STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

THOMAS P. O'CONNELL, )

)

Petitioner, )

)

vs. ) CASE NO. 83-0681

) DEPARTMENT OF ADMINISTRATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice this cause came on for administrative hearing before P. Michael Ruff, duly designated Hearing Officer of the Division of Administrative Hearings, in Fort Lauderdale, Florida, on July 6, 1983. The appearances were as follows:

APPEARANCES

For Petitioner: Thomas P. O'Connell, pro se

205 South F Street

Lake Worth, Florida 33460

For Respondent: Daniel C. Brown, General Counsel

Department of Administration

435 Carlton Building Tallahassee, Florida 32301

This cause concerns a request by Mr. Thomas P. O'Connell, the Petitioner, for the right to change from individual to family coverage under the State Employees Group Health Self-Insurance Plan. Mr. O'Connell, prior to January 1978, was covered under the family coverage portion of the State Employees Group Health Insurance Plan and his dependents included his wife who was disabled and receiving social security benefits. Because of her disability (kidney disease), she was eligible for Medicare health and hospitalization coverage. Mr.

O'Connell contends that he asked an individual (or individuals) in the Florida Atlantic University Personnel Office on two occasions whether he could change from family coverage to single coverage and then get Medicare supplementary coverage only for his wife's needs over and beyond the benefits Medicare would pay for her. He alleges that the individual in the university's personnel office section told him that she was not old enough to be covered by the Medicare "supplement-only" provision in the State's coverage plan and he alleges that he was informed by this person that he could not, in the event of her illness or injury, recover both from Medicare and the State's family plan, although he understood he could still choose to be enrolled in the family plan which would cover his wife. Allegedly because of advice received from individuals connected with that personnel office, that the State's self- insurance plan, which was to take effect in May of 1978, would not provide a coordination of benefits with the Medicare coverage for a disabled person under

65 years of age, as his wife was, he elected to drop his family plan coverage on January 13, 1978, and convert to individual employee coverage.

In November 1982, the hospital allegedly began billing the Petitioner for the twenty percent difference in his wife's dialysis treatment bills which Medicare did not cover. The Petitioner then applied in late November 1982 for coverage under the State's family self-insurance plan once again. After submission of his application and a medical insurability statement to the Respondent and to Blue Cross/Blue Shield, the State's servicing agent, the application was ultimately denied on February 3, 1983.

At the hearing, Petitioner presented his own testimony and two exhibits, both which were admitted into evidence. The Respondent presented the testimony of two witnesses, plus the deposition of Ethel Worthington and three exhibits, all of which were admitted into evidence.

At the conclusion of hearing, the transcript of this proceeding was ordered and duly filed. The parties waived the right to file proposed findings of fact and conclusions of law.

The issue to be resolved herein concerns whether the Petitioner is entitled to change his coverage from individual coverage to family coverage under the Florida State Employees Group Health Self-Insurance Plan without having to furnish medical proof of insurability to the satisfaction of the insurance carrier.

FINDINGS OF FACT

1. Petitioner, Mr. Thomas P. O'Connell, at times pertinent hereto, was an employee of the Florida Atlantic University. From 1974 until January 1978, he and his wife were enrollees in the State of Florida Group Health Insurance Plan under the category of "family coverage." The Petitioner's wife had a health condition which resulted in her becoming eligible for social security disability benefits in 1976. In January 1978, she had to begin undergoing kidney dialysis treatments. She also became eligible for Medicare benefits at about this time. Petitioner's wife was 55 years of age at the time. In January 1978, Petitioner called the personnel office at the university to find out if, since she had become enrolled in the Medicare system due to her kidney ailment, if she was entitled to the State Group Health Insurance Plan Medicare supplement coverage, that is an increment of benefits which pays for the approximate twenty percent of medical and hospitalization bills which Medicare does not cover for Medicare eligible recipients. The Petitioner inquired in this regard of Mrs. Ethel Worthington of the Florida Atlantic University's Personnel Department. He was told that, because she was only 55 years of age, she could not be covered by the State Group Health Plan's Medicare supplement coverage. Mrs. Worthington or another employee of the university's personnel office told him, according to his understanding, that his wife could still be covered under the family plan but that he or they could not collect benefits both from Medicare and from the family plan.

   
   

2. Mr. O'Connell thus believed that the family plan coverage for his wife was redundant and that Medicare would provide her needed benefits. He therefore canceled his State family plan coverage, opting instead for single individual health insurance coverage. The Petitioner had been aware prior to this, however, that Medicare did not pay the final twenty percent of a given bill.

   The employee he conversed with about this in the personnel office told him he was free to remain on family plan coverage. He mistook their advice that both

   benefits could not be collected to mean that the family plan would not pay for her at all if she were eligible for Medicare and that the State health plan would not provide a coordination of benefits with her Medicare coverage since she was under 65 years of age and thus not entitled to the State Medicare supplement coverage.

   
   

3. Indeed, that was the case and the State's plan, both before and after the adoption of the self-insurance plan in May of 1978, provided for coordination of benefits between its own coverage and Medicare coverage such that the State plan would pay for an eligible family member who was under 65 years of age and eligible for Medicare up to, on a coordination basis with Medicare, a hundred percent of the charges. In other words, under the coordination of benefits concept in effect before and after May of 1978, the State plan would pay for that portion of hospital bills or other medical expenses which Medicare did not pay for, provided the Petitioner's wife was covered under the "family plan." Based upon this misunderstanding that no coordination of benefits was available for family members eligible for Medicare benefits until they reached age 65, the Petitioner elected to cancel his family coverage and opt for individual coverage under the State's plan in January 1978.

   
   

4. On April 13, 1978, an open meeting was held to explain the new State Employee's Group Health Self-Insurance Plan, which Petitioner attended. This plan was ultimately adopted in May of 1978, and as stated above, included the coordination of benefits provision for family members eligible for Medicare who were not yet 65, provided family coverage was obtained by the eligible employees. On April 12, 1978, the Petitioner had enrolled in the new group health self-insurance plan for "individual I coverage"; thus, for purposes of this inquiry, continuing the individual coverage he had had since January of that year. At the meeting, it was explained that indeed the family plan coverage would provide coordination of benefits with Medicare or Medicare- eligible dependents of employees and thus pay for expenses not covered by Medicare. Mr. John Wallace, the Director of Personnel for Florida Atlantic University, was at that meeting assisting and explaining the new program and its benefits and provisions to employees. He does not recall the Petitioner asking questions, but also does not recall telling anyone present that a wife could not be covered under the State family plan if she was under age 65 and eligible for Medicare. Mr. O'Connell believes that at this meeting, he talked with Mrs. Ethel Worthington, a secretary at the university's Office of Personnel concerning his wife's coverage. Mrs. Worthington, however, did not attend any of those meetings. She does not recall conversing with the Petitioner at any time about his family coverage or other matter.

   
   

5. An information packet (Respondent's exhibits) explaining the self- insurance plan including its family coverage aspect had been distributed to employees by mailing in March, 1978. Thus, the Petitioner elected to sign up for single or individual coverage (on April 12) after receiving the packet of explanatory materials and, thus, he did not have available to him only information from his telephone conversation with an employee of the personnel office in January, 1978 to consider when electing which coverage to apply for. Rather, he had an accurate explanation of the provisions of the new plan in March or early April, 1978, before he exercised his option to retain individual coverage on April 12, 1978. Further, the Petitioner did not rely on information supplied him at the April 13th meeting because he had already signed up for individual coverage the day before. The brochure contained in Exhibit 5 clearly shows that the family plan coordinates benefits with medicare coverage for dependents under that plan. The Petitioner may have been informed by unknown employees of the university's personnel office that single or individual

   coverage was substantially cheaper than family plan coverage, but it was not established that a representation was made to the effect that the State's family plan coverage and the Medicare coverage applicable to the Petitioner's wife's situation was redundant.

   
   

6. In any event, under the new self-insurance plan, the Petitioner had until April 20, 1978, to enroll. As stated above, the Petitioner voluntarily enrolled in individual I coverage again on April 12, 1978, similar to the individual coverage he had elected to obtain when he dropped his family coverage in January, 1978. Because he had been an employee for longer than 31 days and because his wife had been a dependent for longer than 31 days (see below cited rule), the Petitioner was required to furnish medical proof of insurability for himself and all dependents (his wife). Because the kidney ailment had to be revealed on the medical forms submitted with the application for family-plan coverage, the carrier, Blue Cross/Blue Shield, exercised its right to refuse to assume that risk and would not provide coverage for the Petitioner's wife.

   
   

   CONCLUSIONS OF LAW

   
   

7. The Division of Administrative Hearings has jurisdiction of the subject matter of and the parties to this proceeding. Section 120.57(1), Florida Statutes (1981).

   
   

8. The Respondent is an agency of the State of Florida charged under Chapter 110, Florida Statutes, as well as Chapter 22K-1, Florida Administrative Code, with arranging for and obtaining, as well as administering, a group health insurance plan (self-insurance) for its employees. This statutory and rule authority empowers the Department to take agency action in resolution of questions involving applicability of insurance coverage and related employee- dependent benefits.

   
   

9. In that regard, Section 22K-1.15(1), Florida Administrative Code, provides pertinently as follows:

   
   

   . . . (1) an employee may apply for enrollment in the plan without medical approval by sub- mitting a New Enrollee form to his or her personnel office during the first 31 calendar days of State employment . . .

   1. an employee may apply for enrollment in the plan after the first 31 calendar days by completing and submitting a New Enrollee form and a medical statement form to his or her personnel office. In such cases, the following shall apply:

      1. The employee and each eligible dependent must have medical approval.

      2. If the employee does not receive medical approval, neither the employee nor the employee's eligible dependent may be covered under the plan. . . .

         
         

10. Rule 22K-1.16 provides with regard to changes in coverage at subsection (2):

    
    

    An employee or surviving spouse having individual coverage may apply for a change to

    family coverage within 31 calendar days after the date of acquisition of any eligible dependent by any means without medical approval. If such change is not made within 31 calendar days after the dependent must receive medical approval by the administrator. . .

    * * *

    (4) Within two months prior to an employee or the employee's surviving spouse obtaining age sixty-five (65) the Department of Administration shall notify the employee or surviving spouse and the employing agency of the employee, of an automatic change of cover- age at age sixty-five (65) to a Medicare supplement coverage. . . .

    
    

11. The preponderant weight of the evidence and the above findings of fact clearly reveal that the Petitioner did not acquire his wife as a dependent within 31 calendar days of the time he sought to obtain family coverage to include her nor did the Petitioner apply for such coverage within 31 days of the time he became employed by the State at Florida Atlantic University. Therefore, the above authority requires the Petitioner to submit appropriate proof of medical insurability and obtain approval by the carrier of himself and any dependent family members with regard to medical risk. The Petitioner did not receive medical approval from the carrier, and the Respondent for coverage of Mrs. O'Connell's dialysis treatments, which result in legally justifiable given the preponderant evidence in this record and the mandate of the above rules.

    
    

12. In a corollary vein, the Petitioner in a general sort of way has alleged that the Respondent is estopped to deny coverage for his wife because he contends he relied on certain representations made by employees in the university's personnel office regarding the advisability of his dropping family plan coverage and securing individual coverage in January, 1978. In that connection, the evidence and the findings of fact reveal that although the Petitioner contends he contacted Mrs. Ethel Worthington of the university's personnel office in January, 1978, and received the advice referred to in the above findings of fact which led him to believe he could cancel the State's family plan coverage and still have full coverage for his wife under Medicare benefits, it was not shown which employee he had a conversation with nor precisely what representation may have been made. Mrs. Worthington established by her testimony that she doesn't ever recall speaking to the Petitioner nor giving such advice. She is thoroughly familiar with the State health care plan as it existed both before and after the change to self-insurance coverage, knew that it provided for coordination of benefits with Medicare and would have so advised anyone inquiring and would have advised further that, although it would be cheaper to have only individual coverage, that the family coverage would have paid some benefits in addition to Medicare for his wife's condition. Even had it been proven that Mrs. Worthington or some other employee gave such erroneous advice to Petitioner in January, 1978, which it was not, the findings of fact and evidence establish that in March, 1978, the complete packet of information (Respondent's Exhibit 5) fully explained the State's group health self-insurance plan and was distributed to employees, including the Petitioner, and an examination of that information reveals that it is explained therein that the State' family plan coverage coordinates benefits with other coverages, including Medicare. Thus, it has been established that even had erroneous advice been given to the Petitioner in January, that the Petitioner was on actual notice in March of 1978 of the true details of coverage, and still elected to re-enroll in

    individual coverage. Further, the subject open meeting for all university employees, at which the medical benefits under the new self-insurance plans were explained, occurred on April 13. Contrary to the Petitioner's contention, it was established that Mrs. Worthington was not even present at that meeting and so could not have been the subject of any questions by the Petitioner. Mr. John Wallace was present at the meeting, but engaged in no dialogue with the Petitioner. There is no completed, substantial evidence to show that Petitioner could have relied on any representations made to him at that meeting regarding the question of the efficacy of his keeping individual coverage anyway because of the day prior to that meeting he had already decided to and applied for individual coverage under the new self-insurance plan.

    
    

13. Finally, it has been established by preponderant evidence and through the Petitioner's own testimony that he was actually informed that he could not have the State's Medicare supplement coverage because his wife had not yet reached the age of 65, an assertion which the above rule clearly supports. The totality of the evidence reveals that the Petitioner doubtlessly mistook that representation to mean that the State's family plan coverage would not coordinate with his wife's Medicare benefits and pay for her medical expenses over and above what Medicare would provide for. That was simply an erroneous and unfortunate impression on his part, but it was not demonstrated by evidence in this record that that impression was due to any misrepresentation conveyed to him by any state employee. In short, the Petitioner has simply failed to adduce adequate proof that misrepresentations were made upon which he relied to his detriment in the above regard sufficient to raise the applicability of estoppel against the Respondent herein.

RECOMMENDATION

Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence in this record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, thereupon

RECOMMENDED that the Petitioner by Thomas P. O'Connell to be allowed to enroll in the State of Florida's group health self-insurance plan family coverage without being required to furnish medical proof of insurability for himself and his dependent be DENIED.

DONE AND ORDERED this 13th day of October, 1983, in Tallahassee, Florida.

P. MICHAEL RUFF Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 13th day of October, 1983.

COPIES FURNISHED:

No names or addresses were attached

Docket for Case No: 83-000681

Orders for Case No: 83-000681