Principal Health Care of Louisiana v. Lewer Agency, Civ. A. No. 92-3334.

• Decision Date: 17 September 1993
• Docket Number: Civ. A. No. 92-3334.
• Citation: 831 F. Supp. 570
• Parties: PRINCIPAL HEALTH CARE OF LOUISIANA, INC. v. The LEWER AGENCY, INC., et al.
• Court: U.S. District Court — Eastern District of Louisiana

831 F. Supp. 570

PRINCIPAL HEALTH CARE OF LOUISIANA, INC. v. The LEWER AGENCY, INC., et al.

Civ. A. No. 92-3334.

United States District Court, E.D. Louisiana.

September 17, 1993.

Daniel A. Ranson and J. Michael Daly, Jr. (Windhorst, Gaudry, Ranson, Higgins & Gremillion), Gretna, LA, for plaintiff, Principal Health Care of Louisiana, Inc.

Walter F. Marcus, III (Lemle & Kelleher), New Orleans, LA, for defendants, Lewer Agency, Inc. and General American Life Ins. Co.

ORDER AND REASONS

FONSECA, United States Magistrate Judge.

This case is a dispute between insurance companies as to which is the primary insurer for the medical expenses incurred by a premature baby, Justin Jean Plauche ("Justin"), who was born to parents who were never married and never lived together. Plaintiff, Principal Health Care of Louisiana, Inc. ("Principal"), is the medical insurer of the baby's father, Fred Brockton Pepper ("Pepper"), and defendant, General American Life Insurance Company ("General"), is the medical insurer of the baby's mother, Danielle Charay Plauche ("Plauche"), under their respective employee welfare plans. The complaint requests that the court determine the rights and liabilities of the parties pursuant to the Coordination of Benefits provisions in the respective insurance policies and issue a declaratory judgment that either Principal or General is responsible as the primary insurer for Justin.

This matter was referred to the undersigned Magistrate Judge upon the consent of the parties pursuant to 28 U.S.C. § 636(c) and is before the court on cross-motions for summary judgment. The matter was submitted after oral argument on August 18, 1993.

The Facts

Justin was born, four months prematurely, on December 27, 1991, at East Jefferson General Hospital. Justin's mother, Plauche, who was born on December 9, 1964, and Justin's father, Pepper, who was born on April 29, 1956, have never been married to each other and have never lived together. On January 3, 1992, Pepper formally acknowledged paternity of Justin. Plauche concurred in the acknowledgement.

Immediately after Justin's birth, Plauche and Pepper sought to add Justin as an additional assured and/or member under their respective employee welfare plans. Plauche's employer paid for Plauche's coverage and dependent coverage for Justin under the General plan. Pepper paid for his own medical coverage and dependent coverage for Justin under the Principal plan.

While hospitalized, there were no expenses for Justin other than the hospital bills which are at issue in this case. Justin was discharged from the hospital on April 13, 1992. Of the medical expenses in dispute in this case, which total $245,089.88, all but approximately $500.00 were incurred while Justin was hospitalized from his birth until April 13, 1992.

When Justin was discharged from the hospital, he went to live with Plauche at her parent's house. There is no evidence that there has ever been any judicial determination involving Justin's custody. However, in August, 1992, the Juvenile Court for the Parish of Jefferson ordered that Pepper provide medical support and maintain his current medical insurance for Justin and that he be responsible for the health care expenses of Justin.

Coverage Under The Principal Policy

Principal first contends that it cannot be the primary medical insurance provider for Justin because Justin is not Pepper's dependent child, as that term is defined in the policy, and, therefore, is not a member of the Principal health plan.

The Principal membership agreement provides that the subscriber and family dependents are "members" of the health plan. Plaintiff's Motion for Summary Judgment, Exhibit 1 at p. 9. The definition of "family dependents" includes a "dependent child." The membership agreement defines a "dependent child," in relevant part, as "the Subscriber's unmarried natural or legally adopted child residing within the Service Area ... The child must be dependent on the Subscriber for a majority of his or her financial support ..." Id. at p. 37.

Principal asserts that, for Justin to qualify as Pepper's dependent under the policy, Pepper must have paid at least half toward Justin's support and care. Principal points to Plauche's deposition testimony that the only money she had received from Pepper was $200.00 to help pay hospital bills, that Justin's lived with Plauche after he was released from the hospital, and that Plauche paid Justin's expenses after he was released from the hospital.

In order to determine whether Justin qualified as a "dependent child" of Pepper and, therefore, whether his medical expenses were covered under the Principal policy, we must look at the period during which those medical expenses were incurred. During that time period, Justin was, both factually and legally, "dependent on Pepper for a majority of his or her financial support ..." As indicated above, while Justin was hospitalized, his only expenses were the medical bills which are at issue in this case. Thus, Justin's support was provided, during the relevant period, through the payment of medical insurance premiums. Because Pepper paid premiums for dependent medical coverage for Justin, Principal cannot show that Justin was not dependent on Pepper for a majority of his support during the relevant period.¹ Furthermore, Pepper, who formally acknowledged Justin as his child, had a legal obligation to provide support for his child. See La.Civ.Code art. 240; Hogan v. Hogan, 549 So.2d 267, 271 (La.1989). As noted in Hogan, the parents' obligation to support their child is "conjoint" and solidary, because each parent is bound for the entirety of the child's support. Id. at 271.

Accordingly, Justin was Pepper's "dependent child" for purposes of the Principal policy during the relevant period.²

The Primary Insurer

Principal next contends that General is Justin's primary insurer under the Order of Benefits Determination provision of the Principal policy. The relevant portions of that provision are:

The Health Plan determines its order of benefits using the first of the following rules which applies:

. . . . .

b) Except as stated in paragraph 4.1.C.2.c, when the Health Plan and another Plan cover the same child as a Family Dependent of different persons, called "parents":

1. The benefits of the Plan of the parent whose birthday falls earlier in a year are determined before those of the Plan of the parent whose birthday falls later in the year ...

c) If two or more Plans cover a Member as a dependent child of divorced or separated parents, benefits for the child are determined in this order:

1. First, the Plan of the parent with custody of the child, and 2. Then, the Plan of the spouse of the parent with custody of the child, and

3. Finally, the Plan of the parent not having custody of the child.

Plaintiff's Motion for Summary Judgment, Exhibit 1 at section 4.1.C.³

Principal contends that, because Pepper and Plauche were never married and living together, they are "separated parents" under this provision and that, therefore, paragraph 4.1.C.2.c, the "custody rule," applies. General...