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Stegall v. TML Multistate Intergovernmental Employee Benefits Pool, Inc.

Court of Appeals of Texas, Fifth District, Dallas

October 2, 2019

BARBARA STEGALL, INDIVIDUALLY, AND ON BEHALF OF THE ESTATE OF JOE STEGALL, Appellant
v.
TML MULTISTATE INTERGOVERNMENTAL EMPLOYEE BENEFITS POOL, INC., AND UMR, INC., Appellees

          On Appeal from the County Court at Law No. 4 Dallas County, Texas Trial Court Cause No. CC-16-05440-D

          Before Justices Whitehill, Partida-Kipness, and Pedersen, III

          MEMORANDUM OPINION

          BILL PEDERSEN, III JUSTICE

         Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our . . . elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.[1]

         This is an appeal of the trial court's orders granting the partial plea to the jurisdiction filed by appellee TML Multistate Intergovernmental Employee Benefits Pool, Inc. and the first amended plea to the jurisdiction[2] filed by appellee UMR, Inc. Appellant Barbara Stegall, Individually, and on behalf of the Estate of Joe Stegall, asserts that the trial court erred in granting appellees' pleas to the jurisdiction. In a single issue, she contends that appellees have no governmental immunity because her claims pertain to appellees' proprietary functions, not their governmental functions. We affirm.

         BACKGROUND

         The suit underlying this appeal is a health benefits coverage dispute. Joe Stegall worked as the Chief Financial Officer for the city of Royse City, Texas. As a city employee, he was eligible for, and participated in, the city's medical and prescription drug benefits provided by TML Multistate Intergovernmental Employee Benefits Pool, Inc. (TML). TML is an intergovernmental self-insurance risk pool that operates under the Texas Interlocal Cooperation Act. See Tex. Gov't Code Ann. §§ 791.001, 791.011. UMR, Inc. (UMR) is one of TML's third-party administrators.

         In May 2014, Mr. Stegall was diagnosed with bile duct cancer and liver cancer. His oncologist advised him to begin treatment immediately, using a combination of chemotherapy medications specifically targeting bile duct cancer. The oncologist stated that once he saw how Mr. Stegall responded to the first chemotherapy regimen, additional chemotherapy would be added to treat the liver cancer. Based on Mr. Stegall's positive response to the first chemotherapy regimen, on October 23, 2014, his oncologist prescribed sorafenib (brand name Nexavar), an FDA-approved drug designed to increase survival rates and life expectancy for patients with advanced liver cancer.

         TML and UMR initially denied coverage for Nexavar for Mr. Stegall. When the oncologist sought clarification, he learned that the TML and/or UMR medical representative did not believe that Mr. Stegall actually had liver cancer. Mr. Stegall's oncologist attempted to procure Nexavar through other sources. However, when TML learned of these attempts, a TML representative called Mr. Stegall's oncologist to warn that TML would consider terminating Mr. Stegall's health benefits coverage if Mr. Stegall took Nexavar without TML's authorization. On November 21, 2014, Mr. Stegall and his oncologist learned that TML had reversed its position and would provide coverage for Nexavar. Unfortunately, Mr. Stegall died several weeks later.

         Barbara Stegall, individually, and on behalf of the estate of her deceased husband, sued TML and UMR for wrongful denial of medical benefits and additional acts of interference with the decedent's access to prescribed chemotherapy. Stegall brought suit under tort and contract theories. TML and UMR filed general denials and, as to the tort claims, both filed pleas to the jurisdiction on grounds of governmental immunity. After separate hearings, the trial court granted both pleas to the jurisdiction, leaving only Stegall's breach of contract claims against TML. Stegall voluntarily nonsuited her breach of contract claims against TML and filed a motion for new trial. After her new trial motion was overruled by operation of law, Stegall filed this appeal.

         DISCUSSION

         Stegall contends that the trial court erred in granting appellees' pleas to the jurisdiction. She does not argue that this is a case in which governmental immunity was waived. Instead, she argues that governmental immunity never existed because appellees' claims-adjusting activities, including improperly denying coverage, attempting to intimidate Mr. Stegall into foregoing chemotherapy, threatening Mr. Stegall's future coverage, and later reversing their position on coverage without notifying Mr. Stegall of their decision, were proprietary-not governmental- functions.

         Plea to the Jurisdiction

         In their pleas to the jurisdiction, TML and UMR argued that they had governmental immunity from Stegall's suit. An assertion of governmental immunity implicates a court's subject matter jurisdiction, and such immunity is properly asserted in a plea to the jurisdiction. Harris Cty. v. Annab, 547 S.W.3d 609, 612 (Tex. 2018). The existence of subject matter jurisdiction is a question of law, and we review the trial court's ruling on a plea to the jurisdiction de novo. See id.; see also City of Dallas v. E. Vill. Ass'n, 480 S.W.3d 37, 42 (Tex. App.-Dallas 2015, pet. denied).

         A plea to the jurisdiction can be based on the pleadings or on the evidence. Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004); City of Dallas v. Turley, 316 S.W.3d 762, 767 (Tex. App.-Dallas 2010, pet. denied). When a plea to the jurisdiction challenges the pleadings, we determine if the pleader has alleged facts that affirmatively demonstrate the court's jurisdiction to hear the case. Miranda, 133 S.W.3d at 226, 228. We look to the allegations in the pleadings, construe them in the plaintiff's favor, and look to the pleader's intent. See Cty. of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002); Peek v. Equip. Serv. Co., 779 S.W.2d 802, 804 (Tex. 1989). The plaintiff bears the burden to allege facts that affirmatively demonstrate the trial court's jurisdiction to hear a case. Miranda, 133 S.W.3d at 226-27; Turley, 316 S.W.3d at 767.

         When a plea to the jurisdiction challenges the existence of jurisdictional facts, we consider relevant evidence submitted by the parties to determine if a fact issue exists. Miranda, 133 S.W.3d at 227. The standard of review for a jurisdictional plea based on evidence "generally mirrors that of a summary judgment under Texas Rule of Civil Procedure 166a(c)." Id. at 228.

         Immunity

         Sovereign immunity and governmental immunity are related common law doctrines that protect the government from suit. Hughes v. Tom Green Cty., 573 S.W.3d 212, 218 (Tex. 2019). "Sovereign immunity protects the state and its various divisions, such as agencies and boards, from suit and liability, whereas governmental immunity provides similar protection to the political subdivisions of the state, such as counties, cities, and school districts." Travis Cent. Appraisal Dist. v. Norman, 342 S.W.3d 54, 57-58 (Tex. 2011) (citing Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692, 694 n.3 (Tex. 2003)). Governmental immunity encompasses both immunity from suit and immunity from liability. Reata Constr. Corp. v. City of Dallas, 197 S.W.3d 371, 374 (Tex. 2006); Tooke v. ...


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