More than three years after its initial payment to treat a claimant's hemophilia an insurance company brought suit seeking to recover its payments. The Sixth Circuit ruled in Medical Mut. of Ohio v. k. Amalia Enterprises, Inc., No. 07-4422 (6th Cir. December 2, 2008) that the suit was untimely and ruled that the initial claim provided "sufficient information to place it on notice" that the claim's coverage should be investigated.
Medical Mutual of Ohio provided group health insurance to employees of k. Amalia Enterprises. An employee, Loan A. Tran, and her husband, Khanh B. Luu, submitted forms, as part of the initial application process that did not indicate that their son had a pre-existing condition, hemophilia. Four months after coverage began the insurance company paid the first of a series of claims to treat the child's hemophilia. About two and a half years later and after having paid some $525,000 in claims, the insurance company did an audit and claimed that only then did it realize the child had a preexisting condition. It filed suit seeking to recover some or all of its payments.
The court ruled that the insurance company waited too long to file its suit, ruling that "it reasonably should have discovered the fact" of the child's preexisting condition when it paid the first of many claims more than three years before it filed suit.
Robert L. Abell
