Kracht v. Aalfs Associates HCP

• Decision Date: 17 October 1995
• Docket Number: No. C 94-4025.,C 94-4025.
• Citation: 905 F. Supp. 604
• Court: U.S. District Court — Northern District of West Virginia
• Parties: Thomas KRACHT, Plaintiff, v. AALFS ASSOCIATES H.C.P., Health Care Plan of Aalfs Manufacturing Company, Defendant.

905 F. Supp. 604

Thomas KRACHT, Plaintiff, v. AALFS ASSOCIATES H.C.P., Health Care Plan of Aalfs Manufacturing Company, Defendant.

No. C 94-4025.

United States District Court, N.D. Iowa, Western Division.

October 17, 1995.

COPYRIGHT MATERIAL OMITTED

Redge Berg of Berg & Howe in Spencer, Iowa, for Plaintiff Thomas Kracht.

Maureen Heffernan and Douglas Hodgson of Berenstein, Moore, Moser, Berenstein & Heffernan in Sioux City, Iowa, for Defendant Aalfs Associates H.C.P., Health Care Plan of Aalfs Manufacturing Company.

MEMORANDUM OPINION AND ORDER REGARDING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

BENNETT, District Judge.

                                        TABLE OF CONTENTS
                  I. INTRODUCTION AND PROCEDURAL BACKGROUND ................. 607
                 II. STANDARDS FOR SUMMARY JUDGMENT ......................... 608
                III. FINDINGS OF FACT ....................................... 610
                     A. Undisputed Facts .................................... 610
                     B. Disputed Facts ...................................... 611
                 IV. LEGAL ANALYSIS ......................................... 611
                     A. Standard Of Review .................................. 611
                     B. Pre-existing Condition Analysis ..................... 613
                     C. Pre-Certification For Kracht's Surgery .............. 617
                  V. CONCLUSION ............................................. 618
                

This litigation raises a troublesome issue in which forty-eight hours determines whether Plaintiff or his former employer's health care plan must pay more than $50,000 in medical expenses resulting from Plaintiff's traumatic battle with cancer. This case further demonstrates that "how one wishes to decide a case comes lightly to mind, on a wing; but often how one must decide it comes arduously, weighed down by somber thought." Curtis 1000, Inc. v. Youngblade, 878 F.Supp. 1224, 1232 (N.D.Iowa 1995) (quoting Letelier v. Republic of Chile, 748 F.2d 790, 791 (2d Cir.1984), cert. denied, 471 U.S. 1125, 105 S.Ct. 2656, 86 L.Ed.2d 273 (1985)). Defendant has moved for summary judgment, claiming Plaintiff's cancer was a pre-existing condition that was present when Plaintiff received advice and treatment for symptoms resulting from his cancer on May 30, 1991, forty-eight hours prior to the effective date of his coverage under Defendant's health care plan, even though Plaintiff's condition was incorrectly diagnosed as epididymitis at this time. On the other hand, Plaintiff argues he did not receive advice or treatment for cancer and was not diagnosed with cancer on May 30, 1991. Rather, Plaintiff claims he was not diagnosed with cancer until June 7, 1991, six days after the date of his coverage under Defendant's health care plan commenced. Therefore, Plaintiff argues there is a genuine issue of material fact regarding whether Plaintiff's cancer was a pre-existing condition as defined in Defendant's health care plan, thereby excluding him from coverage under this health care plan and forcing him to endure the hardship of paying for medical expenses from his cancer.

I. INTRODUCTION AND PROCEDURAL BACKGROUND

Plaintiff Thomas Kracht filed a complaint in state court on February 18, 1994, alleging he has suffered damage as a result of the defendant's refusal to pay him medical expense benefits that he claims were provided for and covered under the terms of his health care plan. Defendant Aalfs Associates H.C.P., Health Care Plan of Aalfs Manufacturing Company ("Aalfs") filed a notice of removal in federal court on March 14, 1994, removing this case from state court to the federal district court in the Northern District of Iowa. Aalfs removed this case because Kracht's complaint states a cause of action arising under 29 U.S.C. § 1001 et seq., the Employee Retirement Income Security Act of 1974 ("ERISA") and pertains to benefits due under an employee welfare benefit plan. Also, on March 14, 1994, Aalfs filed its answer to Kracht's complaint, denying Kracht's allegations and raising two affirmative defenses. In Aalfs' first defense, Aalfs alleged Kracht has failed to exhaust all of his administrative remedies as required under 29 U.S.C. § 1001 et seq. and under the terms of the medical benefits program administered by Aalfs. (Answer, p. 1.). In its second affirmative defense, Aalfs argues Kracht was not entitled to coverage for all of his medical expenses because some of his expenses were not covered under the medical benefits program administered by Aalfs. (Answer, p. 2.).

On July 28, 1995, Aalfs filed a motion for summary judgment, claiming that Kracht's medical expenses are not covered under Aalfs' health care plan because Kracht incurred these expenses for a pre-existing condition, which is excluded from Aalfs' health care plan. Kracht's coverage under Aalfs' health care plan became effective on June 1, 1991. Aalfs argues that although Kracht's medical condition was not correctly diagnosed until June 7, 1991, the condition was present on May 30, 1991, and Kracht received medical advice and treatment on May 30, 1991. Because Kracht received this advice and treatment for a condition in existence before his coverage under Aalfs' health care plan was effective, Aalfs asserts this condition is a pre-existing condition. Furthermore, because this condition is a preexisting condition, the expenses for the treatment of this condition are excluded from Aalfs' health care plan. To supplement its motion for summary judgment, Aalfs also filed a memorandum in support of summary judgment, a statement of undisputed material facts, and the affidavits of Melanie Nieman,¹ Rhonda Camarigg,² and Dr. Gregg M. Galloway.³ On July 31, 1995, Aalfs moved for a hearing on its motion for summary judgment. This hearing was subsequently scheduled for October 12, 1995.

On August 25, 1995, Kracht responded to Aalfs' motion for summary judgment, arguing there are material facts in dispute regarding whether the medical advice and treatment Kracht received pertained to a pre-existing condition, thereby barring his recovery of medical expenses. Specifically, Kracht argues his expenses did not relate to a pre-existing condition, existing before June 1, 1991. Rather, his medical expenses relate to his treatment for cancer, for which he alleges he began to receive treatment on June 7, 1991. On May 30, 1991, Kracht argues he was diagnosed as having epididymitis involving the left testicle and treated for this condition. On the other hand, on June 7, 1991, Kracht was diagnosed as having testicular cancer and received different treatment for this condition promptly. Because Kracht alleges he was never advised or treated regarding his testicular cancer before June 1, 1991, he argues his medical expenses do not relate to a pre-existing condition and are covered under Aalfs' health care plan. To support his resistance to Aalfs' motion for summary judgment, Kracht also filed an argument in support of resistance to motion for summary judgment and a response to Aalfs' statement of undisputed material facts.

On October 12, 1995, a hearing was held regarding Aalfs' motion for summary judgment. Aalfs was represented by Maureen Heffernan and Douglas Hodgson, Berenstein, Moore, Moser, Berenstein & Heffernan, Sioux City, Iowa. Kracht was represented by Redge Berg, Berg and Howe, Spencer, Iowa. On the day of the hearing, Kracht filed an affidavit in support of his resistance to Aalfs' motion for summary judgment. In this affidavit, Kracht stated his fiancee obtained pre-certification and approval in accordance with the terms of Aalfs' health care plan for his surgery for testicular cancer on June 7, 1991.

II. STANDARDS FOR SUMMARY JUDGMENT

The Eighth Circuit Court of Appeals recognizes "that summary judgment is a drastic remedy and must be exercised with extreme care to prevent taking genuine issues of fact away from juries." Wabun-Inini v. Sessions, 900 F.2d 1234, 1238 (8th Cir.1990). On the other hand, the Federal Rules of Civil Procedure have authorized for nearly 60 years "motions for summary judgment upon proper showings of the lack of a genuine, triable issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986). Thus, "summary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed `to secure the just, speedy and inexpensive determination of every action.'" Wabun-Inini, 900 F.2d at 1238 (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986)); Hartnagel v. Norman, 953 F.2d 394, 396 (8th Cir. 1992).

The standard for granting summary judgment is well established. Rule 56 of the Federal Rules of Civil Procedure states in pertinent part:

Rule 56. Summary Judgment

(b) For Defending Party. A party against whom a claim ... is asserted ... may, at any time, move for summary judgment in the party's favor as to all or any part thereof.

(c) Motions and Proceedings Thereon. ... The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.

Fed.R.Civ.P. 56(b) & (c) (emphasis added); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986); Beyerbach v. Sears, 49 F.3d 1324, 1325 (8th Cir.1995); Munz v. Michael, 28 F.3d 795, 798 (8th Cir.1994); Roth v. U.S.S. Great Lakes Fleet, Inc., 25 F.3d 707, 708 (8th Cir.1994); Cole v. Bone, 993 F.2d 1328, 1331 (8th Cir.1993); Woodsmith Publishing Co. v. Meredith Corp., 904 F.2d 1244, 1247 (8th Cir.1990); Wabun-Inini, 900 F.2d at 1238 (citing Fed.R.Civ.P. 56(c)).⁴ A court considering a motion for summary judgment must view all the facts in the light most favorable to the nonmoving party, here Kracht, and give Kracht the benefit of all reasonable...