Justia Insurance Law Opinion Summaries

Articles Posted in Health Law
by
In the United States Court of Appeals for the Eleventh Circuit, the Court reviewed a case involving the estates of two patients who passed away after undergoing liposuction procedures at CJL Healthcare, LLC in Georgia. After the patients' deaths, their estates filed lawsuits against the clinic and its doctor. The clinic's insurer, Prime Insurance Co., defended the clinic under a reservation of rights but ultimately withdrew its defense after the costs of defending the lawsuits exhausted the insurance coverage.The estates of the patients and the clinic then filed a lawsuit against the insurers, Prime Insurance Co., Prime Holdings Insurance Services, and Evolution Insurance Brokers, claiming they had breached their duties, contract, and acted negligently. They also claimed the insurers had unlawfully sold surplus lines insurance. The district court dismissed the case, and the plaintiffs appealed.The Court of Appeals affirmed the district court's decision. The Court held that the policy unambiguously provided a $50,000 limit for a single professional liability claim and a $100,000 aggregate limit for all claims. The Court further held that the insurers' duty to defend the clinic ended when the policy limits were exhausted by payment of damages and claim expenses. The Court also affirmed the district court's finding that the Georgia Surplus Lines Insurance Act did not provide a private cause of action for the unauthorized sale of surplus lines insurance. View "Jumlist v. Prime Insurance Co." on Justia Law

by
In this case, a group of healthcare providers (Providers) sued the insurer Sanford Health Plan, Inc. (SHP) for excluding them from participating in some of its health benefit plans. The Providers argued that according to South Dakota’s “Any Willing Provider” law (SDCL 58-17J-2), they had the right to participate as panel providers in all of SHP's plans. The law stipulates that a health insurer cannot block patient choice by excluding a willing and qualified healthcare provider from its panel of providers if the provider is within the geographic coverage area of the health benefit plan. The circuit court determined that the law did not permit SHP to exclude a qualified and willing healthcare provider from participating in every health benefit plan it offered, granting summary judgment in favor of the Providers.The Supreme Court of the State of South Dakota affirmed the circuit court's decision. It interpreted the law as plan-specific, meaning an insurer may not exclude any willing and fully qualified provider from any of its plans or from any tier within a plan. It also clarified that an insurer may still exclude providers from plans if they do not meet the statutory requirements for participation as a panel provider. The court concluded that, according to the law, SHP could not exclude the Providers from participating in its TRUE Plan or Tier 1 of the PLUS Plan, thus affirming the circuit court's granting of summary judgment in favor of the Providers. View "Orthopedic Institute v. Sanford Health Plan, Inc." on Justia Law

by
The United States Court of Appeals for the First Circuit considered a case where Lawrence General Hospital (LGH) sued Continental Casualty Company for denying coverage for losses LGH alleges it suffered during the COVID-19 pandemic. LGH argued that its insurance policy with Continental covered the losses under two types of coverage: coverage for "direct physical loss of or damage to property" and a Health Care Endorsement covering losses and costs incurred due to compliance with government decontamination orders.Applying Massachusetts state law, the court ruled that LGH failed to state a claim that the SARS-CoV-2 virus caused "direct physical loss of or damage to its property," affirming the lower court's dismissal of this claim. However, the court found that LGH was subject to decontamination orders due to COVID-19 and thus had a valid claim for coverage under the Health Care Endorsement. As such, the court reversed the lower court's dismissal of this claim and remanded the case for further proceedings. View "Lawrence General Hospital v. Continental Casualty Co." on Justia Law

by
In this case, the plaintiffs, a minor and her parents, sued their health insurer, Premera Blue Cross, for denying coverage for the minor’s stay in a wilderness therapy program, claiming that the denial violates mental health parity laws. The plaintiffs also alleged breach of contract, insurance bad faith, and violation of the Consumer Protection Act.The Supreme Court of the State of Washington held that the plaintiffs’ breach of contract claim based on alleged violation of federal parity laws does not form a viable common law action. The Court found that the plaintiffs failed to show that a violation of federal parity law would give rise to a viable common law action for breach of contract.Furthermore, the Court held that the breach of contract action based on Premera's alleged violation of state parity laws could not succeed based on the statutory language that was in place at the time.However, the Court did affirm the lower court’s finding that the plaintiffs were not required to produce evidence of objective symptomatology to support their insurance bad faith claim for emotional distress damages. Consequently, the case was remanded to the trial court for further proceedings on the bad faith and Consumer Protection Act claims. View "P.E.L. v. Premera Blue Cross" on Justia Law

by
The insurer, in this case, had notice of the hospital’s lien for treatment provided to the patient and, pursuant to a settlement agreement with the patient, gave him a check for the lien amount made payable to both him and the hospital. The hospital, Long Beach Memorial Medical Center, claims this action did not comply with the Hospital Lien Act (HLA) and sued the insurer who wrote the check, Allstate Insurance Company, for violating the HLA. The trial court granted Allstate’s motion for summary judgment, ruling Allstate’s two-payee check, which was never cashed, satisfied its obligation under the HLA.   The Second Appellate District reversed. The court concluded that merely delivering to the patient (or, in this case, his attorney) a check for the lien amount, made payable to both the patient and the hospital, is not a payment in satisfaction of the hospital’s lien under the HLA. The court explained Allstate maintains that it made this payment to the Medical Center concurrent with payment to the patient and that, therefore, the Medical Center cannot establish Allstate made a settlement payment to the patient without paying the Medical Center the amount of its lien. The court explained that Allstate declined to specify which check made payable to the Medical Center as copayee—the February 2020 check or the March 2021 check— Allstate claims satisfied its payment obligation to the Medical Center. However, neither check was a payment to the Medical Center. Moreover, Allstate does not invoke the exception to the general rule here. View "Long Beach Memorial Medical Center v. Allstate Ins. Co." on Justia Law

by
Plaintiff and appellant Rhonda S. is the conservator, appointed pursuant to section 5350 of the Lanterman-Petris Short Act (LPS), of her adult son David S. Plaintiff sued Defendants and respondents Kaiser Foundation Health Plan, Inc. and Kaiser Foundation Hospitals for a declaration of their obligations, under LPS and the terms of David’s health plan, to transport and accept for “assessment and evaluation” (each as defined in LPS) conservatees like David upon their conservators’ demand. The trial court sustained Kaiser’s demurrer.
The Second Appellate District affirmed. The court explained that it rejects Plaintiff’s implication that an LPS conservatee is per se suffering from an “Emergency Medical Condition” at all times following the judicial determination of grave disability. The purposes of LPS conservatorship include providing treatment to the conservatee. (Section 5350.1.) To assume a conservatee’s condition remains static following the conservatorship order is to assume treatment is always ineffectual. We are offered no basis for such an assumption. For a mental health condition to be an “Emergency Medical Condition” under the plan, “acute symptoms of sufficient severity” must result in an “immediate” specified danger or mental health disorder-induced disability. Second, even if conservatees were in a state of perpetual “Emergency Medical Condition” within the meaning of the plan, Plaintiff’s requested declaration would eliminate the coverage requirement that a “reasonable person would have believed that the medical condition was an Emergency Medical Condition which required ambulance services.” View "Rhonda S. v. Kaiser Foundation Health Plan" on Justia Law

by
Plaintiff Gene Moran, who was a patient at Huntington Beach Hospital (the Hospital) three times in 2013, sued defendants Prime Healthcare Management, Inc., Prime Healthcare Huntington Beach, LLC, Prime Healthcare Services, Inc., and Prime Healthcare Foundation, Inc. (collectively defendants) under various theories in 2013. In a prior opinion, the Court of Appeal found that while most of Moran’s claims lacked merit, he had sufficiently alleged facts supporting standing to claim the amount that self-pay patients were charged was unconscionable, and reversed the trial court’s dismissal of the case. Moran’s sixth amended complaint included both the allegations regarding unconscionability and a new theory of the case: defendants had violated the Unfair Competition Law (UCL), and the Consumer Legal Remedies Act (CLRA) by failing to disclose Evaluation and Management (EMS) fees charged in the emergency room through signage or other methods. The complaint sought relief under both the old and new theories for violations of the UCL, CLRA, and for declaratory relief. Defendants moved to strike the allegations regarding EMS fees, arguing their disclosure obligations were defined by statute. The trial court agreed and struck the allegations from the sixth amended complaint. Finding no reversible error in that decision, the Court of Appeal affirmed. View "Moran v. Prime Healthcare Management, Inc." on Justia Law

by
Michael Andary, conservator and guardian of Ellen Andary; Ronald Krueger, guardian of Philip Krueger; and Moriah, Inc., doing business as Eisenhower Center, brought an action against USAA Casualty Insurance Company and Citizens Insurance Company of America, seeking a declaratory judgment that the Michigan Legislature’s 2019 amendments of the no-fault act, MCL 500.3101 et seq., that placed new limitations on in-home family-provided attendant care in MCL 500.3157(10) and the non-Medicare fee schedule of MCL 500.3157(7) could not be applied to limit or change plaintiffs’ rights to benefits under the insurance policies defendants had issued to them before the 2019 amendments. Andary and Krueger, suffered traumatic injuries in automobile accidents before 2019, had been provided uncapped lifetime medical care covered by personal protection insurance (PIP) benefits under insurance policies and the no-fault act in effect at the time of their injuries. Plaintiffs argued that the retroactive application of the 2019 amendments to them was improper and would also violate their constitutional rights under the Contracts Clause of Const 1963, art 1, § 10 and their due-process and equal-protection rights. Additionally, plaintiffs all challenged the prospective application of the 2019 amendments on behalf of future motor vehicle accident victims and medical providers. Defendants moved to dismiss the case, and the trial court granted defendants’ motion. Plaintiffs appealed, and the Court of Appeals affirmed in part, reversed in part, and remanded the case to the circuit court. The Michigan Supreme Court found that the 2019 no-fault amendments of MCL 500.3157 did not impact services and care that were already being provided to Andary and Krueger and that had been reimbursable prior to the amendments. Andary’s and Krueger’s rights to the PIP benefits at issue in this case were both contractual and statutory in nature, and the 2019 no-fault amendments did not retroactively modify their vested contractual rights. Plaintiffs’ constitutional challenges to prospective application of the amended statutes were dismissed. View "Andary v. USAA Casualty Insurance Company" on Justia Law

by
A healthcare provider contended it was underpaid for substance abuse treatment that it rendered to 29 patients. Seeking to recover the difference directly from the insurance company, the provider filed suit alleging the insurer entered into binding payment agreements during verification of benefits and authorization calls with the provider and otherwise misrepresented or concealed the amounts it would pay for treatment. The trial court entered summary judgment against the provider. After review, the Court of Appeal concluded the court did not err in determining one or more elements of the provider’s causes of action could not be established. View "Aton Center v. United Healthcare Ins. Co." on Justia Law

by
The Supreme Court reversed the judgment of the court of appeal affirming the judgment of the court of appeal granting summary judgment for the defense in this lawsuit brought by the California Medical Association (CMA), holding that the evidence was sufficient to create triable issues of fact precluding summary judgment.CMA, a nonprofit professional association representing California physicians, sued Aetna Health of California Inc. alleging that Aetna violated the unfair competition law (UCL), Cal. Bus. & Prof. Code 17200 et seq., by engaging in unlawful business practices. At issue was whether Aetna satisifed the UCL's standing requirements by diverting its resources to combat allegedly unfair competition. The Supreme Court held (1) the UCL’s standing requirements are satisfied when an organization, in furtherance of a bona fide, preexisting mission, incurs costs to respond to perceived unfair competition that threatens that mission, so long as those expenditures are independent of costs incurred in UCL litigation or preparations for such litigation; and (2) the trial court erred in granting summary judgment for Aetna on the ground that CMA lacked standing. View "Cal. Medical Assn. v. Aetna Health of Cal., Inc." on Justia Law