ENROLLED
       2023 Legislature                                  CS for SB 1552
       
       
       
       
       
       
                                                             20231552er
    1  
    2         An act relating to public records; amending s.
    3         624.319, F.S.; providing an exemption from public
    4         records requirements for examination and investigation
    5         reports and work papers relating to pharmacy benefit
    6         managers; providing for future legislative review and
    7         repeal of the exemption; reenacting and amending s.
    8         626.884, F.S.; expanding a public records exemption
    9         for the books and records of administrators held by
   10         the Office of Insurance Regulation for purposes of
   11         examination, audit, and inspection to incorporate the
   12         inclusion of pharmacy benefit managers as
   13         administrators under the Florida Insurance Code;
   14         providing for future legislative review and repeal of
   15         the exemption; providing statements of public
   16         necessity; providing a contingent effective date.
   17          
   18  Be It Enacted by the Legislature of the State of Florida:
   19  
   20         Section 1. Section 624.319, Florida Statutes, is amended to
   21  read:
   22         624.319 Examination and investigation reports.—
   23         (1) The department or office or its examiner shall make a
   24  full and true written report of each examination. The
   25  examination report shall contain only information obtained from
   26  examination of the records, accounts, files, and documents of or
   27  relative to the insurer examined or from testimony of
   28  individuals under oath, together with relevant conclusions and
   29  recommendations of the examiner based thereon. The department or
   30  office must shall furnish a copy of the examination report to
   31  the insurer examined at least not less than 30 days before prior
   32  to filing the examination report in its office. If such insurer
   33  so requests in writing within such 30-day period, the department
   34  or office must shall grant a hearing with respect to the
   35  examination report and may shall not so file the examination
   36  report until after the hearing and after such modifications have
   37  been made therein as the department or office deems proper.
   38         (2) The examination report so filed is admissible in
   39  evidence in any action or proceeding brought by the department
   40  or office against the person examined, or against its officers,
   41  employees, or agents. In all other proceedings, the
   42  admissibility of the examination report is governed by the
   43  evidence code. The department or office or its examiners may
   44  testify and offer other proper evidence as to information
   45  secured or matters discovered during the course of an
   46  examination, regardless of whether a written report of the
   47  examination has been made, furnished, or filed in the department
   48  or office. The production of documents during the course of an
   49  examination or investigation does not constitute a waiver of the
   50  attorney-client or work-product privilege.
   51         (3)(a)1. Examination reports, until filed, are confidential
   52  and exempt from s. 119.07(1) and s. 24(a), Art. I of the State
   53  Constitution.
   54         2. Investigation reports are confidential and exempt from
   55  s. 119.07(1) and s. 24(a), Art. I of the State Constitution
   56  until the investigation is completed or ceases to be active.
   57         3. For purposes of this subsection, an investigation is
   58  active while it is being conducted by the department or office
   59  with a reasonable, good faith belief that it could lead to the
   60  filing of administrative, civil, or criminal proceedings. An
   61  investigation does not cease to be active if the department or
   62  office is proceeding with reasonable dispatch and has a good
   63  faith belief that action could be initiated by the department or
   64  office or other administrative or law enforcement agency. After
   65  an investigation is completed or ceases to be active, portions
   66  of the investigation report relating to the investigation remain
   67  confidential and exempt from s. 119.07(1) and s. 24(a), Art. I
   68  of the State Constitution if disclosure would:
   69         a. Jeopardize the integrity of another active
   70  investigation;
   71         b. Impair the safety and financial soundness of the
   72  licensee or affiliated party;
   73         c. Reveal personal financial information;
   74         d. Reveal the identity of a confidential source;
   75         e. Defame or cause unwarranted damage to the good name or
   76  reputation of an individual or jeopardize the safety of an
   77  individual; or
   78         f. Reveal investigative techniques or procedures.
   79         (b)1. For purposes of this paragraph, “work papers” means
   80  the records of the procedures followed, the tests performed, the
   81  information obtained and the conclusions reached in an
   82  examination or investigation performed under this section or ss.
   83  624.316, 624.3161, 624.317, and 624.318, and 626.8828. Work
   84  papers include planning documentation, work programs, analyses,
   85  memoranda, letters of confirmation and representation, abstracts
   86  of company documents, and schedules or commentaries prepared or
   87  obtained in the course of such examination or investigation.
   88         2.a. Work papers held by the department or office are
   89  confidential and exempt from s. 119.07(1) and s. 24(a), Art. I
   90  of the State Constitution until the examination report is filed
   91  or until the investigation is completed or ceases to be active.
   92         b. Information received from another governmental entity or
   93  the National Association of Insurance Commissioners, which is
   94  confidential or exempt when held by that entity, for use by the
   95  department or office in the performance of its examination or
   96  investigation duties pursuant to this section or ss. 624.316,
   97  624.3161, 624.317, and 624.318, and 626.8828 is confidential and
   98  exempt from s. 119.07(1) and s. 24(a), Art. I of the State
   99  Constitution.
  100         c. This exemption applies to work papers and such
  101  information held by the department or office before, on, or
  102  after the effective date of this exemption.
  103         3. Confidential and exempt work papers and information may
  104  be disclosed to:
  105         a. Another governmental entity, if disclosure is necessary
  106  for the receiving entity to perform its duties and
  107  responsibilities; and
  108         b. The National Association of Insurance Commissioners.
  109         4. After an examination report is filed or an investigation
  110  is completed or ceases to be active, portions of work papers may
  111  remain confidential and exempt from s. 119.07(1) and s. 24(a),
  112  Art. I of the State Constitution if disclosure would:
  113         a. Jeopardize the integrity of another active examination
  114  or investigation;
  115         b. Impair the safety or financial soundness of the
  116  licensee, affiliated party, or insured;
  117         c. Reveal personal financial, medical, or health
  118  information;
  119         d. Reveal the identity of a confidential source;
  120         e. Defame or cause unwarranted damage to the good name or
  121  reputation of an individual or jeopardize the safety of an
  122  individual;
  123         f. Reveal examination techniques or procedures; or
  124         g. Reveal information that is confidential or exempt under
  125  sub-subparagraph 2.b.
  126         (c) Lists of insurers or regulated companies are
  127  confidential and exempt from s. 119.07(1) if:
  128         1. The financial solvency, condition, or soundness of such
  129  insurers or regulated companies is being monitored by the
  130  office;
  131         2. The list is prepared to internally coordinate regulation
  132  by the office of the financial solvency, condition, or soundness
  133  of the insurers or regulated companies; and
  134         3. The office determines that public inspection of such
  135  list could impair the financial solvency, condition, or
  136  soundness of such insurers or regulated companies.
  137         (4) After the examination report has been filed pursuant to
  138  subsection (1), the department or office may publish the results
  139  of any such examination in one or more newspapers published in
  140  this state whenever it deems it to be in the public interest.
  141         (5) After the examination report of an insurer has been
  142  filed pursuant to subsection (1), an affidavit must shall be
  143  filed with the office, within not more than 30 days after the
  144  report has been filed, on a form furnished by the office and
  145  signed by the officer of the company in charge of the insurer’s
  146  business in this state, stating that she or he has read the
  147  report and that the recommendations made in the report will be
  148  considered within a reasonable time.
  149         (6)This section is subject to the Open Government Sunset
  150  Review Act in accordance with s. 119.15 and shall stand repealed
  151  on October 2, 2028, unless reviewed and save from repeal through
  152  reenactment by the Legislature.
  153         Section 2. Section 626.884, Florida Statutes, is reenacted
  154  and amended to read:
  155         626.884 Maintenance of records by administrator; access;
  156  confidentiality.—
  157         (1) Every administrator shall maintain in such
  158  administrator’s principal administrative office for the duration
  159  of the written agreement and for 5 years thereafter adequate
  160  books and records of all transactions among such administrator,
  161  insurers, and insured persons. Such books and records shall be
  162  maintained in accordance with prudent standards of insurance
  163  recordkeeping.
  164         (2) The office shall have access to books and records
  165  maintained by the administrator for the purpose of examination,
  166  audit, and inspection. Information contained in such books and
  167  records is confidential and exempt from the provisions of s.
  168  119.07(1) and s. 24(a), Art. I of the State Constitution if the
  169  disclosure of such information would reveal a trade secret as
  170  defined in s. 688.002. However, the office may use such
  171  information in any proceeding instituted against the
  172  administrator.
  173         (3) The insurer shall retain the right of continuing access
  174  to books and records maintained by the administrator sufficient
  175  to permit the insurer to fulfill all of its contractual
  176  obligations to insured persons, subject to any restrictions in
  177  the written agreement pertaining to the proprietary rights of
  178  the parties in such books and records.
  179         (4)This section is subject to the Open Government Sunset
  180  Review Act in accordance with s. 119.15 and shall stand repealed
  181  on October 2, 2028, unless reviewed and saved from repeal
  182  through reenactment by the Legislature.
  183         Section 3. (1)The Legislature finds that it is a public
  184  necessity that the information contained in examination and
  185  investigation reports and work papers relating to examinations
  186  and investigations of pharmacy benefit managers, who are now
  187  considered administrators, as defined in s. 626.88, Florida
  188  Statutes, for purposes of regulation under the Florida Insurance
  189  Code, be made confidential and exempt from s. 119.07(1), Florida
  190  Statutes, and s. 24(a), Article I of the State Constitution in
  191  accordance with s. 624.319, Florida Statutes. Administrators who
  192  are pharmacy benefit managers are subject to additional records
  193  production, examination, and investigation provisions, and those
  194  applicable work papers and examinations and investigation
  195  reports are to be made confidential and exempt from s.
  196  119.07(1), Florida Statutes, and s. 24(a), Article I of the
  197  State Constitution in accordance with s. 624.319, Florida
  198  Statutes. As a new class of administrators, pharmacy benefit
  199  managers need to be subject to the exemptions that currently
  200  exist for administrators, unless otherwise provided in statute,
  201  in order to protect their confidential information and business
  202  and professional good name or reputation in a like manner.
  203  Additionally, the Department of Financial Services and the
  204  Office of Insurance Regulation, both of which are responsible
  205  for examinations and investigations of administrators under the
  206  Florida Insurance Code, need to ensure that disclosure of such
  207  information would not jeopardize the integrity of another active
  208  investigation, reveal the identity of a confidential source,
  209  reveal investigative techniques or procedures, or reveal
  210  information that is received from another governmental entity or
  211  the National Association of Insurance Commissioners which is
  212  confidential or exempt when held by that entity. For these
  213  reasons, the Legislature finds that it is a public necessity
  214  that such information be made confidential and exempt from
  215  public records requirements.
  216         (2)The Legislature finds that it is a public necessity
  217  that the trade secret information contained in the books and
  218  records of pharmacy benefit managers, who are now considered
  219  administrators, as defined in s. 626.88, Florida Statutes, for
  220  purposes of regulation under the Florida Insurance Code, which
  221  are held by the Office of Insurance Regulation in relation to
  222  examinations, audits, or inspections of pharmacy benefit
  223  managers be made confidential and exempt from s. 119.07(1),
  224  Florida Statutes, and s. 24(a), Article I of the State
  225  Constitution. The Legislature recognizes that the release of
  226  trade secret information could destroy the value of a business’s
  227  proprietary information and cause financial loss to the business
  228  by giving its competitors an unfair advantage and weakening its
  229  position in the marketplace. As a new class of administrators,
  230  pharmacy benefit managers need to be subject to the exemptions
  231  that currently exist for administrators, unless otherwise
  232  provided in statute, in order to protect their trade secret
  233  information. For these reasons, the Legislature finds that it is
  234  a public necessity to make such trade secret information
  235  contained in the books and records of pharmacy benefit managers
  236  confidential and exempt from public records requirements.
  237         Section 4. This act shall take effect on the same date that
  238  SB 1550 or similar legislation takes effect, if such legislation
  239  is adopted in the same legislative session or an extension
  240  thereof and becomes a law.