Estate of Hays By and Through Hays v. Mid-Century Ins. Co.

• Decision Date: 13 July 1995
• Docket Number: MID-CENTURY,No. 94CA0353,94CA0353
• Parties: The ESTATE OF Pennylynn HAYS, By and Through the Personal Representative of the Estate, Lestel HAYS, Appellant, v.INSURANCE COMPANY, Appellee. . IV
• Court: Colorado Court of Appeals

Page 956

902 P.2d 956

The ESTATE OF Pennylynn HAYS, By and Through the Personal Representative of the Estate, Lestel HAYS, Appellant, v. MID-CENTURY INSURANCE COMPANY, Appellee.

No. 94CA0353.

Colorado Court of Appeals,

Div. IV.

July 13, 1995.

Donald L. Banghart, P.C., Donald L. Banghart, Lakewood, Dale S. Carpenter, III, P.C., Dale S. Carpenter, III, Lakewood, for appellant.

Anderson, Campbell & Laugesen, P.C., Richard W. Laugesen, Franklin D. Patterson, Dwianne S. Ladendorf, Denver, for appellee.

Opinion by Judge DAVIDSON.

In this action to enforce the terms of an automobile insurance contract, plaintiff, Estate of Pennylynn Hays through Lestel Hays, as the Estate's personal representative, appeals from the summary judgment entered in favor of defendant, Mid-Century Insurance Company. Defendant cross-appeals from the trial court's order granting plaintiff's motion to amend the complaint. We affirm.

According to the undisputed facts, Pennylynn Hays was critically injured in an automobile accident. She received emergency medical treatment, which included insertion of tubes in her chest, abdominal paracentesis, a left radial cutdown for an arterial line, exploratory surgery of the abdomen, and a right pneumonectomy. Despite these efforts, she remained in critical condition until she died, three days after the accident.

Hays' automobile insurance policy with defendant provided $50,000 in medical benefits, which were paid. Plaintiff then filed this action, seeking payment under the rehabilitation benefits section of the policy for the additional medical expenses in excess of $50,000. The trial court granted defendant's motion for summary judgment, finding as a matter of law that plaintiff was not entitled to such additional medical benefits.

Plaintiff then filed a motion to reconsider or for post-trial relief and a motion to amend the complaint. The trial court denied plaintiff's motion for post-trial relief but granted the motion to amend.

Thereafter, plaintiff filed an amended complaint reasserting its original breach of contract claim and adding two additional claims for bad faith breach of insurance contract. The trial court then granted defendant's motion to dismiss on the grounds that the two new claims for relief did not incorporate any facts other than those which were alleged in plaintiff's original breach of contract claim and that, therefore, the second and third claims failed to state a claim upon which relief may be granted.

I.

The primary issue raised on appeal is whether the trial court correctly determined as a matter of law that coverage for rehabilitation benefits under the No-Fault provisions of Hays' automobile policy did not include expenses incurred for Hays' emergency surgery and other related medical care. Although we do not exclude the possibility that, depending upon its purpose, emergency medical care could properly be considered to be rehabilitation under some circumstances, nonetheless, we agree with the trial court that, here, it was not.

Plaintiff makes no argument that the Mid-Century policy is not in compliance with the coverage requirements of the No-Fault Act, § 10-4-706, C.R.S. (1994 Repl.Vol. 4A). Plaintiff asserts, however, that the trial court erroneously denied its request for rehabilitation benefits under Hays' policy because, in plaintiff's view, the rehabilitation portion of the No-Fault statute not only applies to retraining or occupational training programs, but "consciously includes additional medical treatment, operations, diagnoses, prescriptions as being covered." Hence, plaintiff concludes, once coverage limits for medical expenses have been exceeded, under the broad statutory meaning of "rehabilitation," the insurer must pay additional medical expenses as rehabilitation benefits so long as the procedures were undertaken in an effort "to restore the insured to her former condition." Consequently, here, according to plaintiff, if Hays had regained consciousness before she died, her treatment expenses which were otherwise medical also were "rehabilitative" under the No-Fault Act. We do not agree.

The No-Fault Act, § 10-4-706(1), C.R.S. (1994 Repl.Vol. 4A), requires, as pertinent here, that every automobile insurance policy must provide coverage for at least $50,000 in medical benefits and $50,000 in rehabilitation benefits. Specifically, § 10-4-706(1)(b), C.R.S. (1994 Repl.Vol 4A) requires such coverage for "all reasonable and necessary expenses for medical, chiropractic, optometric, pediatric, hospital, nursing, x-ray, dental, surgical, ambulance, and prosthetic services." On the other hand, § 10-4-706(1)(c)(I)(A), C.R.S. (1994 Repl.Vol. 4A) requires coverage for "the cost of rehabilitation procedures or treatment and rehabilitative occupational training." Section 10-4-706(1)(c)(II)(C), C.R.S. (1994 Repl.Vol. 4A) specifically requires that any rehabilitation procedure, treatment, or training "shall contribute substantially to rehabilitation."

"Rehabilitation" is the physical restoration of an injured person to daily living through therapy and education. See Dean v. Allstate Insurance Co., 878 F.Supp. 1397, 1402 (D.Colo.1993) (" [Rehabilitation] treatment has traditionally been considered sequential to medical care, during the period 'between the bed and the job,' and as a readaptation to daily living after a debilitating injury."); see also United Service Auto Ass'n v. Martin, 841 P.2d 391 (Colo.App.1992). Whereas the payment of medical benefits is for the treatment of the physical injury itself, rehabilitation benefits are paid for treatment of the effects of such injury. Compare § 10-4-706(1)(b) (payment of medical expenses "for bodily injury" resulting from...