Out-of-Network Expenses Are Uninsured Medical Expenses Under Washington Family Law

Health care can be very expensive, especially if the treatment is not covered by insurance.  A child support order will generally set out how uninsured medical expenses are allocated, but what happens when one parent seeks treatment for a child who is not covered by insurance?  The Washington Supreme Court considered this issue in a recent case.

The child developed a kidney stone.  The condition grew worse while she was visiting her aunt, and she had a temporary stent installed at a hospital in the Cincinnati area.  She was also referred to a group in the area for lithotripsy, which would break open the stone by ultrasonic waves.

The child was covered by her father’s insurance, which was not available in the Cincinnati area where her aunt lived. The nearest facility covered by the insurer was in the Cleveland area.  The wife contacted the husband, who said the aunt should either drive the child to the in-network facility or wait to see if the insurer would approve an out-of-network provider.  The wife felt the daughter needed immediate treatment.  The aunt took the child to the physician group in Cincinnati, and they treated the stone with lithotripsy.  The medical expenses totaled about $13,000.  The insurer determined that the treatment was non-emergent and out-of-network and denied payment.

Under the child support order, the husband was responsible for providing the child’s health insurance and paying 100% of her uninsured medical expenses.  The wife sought to enforce this provision, but the husband argued that the wife had not gone “through the appropriate channels” by failing to obtain a prior authorization from the insurer.  The trial court found the mother, as the primary residential parent, was in a better position to obtain coverage for the treatment from the insurer.  The court ordered the wife to pay 25% of the medical costs.

The appeals court reversed, finding that the costs were uninsured medical expenses, and the child support order therefore controlled how those expenses were allocated.  The dissent in that case expressed concern that a parent in control of health care could unfairly subject the other parent to unnecessary out-of-network expenses, but nothing in the record suggested the mother had acted unreasonably or in bad faith here.  The appeals court found the trial court abused its discretion, and the husband petitioned for review by the Washington Supreme Court.

The husband argued that the costs were not “uninsured medical expenses” because the treatment would have been covered by insurance under different circumstances.  “Uninsured medical expenses” is defined in RCW 26.18.170(18)(d) to include “premiums, copays, deductibles, along with other health care costs not covered by insurance.”  The Court found that the costs were “unambiguously” uninsured medical expenses.

Pursuant to RCW 26.18.170(17) , one parent can enforce collection of the other parent’s portion of uninsured medical expenses.  Courts are to liberally construe chapter 26.8 to ensure that children have adequate support.  The child support order in this case placed 100% financial responsibility for uninsured medical expenses on the father. The primary issue, then, was whether the expenses were uninsured medical expenses.

The Court found that “along with other health care costs not covered by insurance” clearly and unambiguously meant costs the insurer declined to cover.  The purpose of 26.18 RCW is to ensure children are “adequately supported,” so the scope of the enforcement power must be as broad as the medical support obligations.  Not including charges for out-of-network providers would interfere with the statute’s ability to ensure children receive health care in all circumstances.

The Court also considered the regulatory definition of “uninsured medical expenses,” which clarifies that costs that are not paid by insurance are included.  WAC 388-14A-1020.  The statutory and regulatory definitions, when read together, clarified that medical expenses that are not paid by insurance and costs that are not covered by insurance qualify as “uninsured medical expenses.”  Since the expenses in question were neither covered nor paid, they were uninsured medical expenses.

The Court also addressed the dissent from the appeals court, which criticized the majority for requiring the husband to pay 100% of the bill when he was not responsible for the child seeking treatment from a provider that was not in the insurer’s network.  The Court noted that marital fault is generally irrelevant in divorce proceedings.  Child support orders should generally be enforced according to their terms, unless a change in circumstances justifies a modification.  There was no evidence that either parent had acted unreasonably or in bad faith.  In fact, the wife had contacted the husband and asked for coverage by the insurer, and she was told by the doctor that the insurer would pay.

The Court rejected the idea that the parent who pays for the health care can insist on the most cost-effective care because the other parent has no incentive to avoid unnecessary expenses.  Parenting authority is a fundamental right that is not based on financial responsibility.  The child support order did not limit the wife’s right to make decisions just because it assigned financial responsibility to the husband.  Additionally, fault or unfairness does not change the interpretation of what constitutes an uninsured medical expense under the statute.  The out-of-network costs were uninsured medical expenses and subject to the requirement in the child support order that the husband pay 100% of the uninsured medical expenses.

The Court affirmed the Court of Appeals and found that the husband was obligated to pay 100% of the costs of the medical expenses, pursuant to the child support order.

The husband in this case may have never anticipated that he would face such high expenses because he had insurance coverage for the child.  This case shows that even parents who have insurance for their children can face expensive charges.  The child support attorneys at Blair & Kim, PLLC understand the importance of the terms of a child support order.  Call us at (206) 622-6562 or contact us online to discuss your case.

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