AUSTIN — A district court judge ruled Monday the controversial audit of the work by Lubbock’s former health care provider should be open to the public, after attorneys on each side argued over the public’s right to know.
Attorneys for the umbrella insurance group now known as HealthSmart presented evidence seeking to block the release of the audit, which purportedly shows discrepancies in fees, rebates and other charges by the group between 2004 and 2006, costing the city millions in misspent taxpayer dollars.
Attorneys for the city and The Avalanche-Journal argued because the city of Lubbock commissioned the audit and it contains information about taxpayer money, the document should be public information.
“We think this is a document that the citizens of Lubbock should receive,” said Don Richards, The A-J’s attorney. “Citizens of Lubbock ought to know about it, and it’s clearly public information.”
District Judge John Dietz’s ruling upheld a Texas Attorney General Office’s opinion released last month.
The Avalanche-Journal and other local media outlets had requested the audit in April through the state’s open records law.
The insurance group has fought the audit’s release since.
During the hearing, attorneys and witnesses in the Travis County courtroom were careful not to openly discuss specific claims made in the audit.
Attorneys representing HealthSmart argued the audit should be kept secret because it is incomplete, contains confidential information and is misleading.
Throughout the hearing, the insurance group’s lead attorney, Steve Mendeloff, refused to call the 40-page document an audit, instead, referring to it as a report.
Mendeloff questioned the independent auditor hired by the city, Shelly Reaves, about her experience, her methods and the level of accuracy in the audit.
Later, he called the report flawed and incomplete. Under open records laws, if a public document is not complete, it is exempt.
Under cross examination, Reaves stood by the findings she made in the audit and countered she had worked almost exclusively with health care audits during the last 15 years.
She also testified she came to reasonable conclusions based on her analysis of a sample of documents.
Attorneys for HealthSmart also questioned another independent auditor, Brian Jones, who labeled the audit as incomplete. Jones testified the document did not meet the standards of accounting for financial audits.
Later, as he announced his opinion, Dietz said in the law there is no applicable definition of an audit.
In his closing arguments, Mendeloff described the case as a classic David-and-Goliath story between the government and a private company.
He said the insurance group should not be punished continually and subject to public misperception.
Mendeloff said the open government law was not designed to protect something commissioned to make a case in court.
The city hired Reaves to conduct the audit to present during a previous hearing about another legal issue involving the health care provider.
The law was not designed to cover an advocacy piece, he said.
“We are not saying when something is finished and appropriate the public doesn’t have a right to know,” Mendeloff said. “If it’s disclosed at a certain point, then it will look wrong to the public.”
In his closing statement, the city’s attorney, Jeff Jones, said the incendiary report shows a huge amount of money mismanaged and is exactly what the public information act was designed for.
“It can’t be hidden from the eyes of public to see it and make their own decisions,” Jones said.
He suggested the company could create another audit of the company to counter the one by Reaves, if they believe that it is so flawed.
HealthSmart attorneys said they will now appeal the case to the Third Circuit Court of Appeals to block the document’s release.
