Court Opinion

ID: 9658163
Source: CourtListenerOpinion
Date Created: 2023-08-23 20:49:00.782343+00
Date Added: 2024-06-11T18:13:52.093632
License: Public Domain

PATIENCE DRAKE ROGGENSACK, J.
¶ 83. (concurring). I agree with the majority opinion's conclusion that the 2002 MercyCare1 policy did not exclude healthcare services for the pregnancies and deliveries of the gestational carriers, J.M. and C.S.21 also agree that the 2005 MercyCare policy was properly disapproved by the Commissioner of Insurance. I write separately, in concurrence, because I conclude that the Commissioner's interpretation of Wis. Stat. § 632.895(7) is subject to de novo review, not to due weight deference, and because I conclude that § 632.895(7) permits MercyCare to exclude coverage for gestational carrier services, even though the 2002 MercyCare policy did not do so.
I. BACKGROUND
¶ 84. The facts from which this appeal arises are not complex. Two insureds, J.M. and C.S., acted as gestational carriers. Both delivered infants pursuant to *150arrangements with unnamed persons not parties to this litigation. MercyCare refused to pay for J.M.'s and C.S.'s prenatal, delivery and postnatal care, asserting that the 2002 healthcare policy under which both were insureds did not cover healthcare services for their pregnancies and deliveries.
¶ 85. J.M.'s and C.S.'s bills for the healthcare services provided to them were paid by persons other than the insureds. Nevertheless, C.S. complained to the Office of the Commissioner of Insurance that Mercy-Care refused to pay for the healthcare services relating to her pregnancy and delivery. C.S.'s complaint brought MercyCare's nonpayment to the attention of the Commissioner of Insurance.3
¶ 86. The Commissioner re-examined the 2002 policy, which his office had previously approved, and determined that the policy violated Wis. Stat. § 632.895(7)'s mandatory coverage of maternity services.4 The Commissioner also concluded that "[ejven if the surrogacy services could be properly excluded, the 2002 contract is unenforceable because the language is ambiguous."5 The Commissioner did not approve the 2005 contract because he found that it was too complex, which he concluded could mislead the public.6
II. DISCUSSION
A. Standard of Review
¶ 87. On appeal, we review the decision of the Commissioner of Insurance, not that of the circuit court. See Nat'l Motorists Ass'n v. Office of the Comm'r *151of Ins., 2002 WI App 308, ¶ 10, 259 Wis. 2d 240, 655 N.W.2d 179.
¶ 88. This appeal requires construction of the MercyCare healthcare policies. We construe an insurance contract as a question of law. Peterson v. Pa. Life Ins. Co., 2003 WI App 166, ¶ 11, 265 Wis. 2d 768, 669 N.W.2d 151. We do so independently, without deference to the agency's interpretation. Racine Harley-Davidson, Inc. v. Div. of Hearings & Appeals, 2006 WI 86, ¶ 114, 292 Wis. 2d 549, 717 N.W.2d 184 (Roggensack, J. concurring, citing Wis. End-User Gas Ass'n v. PSC, 218 Wis. 2d 558, 565, 581 N.W.2d 556 (Ct. App. 1998)).
¶ 89. The Commissioner's decision turns in part on his interpretation and application of Wis. Stat. § 632.895(7), which we also review as questions of law. Buettner v. DH&FS, 2003 WI App 90, ¶ 6, 264 Wis. 2d 700, 663 N.W.2d 282. We may apply one of three levels of deference to an agency's interpretation and application of a statute: (1) no deference, often referred to a de novo review; (2) due weight deference, where we affirm an agency's statutory interpretation and application if it is reasonable and another interpretation is not more reasonable; and (3) great weight deference, where we affirm an agency's interpretation and application if it is reasonable, even when we conclude that another interpretation is more reasonable. UFE Inc. v. LIRC, 201 Wis. 2d 274, 284-87, 548 N.W.2d 57 (1996).
¶ 90. In order to employ due weight or great weight deference to an agency's statutory interpretation and application, the agency must have met certain experiential benchmarks.7 Due weight deference re*152quires the agency to have been charged by the legislature with administering the statute at issue and the agency must have had some experience in interpreting that statute in a consistent fashion. Id. at 286-87.
¶ 91. Great weight deference requires that: (1) the agency has been charged by the legislature with administering the statute; (2) the agency has long standing experience in administering the statute; (3) the agency has used its expertise and specialized knowledge in forming its interpretation of the statute; and (4) the agency's interpretation must provide more uniformity and consistency in the application of the statute than would a court's decision. Id. at 284.
¶ 92. In the case now before us, the majority opinion gives due weight deference to the Commissioner's interpretation of Wis. Stat. § 632.895(7).8 I would grant the Commissioner's statutory interpretation no deference.
¶ 93. Usually, it does not matter to the ultimate interpretation of a statute whether this court applies due weight deference or a de novo review because in both cases we interpret the statute. Cnty of Dane v. LIRC, 2009 WI 9, ¶ 19, 315 Wis. 2d 293, 759 N.W.2d 571. However, we have set parameters that an agency must satisfy in order to be accorded due weight defer*153ence. UFE, 201 Wis. 2d at 286-87. When an agency has not satisfied the parameters for due weight deference, we should acknowledge that by the level of deference we employ.
¶ 94. The Commissioner's statutory interpretation and application of Wis. Stat. § 632.895(7) present on the following undisputed facts. First, the Office of the Commissioner of Insurance is charged by the legislature with administering § 632.895(7). Second, the Office of the Commissioner of Insurance approved the 2002 MercyCare policy, under which J.M. and C.S. were insured, before it was used as an insuring vehicle, thereby concluding that the 2002 policy complied with § 632.895(7). Third, the current version of § 632.895(7) was in effect when the Commissioner's office initially approved the 2002 contract. Fourth, in resolving C.S.'s complaint, the Commissioner concluded that the same 2002 contract that it had approved under § 632.895(7) violated § 632.895(7).
¶ 95. The Commissioner has met the first parameter for due weight deference in that his office has been charged by the legislature with administering Wis. Stat. § 632.895(7). However, the Office of the Commissioner has demonstrated no experience interpreting the statute in a consistent fashion based on the same facts, i.e., the 2002 MercyCare insurance policy. Stated otherwise, the Office of the Commissioner of Insurance has once approved the 2002 MercyCare policy as being in compliance with the statutes and has once concluded that the same policy violated the statutes. Therefore, the agency has not satisfied the second parameter this court has established for due weight deference. Accordingly, I give no deference to the Commissioner's interpretation and application of § 632.895(7).
*154B. Interpretation of Wis. Stat. § 632.895(7)
¶ 96. Statutory interpretation begins with the language chosen by the legislature. State v. Grunke, 2008 WI 82, ¶ 21, 311 Wis. 2d 439, 752 N.W.2d 769. If the meaning of the statute is plain on its face we ordinarily stop the inquiry. Id. (citing State ex rel. Kalal v. Circuit Court for Dane Cnty, 2004 WT 58, ¶ 45, 271 Wis. 2d 633, 681 N.W.2d 110). "However, if a statute is 'capable of being understood by reasonably well-informed persons in two or more senses[,]' then the statute is ambiguous, and we may consult extrinsic sources to discern its meaning." Grunke, 311 Wis. 2d 439, ¶ 22 (quoting Kalal, 271 Wis. 2d 633, ¶¶ 47-48, 50).
¶ 97. Wisconsin Stat. § 632.895(7), provides:
MATERNITY COVERAGE. Every group disability insurance policy which provides maternity coverage shall provide maternity coverage for all persons covered under the policy. Coverage required under this subsection may not be subject to exclusions or limitations which are not applied to other maternity coverage under the policy.
"Maternity coverage" is not defined in ch. 632. The varying circumstances under which a request for healthcare relating to pregnancy may arise also are not addressed in ch. 632. As a consequence, "maternity coverage" may have different meanings to different reasonably well informed people.
¶ 98. For example, must "maternity coverage" be defined as prenatal, delivery and postnatal services for all women who become pregnant? Or, are the healthcare services that are necessitated by the contract of a gestational carrier not included within the meaning of *155"maternity coverage" because they are more accurately characterized as the contract expenses of a woman who agreed to carry a child to which she has contributed no genetic material and to which she claims no rights of parentage?9 Stated otherwise, while the healthcare expenses J.M. and C.S. incurred were related to their giving birth, they were not expenses incurred to become mothers. Rather, they were the contract expenses they incurred in fulfilling their agreements with third parties.
¶ 99. A construction of Wis. Stat. § 632.895(7) that concludes that the cost of the healthcare services J.M. and C.S. received were contract expenses is consistent with the facts of this case. It is uncontested that as gestational carriers both women contributed no genetic material to the fetuses they carried and that the healthcare bills of J.M. ($16,774.64) and C.S. ($18,510.84) have been paid by third parties. Therefore, any payment by MercyCare for the costs of these gestational carrier services will not inure to the benefit of the insureds, but rather, to the benefit of persons who are not insured by MercyCare.
¶ 100. Because reasonably well informed persons could come to the conclusion that Wis. Stat. § 632.895(7) requires that healthcare services must be *156provided to all pregnant women who are also insureds or to the conclusion that it does not apply to gestational carrier services, which are contract expenses, the statute is ambiguous. Kalal, 271 Wis. 2d 633, ¶¶ 47-48. Accordingly, in attempting to discern its meaning, I consult extrinsic sources. Id. at 50.
¶ 101. The legislative history underlying Wis. Stat. § 632.895(7) gives no indication that the legislature considered insureds who acted as gestational carriers when it mandated coverage for "maternity services." Subsection (7) was amended to its current language by 1985 Wisconsin Act 56, § 33. It began as Assembly Bill 510. The Legislative Reference Bureau's note provides that the amendment to subsection (7) has the effect of requiring "the same maternity coverage for a dependent spouse of a male employee as for a female employee." Another note explains:
Current law requires every group disability insurance policy which provides both coverage of dependent children and maternity coverage to also provide maternity coverage for dependent children....
This subsection requires every group disability insurance policy which provides maternity coverage to any individual to provide the same level of maternity coverage to all persons covered under the policy.
Wisconsin Legislative Council Staff note of September 23, 1985. Therefore, if a person who was not a policyholder, a spouse of a policyholder or the dependant child of a policyholder, but nevertheless was an insured, became pregnant, maternity coverage is required.
¶ 102. The legislature could require coverage for gestational carrier services. However, if coverage for gestational carrier services were considered by the legislature, because it is such a complicated social *157question, there surely would have been some indication of such a discussion.10 But, there is not. Accordingly, I conclude that although the pregnancy of a gestational carrier who carries a child under a contract with a third party could be mandated, there is no indication that the legislature did so in Wis. Stat. § 632.895(7).
C. MercyCare Policies
1. 2002 policy
¶ 103. The 2002 MercyCare policy provides in relevant part:
PREGNANCY BENEFITS
Non-Covered Services:
® Surrogate mother services.
• Elective abortions.
• Maternity services received out of the service area in the last 30 days of pregnancy without prior authorization from the Plan except in an emergency. Prior authorization is based on medical necessity.
• Amniocentesis or chorionic villi sampling (CVS) solely for sex determination.
¶ 104. MercyCare relies on the term, "Surrogate mother services," for its exclusion of coverage for J.M.'s and C.S.'s prenatal, delivery and postnatal care. Surro*158gate mother services is not defined in the 2002 policy. That term could encompass a variety of healthcare services, some of which are not at issue in this case.
¶ 105. For example, surrogate mother services could include the extensive hormone therapy that is required prior to implantation of zygotes11 in order to permit a gestational carrier to carry a child to which she has provided no genetic material. Or, it could refer to similar treatment for a surrogate who has provided the ovum for the zygote with which she will be impregnated. It could also be read to cover the usual prenatal, delivery and postnatal care after the pregnancy has begun for a pregnant woman who carries a child under any type of surrogacy. Or it could encompass more than one of those circumstances, or perhaps some circumstance that I have not mentioned.
¶ 106. Based on this lack of precision in defining surrogate mother services, I conclude that the 2002 policy is ambiguous. The Commissioner also concluded that the 2002 MercyCare policy is ambiguous because it does not adequately define surrogate mother services.12
¶ 107. An ambiguous insurance policy, with undefined terms, is construed as it would be understood by a reasonable insured. Acuity v. Bagadia, 2008 WI 62, ¶ 13, 310 Wis. 2d 197, 750 N.W.2d 817. Policy language that relates to coverage and is ambiguous is construed in favor of the insured, as affording coverage. Id.
¶ 108. Because MercyCare did not define surrogate mother services as healthcare services provided to a woman who contracted to carry a child to which she *159contributes no genetic material and to whom she asserts no rights of parentage, I construe the policy against MercyCare and conclude that the costs of the healthcare provided to J.M. and C.S. must be born by MercyCare.
2. 2005 policy13
¶ 109. The 2005 MercyCare policy provides in relevant part:
PREGNANCY BENEFITS
Non-Covered Services:
• Treatment, services or supplies for a surrogate mother or any pregnancy resulting from your service as a surrogate mother.
SURROGATE MOTHER
Surrogate mother means a woman who, through in vitro fertilization or any other means of fertilization, gives birth to a child which she may or may not have a genetic relationship to, or an individual who provides a uterus for the gestation of a fertilized ovum obtained from a donor when the child will be parented by someone other than the woman who[] gives birth.
*160¶ 110. As if in recognition of the ambiguity in its 2002 policy, while C.S.’s complaint was pending in the Office of the Commissioner of Insurance, MercyCare submitted the 2005 policy for consideration. The 2005 policy defines surrogate mother, as set out above.
¶ 111. The Commissioner denied approval of the 2005 policy based on his authority under Wis. Stat. § 63l.20(2)(a)3.14 The Commissioner explained:
While MercyCare has argued that it is only trying to limit its coverage to provide personal health insurance and "not cover expenses incurred in activities from which the insured profits or expenses are incurred on behalf of persons not covered under the policy.". . . [T]here is nothing in the 2005 Contract's definition of surrogate mother that limits coverage to those situations. Rather, as OCI argues, the definition "permits MercyCare broad discretion in applying its exclusion to any number of women based solely on how and why they are pregnant," and further has the "unintended effect of restricting coverage to some insureds they may or may not intend to exclude." The fact that the policy drafter does not understand the implications of the language in its own policy supports a finding the language is unnecessarily verbose or complex.
¶ 112. Wisconsin Stat. § 631.20(2)(a)3. permits the Commissioner to disapprove a proposed insurance policy upon a "finding" that the policy is "unnecessarily verbose or complex in language." I agree with the finding of the Commissioner. The definition that MercyCare employs in the 2005 policy does not accomplish the purposes MercyCare says it hoped to achieve and could easily mislead a reasonable insured.
*161III. CONCLUSION
¶ 113. In conclusion, I agree with the majority opinion that the 2002 MercyCare policy did not exclude gestational carrier services for the pregnancies and deliveries of J.M. and C.S. I also agree that the 2005 MercyCare policy was properly disapproved by the Commissioner of Insurance. I write separately, in concurrence, because I conclude that the Commissioner's interpretation of Wis. Stat. § 632.895(7) is subject to de novo review, not to due weight deference, and because I conclude that § 632.895(7) permits MercyCare to exclude coverage for gestational carrier services, even though the 2002 MercyCare policy did not do so.
¶ 114. I am authorized to state that Justices ANNETTE KINGSLAND ZIEGLER and MICHAEL J. GABLEMAN join this concurrence.

 MercyCare Insurance Company and MercyCare HMO, Inc. are insurance companies licensed to do business in Wisconsin. As a convenience, I will refer to the insurers as MercyCare.

 Both J.M. and C.S. are "gestational carriers." Gestational carrier was defined by the Commissioner of Insurance as "a woman who receives a transfer of an embryo created by an ovum and sperm from either the intended parents or a donor(s). A gestational carrier shares no genetic material with the child with which she is impregnated." Office of the Commissioner of Insurance Final Decision 39 (Dec. 8, 2006) [hereinafter Commissioner's decision]. Because both J.M. and C.S. are gestational carriers and because surrogate mother is a broader term subject to various interpretations, but includes gestational carriers, I employ the term gestational carrier throughout this opinion.

 Id. at 31.

 Id. at 39.

 Id.

 Id. at 43.

 Although both present as questions of law and are often intertwined, a difference process is employed in the repetitive *152application of a statute to varying fact-sets than is employed in the initial statutory interpretation. Patience Drake Roggensack, Elected to Decide: Is the Decision-Avoidance Doctrine of Great Weight Deference Appropriate in This Court of Last Resort, 89 Marq. L. Rev. 541, 550-52 (Spring 2006) (explaining that giving deference to agency decisions on questions of law was first suggested in regard to an agency's application of a statute to a particular fact-set and later, without further explanation, encompassed statutory interpretation as well).

 Majority op., ¶ 38.

 See Elizabeth S. Scott, Surrogacy and the Politics of Commodification, 72 Law & Contemp. Probs. 109 (Summer 2009) (discussing the social policy concerns of the various forms of surrogacy, including gestational carriers); see also Anna L. Benjamin, The Implications of Using the Medical Expense Deduction of I.R.C. §213 to Subsidize Assisted Reproductive Technology, 79 Notre Dame L. Rev. 1117 (April 2004) (questioning whether the expenses of creating a child through expensive assisted reproduction should qualify as a medical expense deduction within the meaning of I.R.C. § 213).

 See generally Scott, supra note 9 (discussing the various types of surrogacy, including gestational carriers, and how these types of pregnancies may relate to current parentage and abortion concepts).

 When fertilization of the egg is accomplished in vitro, the resulting combination of the egg and the sperm with which a woman is impregnated is the zygote.

 Commissioner's decision at 42.

 Neither J.M. nor C.S. claim coverage under the 2005 policy. Therefore, even though the Commissioner has held that the 2005 policy is not in compliance with Wis. Stat. § 631.20, his decision does not affect payment to J.M. and C.S. Furthermore, since the 2005 policy has not been approved by the Commissioner, it cannot have been used as an insuring vehicle or have affected any other insureds.

 Commissioner's decision at 43.