Ken Paxton, Attorney General of the State of Texas v. Texas Department of State Health Services

Citation: Not availableDocket: 03-14-00594-CV

Court: Court of Appeals of Texas; February 8, 2015; Texas; State Appellate Court

Original Court Document: View Document

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The Texas Department of State Health Services (DSHS) initiated a lawsuit against Greg Abbott, the Attorney General of Texas, seeking a judicial declaration that all materials related to audits or investigations conducted by the Texas Health and Human Services Commission Office of Inspector General are confidential under Texas Government Code section 531.1021(g), regardless of their connection to Medicaid fraud. DSHS also argued that the information referenced in Letter Ruling OR2012-10072 was confidential and exempt from disclosure under the Texas Public Information Act (PIA). The trial court ruled in favor of DSHS by granting its Motion for Summary Judgment and denying Abbott's Motion for Summary Judgment. The appeal centers on the appropriateness of the trial court's decision to favor DSHS's summary judgment motion.

The trial court's decision to uphold the confidentiality of information related to an investigation of alleged misconduct by a Texas Department of State Health Services (DSHS) employee is under scrutiny. The relevant statutes in question are Texas Government Code sections 552.101 and 531.1021, particularly the latter's subsection (g), which makes confidential all information collected by the Office of Inspector General (OIG) during audits or investigations without restricting the subject matter. The attorney general argued that this confidentiality should only apply to cases involving fraud, waste, or abuse in health services, a position the trial court did not endorse.

The procedural background reveals that DSHS sought judicial review after receiving two information requests regarding an OIG investigation initiated by a complaint from one employee against another. The OIG concluded the complaint was unsubstantiated. DSHS contended that the information was confidential under section 531.1021(g), but the Open Records Division (ORD) ruled it only applied to Medicaid-related investigations. DSHS challenged this interpretation, leading to cross-motions for summary judgment. The trial court ultimately sided with DSHS, affirming the confidentiality of the information despite the appeals from Abbott. The statute explicitly states that all materials subpoenaed or compiled by the OIG in connection with any audit or investigation are confidential and not subject to disclosure, with limited exceptions.

The dispute centers on whether Section 531.1021(g) of the Texas Government Code protects as confidential materials compiled by the Office of Inspector General (OIG) during any investigation or only those related to Medicaid fraud and health and human services fraud and abuse. The statute, amended in 2011, distinguishes between investigations conducted by the OIG and those by the Office of the Attorney General (OAG), with confidentiality granted specifically to information related to Medicaid fraud investigations by the OAG. Prior interpretations allowed broader confidentiality for OIG investigations, which have since been challenged by changes in the Attorney General's stance post-2011. The Department of State Health Services (DSHS) argues that the plain language of Section 531.1021(g) supports its interpretation that all OIG investigations related to audits or inquiries should remain confidential, regardless of the subject matter. DSHS contends that the Attorney General's interpretation misreads the statute and undermines the OIG’s responsibilities. The standard of review for appeals in summary judgment cases involves a de novo examination of the evidence presented by both parties, as noted in relevant case law. The core argument asserts that the phrase “in connection with an audit or investigation” should broadly define the confidentiality of OIG materials without limiting the subject matter to Medicaid-related issues.

Courts interpreting statutes must prioritize the plain and common meaning of the language used, as established in FKM P’ship Ltd. v. Bd. of Regents of Univ. of Houston. The case focuses on a specific statutory sentence addressing confidentiality for two separate state offices, each with distinct conditions. The statute states that all information subpoenaed or compiled by the Office of Inspector General (OIG) during audits or investigations, as well as by the attorney general regarding Medicaid fraud investigations, is confidential.

Abbott's interpretation attempts to introduce additional restrictions not present in the original statute by suggesting an expanded scope of confidentiality that includes "Medicaid fraud or other fraud, waste, and abuse in the provision and delivery of all health and human services in the state." This addition implies a broader confidentiality than intended by the Legislature, misrepresenting that OIG has unlimited confidentiality. The actual statute limits confidentiality to information compiled in connection with audits or investigations.

The Department of State Health Services (DSHS) argues that its interpretation aligns more accurately with OIG’s function, which includes investigating employee misconduct, and emphasizes that the interpretation should be contextual rather than isolated. While Abbott refers to Subchapter C in Chapter 531, which outlines OIG's duties related to Medicaid fraud, it does not limit OIG’s scope to these investigations alone. Since 1995, OIG has been responsible for investigating a broader range of issues beyond Medicaid fraud, as directed by the executive commissioner under Texas Government Code § 531.008(c)(2).

The HHSC executive commissioner possesses the authority under Chapter 531 of the Government Code to organize the commission and designate the Office of Inspector General (OIG) to investigate Medicaid fraud and internal matters. The executive commissioner is mandated to adopt operational rules for health and human services agencies and can create and manage divisions within the commission. The OIG has been investigating employee misconduct at health and human service agencies, and prior to a new interpretation by Abbott, investigations by the OIG were deemed confidential under Section 531.1021(g) if they were related to audits or investigations, irrespective of the subject matter. 

The OIG has the discretion to decline to investigate matters not involving fraud, waste, or abuse, allowing agency management to conduct such investigations. Confidentiality protections under Section 531.1021(g) do not apply when management conducts investigations. The legislature has granted the HHSC executive commissioner and the OIG the discretion to decide which matters warrant investigation, and materials compiled by the OIG during investigations have been protected since 2003. Abbott expresses concern that DSHS’s interpretation could extend confidentiality to trivial matters, such as audits of office supplies. However, such materials would only be confidential under Section 531.1021(g) if they relate to an audit or investigation. 

The specific case involves information compiled by the OIG regarding an employee complaint, which HHSC has tasked the OIG to investigate, thus classifying that information as confidential under Section 531.1021(g).

DSHS asserts that its interpretation of Section 531.1021(g) aligns with the Public Information Act (PIA), advocating for a strict construction that ensures public access to final reports from OIG audits while maintaining the confidentiality of materials compiled during investigations. This confidentiality is crucial for encouraging individuals to report misconduct without fear of exposure. DSHS emphasizes that the OIG's ability to access sensitive information is vital for its investigative functions, and that any premature disclosure of OIG files could hinder future investigations and deter whistleblowers.

DSHS contends that the legislature intentionally defined confidentiality based on the type of inquiry, not the subject matter, and any changes to this framework should originate from legislative action rather than judicial intervention. Furthermore, DSHS counters Abbott's claims of misinterpretation by pointing out that the legislature is presumed aware of prior Attorney General rulings and has not amended Section 531.1021(g) in response to Abbott's interpretations. The reference to the City of Dallas case illustrates the principle that the legislative body considers existing regulatory interpretations when enacting laws, reinforcing DSHS's position.

The Attorney General issued Open Records Decision 333 over a decade prior to the enactment of Section 552.222(b), which remains unwithdrawn or overruled. It is presumed the legislature was aware of this decision when enacting the statute. Although the decision did not explicitly clarify any provisions, it reflected the enforcement perspective of the Attorney General. The Texas Supreme Court's precedent indicates that statutes are enacted with awareness of existing laws. The 82nd Legislature likely anticipated that the amended Section 531.1021(g) would maintain the confidentiality of OIG investigative materials, consistent with historical protections, as no amendments to its confidentiality language were made. The legislature had the opportunity to alter this confidentiality during the 2011 amendment through Senate Bill 688 but chose not to. 

Section 531.1021(g), first enacted in 2003 and amended multiple times, establishes confidentiality for all materials related to OIG investigations. The 2005 amendment expanded this protection to audits, while the 2011 amendment included materials collected by the Attorney General during Medicaid fraud investigations. Both the Enrolled Bill Summary and the House Research Organization’s Bill Analysis confirm that such materials are confidential and not subject to public disclosure or legal compulsion. DSHS’s interpretation that the 2011 amendment did not alter the confidentiality status of OIG investigations is supported by both the statute and the Attorney General’s longstanding interpretation that all OIG investigations are confidential.

In 2004, the attorney general issued Previous Determination OR2004-8876, establishing that information related to an Office of Inspector General (OIG) investigation of Child Protective Services Programs is confidential under Section 531.1021(g) of the Government Code. This determination is relevant to the current case, where a request has been made to authorize withholding all OIG investigation materials under section 552.101 in conjunction with Section 531.1021(g). The office has agreed to this request, affirming that all OIG-related materials must be withheld.

The Previous Determination maintains that confidentiality applies broadly to all OIG investigations, irrespective of the subject matter. The legislature had an opportunity to modify this interpretation in 2005 but chose instead to expand confidentiality to include OIG audits, as reflected in S.B. 688 and H.B. 1332, which had no substantive discussion regarding Section 4 of S.B. 688 during the hearings. The absence of testimony or mention in the Bill Analysis suggests that the legislature did not intend to limit the confidentiality previously established for OIG investigations.

The text of S.B. 688 does not imply any significant change to the confidentiality of OIG investigations, and it is presumed that legislative intent aims for just and reasonable results. Furthermore, OIG responsibilities were not curtailed by subsequent amendments, reinforcing the interpretation that the confidentiality accorded to OIG investigations remains intact. A 2011 interpretation reaffirmed that materials compiled by the OIG in connection with audits or investigations are confidential and exempt from disclosure under the Act.

Between the 2005 and 2011 amendments to Section 531.1021(g), the Texas Attorney General consistently ruled that materials compiled for Office of Inspector General (OIG) investigations are protected from disclosure under the Public Information Act (PIA). Notable rulings included protections for various types of information related to complaints against requestors and employee records, indicating a broad interpretation of the confidentiality of OIG investigation materials. The 82nd Legislature is presumed to have acknowledged these interpretations during the amendments, which did not narrow but rather expanded the scope of confidential materials. The legislature retains the authority to amend the statute to clarify its intent if it disagrees with the Attorney General's interpretations. Section 552.101 of the PIA exempts from disclosure any information deemed confidential by law, confirming that the information in question is protected. Therefore, the trial court's ruling should be upheld, and the Department of State Health Services (DSHS) requests the Court to affirm this decision. The document includes compliance and service certificates from Assistant Attorney General Ann Hartley.

The office of inspector general is authorized to request the issuance of subpoenas for investigations related to Medicaid and other health and human services fraud. Upon approval from the commissioner or their designee, subpoenas can be used to compel witness attendance or the production of relevant evidence within Texas. Subpoenas may be served personally or via certified mail. If compliance is not met, the office, through the attorney general, can file a lawsuit in district court to enforce the subpoena. The court must find good cause to order compliance and has the authority to penalize noncompliance. The office is required to pay reasonable fees for photocopied materials, not exceeding its own charges for records. Witness expense reimbursement is governed by a specific statute. All information obtained through subpoenas or investigations is confidential and protected from disclosure, except to specific entities such as the state auditor's office or law enforcement, as permitted by law. Recipients of such information can only disclose it in a manner consistent with the authorized purpose of the original receipt.