B-149485, SEP. 5, 1962

B-149485: Sep 5, 1962

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PURPURA: REFERENCE IS MADE TO YOUR LETTER OF JUNE 27. WHEREIN YOU WERE STATED TO BE INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $73.55. YOU WERE HOSPITALIZED BY THE VETERANS ADMINISTRATION CENTER. A BREAKDOWN OF THE BOARD AND ROOM CHARGES REVEALS THAT YOU WERE CHARGED FOR 33 DAYS AT THE RATE OF $11.25 PER DAY. (2) THAT FOR DAYS THE INDIVIDUAL WAS ENTITLED TO ADDITIONAL BENEFITS UNDER THE CALIFORNIA UNEMPLOYMENT INSURANCE ACT. THE COMPANY CALCULATED THAT UNDER THE POLICY YOU WERE ENTITLED TO $303.50. THIS IS EXPLAINED AS FOLLOWS: THE STATE HAD PAID ADDITIONAL BENEFITS UNDER THE CALIFORNIA UNEMPLOYMENT INSURANCE ACT FOR 12 DAYS. FOR THE REMAINING 21 DAYS YOU WERE ALLOWED $10 PER DAY (WHILE THE V.A.

B-149485, SEP. 5, 1962

TO MR. THEODORE P. PURPURA:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 27, 1962, REQUESTING RECONSIDERATION OF OUR LETTER OF JUNE 4, 1962, WHEREIN YOU WERE STATED TO BE INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $73.55.

ON MARCH 14, 1951, YOU WERE HOSPITALIZED BY THE VETERANS ADMINISTRATION CENTER, LOS ANGELES, CALIFORNIA, FOR A NONSERVICE CONNECTED DISABILITY. AS A CONDITION TO YOUR ADMITTANCE YOU EXECUTED AN ASSIGNMENT TO THE VETERANS ADMINISTRATION OF THE REIMBURSABLE BENEFITS PROVIDED YOU UNDER A GROUP DISABILITY INSURANCE POLICY ISSUED BY THE OCCIDENTAL LIFE INSURANCE COMPANY.

PURSUANT THERETO, THE VETERANS ADMINISTRATION NOTIFIED YOUR INSURER OF THE ASSIGNMENT AND TRANSMITTED AN ITEMIZED BILL COVERING THE COST OF YOUR HOSPITAL TREATMENT FOR THE PERIOD MARCH 14 THROUGH APRIL 16, 1951. THE BILL COMPRISED LABORATORY AND X-RAY COSTS IN THE AMOUNT OF $69.50 AND BOARD AND ROOM CHARGES IN THE AMOUNT OF $371.25, THE ENTIRE BILL TOTALING $440.75. A BREAKDOWN OF THE BOARD AND ROOM CHARGES REVEALS THAT YOU WERE CHARGED FOR 33 DAYS AT THE RATE OF $11.25 PER DAY.

THE INSURANCE POLICY, NO. 2807, PROVIDED, AMONG OTHER THINGS, (1) THAT THE OCCIDENTAL LIFE INSURANCE COMPANY SHOULD PAY THE EXPENSES INCURRED BY THE INSURED INDIVIDUAL FOR CHARGES MADE BY A HOSPITAL FOR ROOM AND BOARD BUT NOT TO EXCEED $10 PER DAY; (2) THAT FOR DAYS THE INDIVIDUAL WAS ENTITLED TO ADDITIONAL BENEFITS UNDER THE CALIFORNIA UNEMPLOYMENT INSURANCE ACT, THE COMPANY SHOULD PAY $2 PER DAY; AND (3) THAT THE COMPANY SHOULD PAY THE EXPENSE INCURRED BY THE INDIVIDUAL FOR OTHER HOSPITAL SERVICES BUT NOT TO EXCEED DURING ANY DISABILITY THE MAXIMUM OF $310.

THE COMPANY CALCULATED THAT UNDER THE POLICY YOU WERE ENTITLED TO $303.50. THIS IS EXPLAINED AS FOLLOWS: THE STATE HAD PAID ADDITIONAL BENEFITS UNDER THE CALIFORNIA UNEMPLOYMENT INSURANCE ACT FOR 12 DAYS. FOR THOSE 12 DAYS, THE COMPANY ALLOWED $2 PER DAY, OR $24. FOR THE REMAINING 21 DAYS YOU WERE ALLOWED $10 PER DAY (WHILE THE V.A. CHARGED YOU $11.25 PER DAY, $10 WAS THE MAXIMUM STIPULATED IN THE POLICY) OR $210. YOU WERE ALLOWED THE FULL AMOUNT OF THE CHARGES FOR THE OTHER HOSPITAL SERVICES WHICH WAS $69.50.

PURSUANT TO THE NOTICE OF ASSIGNMENT AND STATEMENT OF CHARGES, A CHECK IN THE AMOUNT OF $303.50 WAS THEREUPON TRANSMITTED TO THE VETERANS ADMINISTRATION CENTER, LOS ANGELES, CALIFORNIA. HOWEVER, IN CONTRAVENTION OF THE ASSIGNMENT, THE TOTAL AMOUNT OF THE CHECK WAS ERRONEOUSLY DEPOSITED TO YOUR CREDIT IN THE PERSONAL FUNDS OF PATIENTS ACCOUNT AT THE CENTER. YOU WITHDREW $247.55 OF SUCH FUNDS FOR YOUR OWN USE BEFORE THE ERROR WAS DISCOVERED. SUBSEQUENTLY, $150 WAS REPAID BY YOU LEAVING A BALANCE OF $97.55. AFTER FURTHER COLLECTION EFFORTS BY THE VETERANS ADMINISTRATION PROVED UNSUCCESSFUL, THE MATTER WAS REFERRED HERE.

IN OUR LETTER OF JUNE 4, 1962, IT WAS STATED THAT OF THE $303.50 PAID BY THE INSURER, $24 (THE AMOUNT PAID FOR DAYS ENTITLED TO BENEFITS UNDER THE CALIFORNIA UNEMPLOYMENT INSURANCE ACT) REPRESENTED INDEMNITY RATHER THAN REIMBURSEMENT PAYMENTS AND HENCE WAS NOT COVERED BY THE ASSIGNMENT. THUS, YOUR INDEBTEDNESS WAS REDUCED TO $73.55. IN ANSWER YOU CONTEND THAT THE $24 REPRESENTS REIMBURSEMENT PAYMENTS COVERED BY THE ASSIGNMENT BUT THAT THE BALANCE OF $279.50 ($303.50 MINUS $24) REPRESENTS INDEMNITY PAYMENTS NOT COVERED BY THE ASSIGNMENT AND TO WHICH YOU WERE ENTITLED AT THAT TIME. ON SUCH BASIS YOU MAKE CLAIM FOR THE $150 WHICH YOU HAD PREVIOUSLY REPAID.

THE ASSIGNMENT WHICH YOU EXECUTED AS A CONDITION TO YOUR ADMITTANCE TO THE HOSPITAL PROVIDED IN PART, AS FOLLOWS:

"FOR A VALUABLE CONSIDERATION, THE RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED, INCLUDING THE FURNISHING OF HOSPITAL CARE, MEDICAL, SURGICAL, OR CLINICAL TREATMENT, I HEREBY ASSIGN TO THE ADMINISTRATOR OF VETERANS' AFFAIRS:

"ALL CLAIMS OF EVERY CHARACTER WHICH I NOW HAVE OR WHICH HEREAFTER ACCRUES TO ME TO THE EXTENT HEREINAFTER INDICATED UNDER THE TERMS OF THE ABOVE IDENTIFIED INSURANCE CONTRACT OR MEMBERSHIP CERTIFICATE OR PLAN, OR BY REASON OF MY MEMBERSHIP IN THE CORPORATION OR OTHER ORGANIZATION HEREINAFTER NAMED, IN SO FAR AS I BECOME ENTITLED TO PAYMENT BY REASON OF SAID HOSPITAL CARE, MEDICAL, SURGICAL, OR CLINICAL TREATMENT, OR ANY OF THEM. * * *

"THIS ASSIGNMENT INCLUDES THE COST OF AMBULANCE TRANSPORTATION OR OTHER AUXILIARY SERVICES AND ANY AND ALL SUMS TO WHICH I AM OR MAY BE ENTITLED BY REASON OF SAID MEMBERSHIP OR CONTRACT OF INSURANCE AS A CONSEQUENCE OF MY RECEIVING SAID HOSPITAL CARE, MEDICAL, SURGICAL OR CLINICAL TREATMENT, OR ANY OF THEM (SOMETIMES REFERRED TO IN THE INSURANCE BUSINESS AS A RIGHT TO REIMBURSEMENT). THIS ASSIGNMENT DOES NOT INCLUDE ANY SUMS FOR WHICH I AM ENTITLED ON A FIXED BASIS WHICH DO NOT DEPEND UPON THE AMOUNT INCURRED OR DISBURSED BY ME FOR SUCH CARE, (SOMETIMES REFERRED TO IN THE INSURANCE BUSINESS AS A RIGHT TO INDEMNITY).'

AS SET FORTH ABOVE, YOU ASSIGNED ALL SUMS TO WHICH YOU MAY HAVE BEEN ENTITLED BY REASON OF YOUR INSURANCE POLICY AS A CONSEQUENCE OF YOUR RECEIVING HOSPITAL CARE. THIS ENTITLEMENT IS EXPLAINED IN THE ASSIGNMENT AS A "RIGHT TO REIMBURSEMENT.' YOU DID NOT ASSIGN ANY SUMS FOR WHICH YOU WERE ENTITLED ON A FIXED BASIS WHICH DID NOT DEPEND UPON THE AMOUNT INCURRED OR DISBURSED BY YOU FOR SUCH CARE. THIS IS EXPLAINED IN THE ASSIGNMENT AS A "RIGHT TO INDEMNITY.'

SINCE THE $24 PAID BY THE INSURANCE COMPANY AT THE RATE OF $2 FOR THE 12 DAYS THE STATE OF CALIFORNIA PAID THE ADDITIONAL BENEFITS REPRESENTED PAYMENT ON A FIXED BASIS NOT DEPENDENT UPON ANY AMOUNT INCURRED OR DISBURSED BY YOU IT WAS PAID PURSUANT TO A "RIGHT OF INDEMNITY" WITHIN THE MEANING OF THE ASSIGNMENT AND WAS SPECIFICALLY EXCLUDED THEREFROM. HOWEVER, THE REMAINING $279.50 PAID BY THE INSURANCE COMPANY DID NOT REPRESENT PAYMENT ON A FIXED BASIS BUT RATHER, IN FACT, DEPENDED UPON THE AMOUNT OF INDEBTEDNESS INCURRED BY YOU FOR THE HOSPITAL CARE, AS LIMITED BY THE TERMS OF THE POLICY, AND AS SUCH WAS PAID PURSUANT TO A RIGHT OF REIMBURSEMENT WITHIN THE MEANING AND INTENT OF THE ASSIGNMENT WHICH YOU EXECUTED.

ACCORDINGLY, UPON REVIEW, WE SUSTAIN OUR LETTER OF JUNE 4, 1962, AND REAFFIRM YOUR INDEBTEDNESS TO THE UNITED STATES IN THE AMOUNT OF $73.55. PAYMENT IN FULL OR ARRANGEMENTS FOR INSTALLMENT PAYMENTS SHOULD BE MADE PROMPTLY IN ORDER TO FORESTALL FURTHER COLLECTION ACTION AND THE INCURRENCE OF INTEREST AND OTHER ADDITIONAL COSTS TO YOU.