Dobias v. Service Life Ins. Co. of Omaha

• Decision Date: 10 May 1991
• Docket Number: No. 89-231,89-231
• Citation: 469 N.W.2d 143,238 Neb. 87
• Parties: Jerry DOBIAS et al., Appellants, v. SERVICE LIFE INSURANCE COMPANY OF OMAHA, Appellee.
• Court: Nebraska Supreme Court

Page 143

469 N.W.2d 143

238 Neb. 87

Jerry DOBIAS et al., Appellants, v. SERVICE LIFE INSURANCE COMPANY OF OMAHA, Appellee.

No. 89-231.

Supreme Court of Nebraska.

May 10, 1991.

Syllabus by the Court

1. Evidence: Stipulations: Appeal and Error. In a case in which the facts are stipulated, this court reviews the case as if trying it originally in order to determine whether the facts warranted the judgment.

2. Insurance: Contracts: Intent. An insurance policy is to be construed as any other contract to give effect to the parties' intentions at the time the contract was made. Where the terms of such a contract are clear, they are to be accorded their plain and ordinary meaning.

John Thomas and Gregory M. Neuhaus, Center, for appellants.

Scott J. Norby, of Crosby, Guenzel, Davis, Kessner & Kuester, Lincoln, for appellee.

HASTINGS, C.J., and BOSLAUGH, WHITE, CAPORALE, SHANAHAN, GRANT, and FAHRNBRUCH, JJ.

WHITE, Justice.

The plaintiffs, Jerry and Anne Dobias and their daughter Pam, appeal the order of the district court overruling their motion for new trial. The Dobiases had filed this action against the defendant, Service Life Insurance Company of Omaha, for its failure to pay benefits under a health insurance policy. The district court entered judgment for the defendant, finding that the policy did not cover the services received by Pam Dobias when she was a patient at the Immanuel Medical Center's rehabilitation center.

In August 1987, Pam, then 18, was thrown from a pickup truck which overturned. She was taken to a local hospital. She had fractured a vertebra in her back and was flown by Life Flight to Nebraska Methodist Hospital in Omaha. She remained there for 15 days following surgery (a decompression laminectomy and the insertion of Harrington rods to stabilize and support her spine).

Because of her spinal cord injury, Pam was paralyzed from the waist down and faced a number of complications. Her doctors then transferred her to the rehabilitation center at Immanuel Medical Center (Immanuel).

At Immanuel, Pam was placed on the eighth floor, where she received 24-hour acute nursing care and treatment for the complications from the spinal cord injury and paralysis. She suffered from a paralyzed bladder, multiple urinary tract infections, and neuropathic pain due to damage in the spinal cord. She needed training to regulate her bowels, she was given heparin to prevent blood clotting in the legs, and she was placed on a tilt table to regulate her blood pressure. She received treatment for spasticity, and she was observed for the development of decubitus ulcers of the skin, stress ulcer, and occult head injuries such as subdural hematoma. Pam also received anesthetic skin care training and other therapy before she was released to go home on October 30, 1987, after 74 days at Immanuel.

Pam's father had purchased a health insurance policy from the defendant in 1984. Upon submission of a claim, Service Life paid $12,303.91 for Pam's treatment at Methodist, but denied the claim for $42,757.49 for services and care at Immanuel. The insurance company contended that Pam received rehabilitative care, which is not covered by the policy. The Dobiases filed suit in district court, where judgment was entered for the defendant. This appeal followed.

At issue are two definitions in the policy--part E, paragraphs 14 and 15:

(14) "Hospital" means a place which:

(a) is legally operated for the care and treatment of sick and injured persons on an in-patient basis at their expense;

(b) is primarily engaged in providing medical, diagnostic, and major surgical facilities on its own premises or has them available on a prearranged basis (c) has continuous 24-hour nursing services by or under the supervision of registered graduate professional nurses (R.N.'s);

(d) has a staff of one or more doctors available at all times.

(15) "Hospital" does not mean:

(a) convalescent, nursing, rest, custodial, self-care, educational, or rehabilitative homes or units of hospitals used for such care;

(b) facilities primarily treating the mentally ill, aged, drug addicts, or alcoholics.

In finding that the charges were not covered, the trial court held that the policy was clear and unambiguous and that the Immanuel rehabilitation center was not a "hospital," but a separate and distinct unit of Immanuel devoted exclusively to rehabilitation. The plaintiffs-appellants assert as error the trial court's finding that the policy clearly and unambiguously excluded the Immanuel rehabilitation center from the definition of "hospital." The Dobiases suggest that the trial court should have found that the policy was fairly subject to two interpretations and that the trial court should have chosen the interpretation favorable to coverage of Pam's treatment at Immanuel.

When, as in this case, the facts were submitted by stipulation, "we review this case as if trying it originally in order to determine whether the facts warranted the judgment." Dugdale of Nebraska v. First State Bank, 227 Neb. 729, 731, 420 N.W.2d 273, 275 (1988).

We note first...