Tolani v. Med. Mut. of Ohio

2025 Ohio 5624
Ohio Court of Appeals·Decided December 18, 2025·No. 114356·Published

Opinion

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

AJIT TOLANI, ET AL., :

Plaintiffs-Appellants, :

No. 114356

v. :

MEDICAL MUTUAL OF OHIO, :

Defendant-Appellee. :

JOURNAL ENTRY AND OPINION

JUDGMENT: REVERSED AND REMANDED RELEASED AND JOURNALIZED: December 18, 2025

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-23-975686

Appearances:

The Lee Law Firm, LLC, and Brian C. Lee, for appellants.

Frantz Ward LLP, Christopher C. Koehler, and Gregory R.

Farkas, for appellee.

LISA B. FORBES, J.:

Ajit Tolani (“Ajit”) and Shruti Tolani (collectively, “the Tolanis”)

appeal the journal entry that granted Medical Mutual of Ohio’s (“MMO”) motion for summary judgment and dismissed with prejudice the Tolanis’ claims for breach of contract and bad faith. Because we find genuine disputes of material fact exist, including but not limited to whether Ajit made an intentional misrepresentation of material fact entitling MMO to rescind the Tolanis’ health-insurance policy (the “Policy”), we reverse the trial court’s judgment and remand for further proceedings consistent with this opinion. I. Facts, Procedural History, and Pertinent Exhibits A. Background This case concerns MMO’s recission of the Tolanis’ health-insurance coverage. The parties do not dispute the following facts.

In 2015, Ajit was diagnosed with a life-threatening lung condition. He is an Indian citizen and lived in India when he was diagnosed. The Tolanis moved to Cuyahoga County, entering the United States using a B-2 visa on December 23, 2016.

On January 30, 2017, Ajit was approved for a double-lung transplant, which would be performed at the Cleveland Clinic. Ajit purchased from MMO the Policy, effective February 1, 2017. He did so using the Affordable Care Act Exchange (“ACA Marketplace” or “ACA Exchange”), which allows people to compare and purchase health insurance from different providers. On February 9, 2017, the Cleveland Clinic sought approval from MMO to perform a double-lung transplant on Ajit. On March 2, 2017, MMO informed Ajit that it was rescinding his coverage.

B. Procedural History The Tolanis filed a two-count complaint in the Cuyahoga County Court of Common Pleas, claiming that (1) MMO breached its contract by rescinding coverage and failing to provide a 30-day notice of rescission, and (2) MMO rescinded coverage without reasonable justification, thereby acting in bad faith.

C. MMO’s Motion for Summary Judgment MMO moved for summary judgment on both claims made by the Tolanis, arguing that it had been entitled to rescind Ajit’s coverage. MMO attached to its motion numerous documents, the following of which are particularly relevant to this appeal.

1. The Policy

Ajit’s Policy had an enrollment period of one year, effective February 1, 2017. The Policy’s “Eligibility Requirements” stated, “In order to be eligible for this coverage, you must . . . maintain your primary legal residence in the Service Area and live there for at least six (6) months of each year.” The definition of “Service Area” included Cuyahoga County.

The Policy also addressed “Termination of Coverage,” stating, in part, that “[y]our coverage stops . . . [i]mmediately upon notice if” the policyholder “materially misrepresents information provided to Medical Mutual . . . .” The Policy established that MMO could rescind coverage, meaning “coverage may be legally voided all the way back to the day the plan began to provide you with coverage, just as if you never had coverage under the plan.” Per the Policy, “coverage can only be rescinded if you . . . make[] . . . an intentional misrepresentation of material fact, as prohibited by the terms of your plan.”

2. Recission Letter

MMO also provided the court a letter, dated March 2, 2017, which informed Ajit that MMO was rescinding his coverage (“Recission Letter” or the “Letter”). The Letter stated that “[e]ligibility for a Marketplace plan is specifically outlined in 45 C.F.R. § 155.305 ‘Eligibility Standards.’” According to the Letter, under these standards, “[a]n individual must intend to be in the service area of the plan for the entire period for which enrollment is sought” and “must intend to reside in the service area.” MMO had determined that Ajit did “not meet the residency requirement for a Marketplace plan” because his “only intent for being in the area is to receive medical care” and he “plan[ned] to leave the United States as soon as . . . care is complete, estimated to be within 2 to 9 months.”

The Letter then explained that, because of a “misrepresentation of material facts submitted to the Marketplace at the time of enrollment,” MMO was exercising its “right to rescind.” The Letter stated that recission meant to “cancel or discontinue coverage back to the original effective date of [the] policy as if the coverage never existed.” On March 31, 2017, “coverage [would] be terminated with a retroactive date of February 1, 2017, the date of your enrollment.”

3. Social Worker’s Note

Of particular relevance to MMO’s decision to rescind coverage is a note, dated January 11, 2017, which summarized a social worker’s psychosocial evaluation of Ajit (“Social Worker’s Note” or “the Note”). This evaluation was part of the Cleveland Clinic’s assessment of Ajit as a candidate for a lung transplant. The

Social Worker’s Note included information about Ajit’s relocation to the country, immigration status, and plans.

Per the Note, Ajit “came to US with his wife, their 9 yo daughter and his sister and uncle are staying here for the next two months.” The Note also said that Ajit was “prepared that he may have to be here for 9 months” and that he demonstrated “commitment to transplant time frame they expected was 9 months . . . .” As to Ajit’s “Resident Status,” the Note classified him as a “Non-U.S. Citizen/Non-U.S. Resident, Traveled to U.S. for Transplant.” As to what Ajit expected to do after treatment, the Note stated, “Any moves planned: no.”

4. B-2 Visa Extension Applications Several documents provided by MMO show that, after entering the United States, Ajit twice requested that United States Citizenship and Immigration Services (“USCIS”) extend his B-2 visa. Ajit’s visa was originally set to expire on June 22, 2017. The Tolanis submitted to USCIS an “Application to Extend / Change Nonimmigrant Status,” dated June 12, 2017. Another extension request, dated December 20, 2017, notes that USCIS granted the Tolanis’ first request until December 22, 2017.

5. HHS Notice

MMO also provided the court a notice from the United States Department of Health and Human Services (“HHS Notice”) that HHS appears to have sent to Ajit on December 27, 2016. The HHS Notice purports to approve Ajit to purchase health insurance using the ACA Exchange. The HHS Notice stated that

Ajit was “[e]ligible to purchase health coverage through the Marketplace” and provided “Next Steps,” including to “[c]hoose a health plan and make first month’s payment.” Under the header “What should I do next?” the HHS Notice invited Ajit to “[v]isit HealthCare.gov to compare plans side by side . . . .”

6. HHS FAQ

MMO also attached a list of “FAQs on the Marketplace Residency Requirement” that HHS appears to have issued. (“HHS FAQ” or “the FAQ”). The HHS FAQ states that “[f]or the purposes of § 155.305(a), ‘intends to reside’ means that an applicant has a present intent to reside where he or she is living, and intends to remain in the Exchange service area . . . .” The FAQ further provides that individuals “visiting an Exchange service area for a transitory purpose, for example . . . to obtain medical care . . . do not have a present intent to reside, and do not meet the residency requirement for Marketplace Coverage . . . .”

7. Ajit’s Deposition

MMO provided Ajit’s deposition in which MMO extensively questioned Ajit, including the following:

Q: [Y]ou intended to stay in the United States when you came in December of 2016, correct?

A: That’s right.

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Tolani v. Med. Mut. of Ohio, 2025 Ohio 5624 (Ohio Ct. App. 2025).

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