The opinion of the court was delivered by: MILTON SHADUR, Senior District Judge
MEMORANDUM OPINION AND ORDER
Moirav Shaltiel ("Shaltiel"), invoking federal jurisdiction on
diversity of citizenship grounds, has sued Fortis Insurance
Company ("Fortis") under the Declaratory Judgment Act,
28 U.S.C. § 2201. Shaltiel seeks a ruling that under the terms of a medical
insurance Master Group Policy ("Policy") issued by Fortis, it is
obligated to provide benefits covering gastric bypass surgery
that she ultimately underwent on March 8, 2004.
Shaltiel and Fortis have filed cross-motions under Fed.R. Civ.
P. ("Rule") 56 for summary judgment as to Fortis' liability or
nonliability under the Policy.*fn1 For the reasons stated in
this memorandum opinion and order, Shaltiel's motion is granted,
while Fortis' motion is naturally denied. Rule 56 Standards
Every Rule 56 movant bears the burden of establishing the
absence of any genuine issue of material fact (Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23 (1986)). For that purpose courts
consider the evidentiary record in the light most favorable to
nonmovants and draw all reasonable inferences in their favor
(Lesch v. Crown Cork & Seal Co., 282 F.3d 467, 471 (7th Cir.
2002)). Where as here cross-motions for summary judgment are
involved, these principles require the court to take a dual
perspective one that this Court has frequently described as
Janus-like. Here that problem does not exist, for the underlying
facts are not in dispute instead the parties are at odds only
about the meaning of an exclusionary provision in the Policy.
Thus the issue is one of contract interpretation and is ripe for
disposition at the summary judgment stage (Bechtold v.
Physicians Health Plan of N. Ind., Inc., 19 F.3d 322, 325 (7th
On September 1, 1996 Fortis issued Shaltiel a medical insurance
certificate reflecting her coverage under the Policy (J. St. ¶
10). Shaltiel retained the certificate and duly paid all premiums
for the coverage afforded by the Policy (J. St. ¶ 12). As
reflected in the Policy's benefits schedule, benefits were to be
paid for "Covered Charges" (a defined term) incurred by Shaltiel
while coverage was in force (J. Ex. 1). In relevant part Covered Charges were defined as those charges for treatment
determined by Fortis to be (1) medically necessary and (2) not
listed in the stated "Exclusions" from benefits (id.).
On May 2, 2003*fn2
Dr. John C. Alverdy of the University
of Chicago's Center for Surgical Treatment of Obesity sent a fax
to Fortis seeking pre-authorization of benefits on behalf of
Shaltiel "for a gastric restrictive procedure with gastric bypass
for morbid obesity" (J. St. ¶ 14; J. Ex. 2). Dr. Alverdy's letter
further specified that the medical co-morbidities associated with
her morbid obesity included hypertension and obstructive sleep
apnea (J. Ex. 2). Fortis' swift May 6 letter response declined
benefits for the proposed surgery on the basis of a specific
Exclusion from Policy coverage (J. Ex. 1):
We will not pay benefits for any of the following:
* * *
Treatment of "quality of life" or "lifestyle"
concerns including but not limited to: smoking
cessation; obesity; hair loss; sexual function,
dysfunction, inadequacy or desire; or cognitive
That May 6 letter further advised Shaltiel of her right to
appeal the benefit determination.
Shaltiel appealed the initial determination through her
attorney Gerald Mullin ("Mullin") in a May 14 letter (J. St. ¶
16) that explained the proposed surgery was "neither primarily a
lifestyle or cosmetic undertaking [but] rather an attempt to cure
severe morbid obesity that is potentially life threatening" (J.
Ex. 4). Fortis' June 2 letter response to Mullin repeated its
denial of benefits based on the above-quoted Policy language and
advised him of Shaltiel's right to file a first level grievance
as to the adverse determination (J. St. ¶ 18).
Shaltiel did so through Mullin on July 22 (J. St. ¶ 19) with a
written grievance that included the previous correspondence
between the parties, a medical report from Dr. Alverdy reflecting
his determination that Shaltiel was an appropriate candidate for
the procedure and two medical journal articles regarding the
proposed treatment (J. Ex. 6). On August 19 Fortis sent Mullin a
letter stating that it had reviewed the information he sent but
that it was unable to reverse its original decision that benefits
were not available for Shaltiel's proposed gastrointestinal
surgery (J. St. ¶ 20).
On October 13 Shaltiel (through Mullin) filed a second level
grievance that included a letter from Dr. Ronald A. Feingold
stating that Shaltiel was suffering from "marked exogenous
obesity, hypertension and sleep apnea" and that she had been
"advised for medical reasons to undergo gastric bypass surgery
for treatment of her obesity" (J. St. ¶ 22; J. Ex. 9). Fortis'
November 6 letter response stated that following a review by the Fortis Health Grievance Panel it had been determined that
benefits were not available for the proposed surgery because
"[t]he certificate specifically excludes treatment of obesity"
(J. St. ¶ 23; J. Ex. 10). Fortis' letter further said that all
avenues in Fortis' internal grievance process had now been
Shaltiel underwent gastric bypass surgery on March 8, 2004 (J.
St. ¶ 24). According to the report of an examination conducted by
Dr. Feingold on June 28, 2004, since the surgery Shaltiel had
lost 61 pounds, no longer had symptoms of sleep apnea and had
normal blood pressure levels (J. St. ¶ 25).
Shaltiel's Entitlement to Benefits
Because the Policy was executed and issued in Illinois, it is
construed in accordance with Illinois law (Cross v. Zurich Gen.
Accident & Liab. Ins. Co., 184 F.2d 609, 611 (7th Cir. 1950)).
For that purpose the sole question to be decided here is whether
Shaltiel's gastric bypass surgery fell within the earlier-quoted
Exclusion. In that respect Shaltiel argues that the Exclusion
language does not encompass gastric bypass surgery in her case,
while Fortis contends that it excludes all treatment that
addresses obesity, including gastric bypass surgery regardless of
Contract construction under Illinois law involves the two-step
inquiry set out in Lumpkin v. Envirodyne Indus., Inc., 933 F.2d 449, 456 (7th Cir. 1991). First the court looks to the
language of the contract. If the plain language provides an
unambiguous answer to the issue in dispute, the inquiry is over
(id.). But if the contractual language is ambiguous as to that
issue, the court must then go on to declare the contract's
meaning (id.). And where as here the extrinsic ...