Arlington insurance law attorneys would find this case to be a good case to show clients when trying to explain why the client needs an attorney.
The style of the case is, Amy Warmbrod v. USAA County Mutual Insurance Company. This is an El Paso Court of Appeals opinion issued in April 2012.
Amy Warmbrod filed suit against USAA alleging various causes of action and seeking damages arising out of USAA’s handling of her underinsured motorist (UIM) claim. Warmbrod appeals the summary judgment granted in favor of USAA.
Warmbrod sustained severe injuries in a car accident on July 28, 2006.
She was treated free of charge at United States Army hospitals by virtue of her husband’s military status. Warmbrod’s injuries and damages were in excess of both the tortfeasor’s insurance coverage and the UIM provisions of her own USAA auto policy. Warmbrod demanded that USAA pay her the $100,000 UIM benefits under her policy. The United States Army submitted a reimbursement claim to USAA for the medical care it rendered to Warmbrod in the amount of $26,404.96 pursuant to 10 U. S. C. § 1095 and the Federal Medical Care Recovery Act, 42 U.S.C. §§ 2651-53. After receiving two payments totaling $3,403.53, the Army sought to recover from USAA the remaining balance of $23,101.43, claiming that it had a right to all available insurance coverage including Warmbrod’s UIM benefits which were payable to Warmbrod under her USAA policy. USAA paid Warmbrod $76,898.57 of the $100,000 UIM benefits and issued a second check for the remaining $23,101.43 payable to Warmbrod, her attorney, and the Army.
Warmbrod contends that the trial court erred by granting USAA summary judgment because under the Federal Medical Care Recovery Act (FMCRA), USAA was not obligated to pay the Army’s medical reimbursement claim from her UIM coverage. USAA takes the position that FMCRA is not applicable to the facts of this case and asserts that, pursuant to 10 U.S.C. § 1095 and the implementing regulations, the Army is entitled to recovery from Warmbrod’s UIM coverage.
FMCRA is one of the federal statutes that gives the United States government the authority to recover medical care it provides at its own expense to covered beneficiaries. See 42 U.S.C. §§ 2651-53.
FMCRA gives the United States government an independent right to recover the reasonable value of medical care incurred under circumstances creating tort liability upon some third person. Therefore, Section 2651 governs collection from a third-party tortfeasor. However, the United States government does not have a right to first party insurance proceeds under FMCRA. Under state law, the United States government is a proper claimant against UI/UIM coverage pursuant to the insurance contract. As neither Warmbrod nor USAA were third-party tortfeasors, the Army cannot recover under FMCRA on any settlement from the UIM coverage of Warmbrod’s auto policy.
As to Section 1095, the United States has a right to collect reasonable medical care costs rendered at its expense to a covered beneficiary under both Section 1095 and FMCRA. 32 C.F.R. § 220.11(b). The FMCRA does not purport to limit any other law authorizing the United State government to recover the costs of medical care rendered at its expense as set forth in 42 U.S.C. § 2651. If a medical care recovery claim is brought under the concurrent authority of the FMCRA and Section 1095, the United States’ right to collect is governed by Section 1095 and the implementing regulations.
Under Section 1095, the corollary to FMCRA, the United States government has the right to collect reasonable medical expenses for the care it provided at government expense from third-party payers. Moreover, Section 1095 limits its definition of “third-party payer” to that section of the United States Code.
The plain language of 10 U.S.C. § 1095 is clear that the United States’ right to reimbursement from third-party payers includes reimbursement from automobile insurers. In essence, Section 1095 authorizes the United States’ claims for recovery in states with no-fault statutes and against the MedPay, UI/UIM, personal injury protection portions of the injured party’s insurance as well as Medicare supplemental insurance.
This Court, in it’s opinion examined each of the statutes at issue and ultimately ruled in favor of USAA.
It should be clear how, how unclear all these laws are. Compounding this is that by handling these issues in a wrong manner, the claimant may be subjected to personal liability.
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