Appeal from the Superior Court of the District of Columbia; Hon. Nicholas S. Nunzio, Trial Judge
Rogers, Chief Judge. Ferren, Associate Judge, and Kern, Senior Judge.
The opinion of the court was delivered by: Rogers
Appellant Janice L. Mueller appeals from the judgment holding that appellee Healthplus, Inc., is not liable for payment of her medical expenses under a group insurance policy offered through her employer, Washington Center for Aging Services. She contends that the trial Judge erred in ruling that Healthplus had complied with the cancellation provision of the policy by giving notice to her employer without directly notifying her. We agree; accordingly we reverse. *fn1
The relevant facts are not in dispute. In January 1988, appellant enrolled as a subscriber in Healthplus, Inc.'s group insurance policy, which was offered through her employer, Washington Center for Aging Services (WCAS). On January 23, 1988, she was diagnosed by her gynecologist, Dr. Oweiss, as having an infection. The infection was recurrent through August 1988, and required treatment through September 1988. On March 8, 1988, appellant was diagnosed as having a cervical Nabothian cyst, which was removed on April 18, 1988, by Dr. Oweiss. Appellant thereafter required treatment for symptoms associated with the removal of the cyst through June 1988.
On February 12, 1988, Healthplus sent a letter to WCAS's insurance liaison, Becky Mays, stating that "Healthplus regrets to inform you that it will not be submitting a proposal to Washington Center for the Aging to renew our contract for provision of health care services." WCAS, through its Director of Personnel, issued a memorandum thirteen days later to those employees enrolled in Healthplus stating that "effective April 1, 1988, Healthplus will no longer provide medical services for WCAS/Urban Shelters employees who are now covered by the plan. . . . You must select another carrier to provide medical services during the open enrollment period beginning March 15, 1988."
WCAS conducted a seminar on March 15, 1988, regarding available health care options. Appellant was in attendance as were representatives from three group plans, MDIPA, Kaiser-Permanente, and Group Health Association. All three plans offered coverage of pre-existing illnesses, but would not have allowed appellant to retain Dr. Oweiss as her treating physician. *fn2 Appellant testified that Dr. Oweiss advised her not to change physicians on the eve of surgery and in the middle of treatment. Representatives from a fourth group plan that WCAS was offering, Prudential Insurance Company, did not attend the seminar. Appellant testified that she was advised by Becky Mays that only the Prudential plan would allow her to keep her own doctor.
Appellant eventually elected coverage with Prudential, retaining Dr. Oweiss as her physician. When she submitted a reimbursement request to Prudential for her expenses after April 1, 1988, Prudential denied them on the ground that they were the result of a "pre-existing condition." Appellant's request for reimbursement from Healthplus was denied for expenses incurred after March 31, 1988.
Appellant sued Healthplus in the Small Claims and Conciliation Branch of the Superior Court. The trial Judge ruled that appellant did not have a continuing right to coverage under the Healthplus group plan, and that Healthplus had complied with the cancellation provision in the plan by giving effective notice through WCAS. Specifically, the Judge found:
First, the contract for health care coverage existed between and WCAS, not .
Second, was properly and timely notified of the pending termination, and had available to her a health care representative to fully explain her option.
Third, could have converted to [Healthplus's] plan on an individual basis, that is assuming the premiums herself, or could have chosen another carrier who covered pre-existing conditions.
Appellant contends that the cancellation provisions in the group plan required Healthplus, as the terminating party, to provide written notice directly to her. *fn3 This provision was not satisfied, according to appellant, because WCAS, the employer, and not Healthplus, provided the notice to appellant. Since she never received the notice as required by the plan, ...