Providence Health Plan v. Winchester
252 Or. App. 283
| Or. Ct. App. | 2012Background
- Providence Health Plan sues Winchester to recover medical expenses Providence paid for Winchester’s injuries from a pedestrian automobile accident.
- The driver’s liability policy and Winchester’s own UIM and PIP policies are involved; Providence seeks reimbursement from settlements received by Winchester.
- Providence asserted a Subrogation Trust Agreement and a Third Party Liability/Subrogation provision in its employer group contract as the basis for recovery.
- Winchester settled with State Farm for policy limits: driver’s policy $25,000, UIM $75,000, PIP $15,000, totaling $115,000; Providence had paid $86,417.25 in medical expenses.
- The trial court granted Providence summary judgment; Winchester appealed, arguing the contract provision is superseded by ORS 742.534–742.538 and prerequisites of ORS 742.538 were not met.
- The court reversed, holding that ORS 742.538 prerequisites were not satisfied because interinsurer reimbursement under ORS 742.534 was available when Providence asserted its right to subrogation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ORS 742.538 preempts Providence's contract provision | Providence argues contract rights supplement, not conflict with ORS 742.538. | Providence’s contract is superseded by ORS 742.538 because it conflicts with statutory prerequisites. | ORS 742.538 preempts contract where applicable. |
| Whether ORS 742.534 was available to Providence when it asserted subrogation | Interinsurer reimbursement under ORS 742.534 was not available once payor reached policy limits. | 742.534 remained available; Providence could not proceed under 742.538. | 742.534 was available; Providence could not pursue 742.538. |
| Whether Providence satisfied ORS 742.538 prerequisites | Providence satisfies prereqs by showing non-availability of 742.534 and entitlement under policy. | Because 742.534 was available, and Providence hadn’t elected lien under 742.536, 742.538 prereqs were not met. | Prerequisites not met; recovery under 742.538 denied. |
Key Cases Cited
- State Farm Mut. Auto. Ins. Co. v. Hale, 215 Or App 19 (2007) (adopts ORS 742.538 subrogation framework and availability analysis)
- State Farm Mut. Auto. Ins. Co. v. Sommerholder, 65 Or App 449 (1983) (explains ORS 742.534 interinsurer reimbursement framework)