Recently, Steven Hughes and I obtained a jury award on behalf our client, the Estate of Frank Madden, against Medico Insurance Company for violating the Insurance Fair Conduct Act (IFCA) and insurance bad faith.
In the late 1990s and early 2000s, Frank purchased two long-term care policies that provided benefits to Frank if he moved into an assisted living facility. On November 18, 2009, Medico certified Frank Madden to receive benefits under the two long-term care policies. The certification was based on the opinion of Frank’s primary care physician and Medico’s own IME nurse. In reliance on Medico’s certification, Frank moved into an assisted living facility, fully expecting that his expenses would be paid by Medico. Frank was 90 years old when he moved into the assisted living facility.
However, four months later, Medico decertified Frank and asserted that Frank misrepresented his care needs and was attempting to commit insurance fraud. Medico based its denial on a statement from one nurse at the assisted living facility that opined that Frank was mostly independent and did not need care. Other than a phone call to the assisted living director, no other investigation was conducted by Medico.
Frank was subsequently evicted from his assisted living facility because he could not pay the rent. Unfortunately, Frank Madden passed away one month after he filed suit against Medico.
On October 18, 2011, a Spokane jury found that Medico violated IFCA and committed bad faith when it unreasonably denied Frank Madden’s claim for benefits under two long-term care policies. The jury awarded the Estate of Frank Madden $92,200 in economic and noneconomic damages. On December 12, 2011, Judge Cozza of the Spokane Superior Court entered a judgment against Medico Insurance Company for $330,000, which included attorney fees, costs, and punitive damages.
Frank can now rest in peace knowing that justice was done.