Gilley v. Protective Life Ins. Co.
| Decision Date | 31 March 1994 |
| Docket Number | No. 93-7102,93-7102 |
| Citation | 17 F.3d 775 |
| Parties | 18 Employee Benefits Cas. 1232 Mai E. GILLEY, Plaintiff-Appellee, v. PROTECTIVE LIFE INSURANCE COMPANY, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Michael Watts, Janet G. Arnold, Holcomb, Dunbar, Connell, Chaffin & Willard, Oxford, MS, for defendant-appellant.
John J. Crow, Jr., Water Valley, MS, C. Collier Carlton, Jr., Farese, Farese & Farese, Ashland, MS, for plaintiff-appellee.
Appeal from the United States District Court for the Northern District of Mississippi.
Before HENDERSON *, SMITH, and EMILIO M. GARZA, Circuit Judges.
The district court held that under MISS.CODE ANN. Sec. 83-9-33 (1991), an insurance company that has provided single person health insurance is obliged to pay for the medical expenses of the insured's newborn child. Concluding that no such obligation exists, we reverse and render judgment in favor of the company.
Mai Gilley was an employee of the Yalobusha County School District, which offered its employees a group insurance plan underwritten by the Protective Life Insurance Company. In 1987, Gilley purchased "single" coverage for herself under the plan. Such a policy carried a monthly premium of $90.70. Gilley had the opportunity to, but did not, enroll in coverage for her family. 1 Gilley had no children when she enrolled. Her husband had his own insurance plan, under which he too had chosen single person coverage.
Gilley's insurance policy provided in pertinent part:
WHEN INSURANCE FOR DEPENDENTS BEGINS
To insure your Dependents, you must fill out and sign our enrollment card and give it to your Employer.
Such enrollment card must be submitted:
....
(d) within 31 days after the date you first acquire a Dependent.
....
If such enrollment card is submitted as provided in ... "(d)" above, insurance for each then eligible dependent will begin on the later of (a) the first day of the calendar month which occurs on or next follows the date we receive such enrollment card or (b) the date your insurance begins, subject to being deferred as shown under DEFERRAL OF INSURANCE FOR DEPENDENTS.
....
If a Dependent first becomes eligible while insurance for your Dependents is in effect, that Dependent's insurance will begin on the date he or she becomes eligible, subject to being deferred as shown under DEFERRAL OF INSURANCE FOR DEPENDENTS.
....
If a Dependent is confined at home or in any facility due to injury, sickness, or any other physical condition or mental disability on the date insurance for that Dependent otherwise would begin, such insurance will not begin until the date that Dependent is no longer confined.
However, Medical Care Insurance for your natural child born while Medical Care Insurance for your Dependents is in effect will begin on that child's birthdate even if that child is confined on that date.
The insurance policy provided that coverage would be denied for a pre-existing condition, defined as:
Pre-Existing Condition--any injury or illness for which you (or a Dependent) see a Qualified Practitioner and/or receive care, services, or supplies within the 90 day period just before becoming insured under the Policy.
. . . . .
For a Dependent, a condition is deemed not Pre-existing after the earlier of the following dates:
(a) the date 90 days in a row have gone by (beginning before, on, or after the date of becoming insured and ending after that date) during which the Dependent did not see a Qualified Practitioner or receive care, services, or supplies in connection with that Injury or Illness; or
(b) the date the Dependent has been insured for 365 days in a row.
On March 12, 1989, Gilley gave birth prematurely to twin boys, one of whom died at birth. The surviving son, Kainen, remained in the hospital continuously from his birth until he was released on July 12, 1989. During the four months Kainen was in the hospital, the hospital bills attributable to his care amounted to approximately $140,000. 2
Approximately a week and a half after the birth, Gilley completed an enrollment application adding both Kainen and her husband to her policy. The premium for family coverage was $295.05 per month. When the insurance company received Gilley's enrollment card, it requested that Gilley complete "Evidence of Insurability" forms on her husband and her son.
On April 17, 1989, Gilley submitted the forms. On her son's form, Gilley entered the son's date of birth, and under the heading "Duration of Treatment-Results or Remaining Effects," Gilley wrote "Treatment in Progress." Under the form's heading "Name and address of Physician and of Hospital or other Institution," Gilley listed "Edwin G. Brown" and "Jackson University Medical Center."
The insurance company sent a letter requesting more detailed information. 3 But when Gilley called the insurance company to give such information, she was told "never mind." On May 3, 1989, the insurance company sent a letter to the school district stating that it would cover Gilley's son starting May 1, 1989. 4
An internal document from the insurance company, a "Health Services Case Review Form," indicates that the company opened a file for Gilley's surviving son on March 13, 1989. On the first page of the form, the attending physician is listed as "Edwin Brown," and the facility is listed as "Univ." The Diagnosis/Symptoms section contains the entry "prematurity 25 wks." Under the heading Medical Admission--Treatment Plan, the word "NICU" is written. Although the above entries are undated, the second page of the form contains a number of entries dated March 14, 1989 to March 17, 1989. The March 14 entry contains the words
Despite its May 3 letter, the insurance company now has changed its position, arguing that it is not liable for any of Kainen's medical expenses. The hospital turned the Gilleys' debt for Kainen's medical expenses over to a collection agency, and the Gilleys began paying the hospital at the rate of approximately $100 per month.
The company billed Gilley for single person coverage for March and April 1989. Nonetheless, for those two months Gilley made payments to the company at the family rate. On February 28, 1991, the company reimbursed Gilley for the difference between the family and single rates for the two months. There is no evidence in the record about the payments or billings for subsequent months.
Gilley sued the insurance company, alleging that she should recover medical expenses and extracontractual and punitive damages. Neither Gilley nor the insurance company requested a jury trial. The insurance company moved for summary judgment on all of Gilley's claims.
The district court granted the motion as it related to punitive damages but denied the motion as it related to medical expenses, relying upon MISS.CODE ANN. Sec. 83-9-33 (1991). 5 Nearly two months later, the court entered a final judgment in favor of Gilley as to her claim for medical expenses and dismissed her claim for extracontractual and punitive damages. 6 The insurance company now appeals the denial of its motion for summary judgment as it related to medical expenses.
The insurance policy, under its terms, does not require the company to pay for Kainen's medical expenses. A review of the relevant provisions shows that insurance coverage for Kainen did not begin until the day he was released from the hospital.
In order to begin coverage for a dependent, the insured must submit an enrollment card within thirty-one days after the date the insured first acquires the dependent:
To insure your Dependents, you must fill out and sign our enrollment card and give it to your employer.
Such enrollment card must be submitted:
....
(d) within 31 days after the date you first acquire a Dependent.
Gilley did fill out an enrollment card requesting family coverage within thirty-one days after Kainen's birth on March 12, 1989. Approximately a week and a half afterward, Gilley completed an enrollment application to add both Kainen and her husband to her group policy. The insurance company did not receive the card until April 1989.
Once an enrollment card has been submitted, the insurance policy provides that coverage begins on the later of: (a) the first day of the month after receipt of the enrollment card or (b) the end of the deferral period applicable to dependents who are confined for health treatment on the date coverage otherwise would begin. The "(a)" date would be May 1, 1989, as the enrollment card was received in April. The "(b)" date is determined by reference to the policy's deferral provision, which says,
If a Dependent is confined at home or in any facility due to injury, sickness, or any other physical condition or mental disability on the date insurance for that Dependent otherwise would begin, such insurance will not begin until the date that Dependent is no longer confined.
Because Gilley's son was in the hospital on May 1, 1989, the "(b)" date is July 12, 1989, the day the son was released from the hospital. The later of the "(a)" and "(b)" dates is July 12. Coverage therefore was deferred until July 12, and none of Kainen's stay in the hospital was covered.
The district court erroneously held that MISS.CODE ANN. Sec. 83-9-33 required the insurance company to pay for the son's medical expenses from the date of birth. Section 83-9-33(1) provides,
All individual and group health insurance policies providing coverage on an expense incurred basis and individual and group service or indemnity type contracts issued after January 1, 1980, by an insurer or nonprofit corporation which provides coverage for a family member of an insured or subscribed shall, as to such family members' coverage, also provide that the health insurance benefits applicable for children shall be payable with respect to a newly born child of the...
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