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July 5, 1996


Appeal from the Circuit Court of Cook County. No. 92 CH 07378. The Honorable Richard Curry, Judge Presiding.

As Corrected September 5, 1996.

The Honorable Justice Hourihane delivered the opinion of the court: Gordon and Cousins, J.j., concur.

The opinion of the court was delivered by: Hourihane

JUSTICE HOURIHANE delivered the opinion of the court:

Plaintiff, Vivian O'Rourke (Mrs. O'Rourke), a breast cancer patient, sued her insurer, Access Health, Inc. (Access), for refusing to pay the costs associated with a bone marrow transplant prescribed by her physician, but determined by Access to be "experimental" and thus not a plan benefit. Plaintiff appeals the trial court's dismissal with prejudice of her complaint, pursuant to section 2-619 of the Code of Civil Procedure (Code). 735 ILCS 5/2-619 (West 1994).

On appeal, plaintiff argues that the trial court erred in granting defendant's motion by (i) finding no ambiguity in the controlling contract language governing experimental procedures; (ii) finding the bone marrow transplant did not fall within the contract definition of "emergency" care and was not otherwise authorized by plaintiff's primary care physician; (iii) applying a two-year statute of limitations as to plaintiff's claim for attorneys' fees under section 155 of the Illinois Insurance Code; and (iv) finding that plaintiff's failure to seek administrative review of an adverse decision by the Illinois Department of Insurance (IDI) estopped her from relitigating the same issues in the circuit court. Plaintiff further argues on appeal that defendant is equitably estopped to deny coverage. For the reasons that follow, we affirm the decision of the trial court.


In July 1989, Mrs. O'Rourke was enrolled as a member of Access, an Illinois health maintenance organization, by virtue of a group medical plan that covered her husband. In November of 1989, Dr. Steven K. Sauerberg, an Access-approved primary care physician, referred Mrs. O'Rourke to Dr. Nicholas J. Vogelzang for treatment of breast cancer. A few days later, Mrs. O'Rourke underwent a modified radical mastectomy, followed by a standard course of chemotherapy. Dr. Vogelzang also advised Mrs. O'Rourke that she should consider high-dose chemotherapy with autologous bone marrow transplant (HDC/ABMT). *fn1 Mrs. O'Rourke obtained a second opinion from Dr. Patricia Madej of Hinsdale Hematology/Oncology Associates, Ltd., who concurred in Dr. Vogelzang's recommendation.

Thereafter, on December 12, 1989, Dr. Vogelzang wrote to Dr. Sauerberg requesting that he seek authorization from Access for the HDC/ABMT procedure. Approximately one month later, Access denied pre-certification because the procedure was "experimental" and thus excluded from coverage under Section 8.17 of the subscription agreement. Section 8.17 provides:

"Procedures which are considered experimental by the ACCESS medical staff are not covered by ACCESS. In the event that such procedures are deemed non-experimental by the Federal Office of Health Technology Assessment, the decision of the Federal Office of Health Technology will prevail."

On January 23, 1990, plaintiff wrote to Dr. Glen Tomlinson, Access Medical Director, seeking reconsideration of the denial of coverage. Approximately two months later, Access again denied coverage, based on its determination that "bone marrow transplantation for breast cancer disease clearly had not reached the level of the generally accepted standard of treatment." Notwithstanding the denial of coverage, Dr. Vogelzang encouraged Mrs. O'Rourke to proceed with the bone marrow transplant, "if at all financially possible."

On April 23, 1990, plaintiff again sought reconsideration but was once more advised by Access that coverage was being denied pursuant to Section 8.17 of the subscription agreement.

Shortly thereafter, Mr. O'Rourke executed a membership contract change which cancelled the subscription agreement with Access, effective June 30, 1990. Sometime that month, Mrs. O'Rourke began the HDC/ABMT procedure at Hinsdale Hospital. Significantly, neither the hospital nor the physician are affiliated with Access.

In an effort to compel Access to pay the cost of the HDC/ABMT, Mrs. O'Rourke filed a complaint with the IDI. The IDI contacted the Federal Office of Health Technology Assessment in Washington, D.C., which confirmed that although the National Cancer Institute was evaluating HDC/ABMT for the treatment of several cancers, including breast cancer, the procedure was presently considered experimental. On October 24, 1990, without conducting a formal hearing, the IDI closed the O'Rourkes' complaint file, stating that Access "appears to be within its contractual rights to deny Ms. O'Rourke's claim." Plaintiff did not seek reconsideration of the IDI's decision. Rather, in July 1992, Mrs. O'Rourke filed a two-count complaint against Access in the chancery court. Count I seeks reimbursement of expenses in connection with the HDC/ABMT. Count II seeks attorneys' fees under section 155 of the Illinois Insurance Code (215 ILCS 5/155 (West 1994)), based on defendant's allegedly vexatious and unreasonable conduct in the investigation and resultant denial of her claim for coverage.

Access filed a combined amended motion to dismiss, pursuant to section 2-619.1 of the Code. Access argued that dismissal of both counts was warranted under section 2-615 because the complaint failed to state a cause of action for equitable relief. Access also argued for dismissal of count I to the extent that plaintiff sought reimbursement for medical expenses incurred subsequent to Mr. O'Rourke's voluntary termination of coverage through Access. As to count II, Access asserted that plaintiff's admission in the complaint that plaintiff's counsel had referred this matter to the IDI and the IDI's determination that Access' denial of coverage was within its rights, effectively precluded her from now arguing that Access' conduct was vexatious and unreasonable.

Access also argued that both counts should be dismissed pursuant to section 2-619(a)(9) because the HDC/ABMT procedure was provided by a non-Access affiliated physician and hospital, was not an "emergency", as defined in the subscription agreement, and was not otherwise "authorized" by her primary care physician. Access further argued for dismissal of count II under section 2-619 (a)(5), asserting that plaintiff's claim is time-barred by the two-year statute of limitations set forth in section 13-202 of the Code for actions for a statutory penalty. 735 ILCS 5/13-202 (West 1994).

Access filed a supplement to its amended motion to dismiss, seeking dismissal under section 2-619(a)(4) on the ground that plaintiff is collaterally estopped from re-litigating the same issues raised before the IDI.

The trial court granted defendant's 2-619 motion and dismissed both counts with prejudice. This appeal ...

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