Bad Faith, Emotional Distress Claims Reinstated Against Health Insurer
The Hawaii Intermediate Court of Appeals reversed the trial court's grant of summary judgment to the health insurer, reinstating the insured's claims for bad faith and emotional distress. Groeger v. Kaiser Foundation Health Plan, Inc., 2023 Haw. App. LEXIS 308 (Haw. Ct. App. Aug. 29, 2023).
In March 2012, Christian Groeger was diagnosed with Guillian-Barre Syndrome, an illness in which a person's immune system attacks part of the peripheral nervous system. Christian was in the hospital from April 2012 to February 2013 while insured under a medical plan with Kaiser Health Plan. Christian's mother and father, Knut and Peninska, spent time with Christian during his treatment at Kaiser Hospital.
The Groegers sued Kaiser for mishandling numerous requests for medically necessary services that Christian needed to overcome his serious condition after being admitted to the hospital. At one point, Kaiser lowered Christian's level of care to that of "nursing facility" and he was using up his sixty-day benefit. In February, 2013, doctors from Germany, where the family was from, visited the hospital and said they would have provided different treatment from that received from Kaiser. Christian was finally relocated and admitted to a German hospital, where he subsequently recovered.
The trial court granted summary judgment to Kaiser on plaintiffs' claims for bad faith, intentional infliction of emotional distress (IIED), and negligent infliction of emotional distress (NIED). In support of the motion, Kaiser submitted the Service Agreement, asserting that it set out the medical coverage to which Christian was entitled during his hospitalization. The court determined that no Kaiser physician prescribed or recommended the treatment at the German hospital and therefore, "as a matter of law, the requested treatment was not 'Medically Necessary' as defined by the Service Agreement."
On appeal, the Groegers contended that Kaiser never established that the Service Agreement was provided to the Groegers. Thus, the document should not have been applied to grant summary judgment. The Court of Appeals agreed that Kaiser failed to demonstrate that the Service Agreement submitted to the trial court was the agreement or plan that Peninska had reviewed and that she understood the applicable terms. This created genuine issues of material fact whether the terms of applicable medical coverage were met and whether the Groegers were properly informed of the coverage or agreement terms.
Further, Knut and Peninska submitted declarations stating they made numerous requests for specific treatment for Christian, and their requests were ignored and denied without much, if any, explanation. Peninska stated that a respiratory therapist told her he would do more for Christian but was not permitted to do so by those who were higher up. Given this record, there were genuine issues of material fact and summary judgment in favor of Kaiser on the bad faith claim was not warranted.
Further, granting summary judgment Kaiser on the IIED and NIED claims was improper. The IIED and NIED claims were based on alleged delay and denial of coverage for medical services
