Gendel v. State

38 Ill. Ct. Cl. 76
CourtCourt of Claims of Illinois
DecidedJuly 11, 1984
DocketNo. 78-CC-1063
StatusPublished
Cited by4 cases

This text of 38 Ill. Ct. Cl. 76 (Gendel v. State) is published on Counsel Stack Legal Research, covering Court of Claims of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gendel v. State, 38 Ill. Ct. Cl. 76 (Ill. Super. Ct. 1984).

Opinion

Roe, C.J.

Claimants, Gertrude Gendel and Ruth Lew, both individually and in a representative capacity on behalf of all others similarly situated, brought this action seeking to recover from the State sums of money paid as and for premiums to enroll in part B of the Medicare program and interest thereon from the date of the entry of judgment in the proceedings brought heretofore in the circuit court of Cook County.

Claimant, Gertrude Gendel, is an “annuitant” and Claimant, Ruth Lew, is an “employee” as those terms are defined by sections 3(b) and 3(k) respectively of the State Employees Group Insurance Act of 1971 (hereinafter “the Act”). (Ill. Rev. Stat. 1983, ch. 127, par. 523.) Sometime after the Act was enacted by the legislature, the Director of the Department of Personnel (hereinafter “the Director”) who was charged with implementing said Act, issued the following directive:

“The State Employees Group Insurance Act of 1971 REQUIRES THAT, WHEN PERSONS ARE ELIGIBLE FOR MEDICARE, STATE PLAN BENEFITS WILL BE REDUCED BY THE AMOUNT OF MEDICARE BENEFITS. When Claims are submitted for members covered by Medicare, benefits payable under the State Plan are calculated in the normal manner; benefits payable under Medicare are then subtracted from the State Plan benefit amount; and any difference due is paid by the State Plan. The result is that Medicare and Non-Medicare members receive the same net total benefits.
Medicare Part ‘B’ — (Physician Care) — Everyone 65 years of age and over is eligible for Medicare Part B and the minimum cost is currently $6.30 per month. The State program assumes all eligible persons will enroll in Medicare Part B and pay the premium cost. IF YOU DO NOT ENROLL IN PART B, THE HEALTH INSURANCE CARRIER WILL DEDUCT FROM ANY STATE PLAN BENEFITS ALL AMOUNTS WHICH PART B WOULD HAVE PAID.”

In a class action filed in the circuit court of Cook County as Gendel v. Jones, 76 CH 2420, Claimants contended that the directive cited above violated several provisions of the Act. Claimants sought relief to declare the Director’s existing policy violative of section 10(a) of the Act, and to the extent covered individuals would continue making premium payments for Medicare part B coverage, the Director would reimburse said individuals for the amounts so paid. Ill. Rev. Stat. 1983, ch. 127, par. 530(a).

The circuit court granted the requested relief on October 19,1976, by an order granting Plaintiffs’ motion for summary judgment. The order was stayed pending appeal and enforcement thereof suspended.

The issue on appeal involved an interpretation of two provisions of the Act. Section 10(a) provides in pertinent part:

“The State shall pay the cost of the basic non-contributory group life insurance and group health insurance on each eligible employee and annuitant, and part of each eligible employee’s and annuitant’s premiums for health insurance coverage for his dependents as provided by Section 9.”

Section 6 provides in part:

“The group health insurance program shall be designed by the Director (1) to provide a reasonable relationship between the benefits to be included and the expected distribution of expenses of each such type to be incurred by the covered employees and dependents, and (2) to include reasonable controls, which may include deductible and co-insurance provisions, applicable to some or all of the benefits, or a coordination of benefits provision, to prevent or minimize unnecessary utilization of the various hospital, surgical and medical expenses to be provided and to provide reasonable assurance of stability of the program, and (3) to provide benefits to the extent possible to employees throughout the State, wherever located, on an equitable basis.
Where a covered employee or annuitant, or any of their covered dependents, are eligible for benefits under the Federal Medicare health insurance program (Title XVIII of the Social Security Act as added by Public Law 89-97, 89th Congress), benefits paid under the State of Illinois program will be reduced by the amount of benefits paid by Medicare, with premiums adjusted to an amount deemed by the Director to be reasonably consistent with the reduction of benefits.”

Plaintiffs argued that to the extent class members were required to pay premiums for insurance coverage while all State employees under 65 years of age received full coverage without cost to themselves, the Director had violated the mandate of section 10(a) of the Act. Defendants asserted that the policy instituted by the Director was within the authority conferred upon him by section 6 of the Act as set forth herein.

The appellate court in its opinion held that the Director could not effectuate policies in reliance on section 6 which rendered meaningless other provisions of the Act. Hence, the court found that the State was required to pay for the entire insurance coverage, and to the extent the Director’s policy required otherwise, that the directive exceeded the authority granted the Director. The court concluded by stating:

“To the extent that the Circuit Court of Cook County determines the rights of the plaintiffs to full coverage without additional cost to themselves, it is affirmed; to the extent it might be construed to purport to enter a monetary judgment against the State of Illinois, it is reversed.” Gendel v. Jones (1978), 58 Ill. App. 3d 739,744.

In accordance with the appellate court’s decision, Claimants filed this action seeking to recover a monetary judgment against the State in the amount of premiums paid by class members in contravention of the statute.

Initially, we find that this matter is properly before the Court as a class action pursuant to the Code of Civil Procedure (Ill. Rev. Stat. 1983, ch. 110, par. 2 — 801 et seq.) and the Court of Claims Rules 2 and 4. The class, which comprises some 24,000 individuals, is so numerous that joinder is impracticable. There are questions common to the class which predominate over any questions affecting only individuals, e.g., whether Claimants are entitled to recover a monetary award from the State, whether interest is allowable on any such award, etc. The representative parties will fairly and adequately protect the interests of the class as was demonstrated through their able representation in the circuit court proceedings. The class action is an appropriate vehicle for resolving this controversy as the number of Claimants is large while the amount due each is relatively small, thus avoiding the necessity of processing approximately 24,000 separate claims.

Claimants contend that the obligation of the State to provide group life and group health insurance coverage is contractual in nature and, therefore, failure to provide the same constitutes a breach of contract. We are constrained to find that the Act does not create an enforceable contractual right on behalf of the Claimants. Aside from the other contractual prerequisites of offer and acceptance, we find that there was no consideration passing from Claimants to the State. Claimants have not shown something bargained for and given in exchange for a promise (Restatement of Contracts section 75).

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Farrell v. State
52 Ill. Ct. Cl. 275 (Court of Claims of Illinois, 2000)
K & S Associates, Inc. v. State
43 Ill. Ct. Cl. 117 (Court of Claims of Illinois, 1991)
Universal Printing Co. v. State
43 Ill. Ct. Cl. 165 (Court of Claims of Illinois, 1990)
Doe v. State
40 Ill. Ct. Cl. 37 (Court of Claims of Illinois, 1986)

Cite This Page — Counsel Stack

Bluebook (online)
38 Ill. Ct. Cl. 76, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gendel-v-state-ilclaimsct-1984.