Shaffer v. WinHealth Partners
2011 WY 131
| Wyo. | 2011Background
- Shaffer had WINhealth health insurance; breast reduction surgery in Dec 2005 was medically necessary, not cosmetic.
- After Jan 2006 WIN denied coverage for subsequent MRSA treatment arising from the surgery, claiming it was a complication from an excluded cosmetic procedure.
- Shaffer appealed through WIN’s internal process and then filed a lawsuit alleging breach of contract, bad faith, and attorney’s fees.
- The district court granted summary judgment for WIN, holding that reduction mammoplasty was excluded or limited and that MRSA treatment was not covered as a complication of a non-covered service.
- Wyoming Supreme Court reversed, directing partial summary judgment for Shaffer on MRSA treatment and remanding for remaining issues, including bad faith.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether reduction mammoplasty is ambiguous and whether summary judgment was proper | Shaffer contends the term is ambiguous and limited to non-cosmetic cases | WIN asserts reduction mammoplasty is unambiguously excluded as a blanket term | Partial reversal; ambiguity resolved in Shaffer’s favor, creating factual questions for trial on MRSA treatment |
| Whether the contract permits coverage for complications from medically necessary reduction mammoplasty | Contract allows coverage where not explicitly excluded or limited | Contract excludes reduction mammoplasty and complications arising from excluded procedures | Shaffer entitled to summary judgment on MRSA treatment; contract language interpreted to limit coverage to non-cosmetic reductions; remaining issues remanded |
| Whether Dr. Wyatt's affidavit was properly used as parol evidence and whether it was disputed | Wyatt's affidavit should be considered; Shaffer disputes its scope | Wyatt affidavit can be used to interpret terms | Not pivotal to outcome; interpretation favors Shaffer under liberal construction rules |
| Whether other contract sections should affect the interpretation of subpart 45 and 28 | Other contract provisions should inform meaning of exclusions/limitations | Subparts are standalone | Court treated whole contract; found coverage not wholly excluded but limited to non-cosmetic reductions |
| Whether Shaffer is entitled to partial summary judgment on contract terms | Yes, on MRSA treatment under contract interpretation | No, contract excludes applicable services | Reversed district court; Shaffer entitled to summary judgment on MRSA treatment; remand for remaining issues |
Key Cases Cited
- Aaron v. State Farm Mut. Auto. Ins. Co., 34 P.3d 929 (Wy. 2001) (established rules of insurance contract interpretation in Wyoming)
- McKay v. Equitable Life Assurance Society of the United States, 421 P.2d 166 (Wy. 1966) (words given ordinary meaning; avoid torturing contract language)
- Commercial Union Ins. Co. v. Stamper, 732 P.2d 534 (Wy. 1987) (principles of construction in insurance policies)
- Farmers Ins Exch v. Dist. Court of Ninth Jud. Dist., 844 P.2d 1099 (Wy. 1993) (interpretation against insurer when ambiguity exists)
- Ball v. State ex rel. Workers' Safety & Comp. Div., 239 P.3d 621 (Wy. 2010) (statutory-like approach to contract interpretation in Wyoming)