Issued and entered December 19, 2002 by Frank M. Fitzgerald, Commissioner

ORDER

I
PROCEDURAL BACKGROUND

On June 7, 2002 the Petitioner, XXXXXXXX, filed a request for external review with the Commissioner of Financial and Insurance Services (Commissioner) under the Patient’s Right to Independent Review Act, MCL 550.1901 to MCL 550.1929. After a review of the material submitted, the Commissioner accepted the request. The issue involved is medical in nature. The Commissioner therefore assigned it to an independent review organization (IRO) on June 14, 2002. On June 27, 2002, the IRO provided its recommendation to the Commissioner.

II
FACTUAL BACKGROUND

In 2001, the Petitioner underwent amputation of his right leg at XXXXXXXXXXXX. He also had severe ulcerations of his left lower leg. From XXXXXXXXXX, he was transferred to the XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX on August 9, 2001 where he stayed until November 11, 2001. XXXXXXX billed him for his room and board, drugs, and therapy services that Medicare paid as the primary insurance leaving a balance of $7,821.00.

Blue Cross and Blue Shield of Michigan (BCBSM) denied coverage for the balance of his care at XXXXXX. The Petitioner believes that BCBSM is required to for the balance of his care at XXXXXXXXX.

III
ISSUE

Is BCBSM required to pay the $7,821.00 balance for the care the Petitioner received at XXXXXXXXX?

IV
ANALYSIS

Petitioner’s Argument

After the Petitioner was admitted to XXXXXX on August 9, 2001 he was advised by a social worker there that his care would be covered up to 100 days by Medicare and BCBSM. BCBSM denied payment for the co-payment charges not paid by Medicare because convalescent care is not a covered benefit under the Certificate. The Petitioner argues that he did not receive convalescent care but open wound care and rehabilitation with physical therapy. This care was necessary because his leg was amputated above the knee.

The Petitioner provided information from his doctors indicating the type of care he received at XXXXXXXX. The Petitioner is 83 years old and on a limited budget. He believes that since Medicare paid its part of his care at XXXXXX BCBSM is required to pay for the balance.
BCBSM’s Argument

BCBSM argues that XXXXXXXwhere the Petitioner received care is not a hospital. It appears that the Petitioner received some skilled care at this facility but it is not listed as a Skilled Nursing Facility (SNF) with BCBSM. BCBSM also indicates that even if XXXXXX was a SNF the Petitioner’s certificate does not cover services at such a facility.

BCBSM states that any statement made by a social worker at XXXXXXX cannot bind BCBSM since that individual is not an employee or agent of BCBSM.

BCBSM argues it acted properly in this case when it denied payment for the Petitioner’s care at XXXXXXXX since this facility is not a hospital and its services are not a covered benefit under the Certificate.

IRO Recommendation

The IRO recommended and concluded:

1. The treatment the Petitioner received at XXXXX from August 9, 2001 until November 11, 2001 was medically necessary for treatment of his condition.
2. XXXXXXXXXXXXXXXXXXXXXXX does not meet the definition of a hospital set forth in the BCBSM Certificate.

Commissioner’s Review

The certificate of coverage controls the analysis of whether BCBSM is required to pay the balance of the care the Petitioner received at XXXXXXXXX. The Petitioner is enrolled through the XXXXXXXXXXXXXXXXXXXX, an area rated group. The Comprehensive Hospital Care Group Benefit Certificate governs the coverage. His coverage is supplemental to Medicare. It provides coverage for services not covered by Medicare up to the coverage limits enjoyed by members of his group who are not yet eligible for Medicare. The specific terms of coverage that apply to this dispute are as follows:

SECTION 2: The Language of Health Care
This section explains the terms used in your Certificate
Hospital
A facility which provides inpatient diagnosis and therapeutic services 24 hours every day. Patients served are injured or acutely ill. The facility provides a professional staff of licensed physicians and nurses to supervise the care of the patients.
Payable inpatient services

• Semi-private room
• Nursing services
• Meals, including special diets…
• Physical therapy treatments, including occupational and speech used for rehabilitation…
• BCBSM-approved drugs, biologicals and solutions used during your stay in the hospital.

Nursing home care is not a covered benefit under the Petitioner’s BCBSM Certificate. Hospital care is a covered benefit. XXXXXX is a nursing home and does not meet the definition of a hospital as set forth in the Certificate. Therefore, BCBSM is not required to pay for any of the care provided to the Petitioner at XXXXXXXXX.

V
ORDER