Court Opinion

ID: 9467948
Source: CourtListenerOpinion
Date Created: 2023-08-05 02:00:36.051531+00
Date Added: 2024-06-11T17:40:36.577595
License: Public Domain

RANDALL, Circuit Judge,
dissenting:
I dissent. In my view, the district judge was correct when he found the medicare provision of the contract to be clear and free of ambiguity and to preclude the recovery by the plaintiff from the defendant of those costs which would have been paid *340by medicare. Since the district judge’s opinion was not published, I reproduce it below in order to set forth the reasons for his conclusion, reasons with which I agree.
EDWARD J. BOYLE, Sr., District Judge:
This action to recover medical benefits under an insurance policy has been submitted for adjudication upon stipulated facts, the deposition of the plaintiff and memoranda of counsel.1 All third-party indemnity issues have been severed.2 The sole issue to be decided is whether the medicare provision of the insurance contract3 bars recovery by the plaintiff. The parties disagree as to the meaning of the phrase “eligible for coverage under Medicare” in the third paragraph of the exclusionary clause.
Several state rules of construction regarding insurance contracts are relevant to our determination of this issue. If the language of the contract term is clear, it will be enforced to effect the intent of the parties. LSA-C.C. art. 1945(3). Exclusionary clauses are to be construed strictly; ambiguous contract terms are to be construed in favor of the insured. Snell v. Stein, 261 La. 358, 259 So.2d 876, 878, 879 (1972).
A brief explanation of the medicare eligibility provisions is necessary to understand the issues in this case. Medicare is divided into two parts, A and B, each of which has its own qualification requirements. Part A is generally for hospital costs; Part B covers chiefly physician costs. Under the statutory provisions and regulations, some persons qualify automatically for coverage under both parts.4 Plaintiff, because she was not eligible to receive Social Security retirement benefits,5 could not qualify automatically for either or both Part A and/or Part B coverages. Plaintiff could qualify for Part A of the program if she enrolled in Part B of the program; plaintiff could enroll in Part B of the program because she was over 65 and both a United States citizen and resident.6 The only difference between those persons automatically enrolled and those who must enroll themselves in the program is that the latter group must pay premiums for Part A of the program.7
Plaintiff admits that she could have voluntarily enrolled in the entire medicare program: “There is no dispute that the plaintiff could have, if she wished, taken affirmative steps with respect to medicare/medicade [sjc] benefits and obtained through Parts A and B of the medicare program payments made on her behalf for substan*341tially all of her in-patient hospital expenses as well as physical expenses.”8 Plaintiff contends, however, that because Part A of the program was available to her only after she enrolled in Part B of the program, she was not “eligible for coverage under Medicare” as contemplated by Section 30 of the policy. We cannot agree.
The medicare clause of the contract is quite explicit that the term “medicare” includes both Parts A and B of the program. Simply because Mrs. Kemp had to enroll in Part B before she could enroll in Part A does not significantly distinguish her from other insureds. The fact remains that all of those insured were required to become enrolled in the entire medicare program. We find that Mrs. Kemp was “eligible for coverage under Medicare” within the clear meaning of the contract.
Plaintiff further contends that the two sentences of paragraph three of the medicare provision create an ambiguity in the policy. If in sentence one of paragraph three “eligible for coverage” means plaintiff must enroll in the medicare program, there would be no need for the presumption in sentence two that plaintiff actually became enrolled. This is simply not what the two sentences say.
The first sentence states that if one is “eligible for coverage under medicare,” the insurer will not pay those charges covered by the medicare program. It does not require that the insured enroll in the program, but merely that the insured be eligible to enroll. The presumption in the second sentence does not make the first sentence conditional. The presumption is that coverage under medicare began at the earliest possible date, not that the insured actually became enrolled as plaintiff contends. There is no conflict or ambiguity created by the two sentences of paragraph three.
Finally, plaintiff asserts that the presumption that the plaintiff “became enrolled” in the medicare program is a rebut-table one and that the evidence clearly indicates that the plaintiff did not become covered prior to her surgery.9 If we were to hold that the presumption that plaintiff “became covered” is a rebuttable one, the sentence would be meaningless. If a plaintiff need only show that he has not obtained medicare coverage to defeat the presumption, the contract language could never apply. A contract provision should be construed in a manner which gives it meaning rather than rendering it nugatory. LSA-C.C. art. 1951.
We find the medicare contract provision to be clear and explicit. There is no ambiguity to resolve. Plaintiff was eligible to receive medicare benefits but failed to enroll in the program. She is not entitled to recover those costs from the defendant which would have been paid by medicare.
Plaintiff seeks penalties and attorney’s fees from defendant under LSA-R.S. 22:657 for refusing to pay her claim within thirty (30) days of notice and proof of claim. Since we find she is not entitled to payment under the policy, plaintiff is not entitled to such an award.
Accordingly, plaintiff’s complaint will be dismissed at plaintiff’s costs. The third-party claims of the defendant for indemnity will be dismissed for mootness.

. See Record Document No. 29. Although the Stipulation of Facts filed by counsel for the defendant was not signed by counsel for the plaintiff, counsel for plaintiff accepted the stipulation in his memorandum. See Record Document No. 31 at page 1.

. See Record Document No. 25. In view of the result reached, the third-party indemnity claims are moot and must be dismissed.

. The policy provides:
SECTION 30 — MEDICARE PROVISION
This Provision does not apply to Life Insurance Benefits, Accidental Death and Dismemberment Benefits, or benefits payable for any loss of time on account of disability, if any such benefits are provided in the Policy.
Wherever used in this Provision, the term “Medicare” refers to Health Insurance for the Aged as provided under both Parts A and B, Title XVIII of the Social Security Act, as amended from time to time.
INTEGRATION OF BENEFITS WITH THE MEDICARE PROGRAM
With respect to each Insured Person who is eligible for coverage under Medicare, a benefit otherwise payable under the Group Policy shall be reduced by the amount of any similar Medicare benefit. It will be presumed that each Insured Person eligible for coverage under Medicare became covered for all parts of Medicare on the earliest possible date and has maintained such coverage in force.
If the Policy contains a “Coordination of Benefits” provision, the definition of “Plan” contained therein shall not be construed to include coverage under Medicare.

. 42 U.S.C. § 1395c; 42 U.S.C. § 1395o; 42 C.F.R. 405.210.

. See Plaintiff’s Deposition, Record Document No. 21, at pp. 22-23.

. 42 U.S.C. § 1395Í-2; 42 U.S.C. § 1395o.

. 42 U.S.C. § 1395i-2(d). Both groups must pay premiums for Part B of the plan. 42 U.S.C. § 1395r.

. See Record Document No. 31 at p. 4.

. Plaintiffs memorandum, at page 4, states: “There is no dispute, and no evidence to substantiate the contention that she did in fact enroll. The presumption of fact as set forth in Section 30 of the policy is not conclusive, but merely a rebuttable presumption.” See Record Document No. 31.