Katskee v. Blue Cross/Blue Shield of Nebraska

• Court: Nebraska Supreme Court
• Writing for the Court: HASTINGS; WHITE; WRIGHT
• Citation: Katskee v. Blue Cross/Blue Shield of Nebraska, 515 N.W.2d 645, 245 Neb. 808 (Neb. 1994)
• Decision Date: 06 May 1994
• Docket Number: No. S-92-1022,S-92-1022
• Parties: , 62 USLW 2756 Sindie KATSKEE, Appellant, v. BLUE CROSS/BLUE SHIELD OF NEBRASKA, Appellee.

Page 645

515 N.W.2d 645

245 Neb. 808, 62 USLW 2756

Sindie KATSKEE, Appellant, v. BLUE CROSS/BLUE SHIELD OF NEBRASKA, Appellee.

No. S-92-1022.

Supreme Court of Nebraska.

May 6, 1994.

Syllabus by the Court

1. Summary Judgment. Summary judgment is proper when the pleadings, depositions, admissions, stipulations, and affidavits in the record disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law.

2. Summary Judgment: Proof. The party moving for summary judgment has the burden to show that no genuine issue of material fact exists and must produce sufficient evidence to demonstrate that the moving party is entitled to judgment as a matter of law.

3. Summary Judgment: Appeal and Error. In reviewing an order granting summary judgment, the appellate court views the evidence in a light most favorable to the nonmoving party and gives that party the benefit of all reasonable inferences deducible from the evidence.

4. Insurance: Contracts: Appeal and Error. The interpretation and construction of an insurance contract ordinarily involve questions of law in connection with which an appellate court has an obligation to reach conclusions independent of the determinations made by the court below.

5. 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. When the terms of the contract are clear, a court may not resort to rules of construction, and the terms are to be accorded their plain and ordinary meaning as the ordinary or reasonable person would understand them. In such a case, a court shall seek to ascertain the intention of the parties from the plain meaning of the policy.

6. Insurance: Contracts: Intent. If a court finds that an insurance policy is ambiguous, then the court may employ rules of construction and look beyond the language of the policy to ascertain the intention of the parties. A general principle of construction, which has been applied to ambiguous insurance policies, holds that an ambiguous policy will be construed in favor of the insured. However, an appellate court will not read an ambiguity into policy language which is plain and unambiguous in order to construe it against the insurer.

7. Insurance: Contracts. When interpreting the plain meaning of the terms of an insurance policy, the natural and obvious meaning of the provisions in a policy is to be adopted in preference to a fanciful, curious, or hidden meaning, and further, while for the purpose of judicial decision dictionary definitions often are not controlling, they are at least persuasive that meanings which they do not embrace are not common.

8. Insurance: Contracts: Words and Phrases. The plain and ordinary meaning of the terms "bodily disorder" and "disease," as they are used in an insurance policy to define illness, encompasses any abnormal condition of the body or its components of such a degree that in its natural progression would be expected to be problematic; a deviation from the healthy or normal state affecting the functions or tissues of the body; an inherent defect of the body; or a morbid physical or mental state which deviates from or interrupts the normal structure or function of any part, organ, or system of the body and which is manifested by a characteristic set of symptoms and signs.

Michael J. Mooney, Gross & Welch, Omaha, for appellant.

John F. Thomas and Ronald G. Fleming, McGrath, North, Mullin & Kratz, P.C., Omaha, for appellee.

HASTINGS, C.J., and BOSLAUGH, WHITE, CAPORALE, FAHRNBRUCH, and LANPHIER, JJ.

WHITE, Justice.

This appeal arises from a summary judgment issued by the Douglas County District Court dismissing appellant Sindie Katskee's action for breach of contract. This action concerns the determination of what constitutes an illness within the meaning of a health insurance policy issued by appellee, Blue Cross/Blue Shield of Nebraska. We reverse the decision of the district court and remand the cause for further proceedings.

In January 1990, upon the recommendation of her gynecologist, Dr. Larry E. Roffman, appellant consulted with Dr. Henry T. Lynch regarding her family's history of breast and ovarian cancer, and particularly her health in relation to such a history. After examining appellant and investigating her family's medical history, Dr. Lynch diagnosed her as suffering from a genetic condition known as breast-ovarian carcinoma syndrome. Dr. Lynch then recommended that appellant have a total abdominal hysterectomy and bilateral salpingo-oophorectomy, which involves the removal of the uterus, the ovaries, and the fallopian tubes. Dr. Roffman concurred in Dr. Lynch's diagnosis and agreed that the recommended surgery was the most medically appropriate treatment available.

After considering the diagnosis and recommended treatment, appellant decided to have the surgery. In preparation for the surgery, appellant filed a claim with Blue Cross/Blue Shield. Both Drs. Lynch and Roffman wrote to Blue Cross/Blue Shield and explained the diagnosis and their basis for recommending the surgery. Initially, Blue Cross/Blue Shield sent a letter to appellant and indicated that it might pay for the surgery. Two weeks before the surgery, Dr. Roger Mason, the chief medical officer for Blue Cross/Blue Shield, wrote to appellant and stated that Blue Cross/Blue Shield would not cover the cost of the surgery. Nonetheless, appellant had the surgery in November 1990.

Appellant filed this action for breach of contract, seeking to recover $6,022.57 in costs associated with the surgery. Blue Cross/Blue Shield filed a motion for summary judgment. The district court granted the motion. It found that there was no genuine issue of material fact and that the policy did not cover appellant's surgery. Specifically, the court stated that (1) appellant did not suffer from cancer, and although her high-risk condition warranted the surgery, it was not covered by the policy; (2) appellant did not have a bodily illness or disease which was covered by the policy; and (3) under the terms of the policy, Blue Cross/Blue Shield reserved the right to determine what is medically necessary. Appellant filed a notice of appeal to the Nebraska Court of Appeals, and on our motion, we removed the case to the Nebraska Supreme Court.

Appellant contends that the district court erred in finding that no genuine issue of material fact existed and granting summary judgment in favor of appellee.

Summary judgment is proper when the pleadings, depositions, admissions, stipulations, and affidavits in the record disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law. Dalton Buick v. Universal Underwriters Ins. Co., 245 Neb. 282, 512 N.W.2d 633 (1994); Hillie v. Mutual of Omaha Ins. Co., 245 Neb. 219, 512 N.W.2d 358 (1994); Healy v. Langdon, 245 Neb. 1, 511 N.W.2d 498 (1994); Plambeck v. Union Pacific RR. Co., 244 Neb. 780, 509 N.W.2d 17 (1993). The party moving for summary judgment has the burden to show that no genuine issue of material fact exists and must produce sufficient evidence to demonstrate that the moving party is entitled to judgment as a matter of law. Transamerica Commercial Fin. Corp. v. Rochford, 244 Neb. 802, 509 N.W.2d 214 (1993).

In reviewing an order granting summary judgment, the appellate court views the evidence in a light most favorable to the nonmoving party and gives that party the benefit of all reasonable inferences deducible from the evidence. Hillie, supra; VonSeggern v. Willman, 244 Neb. 565, 508 N.W.2d 261 (1993).

The substantive issues raised in this appeal are governed by the rule that the interpretation and construction of an insurance contract ordinarily involve questions of law in connection with which an appellate court has an obligation to reach conclusions independent of the determinations made by the court below. Dalton Buick, supra; Decker v. Combined Ins. Co. of Am., 244 Neb. 281, 505 N.W.2d 719 (1993); Polenz v. Farm Bureau Ins. Co., 227 Neb. 703, 419 N.W.2d 677 (1988).

Blue Cross/Blue Shield contends that appellant's costs are not covered by the insurance policy. The policy provides coverage for services which are medically necessary. The policy defines "medically necessary" as follows:

The services, procedures, drugs, supplies or Durable Medical Equipment provided by the Physician, Hospital or other health care provider, in the diagnosis or treatment of the Covered Person's Illness, Injury, or Pregnancy, which are:

1. Appropriate for the symptoms and diagnosis of the patient's Illness, Injury or Pregnancy; and

2. Provided in the most appropriate setting and at the most appropriate level of services[;] and 3. Consistent with the standards of good medical practice in the medical community of the State of Nebraska; and

4. Not provided primarily for the convenience of any of the following:

a. the Covered Person;

b. the Physician;

c. the Covered Person's family;

d. any other person or health care provider; and

5. Not considered to be unnecessarily repetitive when performed in combination with other diagnoses or treatment procedures.

We shall determine whether services provided are Medically Necessary. Services will not automatically be considered Medically Necessary because they have been ordered or provided by a Physician.

(Emphasis supplied.) Blue Cross/Blue Shield denied coverage because it concluded that appellant's condition does not constitute an illness, and thus the treatment she received was not medically necessary. Blue Cross/Blue Shield has not raised any other basis for its denial, and we therefore will limit our consideration to whether appellant's condition constituted an...