Huffman v. Aetna Life and Cas. Co.

• Decision Date: 24 January 1985
• Citation: 337 Pa.Super. 274,486 A.2d 1330
• Parties: Mary Margaret HUFFMAN, Appellant, v. AETNA LIFE AND CASUALTY COMPANY, a corporation.
• Court: Pennsylvania Superior Court

Page 1330

486 A.2d 1330

337 Pa.Super. 274

Mary Margaret HUFFMAN, Appellant, v. AETNA LIFE AND CASUALTY COMPANY, a corporation.

Superior Court of Pennsylvania.

Argued April 11, 1984.

Filed Nov. 23, 1984.

Reargument Denied Jan. 24, 1985.

Samuel J. Pasquarelli, Pittsburgh, for appellant.

Alan Shapiro, Pittsburgh, for appellee.

Before ROWLEY, JOHNSON and POPOVICH, JJ.

ROWLEY, Judge:

This is an appeal from an Order which granted the appellee's motion for summary judgment. Appellant's husband, the late Arthur Huffman, was employed by the Western Pennsylvania Water Company, which provided its employees with a group hospitalization insurance policy issued by the appellee, the Aetna Life and Casualty Company. For various periods of time during 1977 and 1978, appellant's husband was confined at the Washington Hospital Extended Care Facility. The expenses incurred during the periods of confinement were slightly over $8,000. After appellant had made demand, appellee refused to pay for these expenses, claiming that the Washington Hospital Extended Care Facility was not a "hospital" within the meaning of the insured's policy. Appellant then instigated suit against the appellee, afterwhich the appellee filed a petition to transfer the case to the arbitration docket. This petition was granted, and the arbitrators decided in favor of the appellant in the amount of slightly over $4,000. The appellee appealed the arbitrators' decision. A deposition was taken of Mary McHugh, the administrator of the Washington Hospital Extended Care Facility. The appellee then filed a motion for summary judgment. The trial court, agreeing with the appellee that the Washington Hospital Extended Care Facility could not be regarded as a "hospital," granted the summary judgment motion. Because we see the meaning of "hospital" under these circumstances as ambiguous and because the trial court did not sufficiently consider the expectations of Arthur Huffman as a policyholder, we reverse.

At the outset of this opinion, we emphasize the standards which are to be followed in determining whether a summary judgment motion should be granted. First, summary disposition of a case is permitted only in the "clearest of cases." Hankin v. Mintz, 276 Pa.Super. 538, 540, 419 A.2d 588, 589 (1980). Second, for a summary judgment to be upheld, there can be no genuine issues of fact and the moving party must be entitled to judgment as a matter of law. Rybas v. Wapner, 311 Pa.Super. 50, 457 A.2d 108 (1983). The case at bar was not among the "clearest of cases" ripe for summary judgment. Nor was the appellee entitled to judgment as a matter of law.

The task at hand is to determine whether the Washington Hospital Extended Care Facility can be regarded as a "hospital" as defined in the insurance policy. We begin this task by examining the policy to ascertain the intentions of the parties involved in the insurance agreement. Standard Venetian Blind Co. v. American Empire Insurance, 503 Pa. 300, 469 A.2d 563, 566 (1983). In its policy, the appellee used seven elements to define "hospital." ¹ Reproduced Record at 88a. Individual analysis of these elements sheds considerable light on the intentions of the parties.

The Washington Hospital Extended Care Facility meets the requirements of elements "b" through "e" in the policy's definition of "hospital." Ms. McHugh's testimony establishes that the Facility is, and was at the time of Mr. Huffman's confinement, open at all times and operated primarily for treatment of inpatients. Reproduced Record at 38a, 35a-36a, respectively. She also testified that physicians are and were available at all times and that a graduate registered nurse is and was present throughout each day. Reproduced Record at 42a-45a, 43a-44a, respectively.

Appellee contends that the Facility fails to meet the requirement of the next element, that to be a "hospital" an institution must provide "organized facilities for diagnosis and major surgery." Reproduced Record at 88a, 10(f). As authority for its position, appellee relies on Taylor v. Phoenix Mutual Life Insurance Company, 453 F.Supp. 372 (E.D.Pa.1978), and Kravitz v. Equitable Life Assurance Society of U.S., 453 F.Supp. 381 (E.D.Pa.1978), two other cases which applied Pennsylvania law to resolve the issue of whether an institution qualified as a "hospital" as defined in the applicable insurance policy. Close analysis of these cases, however, reveals that they are factually dissimilar to the case at bar.

In Taylor, for instance, the plaintiff had been injured in a motorcycle accident, was hospitalized, and then transferred to the Moss Rehabilitation Hospital. Taylor v. Phoenix Mutual Life Insurance Company, supra. Adjacent to Moss was the Albert Einstein Medical Center, a "general" hospital. 453 F.Supp. at 376. But Moss and Einstein were "totally separate" corporate entities. 453 F.Supp. at 373. In addition, Einstein had a separate medical staff from Moss. 453 F.Supp. at 376. The Court entered summary judgment on behalf of the defendant-insurer because Moss was not a "short-term, acute general hospital" nor did it have "organized departments of medicine and major surgery" as required by the policy's definition of "hospital." 453 F.Supp. at 378.

In Kravitz, the plaintiff's daughter had been institutionalized at the Delaware Valley Mental Health Foundation. Kravitz v. Equitable Life Assurance Society of U.S., supra. The Foundation had a "Memorandum of Understanding" with the Doylestown Hospital to the effect that Foundation patients requiring hospitalization could be quickly transferred to the Doylestown Hospital. But again, the Foundation and the Doylestown Hospital were separate institutions. The defendant-insurer's summary judgment motion was also granted in Kravitz, since the policy's definition of "hospital" required that a registered nurse be on duty at all times and that surgical facilities exist "on the premises." 453 F.Supp. at 385. The Foundation did not have a registered nurse present at all in the evenings nor did it have any surgical facilities "on the premises." The plaintiff in that case was consequently denied relief.

Appellee suggests in its brief that, reading Taylor and Kravitz together, one may "assume" that an institution which merely has access to surgical facilities cannot qualify as a "hospital" since surgical facilities are not directly available at that institution. We should not, however, on a motion for summary judgment make such an assumption. In Taylor, Moss did not qualify as a hospital because it did not have "organized departments of medicine and major surgery." 453 F.Supp. at 379. This is a more demanding requirement than that in the appellee's policy which requires only that facilities for surgery be provided. Reproduced Record at 88a, 10(f). Furthermore, in granting summary judgment, the Taylor court relied heavily on the fact that Moss itself was not a general hospital but was primarily an institution for rehabilitative care. 453 F.Supp. at 379-380. The question of surgical facilities was merely incidental to the disposition of the case. The policy in Kravitz, on the other hand, explicitly provided that a "hospital" have surgical facilities "on the premises." This was also a more demanding requirement regarding surgical facilities than that in the appellee's policy.

One cannot suddenly deduce, after reading Taylor and Kravitz, that mere access to surgical facilities is insufficient to meet the requirement of a provision concerning facilities for surgery. No such rule can be derived from Taylor and Kravitz because the U.S. District Court disposed of those cases by considering generally the insurance policies involved and the circumstances surrounding the insurance agreement. Consideration of surgical facilities corresponded to the requirements of the unique policies involved in the cases. The Court did not explicitly or implicitly say that an institution which shared surgical facilities could not qualify as a "hospital" under the terms of any insurance policy. In the situation here presented, the policy's requirement regarding surgical facilities is markedly different, as is the relationship between the entities sharing these surgical facilities.

The Washington Hospital Extended Care Facility is, according to Ms. McHugh's testimony, a department of the Washington Hospital. Reproduced Record at 63a. The Washington Hospital owns and controls the Washington Hospital Extended Care Facility. Reproduced Record at 29a-30a. These facts serve to distinguish the appellant's case from Taylor and Kravitz. Moss and the Foundation were merely affiliated with other hospitals. They were neither a department of a hospital nor a subordinate to a hospital as the Facility is in this case and was in 1977-1978.

Furthermore, the insurance policies in Taylor and Kravitz contained more demanding requirements regarding the provision of surgical facilities. Here, Ms. McHugh testified that organized facilities for major surgery were available to patients at the Washington Hospital Extended Care Facility. Reproduced Record at 59a. This is sufficient to establish that the Facility is able to provide facilities for surgery as required by element "f" of the policy definition of "hospital." Reproduced Record at 88a, 10(f). Appellee argues that Washington Hospital's surgical facilities are "available" to the Washington Hospital Extended Care Facility just as they would be available to any other nursing home in Washington County. The surgical facilities might well be available to other institutions, but none of those institutions is owned and controlled by the Washington Hospital. The Washington Hospital Extended Care Facility is therefore an institution which provides its patients with organized facilities for major surgery and as such satisfies the requirements of element "f" in the policy's definition of "hospital."

The next element, "g," used to define "hospital" states that...