ 12 (quoting
Ancient Coin Collectors Guild v. U.S. Dep't of
State, 641 F.3d 504, 512, 395 U.S. App.D.C. 138 (D.C.
Cir. 2011)). The Court agrees.
Plaintiff notes that the ACA's requirements limit the
aspects of insurance plans that insurers may manipulate in
order to produce innovation. For example, the ACA requires
health plans to cover specific, identified " essential
health benefits," 42 U.S.C. § 300gg-6(a); meet
certain minimum actuarial value requirements, see id. §
18022(d); comply with maximum annual cost-sharing limits, id.
§ 300gg-6(b); not discriminate in benefit design, 45
C.F.R. § 156.125; and " [n]ot employ . . . benefit
designs that will . . . discourage the enrollment of
individuals with significant health needs," id.
light of these statutory and regulatory limitations,
Plaintiff is correct that the ACA " has made it more
difficult for [insurers] to compete on the basis of plan
benefit design." Pl.'s Resp. to Gov't's SMF
at ¶ 12. However, the existence of genuine issues of
material fact regarding the Government's other grounds
for withholding precludes a grant of summary judgment to
Government argues that " [p]ublic release of [non-final]
information to consumers misinforms them of their benefits
for a particular plan, leading to competitive harm to the
issuers whose inaccurate, non-final information has been
released." Gov't's Mot. at 21 (citing
Gov't's Att.3 at 41 [Dkt. No. 32-4]). The Government
notes that until insurers have signed their plan confirmation
agreements, they remain free to withdraw health plan
offerings. Consequently, consumers reviewing early-released
data might find plan offerings that are not actually included
in the FFM.
again citing the Government's process
letters to the insurers, argues that the
Government exaggerates the extent to which insurers may
change their data late in the review process. It also
contends that the Government's argument -- that release
of information will confuse the public -- runs counter to
FOIA's purpose, which is to provide " a means for
citizens to know what their Government is up to."
Favish, 541 U.S. at 171.
Government fails to respond to any of Plaintiff's
arguments in its Reply. Moreover, the insurer letter the
Government cites for the proposition that consumer confusion
will lead to competitive harm, Gov't's Ex. 3 at 41
[Dkt. No. 32-4], does not even mention consumer confusion.
Finally, our Court of Appeals has " emphasize[d] that
[t]he important point for competitive harm in the FOIA
context . . . is that it be limited to harm flowing from the
affirmative use of proprietary information by competitors.
Competitive harm should not be taken to mean simply any
injury to competitive position, as might flow from customer
or employee disgruntlement[.] " Public Citizen v.
FDA, 704 F.2d at 1291. Even viewed in the light most
favorable to the Government, it has failed to show that the
harm it claims will arise from consumer confusion would be
caused by competitors' use of proprietary information as
Exemption 4 requires.
Government also argues that it may withhold the requested
data because early release would damage the effectiveness of
the FFM program. Plaintiff denies that harm to " program
effectiveness" is a valid basis for withholding under
Exemption 4. Even if harm to program effectiveness is
properly considered grounds for withholding, the Government
has failed to demonstrate that release of the requested
benefits data at any point before the beginning of the Open
Enrollment Period would harm the FFM program. Consequently,
summary judgment for the Government must be denied on this
claim for the following reasons.
described above, our Court of Appeals has adopted the
two-pronged National Parks test, which considers the
Government's interest in obtaining information from
private entities and private parties' interest in
avoiding competitive harm. National Parks, 498 F.2d
at 770. In that case, the Court of Appeals mentioned, for the
first time, program effectiveness in connection with
Exemption 4. National Parks, 498 F.2d at 770 n.17
(" We express no opinion as to whether other
governmental interests are embodied in this exemption. Cf.
1963 Hearings at 200 [sic] where the problems of compliance
and program effectiveness are mentioned as governmental
interests possibly served by this exemption." ).
that decision, the U.S. Court of Appeals for the First
Circuit interpreted National Parks to contemplate application
of Exemption 4 to information that, if released, would harm
[The National Parks test does not impose] a limitation on the
number of legitimate interests which are protected by
Exemption 4. . . . [I]n view of the legitimate governmental
interest of efficient operation, it would do violence to the
statutory purpose of Exemption 4 were the Government to be
disadvantaged by disclosing information which serves a
valuable purpose and is useful for the effective execution of
its statutory responsibilities.
9 to 5 Org. for Women Office Workers v. Bd. of Governors
of Fed. Reserve Sys., 721 F.2d 1, 9-10 (1st Cir. 1983).
out Court of Appeals expressed support for the First
Circuit's ruling. Critical Mass. Energy Project v.
Nuclear Regulatory Comm'n, 830 F.2d 278, 286, 265
U.S. App.D.C. 130 (D.C. Cir. 1987) (" Critical Mass.
I" ) (agreeing with the First Circuit's reasoning
but holding that the Government had not shown how disclosure
would harm the effective performance of the agency's
responsibilities). Sitting en banc in Critical Mass. III, our
Court of Appeals later explained that while the National
Parks test is not exclusive, the Court agreed with the "
First Circuit's conclusion that the exemption also
protects a governmental interest in administrative efficiency
and effectiveness." Critical Mass. III, 975
F.2d at 879 (citing Critical Mass. I, 830 F.2d at
Government, of course, bears the burden of demonstrating with
specific factual and evidentiary material that disclosure
would cause the cited harm. 5 U.S.C. § 552 (a) (4) (B) ;
Comstock, 464 F.Supp. at 807. The Government
contends that maintaining the confidentiality of plan
benefits data until the Open Enrollment Period begins is
central to the FFM program's operation. Gov't's
Mot. at 18. However, the Government has failed to show
concretely how it
(including the ACA and FFM) would be harmed through the
release of information prior to the Open Enrollment Period,
and instead relies on conclusory statements that are
insufficient to carry the Government's burden. See
Comstock, 464 F.Supp. at 807.
to its concern about consumer confusion, the Government
contends that pre-Open Enrollment disclosure would cause
confusion and harm the effectiveness of the FFM as a "
one stop shopping tool" for consumers to identify and
purchase health plans. Gov't's Mot. at 18-19. The
Government has failed to substantiate its claim that
disclosure would result in consumer confusion with specific
factual and evidentiary material. Moreover, the Government
does not explain why public release of data after the
beginning of the Open Enrollment Period would not be equally
confusing to consumers given that such data is "
regularly" updated after its release. See CCIIO, Health
Insurance Marketplace Public Use Files (Marketplace PUF),
Government also fails to explain how consumer confusion would
result in harm to the FFM program sufficient to warrant
withholding. Consumers choosing to enroll in a health
insurance plan through the FFM must complete CMS's
application during the Open Enrollment Period whether by
using HealthCare.gov , by calling the Marketplace Call
Center, or by meeting with a professional. See Federal
Marketplace Progress Fact Sheet, CMS.gov,
(updated May 31, 2013). The Government offers no reason why
any confusion would not be cured upon a consumer's first
interaction with the FFM itself.
Government also contends -- improperly, for the first time in
its Reply, Am. Wildlands v. Kempthorne, 530 F.3d
991, 1001, 382 U.S. App.D.C. 78 (D.C. Cir. 2008) -- that
early release of information " would likely" lead
insurers to initially provide the Government with false data
and make last minute changes before plan finalization.
Gov't's Reply at 9. This is pure speculation.
Moreover, the Government's concern hardly seems plausible
in light of its own statement that after the initial
submission period significant changes may not be made to
benefit plans except with permission from CCIIO.
Gov't's SMF at ¶ 14; 2015 CCIIO Letter at 10.
the Government has failed to carry its burden to demonstrate
harm to program effectiveness. Because the Government has
failed to show either competitive harm or harm to program
effectiveness, its Motion for Summary Judgment must be
Plaintiff points out, the Government has an obligation under
FOIA to consider whether any portion of the requested data
falls outside of Exemption 4 and is reasonably segregable
from exempt data. See 5 U.S.C. § 552(b) (" Any
reasonably segregable portion of a record shall be provided
to any person requesting such record after deletion of the
portions which are exempt under this subsection." );
Powell v. U.S. Bureau of Prisons, 927 F.2d 1239,
1242, 288 U.S. App.D.C. 384 (D.C. Cir. 1991) (" [T]his
court has long recognized that agencies . . . are obliged to
determine whether nonexempt material can reasonably be
segregated from exempt material." ); Mead Data Cent,
v. U.S. Dep't of Air Force, 566 F.2d 242, 261, 184
U.S. App.D.C. 350 (D.C. Cir. 1977) (" [U]nless the
of the FOIA is to be nothing more than a precatory precept,
agencies must be required to provide the reasons behind their
conclusions in order that they may be challenged by FOIA
plaintiffs and reviewed by the courts." ).
Reply, the Government contends that release of any plan
benefits data before the beginning of the Open Enrollment
Period would cause FFM-participating insurers competitive
harm and that therefore, none of the requested data is
reasonably segregable from data covered by Exemption 4.
Because both Parties' Motions for Summary Judgment are
being denied, the Court need not at this time assess the
merits of the Government's position.
foregoing reasons, Plaintiffs' Motion for Summary
Judgment shall be denied and Defendants' Motion for
Summary Judgment shall be denied.
Court warns the Parties that any future filings must contain
clearer presentation of the facts underlying this case.
The Government refers to its Reply as its
Combined Reply in Support of Its Motion for Summary Judgment
and Opposition to Plaintiff's Cross-Motion for Summary
Judgment, but the Government's Combined Cross-Motion and
Opposition, of course, serves as the Government's
Opposition. Therefore, the Reply is cited herein as
The Parties do not agree as to the scope of
permissible changes to QHP data following the initial and
final QHP application data deadlines. See e.g., Pl.'s SMF
at ¶ 27; Gov't's Resp. to Pl.'s SMF at
¶ 27. They do agree, however, that changes made after
September 4, 2014 required CMS approval. Gov't's
Resp. to Pl.'s SMF at ¶ 27.
The Government attempts to distinguish
Payne by arguing that the challenge presented in Payne was
not moot only because the agency had unlawfully withheld
documents under FOIA Exemptions 4 and 5, whereas in this
case, the Government is right to withhold the requested
information under Exemption 4. Gov't's Reply at
10-11. The Government's argument rests entirely upon the
presumption that it will prevail on the merits, and thus,
puts the cart before the horse. " [M]ootness should not
be confused with the merits. An argument that an action is
moot because the plaintiff is not entitled to the requested
relief, for example, is no more than an argument on the
merits that should be decided on the merits." 13B
Charles Alan Wright & Arthur R. Miller, Federal Practice and
Procedure § 3533.1 (3d ed. 2015).
The Government does not directly address
the first prong of the National Parks test in its
Plaintiff also notes that " an
estimated 85% of Exchange enrollees depend on subsidies to
purchase coverage. Given that unsubsidized coverage in the
non-[FFM] market is not significantly cheaper than [FFM]
coverage, it seems unlikely that [FFM] enrollees could afford
to purchase coverage outside of the [FFM] or that off-[FFM]
plans are competing for those same customers." Pl.'s
Opp'n at 4.
Thus, neither Party has submitted
sufficient convincing evidence to prevail on its Motion for
The Government contends that courts
" generally defer to the agency's predictive
judgment as to the repercussions of disclosure."
Gov't's Mot. at 13 (quoting United Techs. Corp.
v. Dep't of Defense, 601 F.3d 557, 563, 390 U.S.
App.D.C. 136 (D.C. Cir. 2010)). The passage the Government
quotes, however, concerned a " reverse FOIA" case
brought under the Administrative Procedure Act ("
APA" ). Id. Such cases are reviewed under the
APA's deferential " arbitrary and capricious"
standard. Id. Agency determinations in direct FOIA
challenges, like the case at hand, are reviewed de novo. 5
U.S.C. § 552 (a) (4) (B).
Of course, the Government has to prevail
at both steps of the National Parks test but has already
failed to meet its burden at step one.
See p. 23.
The Second Circuit has criticized the
Government's assertion of a right to withhold information
that, if released, would harm Government programs. Bloomberg,
L.P. v. Bd. of Governors of the Fed. Reserve Sys., 601 F.3d
143, 150 (2d Cir. 2010) (" The 'program
effectiveness' test, if applied as the [Government]
invokes it, would give impermissible deference to the agency,
and would be analogous to the 'public interest'
standard rejected by the Supreme Court in the context of
Exemption Five." ) (citing Fed. Open Market Comm. of
Fed. Reserve Sys. v. Merrill, 443 U.S. 340, 354, 99
S.Ct. 2800, 61 L.Ed.2d 587 (1979)).
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