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Wake v. State ex rel. Oklahoma Office of Management and Enterprise Services Employees Group Insurance Division

Court of Appeals of Oklahoma, Division III

July 12, 2019

DENISE WAKE, Plaintiff/Appellant,
v.
STATE OF OKLAHOMA ex rel. OKLAHOMA OFFICE OF MANAGEMENT AND ENTERPRISE SERVICES EMPLOYEES GROUP INSURANCE DIVISION and PRESTON DOERFLINGER, in his official capacity only as director of OMES, Defendants/Appellees.

          Mandate Issued: 08/28/2019

          APPEAL FROM THE DISTRICT COURT OF CLEVELAND COUNTY, OKLAHOMA, HONORABLE THAD BALKMAN, JUDGE.

          Roy S. Dickinson, ROY S. DICKINSON, P.C., Norman, Oklahoma, for Plaintiff/Appellant.

          Byron W. Knox, OMES DEPUTY GENERAL COUNSEL, Oklahoma City, Oklahoma, for Defendants/Appellees.

          Bay Mitchell, Presiding Judge.

         ¶1 Plaintiff/Appellant Denise Wake appeals from the district court's order affirming Defendant/Appellant State of Oklahoma ex rel. Oklahoma Office of Management and Enterprise Services (OMES) Employees Group Insurance Division (EGID) and Preston Doerflinger's final order denying certification for bariatric revision surgery. We find the procedure is a covered service according to the terms of the health insurance policy. We reverse the final agency order and remand to the OMES EGID Grievance Panel with instructions to enter a final order granting certification.

         ¶2 Wake has suffered from severe obesity her entire adult life. She had bariatric surgery in 1984. At that time, Wake was in college. She had a vertical banded gastroplasty (VBG), also known as stomach stapling. Initially, the procedure was successful and Wake lost significant weight. However, the VBG failed, and she re-gained weight. Wake also experienced other medical issues as a result of the failed VBG, including erosion of the staple lining, severe abdominal pain, frequent nausea and vomiting, gastroesophageal reflux disease (GERD), chronic diarrhea, and food intolerance. VBG was one of the earliest surgical weight loss procedures and popular in the 1980's. It has since fallen into disfavor due to these symptoms and complications and the rise of other more effective procedures. As a result of unsatisfactory long-term weight loss and/or these symptoms and complications, revision surgery is often required. There are several options for revision surgery, including conversion from a VGB to a Roux-en-Y (RNY) gastric bypass.

         ¶3 Wake started teaching in the Norman Public Schools district and has been covered by the employee benefit HealthChoice Health and Dental Plan (the Plan) since 2012. OMES and EGID sponsor and administer the Plan. A new benefit for bariatric surgery was added to the Plan as of January 1, 2017. Bariatric surgery requires pre-service certification. On January 6, 2017, Wake's doctor submitted a request for certification for conversion of Wake's failed VBG to a RNY gastric bypass. On January 17, 2017, HealthChoice denied certification finding the procedure was not covered by the Plan. [1] The explanation of denial provided: "Gastric surgery done prior to 1/01/2017 therefore not a covered benefit." Wake filed a timely request for a OMES EGID Grievance Panel Hearing. After a hearing June 28, 2017, the Panel issued a final order upholding the denial and concluding "by the greater weight of the evidence that the requested procedure is a complication of a non-covered procedure; therefore, no benefits are available. Administrative Rule: 260:50-5-12(12)(19), Health Handbook: pages 32 #10, #11." Wake then appealed to the district court, where the Panel's final order denying certification was affirmed. Wake appeals.

         ¶4 The issues on appeal are whether the requested procedure is covered by the Plan and whether any coverage exclusions apply. The facts are not in dispute. These issues concern contract interpretation. An insurance policy is a contract, and the rules of construction apply. See May v. Mid-Century Ins. Co., 2006 OK 100, ¶22, 151 P.3d 132. If unambiguous, the terms and words of the contract must be accepted in their plain, ordinary, and popular sense. See id.; Flitton v. Equity Fire & Cas. Co., 1992 OK 2, ¶7, 824 P.2d 1132, 1134 (citing Wiley v. Travelers Ins. Co., 1974 OK 147, ¶16, 534 P.2d 1293, 1295). "The construction of an insurance policy should be a natural and reasonable one, fairly construed to effectuate its purpose, and viewed in the light of common sense so as not to bring about an absurd result." Wiley, 1974 OK 147, ¶16, 534 P.2d at 1295. Whether contract language is ambiguous is a question of law. See Am. Econ. Ins. Co. v. Bogdahn, 2004 OK 9, ¶11, 89 P.3d 1051. Questions of law are reviewed de novo. See May, 2006 OK 100, ¶22. The appellate court may set aside, modify, or reverse a final agency order if it determines that the substantial rights of the appellant have been prejudiced because the agency findings, inferences, conclusions, or decisions are affected by an error of law. See 75 O.S. 2011 §322 (1)(d).

         ¶5 The Covered Services, Supplies and Equipment section of the policy provides that "Bariatric Surgery" is a covered service. "Bariatric Surgery" is a general term which includes a variety of weight-loss procedures. The policy describes the specific procedures and services covered:

Services covered include, but are not limited to sleeve, bypass, duodenal switch, revision and conversion of sleeve, bypass and duodenal switch, and complications from these procedures performed under the HealthChoice plans.

         ¶6 Wake argues she is seeking a revision surgery, which is a covered service. OMES argues Wake is requesting a procedure to correct complications from the 1984 surgery and, because the previous bariatric surgery was not performed under a HealthChoice plan, the revision surgery is not covered.

         ¶7 We find the Covered Services language is not ambiguous. Revision and conversion of sleeve, bypass, and duodenal switch are covered services. Three categories of covered services are contemplated in this provision: (1) original sleeve, bypass, and duodenal switch; (2) revision and conversion of sleeve, bypass, and duodenal switch; and (3) complications from either an original sleeve, bypass, or duodenal switch performed under the HealthChoice plans or a revision and conversion of a sleeve, bypass, or duodenal switch performed under the HealthChoice plans. We agree with Wake that the requested procedure falls into the second category and is covered by the Plan.

         ¶8 OMES's position that revision and conversion procedures are covered only if the previous bariatric surgery was covered by and performed under a HealthChoice plan on or after January 1, 2017 is problematic. That interpretation would require us to read additional words into the Covered Services provision. The second category of Covered Services does not read "revision and conversion of sleeve, bypass and duodenal switch if the previous or original bariatric surgery was performed under the HealthChoice plans." Additionally, the limiting language "performed under the HealthChoice plans" attaches only to "complications from these procedures" and does not attach to "revision and conversion of sleeve, bypass and duodenal switch." "[R]evision and conversion of sleeve, bypass and duodenal switch" and "complications from these procedures performed under the HealthChoice plans" are separated by a ...


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