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Kansas defends its decision to redact whole pages of a $100,000 drug spending report

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Law professors who reviewed the redacted content for the Kansas News Service struggled to understand why the state would consider it legal to black out the information.

A state agency is defending its blacking out of much of a report commissioned with tax dollars. It says it was accommodating a contractor that argued the redactions were needed to protect trade secrets.

The report is an audit of prescription drug spending for state employees, their families and retirees. When the Kansas News Service asked for a copy, the state provided a heavily redacted version.

That decision came under fire on Monday. Some members of the seven-person board that oversees the state health insurance plan questioned why details of the audit should be kept from public view.

“That seems crazy to me,” Insurance Commissioner Vicki Schmidt said. “It doesn’t seem right.”

Another member of the panel noted that tax dollars paid for the audit.

“So going forward,” state employee Rebekah Gaston said, “are there ways that we can make this more transparent?”

Law professors who reviewed the redactions for the Kansas News Service struggled to understand why the state would consider it legal to shield the information. The state said it was protecting trade secrets.

But many of the blacked-out details — such as the number of prescriptions the plan covered in 2019 — are available in other public documents, including on the state’s own website. (The Kansas News Service was able to view some of the obscured content because the redactions were done incorrectly and the text beneath the black boxes remained accessible.)

Officials at the Kansas Department of Administration said they had followed standard procedures.

But they also shifted some of the responsibility onto the authors of the $100,000 report, a private auditing firm called PillarRx.

PillarRx considered its report confidential, a lawyer for the Department of Administration said. The department gave the firm the option of redacting it, and the firm did so.

So PillarRx sent a redacted version to the department, but the department felt the redactions went too far, said John Yeary, the Kansas Department of Administration’s chief counsel.

“So we pushed back,” he said. “And they came back with (a new version that) was ultimately provided” to the Kansas News Service.

In that version, large swaths and even whole pages of the report on $160 million in state spending on medications remain blacked out.

Schmidt took issue with the department’s explanation.

“We just can’t take (PillarRx’s) word for it when they say that it is proprietary,” she said. “We have some due diligence as a state.”

The head of the Kansas Department of Administration, Secretary DeAngela Burns-Wallace, said her agency’s lawyers did just that. (She is also a member of the oversight board, the Health Care Commission.)

“The very first version that the company provided, the legal team went back and said, ‘No, we disagree. And we need you to take an additional look.’ And so what was finally released is actually a different version than the initial one. So they did do that due diligence. ...

“We can agree to disagree on if they could have done more,” she said, “if you felt that something else should have been done.”

Schmidt asked Yeary, the department’s lawyer, if he stands by the redactions.

“I won’t say I completely 100% agree with PillarRx on what they view as a trade secret or proprietary and confidential,” he said. “I do feel like, that our approach in responding as an agency where there are interests on both sides was appropriate.”

PillarRx declined an interview request from the Kansas News Service to discuss any aspect of the audit and didn’t have a representative at Monday’s board meeting.

The audit was commissioned to check the work of CVS Health. CVS is the state’s pharmacy benefit manager, meaning it processes prescription drug claims.

Experts say the audit failed to answer key questions about whether CVS saves the state money or contributes to high drug costs.

Celia Llopis-Jepsen reports on consumer health for the Kansas News Service. You can follow her on Twitter @celia_LJ or email her at celia (at) kcur (dot) org.

The Kansas News Service is a collaboration of KCUR, Kansas Public Radio, KMUW and High Plains Public Radio focused on health, the social determinants of health and their connection to public policy.

Kansas News Service stories and photos may be republished by news media at no cost with proper attribution and a link to ksnewsservice.org.

Copyright 2021 KCUR 89.3. To see more, visit KCUR 89.3.