Schmidt v. Fortis Ins. Co.
| Decision Date | 03 January 2005 |
| Docket Number | No. C03-3094-MWB.,C03-3094-MWB. |
| Citation | 349 F.Supp.2d 1171 |
| Parties | Karen M. SCHMIDT and Daniel J. Schmidt, Plaintiffs, v. FORTIS INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — Northern District of Iowa |
Chad Andrew Swanson, Dutton Braun Staack Hellman Iversen, Waterloo, IA, for Plaintiffs.
Debra Lynne Hulett, Michael W Thrall, Nyemaster Goode Voigts West Hansell & O'Brien, PC, Des Moines, IA, for Defendant.
The plaintiffs, Karen Schmidt and Daniel Schmidt ("Schmidts"), are husband and wife. Karen is a self-employed business owner and is currently the owner/operator of several businesses including a video rental and tanning business (known as "Home Video" and "The Sun Tanner"), a payday loan business housed near the video and tanning business, Hampton Home Store and the Coonley apartment building. Karen is also a Radio Shack dealer in connection with the video and tanning businesses, and a U.S. Cellular agent in connection with the Hampton Home Store. In approximately 1988, Karen was personally involved in securing a health and disability insurance plan for a full-time employee of the video and tanning business. From approximately 1990 through August 2001, Daniel Schmidt was employed by the Hampton-Dumont Community School District as the director of maintenance. In approximately 1988, prior to Daniel obtaining his position with the Hampton-Dumont Community School District, the Schmidts purchased a family health insurance policy from Blue Cross Blue Shield ("BCBS"). The Schmidts were covered by the BCBS policy when Karen was diagnosed with breast cancer and underwent a mastectomy followed by chemotherapy in 1989. When Daniel began his employment with the Hampton-Dumont Community School District, and secured health insurance for his family via that employment, the Schmidts terminated their BCBS policy on the basis of cost and duplication of benefits. At no point did the Schmidts have health insurance coverage through any of the businesses that they owned.
In the summer of 2001, the Schmidts were anticipating the purchase of the Hampton Home Store — a major appliance retail store which also services appliances. At this time, the Schmidts were considering the possibility of Daniel ending his employment with the Hampton-Dumont Community School District and co-operating the Hampton Home Store with Karen. The sale of the Hampton Home Store to the Schmidts was to be completed on August 13, 2001. At this time, the Schmidts had health insurance through the Hampton-Dumont Community Schools under a self-funded plan — but, this coverage would lapse following the termination of Daniel's employment with the school district.1 Therefore, obtaining replacement health care insurance prior to the completion of the sale of the Hampton Home Store to the Schmidts became a priority. Karen was particularly concerned with obtaining replacement coverage in light of her breast cancer history, which is explained in great detail below. When Daniel expressed an interest in leaving his position at the school district in favor of co-operating the Hampton Home Store with Karen, Dr. Lee Morrison, the superintendent of the school district, recommended that the Schmidts contact the school district's insurance agent, Loren Kiel, at Midwest Group Benefits, Inc. in Decorah, Iowa, to discuss their options for purchasing replacement health care insurance.
Dr. Keith Hansen, D.O., has been Karen's primary care physician since 1973. On March 21, 1989, a mammogram performed on Karen revealed the presence of a mass in her right breast. A biopsy of the mass was conducted on that same day. The biopsy revealed a medullary carcinoma and Karen was diagnosed with stage II breast cancer, with one of eighteen lymph nodes positive. On March 29, 1989, Karen underwent a radical partial mastectomy with axillary dissection. The surgery was performed by Dr. Hansen and Dr. Richard Francis, M.D. The last time Karen had detectable residual cancer was at the time of her mastectomy on March 29, 1989.
Following the surgery, Karen began seeing Dr. Peter Silberstein, M.D., who at the time2 was an oncology/hematology specialist at The Park Clinic3 in Mason City, Iowa. Karen's first visit with Dr. Silberstein was on April 20, 1989. Under Dr. Silberstein's supervision, Karen underwent six months of chemotherapy — from approximately April 1989 through September 1989. In approximately November of 1989, following the completion of the chemotherapy regimen and after finding that the tumor was estrogen and progesterone receptor positive, Dr. Silberstein prescribed the prescription drug tamoxifen4 for Karen — which Karen then began taking.5 The last progress note in Karen's chart with Dr. Silberstein was entered on December 26, 1990 — this is the last date Dr. Silberstein believes he saw Karen as a patient. With regard to tamoxifen, the December 26, 1990, progress note indicates:
In regards to the TAMOXIFEN. She currently is on TAMOXIFEN and taking it only once a day. Her ER/PR is positive. I told her that I would slightly recommend that she continue on that though she wanted to discontinue the TAMOXIFEN because of her hot flashes. That would [ ]6 have been reasonable, since many oncologists do not give both chemotherapy and the TAMOXIFEN.
Defendant Fortis Insurance Company's Appendix in Support of Its Resistance to Plaintiffs' Motion for Summary Judgment and Defendant's Motion for Summary Judgment, Doc. No. 34, at 8 ("Deft.'s App."). Following December 1990, Dr. Hansen continued to renew Karen's original tamoxifen prescription initiated by Dr. Silberstein, and Karen remained on a daily tamoxifen regiment through 1996.7 Dr. Hansen's progress notes throughout this time period contain numerous references to Karen's tamoxifen prescription and usage, for example:
• February 5, 1990 — "The patient calls in stating she is on Tamoxifen, post CA of the breast." Plaintiffs' Appendix in Support of Motion for Summary Judgment, Doc. No. 18, at 140 ("Plf.s' App.").
• August 5, 1991 — "In for recheck of her dysfunctional uterine bleeding related to her Megace [handwritten `Tamoxifen'] therapy and recent treatment with Provera." Deft.'s App. at 9.
• November 19, 1991 — "Patient is wondering about how much follow-up she should do at this point on her Tamoxifen therapy and post CA of the breast." Deft.'s App. at 10
• May 6, 1992 — "She is on TAMOXIFEN 10mg bid." Deft.'s App. at 11.
• September 22, 1992 -"Her routine medication is Nolvadex." Deft.'s App. at 11.
• February 4, 1993 — "Also is in for six month follow-up of her Tamoxifen...."; "Also history of CA of the breast with Tamoxifen therapy." Plf.s' App. at 139.
• March 15, 1994 — Plf.s' App. at 139.
• December 18, 1995 — Deft.'s App. at 14.
• ...
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