Medical transparency company sues KY, argues it’s withholding pricing data
A Florida-based company that seeks to provide medical transparency is suing Kentucky’s labor cabinet to obtain pricing data, while the state argues the documents are exempt from public records laws because they’re owned by a third party.
RefMed, also known as D1 Data Solutions, filed a civil lawsuit Friday in Franklin Circuit Court asking that a judge require the Kentucky Education and Labor Cabinet to release fee schedules for workers’ compensation claims in the commonwealth.
Fee schedules are documents that determine the maximum costs for specific health services, such as surgery and doctors’ visits. New York City-based FAIR Health helped Kentucky revise its fee schedules — a process the state undergoes every two years — in 2024. The Kentucky Education and Labor Cabinet paid $85,000 to FAIR Health for the work.
Now, the Kentucky labor cabinet says those records are available only through FAIR Health. And FAIR Health says to obtain them, a requester must pay additional fees — up to $175.
“This case poses a simple question: Can a public agency require an Open Records Act requester to purchase a public record that carries the force of law from a private entity?” RefMed wrote in the suit.
While RefMed is based in Florida, it is registered to work in Kentucky, and therefore eligible to obtain records in Kentucky.
Neither FAIR Health nor the state labor cabinet responded to a request for comment Monday morning.
Lawyer: KY department protecting monopoly
On March 24, RefMed sent an open records request to the Kentucky Education and Labor Cabinet seeking fee schedules for workers’ compensation claims, according to the lawsuit.
One day later, the state cabinet denied the company’s request, arguing the billing codes included in the fee schedule were “proprietary” to the American Medical Association, an advocacy association for physicians. In order to obtain the documents, RefMed would have to pay FAIR Health for licensing fees.
But RefMed had already paid licensing fees to the American Medical Association. And even so, the company argues, the documents are public under Kentucky law and should require no licensing fees.
FAIR Health is contracted to work on state fee schedules in Georgia, Mississippi, South Carolina and Tennessee. Kentucky has contracted with the company since 2012.
FAIR Health is the nation’s largest repository of private claims data, according to its website. When someone seeks data from the company, it charges different amounts, depending on the format. For example, a PDF costs an initial fee of $75, plus an additional $60 for each person with whom the data is shared.
An electronic copy is $175, with an additional $60 sharing fee. A hard copy is $150.
“The best way to understand the department’s denial, then, is as an attempt to protect the monopoly that it decided — for whatever reason — to grant to FAIR Health, a vendor to whom the public has already paid hundreds of thousands of dollars to help develop the fee schedules,” the lawsuit states.
RefMed argues that once the state adopted the 2024 fee schedule, it became a final public record under the open records act. Because the fee schedules are updated every two years, the 2024 schedule is the most recent copy.
“Instead, by requiring additional licensing fees, the lawsuit alleges FAIR Health is extracting fees from public records requesters and dictating how other people use those records,” the lawsuit states.
RefMed is asking the judge order that the state labor department turn over the documents unredacted.
FAIR Health and the sate labor cabinet had not filed a response to the lawsuit as of Monday morning. A hearing has not been scheduled.
