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Thompson v. State

Court of Workers Compensation of Montana

October 18, 2005

LEE N. THOMPSON, DARIN SHARP, and SCOTT BAILEY Petitioners
v.
STATE OF MONTANA Respondent LIBERTY NORTHWEST INSURANCE CORPORATION and MONTANA STATE FUND Intervenors.

          Submitted: June 24, 2005

         Appealed to Supreme Court 05/15/06

         Reversed 08/17/07

          ORDER GRANTING MOTIONS FOR SUMMARY JUDGMENT

          JAMES JEREMIAH SHEA JUDGE.

         Summary: Petitioners filed an action for declaratory judgment seeking to have this Court declare subsection (3) of section 39-71-604, MCA (2003), and subsection (5) of section 50-16-527, MCA (2003), unconstitutional as violative of Mont. Const., Art. II, §§ 10 and 17, and/or the Fifth and Fourteenth Amendments to the United States Constitution. Petitioners subsequently filed motions for summary judgment on these issues.

         Held: Summary judgment is granted. Section 39-71-604(3), MCA (2003), and section 50-16-527(5), MCA (2003), violate the petitioners' constitutional right of privacy as guaranteed by Mont. Const., Art. II, § 10, and no compelling state interest exists to justify such violation. Moreover, the Court also finds that sections 39-71-604(3) and 50-16-527(5), MCA (2003), violate the petitioners' constitutional right to due process as guaranteed by Mont. Const., Art. II, § 17, and no rational basis exists to justify such violation.

         Topics:

Constitutional Law: Privacy. Mont. Const., Art. II, § 10, prohibits insurers or their representatives from engaging in ex parte communications with a claimant's treating health care provider under the auspices of either section 39-71-604(3), MCA (2003), or section 50-16-527(5), MCA (2003).
Constitutional Law: Due Process. Mont. Const., Art. II, § 17, prohibits insurers or their representatives from engaging in ex parte communications with a claimant's treating health care provider under the auspices of either section 39-71-604(3), MCA (2003), or section 50-16-527(5), MCA (2003).
Constitutions, Statutes, Rules, and Regulations: Montana Code Annotated: 39-71-604(3) and 50-16-527(5), MCA (2003). Sections 39-71-604(3) and 50-16-527(5), MCA (2003), which allow an insurer or its agent to communicate with a physician or other health care provider about an injured employee's health care information by telephone, letter, electronic communication, in person, or by other means and to receive from the physician or health care provider the sought after information without prior notice to the injured employee, to the employee's authorized representative or agent, or in the case of death, to the employee's personal representative or any person with a right or claim to compensation for the injury or death are violative of Mont. Const., Art. II, §§ 10 and 17.
Attorney Fees: Private Attorney General Theory. The petitioners are entitled to attorney fees pursuant to the private attorney general theory. Protecting fundamental constitutional rights is of the highest societal importance; the need for private individuals to vindicate these constitutional rights was apparent where the State of Montana was defending the constitutionality of these statutes in the litigation; and, all claimants in the Montana Workers' Compensation system stand to benefit from the petitioners' actions.

         ¶1 The petitioners have petitioned this Court for a declaratory judgment that subsection (3) of section 39-71-604, MCA (2003), and subsection (5) of section 50-16-527, MCA (2003), are unconstitutional pursuant to Mont. Const., Art. II, §§ 10 and 17, and/or the Fifth and Fourteenth Amendments to the United States Constitution. Although disputing the merits of the petitioners' claims, all parties to this action agree that the issues raised by the petitioners are appropriate for declaratory judgment by this Court. The petitioners then moved for summary judgment on these issues. For the reasons set forth below, the petitioners' motions for summary judgment are granted.[1]

         FACTUAL BACKGROUND

         ¶2 The petitioners are or have been injured employees with claims for workers' compensation benefits under the workers' compensation laws of the State of Montana. During the administration of the petitioners' workers' compensation claims, the workers' compensation insurers for the petitioners, or their agents, have engaged in private communications with the petitioners' physicians or other health care providers or have otherwise asserted the right to engage in such private communications under the auspices of sections 39-71-604(3) or 50-16-527(5), MCA (2003). Both of these sections were passed by the 2003 Legislature and were signed into law in April 2003. No constitutional challenges have previously been made to either statutory section.

         DISCUSSION

         ¶3 The challenged language contained in both of the statutes at issue is substantively identical. In its entirety, section 39-71-604(3), MCA (2003), reads as follows:

A signed claim for workers' compensation or occupational disease benefits or a signed release authorizes a workers' compensation insurer, as defined in 39-71-116, or the agent of the workers' compensation insurer to communicate with a physician or other health care provider about relevant health care information, as authorized in subsection (2), by telephone, letter, electronic communication, in person, or by other means, about a claim and to receive from the physician or health care provider the information authorized in subsection (2) without prior notice to the injured employee, to the employee's authorized representative or agent, or in the case of death, to the employee's personal representative or any person with a right or claim to compensation for the injury or death.

         ¶4 In its entirety, section 50-16-527(5), MCA (2003), reads as follows:

A signed claim for workers' compensation or occupational disease benefits or a signed release authorizes a workers' compensation insurer, as defined in 39-71-116, or the agent of the workers' compensation insurer to communicate with a physician or other health care provider about relevant health care information, as authorized in subsection (4), by telephone, letter, electronic communication, in person, or by other means, about a claim and to receive from the physician or health care provider the information authorized in subsection (4) without prior notice to the injured employee, to the employee's authorized representative or agent, or in the case of death, to the employee's personal representative or any person with a right or claim to compensation for the injury or death.

         ¶5 These sections were enacted pursuant to Senate Bill 450 (SB 450), passed by the 2003 Legislature. Nothing in the legislative history, however, offers any particularly helpful insight as to the purpose of this bill as it pertains to these specific sections. The only insight presented to this Court as to the Legislature's motivation is a Fiscal Note, submitted by the petitioners, which pertains to the financial impact of other, unrelated provisions of SB 450. At paragraphs 4 and 5 of this Fiscal Note is an apparent reference to the statutory amendments at issue in this case. The entire sum and substance of these references, however, is an acknowledgment that SB 450 will allow private "communication of relevant medical information between the insurer, or agent thereof, and the health care provider." As to the justification for this expanded access, the Fiscal Note says only: "The proposal will make the process more efficient, and thereby reduce costs. The more quickly the insurer can receive information on the status of the claimant, the more quickly they can authorize certain procedures to hasten the process."

         ¶6 Save for this brief reference, the Court is left with virtually no background against which to assess whether a compelling state interest exists to allow a workers' compensation insurer or its agent the essentially unfettered access to an injured workers' physician or health care provider as prescribed by these sections.

         A. Montana Constitution, Article II, Section 10. Right of Individual Privacy.

         ¶7 Article II, Section 10 of the Montana Constitution provides:

The right of individual privacy is essential to the well-being of a free society and shall not be infringed without the showing of a compelling state interest.

         ¶8 The Montana Supreme Court has long recognized that the privacy interests attendant an individual's medical information implicate Article II, Section 10 of the Montana Constitution. Specifically, the Court has most recently held: "Medical records are private and deserve the utmost constitutional protection. Article II, Section 10, of the Montana Constitution guarantees informational privacy in the sanctity of one's medical records."[2] That being the case, the very language of Article II, Section 10 mandates that a compelling state interest be shown in order for the statutory sections at issue in the present case to survive a constitutional challenge. Additionally, since the right of individual privacy is among those rights guaranteed by the Montana Constitution's Declaration of Rights, it is deemed a fundamental right.[3] Any statute which implicates a fundamental right must be strictly scrutinized ...


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