Title: Reserve Life Ins. Co. v. Coke

State: mississippi

Issuer: Mississippi Supreme Court

Document:

254 Miss. 936 (1966) 183 So. 2d 490 RESERVE LIFE INSURANCE COMPANY v. COKE No. 43834. Supreme Court of Mississippi. February 28, 1966. Bacon & Smith, Jackson, for appellant. *938 Ralph E. Pogue, Aberdeen, for appellee. SMITH, J. Reserve Life Insurance Company has appealed from a judgment entered against it by the Circuit Court of Monroe County in favor of Will Edd Coke in the amount of $329.50. Appellant issued its health and accident policy to Will Edd Coke, the appellee, providing indemnities against liability for hospital and surgical expense "actually incurred," not to exceed $6 per day. The policy also covered appellee's wife, Mrs. Betty Ann Coke. Mrs. Coke was a patient in the Mississippi State Sanatorium at Magee, Mississippi, during 1963, for 52 days. After Mrs. Coke was discharged, the State Sanatorium submitted a bill to Mr. Coke for his wife's hospitalization in the amount of $8 per day. When, however, it was discovered that Mr. Coke had a hospitalization policy that paid up to $6 per day, the bill was reduced to $6 per day. Reserve Life Insurance Company refused to pay the amount of $6 per day, but said that it would pay the maximum of $21 per week, or $3 per day, as provided by Mississippi Code Annotated section 6872 (1952). That *939 section provides that there shall be collected from patients in the State Sanatorium not less than $5 per week, nor more than $21 per week, according to the patient's "ability to pay." Appellee declined to accept this offer, and Reserve Life Insurance Company paid into court the sum of $173.50, which included hospitalization expense computed at the statutory maximum rate of $21 per week. It is the contention of Reserve Life Insurance Company that Section 6872 fixes $21 per week as the maximum which may be charged for hospitalization at the State Sanatorium, and therefore appellee could not legally incur hospital expense in excess of that amount. At the conclusion of the evidence on behalf of the plaintiff (appellee), and without the defendant ever having rested, the court sustained a motion for a directed verdict for the plaintiff. However, no point is made on this appeal that the defendant was not allowed to present testimony. The policy insured appellee against certain "expenses of hospital confinement" incurred while the policy was in force. These "hospital expense benefits" are specified on the front page of the policy under Schedule A, Part One. Here the policy provided: Several grounds are assigned by appellant as requiring the reversal of this case. We consider it necessary to notice only one. Were hospitalization expenses "actually incurred" by appellee within the meaning of the policy, in the amount of $6 per day, or were the expenses incurred limited to the maximum permitted to be charged under Section 6872, supra? It is contended by appellee that, notwithstanding the provisions of the above statute, the administrative authority of the sanatorium was authorized within its discretion *941 to exceed the maximum charge fixed in the statute, if a patient was able to pay more. The patient here was able to pay. (Hn 1) The Mississippi State Board of Health is an administrative board created by the legislature, and its powers are defined and limited by statute. In Tepper Bros. v. Buttross, 178 Miss. 659, 664, 174 So. 556 (1937), this Court said: In 73 C.J.S. Public Administrative Bodies and Procedure section 94 at 414-15 (1951), it is stated: In Broadhead v. Monaghan, 238 Miss. 239, 117 So. 2d 881, (1960), this Court said: The question here is whether appellee "actually incurred" hospital expenses in excess of $21 per week, within the meaning of the policy. The situation is analogous to that considered in several cases involving treatment in a government hospital of a veteran or service man entitled to receive such treatment without cost. In those cases, it has been held that since the veteran was not legally liable for hospital charges he had not legally "incurred" the expense and was not entitled to payment under a policy which provided for reimbursement for "incurred" medical and hospital expenses. Irby v. Government Employees Ins. Co., 175 So. 2d 9 (La. 1965), involved a suit for reimbursement for medical and hospital expenses. The court said: In Stuyvesant Ins. Co. of New York v. Nardelli, 286 F.2d 600, 603 (5th Cir.1961), cited in the Irby case, supra, the court said: "The term `incur,' when used in policies of insurance, has a fixed legal meaning. `A debt has been incurred when liability attaches; ...'" (Hn 2) The policy here under consideration provides for indemnity against liability for hospital expenses "incurred." This contemplates expenses for which the policyholder has become legally liable. (Hn 3) Under the statute, the Board of Health was restricted to a charge of not more than $21 per week. For that reason, appellee incurred no legal liability in excess of that sum for the hospitalization of his wife in the sanatorium. The statute has not been revised in recent years and admittedly the charges authorized are *944 quite small; however, (Hn 4) the amendment of this statute is a matter within the exclusive province of the legislature. A cross-appeal appears to be without merit and has been expressly abandoned by appellee. The case will be affirmed on cross-appeal, and on direct appeal the judgment of the lower cort will be reversed and judgment entered here limiting appellee's recovery to the sum of $173.50, the amount paid into court by appellant. Affirmed on cross-appeal; reversed and judgment for appellant on direct appeal. Gillespie, J.J., and Brady, Patterson, and Robertson, JJ., concur.