IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT _______________
No. 95-50512 _______________
UNITED SERVICES AUTOMOBILE ASSOCIATION,
Plaintiff-Appellee,
VERSUS
WILLIAM J. PERRY, Secretary of United States Department of Defense, and UNITED STATES OF AMERICA,
Defendants-Appellants.
Appeal from the United States District Court for the Western District of Texas
December 13, 1996
Before SMITH, DUHÉ, and DeMOSS, Circuit Judges.
PER CURIAM:
The opinion originally issued in this case, 92 F.3d 295 (5th
Cir. 1996) (per curiam), is hereby withdrawn, and the following
opinion is substituted for purposes of clarification:
In this case of first impression, we are called upon to
interpret the meaning of Congress’s 1990 amendment to 10 U.S.C. § 1095 (Supp. 1995), which allows the military to be reimbursed by
insurance carriers for medical expenses it incurs in treating
soldiers whom the carriers insure. We determine that the term
“no-fault insurance carrier,” as it appears in the statute, is
ambiguous. We therefore defer to the interpretation of that term
by the agency entitled to administer the statute, the Department of
Defense (“DOD”), reverse the summary judgment in favor of United
Services Automobile Association (“USAA”), and render summary
judgment for the government.1
I.
This case arises from twelve separate automobile accidents2
involving members of the military who were entitled to receive and
did receive medical care in a military hospital and who were also
insured by USAA. The service members were treated for their
injuries at military hospitals at no cost to the soldiers.
10 U.S.C. §§ 1074, 1076 (Supp. 1995). Each soldier had an
individually-owned automobile insurance policy issued by USAA that
contained liability coverage, uninsured motorist coverage, coverage
for damage to the insured’s vehicle and medical payments coverage
1 The defendants-appellants in this action are William J. Perry, Secretary of Defense, and the United States of America. Both parties will collectively be referred to as the “government.” 2 It would appear that all of these accidents occurred in states which have retained tort theories as the basis for recovery for injuries in automobile accidents and have not adopted a comprehensive scheme of “no-fault insurance” for dealing with injuries arising out of automobile accidents. It would also appear that these accidents occurred after 1990.
2 (“Medpay”), which covered the insureds for medical costs arising
from automobile accidents.
The government filed claims with USAA, seeking reimbursement
for costs incurred in treating USAA’s insureds. The government
based its claim on 10 U.S.C. § 1095(a)(1), which provides that “the
United States shall have the right to collect from a third-party
payer the reasonable costs of health care services incurred by the
United States on behalf of such person through a [military
hospital]. . . .” The statute defines a “third-party payer” as “an
entity that provides an insurance, medical service, or health plan
by contract or agreement, including an automobile liability
insurance or no-fault insurance carrier.” § 1095(h)(1).
USAA refused to pay, and instead filed a declaratory judgment
action against the government, seeking a determination that it did
not owe reimbursement. Specifically, USAA sought a determination
that it was not a third-party payer under § 1095.
The parties stipulated that there were no disputed facts and
filed cross-motions for summary judgment. The district court ruled
in USAA’s favor, holding that Medpay is not no-fault insurance and
USAA is therefore not a third-party payer liable to the government
under § 1095. The government timely appealed.
II.
The government contends that USAA is a “third-party payer”
3 under § 1095, required to reimburse the government for health care
the military provides its insureds. We must determine whether USAA
is a “third-party payer” because of the inclusion of its Medpay
coverage in its automobile policy.
Before 1990, § 1095 defined “third-party payer” as “an entity
that provides insurance, medical service or health plan by contract
or agreement.” Congress amended the statute in 1990, adding the
words “including an automobile liability insurance or no-fault
insurance carrier.” The government and USAA have already litigated
the issue of whether USAA is a third-party payer because of Medpay
under § 1095 as it was prior to 1990. In United States v. USAA,
5 F.3d 204 (7th Cir. 1993), the court held that USAA was not such
a third-party payer.
We are, of course, not bound by the Seventh Circuit’s
decision. Principles of estoppel, however, preclude the government
from re-litigating against the same party an issue upon which
another circuit has ruled against the government. United States v.
Stauffer Chem. Co., 464 U.S. 165, 171 (1984). Thus, if the
government is to prevail in its view that USAA is now a third-party
payer, it must do so under the 1990 amendments.3 We must, there-
fore, determine whether USAA is an “automobile liability insurance
or no-fault insurance carrier.”
3 We take no position as to whether the prior case against USAA was decided correctly. We merely conclude that, because the parties and the issues are the same, the government is precluded from arguing that USAA was a “third-party payer” under the pre-1990 version of the statute.
4 We conclude that USAA is a no-fault insurance carrier because
Medpay is a form of no-fault insurance. DOD is entrusted to
administer § 1095, and it has issued regulations interpreting the
term “no-fault insurance” as
an insurance contract providing compensation for health and medical expenses relating to personal injury arising from the operation of a motor vehicle in which the compensation is not premised on who may have been responsible for causing such injury. No-fault insurance includes personal injury protection and medical payments benefits in cases involving personal injuries resulting from operation of a motor vehicle.
32 C.F.R. § 220.12(I) (1995). USAA urges us to reject this
definition, arguing that “no-fault insurance” refers only to a
state-adopted regime of automobile insurance that pays without
regard to fault.
When an agency has issued an interpretation of a statute it is
entitled to administer, our own interpretation of the statute is
not entirely de novo. The Supreme Court has given us guidance, in
Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc.,
467 U.S. 837, 842-43 (1984), in reviewing such agency regulations:
When a court reviews an agency’s construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction, as would be necessary in the absence of administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the
5 question for the court is whether the agency’s answer is based on a permissible construction of the statute. [Footnotes omitted.]
Accordingly, our first task is to apply the “traditional tools
of statutory construction,” id. at 843 n.9, and determine whether
the statute is ambiguous. If we decide that Congress has spoken
directly to the precise issue, our job is done; we will “give
effect to the unambiguously expressed intent of Congress.” Id.
at 843. If, however, we find that Congress has not spoken plainly
to the issue and the statute is ambiguous, we then will determine
whether the agency’s construction of the statute is a permissible
one.
A statute is ambiguous if it is susceptible of more than one
accepted meaning. See MCI Telecommunications Corp. v. American
Tel. & Tel. Co., 512 U.S. 218, ___, 114 S. Ct. 2223, 2230 (1994);
National R.R. Passenger Corp. v. Boston & Maine Corp., 503 U.S.
407, 418-19 (1992); see also NORMAN J. SINGER, 2A SUTHERLAND STATUTORY
CONSTRUCTION § 45.02 (5th ed. 1992). In interpreting a statute, we
begin with its plain language. White v. INS, 75 F.3d 213, 215 (5th
Cir. 1996); Phillips v. Marine Concrete Structures, Inc., 895 F.2d
1033, 1035 (5th Cir. 1990). Our attempt to ascertain plain meaning
requires us to look not only to “the particular statutory language
at issue,” but also to “the language and design of the statute as
a whole.” K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291 (1988)
(citing Bethesda Hosp. Ass'n v. Bowen, 485 U.S. 399, 403-05 (1988);
6 Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 220-21
(1986)). It is only when traditional methods of statutory
construction fail to reveal a provision’s meaning that we conclude
that it is ambiguous. Chevron, 467 U.S. at 843 & n.9.
At first glance, either USAA’s or the government’s interpreta-
tion of § 1095 seems plausible. Recourse to dictionaries does not
clarify the issue but only serves to prove that the term “no-fault
insurance carrier” is ambiguous. One authority defines no-fault as
“[o]f or indicating a system of automotive insurance in which
accident victims are compensated by their insurance companies
without assignment of blame.” WEBSTER’S II NEW RIVERSIDE UNIVERSITY
DICTIONARY 797 (1988). This definition supports USAA’s position, as
it considers “no-fault” as referring to a system of insurance.
Another source supports the government’s view by defining “no-
fault” as “of, or relating to, or being a motor vehicle insurance
plan under which an accident victim is compensated . . . by his own
insurance company regardless of who is responsible for the
accident.” WEBSTER’S NINTH NEW COLLEGIATE DICTIONARY 801 (1989).
Both parties can (and do) claim assistance from a third
reference, which defines “no-fault auto insurance” as the
[t]ype of automobile insurance in which claims for personal injury . . . are made against the claimant's own insurance company (no matter who was at fault) rather than against the insurer of the party at fault. Under such state 'no-fault' statutes only in cases of serious personal injuries and high medical costs may the injured bring an action against the other party or his insurer. No-fault statutes vary from state to state in terms of
7 scope of coverage, threshold amounts, etc.
BLACK’S LAW DICTIONARY 723 (5th ed. 1979). Still another authority
defines “no-fault” as “designat[ing] a form of motor vehicle
insurance.” OXFORD ENGLISH DICTIONARY 462 (2d ed. 1989). In its
examples of usage, however, it leans toward USAA’s definition. Id.
at 462 (“[A] no-fault compensation system in being discussed
. . . . [a] strong no-fault insurance bill.”). A final source
lends credence to the government’s position, defining “no-fault” as
“a form of automobile insurance enabling the policyholder in case
of an accident to collect a certain basic compensation . . . from
his own insurance company without determination of liability.”
RANDOM HOUSE COLLEGE DICTIONARY 902 (1982).
Based on this review of definitions of “no-fault,” we
determine that the word is commonly used in both ways, to denote
either (1) an insurance policy or (2) a state-imposed insurance
system that pays regardless of fault. Thus, the “battle of the
dictionaries” does not resolve the ambiguity.
Because “no-fault” is an insurance term and can be a term of
art, we also consider how the word is used in the insurance field.
A leading insurance treatise uses “no-fault” to refer to a state
system of insurance without regard to fault. 12A COUCH ON INSURANCE
§§ 45:661-678 (2d ed. 1981); see also R. LONG, THE LAW OF LIABILITY
INSURANCE § 27.01 at 27-3 (1994). Another treatise, however, refers
to insurance policies paying without regard to fault as “nonfault
8 insurance.” ROBERT E. KEETON, BASIC TEXT OF INSURANCE LAW, § 4.10 at 246
(1971). Therefore, we can see that while “no-fault” is more
commonly used in the insurance area to mean a state system paying
regardless of fault, it can also be used to refer to a policy that
pays regardless of fault.
This analysis leads us to conclude that, as used in § 1095,
the term “no-fault insurance” is susceptible of two distinct
meanings. Moreover, a review of the design of the statute as a
whole, as well as of its relationship with other laws, does not
clarify its meaning. Therefore, the statute is ambiguous.4 Cf.
MCI Telecommunications, 512 U.S. at ___, 114 S. Ct. at 2230 (“Most
cases of verbal ambiguity in statutes involve . . . a selection
between accepted alternative meanings shown as such by many
dictionaries.”). As Congress has not “directly addressed the
precise question at issue” here, it remains for us to determine
4 The dissent concludes that the statute’s legislative history renders the term “no-fault insurance” unambiguous, although it concedes that the text of the statute is ambiguous. It is a rare case indeed in which legislative history alone will permit us to find that “Congress has . . . directly addressed the precise question at issue.” Chevron, 467 U.S. at 843. This is not such a case. The dissent acknowledges that the committee reports of the House and Senate merely restate the text of the amendment. See H. REP. No. 923, 101st Cong., 2d Sess., reprinted at 1990 U.S.C.C.A.N. 3110; H. REP. No. 665, 101st Cong., 2d Sess., reprinted at 1990 U.S.C.C.A.N. 2931; S. REP. No. 521, 101st Cong., 2d Sess.
The “legislative history” relied upon by the dissent is not really legislative history at all, but a general background history of the statute drawn from non- legislative sources. This is an even less reliable basis than legislative history from which to conclude that a statute, ambiguous on its face, is unambiguous in fact. Indeed, we conclude from the general background history of § 1095 that the purpose of the statute is to prevent a windfall to insurers who happen to be liable to members of the armed forces, and that purpose is furthered by DOD’s interpretation of the statute. In any event, we respectfully do not believe that the dissent’s sources are adequate to allow us to find that “Congress has directly addressed the precise question at issue.”
9 whether DOD’s construction of that term is a permissible one.
Chevron, 467 U.S. at 843. We have no difficulty concluding that it
is. DOD’s construction is consistent with the language of the
statute, dictionaries, and insurance treatises. It is not, of
course, the only permissible construction, but it is one permissi-
ble construction, and that is enough. We are Chevron-bound to
conclude that Medpay is a form of no-fault insurance within the
meaning of § 1095, and USAA is liable to the government for
reimbursement of medical expenses.
The judgment is REVERSED, and summary judgment is RENDERED for
the government on the cross-motion for summary judgment.
ENDRECORD
10 DeMOSS, Circuit Judge, dissenting:
I agree with the majority that the controlling issue in
this case is “whether USAA is an ‘automobile liability insurance5
or no-fault insurance carrier.’” Majority Opinion at 4. I,
however, come to a different conclusion than that reached by the
majority.
5 Finding that Medpay is no-fault insurance, the majority does not address the issue of whether USAA is a third-party payer because it is “an automobile liability insurance . . . carrier.” I would hold that, for 10 U.S.C. § 1095 purposes, USAA is not an automobile liability insurance carrier and, thus, not a third-party payer.
According to Department of Defense regulations, “automobile liability insurance” is “insurance against legal liability for health and medical expenses resulting from personal injuries arising from operation of a motor vehicle.” 32 CFR § 220.12(a) (1993). This liability coverage protects the insured from liability for injuries sustained by third parties in automobile accidents involving the insured as operator of the insured’s automobile. Medpay, on the other hand, is coverage that provides medical benefits for the insured when she is injured in an accident. It is not insurance against legal liability. Therefore, the Medpay coverage in the USAA’s policy is not automobile liability insurance.
The government contends that § 1095 imposes liability for reimbursement on any company which provides automobile liability insurance, regardless of whether the policy in question is automobile liability insurance. It is undisputed that USAA provides automobile liability insurance, and thus could be considered, in a general sense, an automobile liability insurance carrier. I do not read § 1095 as expansively as the government. I do not read § 1095 as imposing a duty to reimburse on either a liability insurance carrier or a no-fault insurance carrier simply because the insurer issues those types of policies to other insureds; rather I read the statute as applying to the particular carrier who has issued a specific policy to an individual who is both an “insured” under such policy and is also simultaneously “a covered beneficiary” entitled to medical care in a military facility as contemplated by § 1095. The right of reimbursement, if any, in favor of the government is dependent upon the terms and provisions of a particular policy. I read 10 U.S.C. § 1095, influenced by the legislative
history, to clearly and unambiguously state that medical payment
plans such as Medpay are not no-fault insurance. The legislative
history makes clear that Congress used the phrase “no-fault
insurance” to refer to state adopted systems of automobile
insurance that pay regardless of fault. Congress did not use the
term to describe any automobile insurance policy that contains one
aspect of coverage which pays without regard to fault. Because
Congress has clearly spoken to the issue, we must “give effect to
the unambiguously expressed intent of Congress.” Chevron, U.S.A.
v. Natural Resources Defense Counsel, 467 U.S. 837, 843 (1984). I
would hold that Medpay is not no-fault insurance and USAA is not a
third-party payer under § 1095. Accordingly, I respectfully
dissent from the majority’s opinion.
The government argues that, under the regulations, USAA
is a no-fault insurance carrier with respect to Medpay. No-fault
insurance, the government maintains, is any insurance policy which
pays regardless of fault. Department of Defense regulations define
“no-fault insurance” as:
an insurance contract providing compensa- tion for health and medical expenses relating to personal injury arising from the operation of a motor vehicle in which the compensation is not premised on who may have been responsible for causing such injury. No-fault insurance includes personal injury protection and medical
12 payments benefits in cases involving personal injuries resulting from opera- tion of a motor vehicle.
32 CFR § 220.12(I). USAA argues that the regulations are incor-
rect. USAA contends that no-fault insurance in § 1095 refers to a
state adopted regime of automobile insurance that pays without
regard to fault. It is the second sentence of this regulation
which is the critical issue in this case.
The Supreme Court has given us guidance in reviewing
agency regulations which interpret statutes. Chevron, 467 U.S.
837. “[T]he Supreme Court established a two-step method for
judicial review of an agency’s interpretation of a statute that it
administers.” Mississippi Poultry Ass’n, Inc. v. Madigan, 31 F.3d
293, 299 (5th Cir. 1994) (en banc). The court first must use the
“traditional tools of statutory construction” to determine “whether
Congress has directly spoken to the precise question at issue.”
Chevron, 467 U.S. at 842-43 & n.9 (1984). If so, the court and the
agency “must give effect to the unambiguously expressed intent of
Congress.” Id. at 842-43. However, “[i]f the statute is silent or
ambiguous” on the particular issue, the court must determine
“whether the agency’s answer is based on a permissible construction
of the statute.” Id. at 843.
“In determining whether Congress has directly spoken to
the issue, the court may consider not only the plain meaning of the
statute, but also any pertinent legislative history.” Doyle v.
13 Shalala, 62 F.3d 740, 745 (5th Cir. 1995) (citing Chevron, 467 U.S.
at 845). The Supreme Court has made clear that the judiciary
retains its right “to say ‘what the law is,’ that is, to interpret
statutes.” Mississippi Poultry, 31 F.3d at 299 (quoting Chevron,
467 U.S. at 843 n.9).
Accordingly, our first task is to determine whether the
statute is ambiguous. If we determine that Congress has spoken to
the issue, then our job is done; we will “give effect to the
unambiguously expressed intent of Congress.” Chevron, 467 U.S. at
843. If, however, we find that Congress has not clearly spoken to
the issue and the statute is ambiguous on its face, we then will
look to legislative history to clarify the purpose. If legislative
history is ambiguous, we will defer to the agency’s interpretation
if it is “based on a permissible construction of the statute.” Id.
at 843.
I agree with the majority that the statute is susceptible
to more than one reasonable meaning and, thus, is ambiguous on its
face. Therefore, we must consider the legislative history of the
1990 amendment. The committee reports of the House and Senate
provide no additional guidance, as they merely restate the text of
the amendment. See H. REP. No. 923, 101st Cong., 2d Sess.,
reprinted at 1990 U.S.C.C.A.N. 3110; H. REP. No. 665, 101st Cong.,
2d Sess., reprinted at 1990 U.S.C.C.A.N. 2931; S. REP. No. 521,
14 101st Cong., 2d Sess.
In construing an amendment to a statute, however, it is
important to understand the reason behind the amendment, or, as the
Second Circuit has explained it, the “mischief” Congress sought to
remedy with the amendment. United States v. Clemente, 608 F.2d 76,
79 (2d Cir. 1979) (“The amendment must be interpreted in terms of
the mischief it was intended to rectify.”) (citing In re Letters
Rogatory, 385 F.2d 1017, 1020 (2d Cir. 1967)); 2A SUTHERLAND STATUTORY
CONSTRUCTION § 45.09. A review of the history of the military’s
attempts to collect from third-parties in general, and of § 1095 in
particular, clarifies Congress’ intent. After such a review, it is
apparent that the problem Congress was trying to remedy was the
thwarting of the military’s collection efforts caused by the
passage of no-fault automobile insurance systems in many states.
Members of the United States military and their depend-
ents are entitled to free medical care in military hospitals. 10
U.S.C. §§ 1074, 1076. Occasionally a service member will be
injured due to the fault of another (often in an automobile
accident) and the soldier will be treated in a military hospital.
During World War II the military began seeking reimbursement from
tort-feasors for the cost of treating injured soldiers. The
authority for these actions was Army Regulation 25-220. See Capt.
Dominique Dillenseger and Capt. Milo H. Hawley, Sources of Medical
Care Recovery in Automobile Accident Cases, ARMY LAW. 50, 51
15 (October 1991) (hereinafter, “Medical Care Recovery”). The
military continued to bring such claims until 1947 when the Supreme
Court held that the federal government could not impose liability
on tort-feasors who injure soldiers because Congress had not passed
legislation authorizing the government to do so. United States v.
Standard Oil of California, 332 U.S. 301, 315-16 (1947).
For 15 years Congress declined the Court’s invitation to
create liability for tort-feasors injuring soldiers. In 1960,
however, a Comptroller General report revealed that the United
States was losing significant sums of money due to unreimbursed
healthcare expenditures provided to injured soldiers. COMPTROLLER
GENERAL OF THE UNITED STATES, REVIEW OF THE GOVERNMENT’S RIGHTS AND PRACTICES
CONCERNING RECOVERY OF THE COST OF HOSPITAL AND MEDICAL SERVICES IN NEGLIGENT
THIRD PARTY CASES (1960) (cited in Medical Care Recovery at 51).
Responding to the report, Congress in 1962 passed the Federal
Medical Care Recovery Act (“FMCRA”), 42 U.S.C. § 2651, et seq. The
FMCRA allows the government to recover from tort-feasors for
medical expenses it provides to service members. The FMCRA allows
recovery when the injury occurs “under circumstances creating a
tort liability upon some third person.” 42 U.S.C. § 2651(a). The
law of the state where the injury takes place determines whether a
tort has occurred. Medical Care Recovery at 51.6
6 In some circumstances, the government can also recover under state law as a third-party beneficiary to the insurance contract. (continued...)
16 Because tort liability is required for FMCRA recovery,
the government could not recover in states which adopted no-fault
automobile insurance laws. In states where no-fault automobile
insurance laws have been adopted,7 there is no tort liability for
injuries sustained in automobile accidents. Instead, all individu-
als have insurance which pays regardless of who is at fault. 12A
Couch on Insurance § 45:661, at 245-46 (2d ed. 1981).8
In 1990 the General Accounting Office (GAO) provided a report
to Congress.9 GAO, MILITARY HEALTH CARE: RECOVERY OF MEDICAL COSTS FROM
LIABLE THIRD PARTIES CAN BE IMPROVED, GA1.13:NS1AD-40-49 (April 1990)
(hereinafter, the “GAO report”). The GAO report noted that since
the passage of the FMCRA:
[S]ome states have . . . passed no-fault insurance laws that generally allow for
(...continued) See, e.g., United States v. Allstate Ins. Co., 910 F.2d 1281, 1283- 84 (5th Cir. 1990). This is separate from the FMCRA and § 1095. United States v. State Farm Mutual Automobile Ins. Co., 936 F.2d 206, 209 (5th Cir. 1991). Neither party raises this issue, so we do not address it. 7 In 1990, 21 states, the District of Columbia and Puerto Rico had some version of no-fault insurance applicable to automobile collision injuries. 8 Medical payment coverages (such as Medpay) differ from policies under no-fault insurance systems in two key respects. First, Medpay is not required by statute; it is a voluntary add-on. Second, Medpay does not alter tort liability; it merely compensates the insured for any medical expenses he has incurred due to an automobile accident. 9 Specifically, the report was addressed to the Chairman, Subcommittee on Readiness, Committee on Armed Services, House of Representatives.
17 recovery by individuals from their own insurance companies irrespective of fault. Since no-fault laws by definition do not establish an at-fault or liable party, [the government’s] legal ability to conduct recoveries under [the FMCRA] varies according to the no-fault statutes in these states.
GAO report at 4. The GAO report recommended “that the Congress
enact legislation to enable recovery by the government in states
with no-fault automobile insurance laws.”10 Id.
The Department of Defense (“DOD”), when it promulgated
its regulations to amended § 1095, recognized that the GAO report
was what prompted Congress to amend § 1095 to include no-fault
insurance carriers. 57 Fed. Reg. 41096 (1992) (“based on the GAO
report, Congress supplemented current legal authority to collect in
tort liability cases with new authority to also collect from no-
fault insurance carriers”).11
10 I recognize that the majority does not consider my discussion of the GAO report to be legitimate legislative history because it is not a committee report or a statement from a congressman. Majority Opinion at 8 n.4. I do not share the majority’s narrow view of legislative history. I consider quite instructive the agency report which, all parties agree, provided the impetus for Congress to act. A leading treatise on statutory construction notes that reports of non-legislative committees or commissions suggesting particular legislation “are considered valuable aids.” SUTHERLAND STATUTORY CONSTRUCTION § 48.11 at 347. I consider the report of the GAO suggesting legislation to be similarly helpful. 11 It appears, however, that the DOD misinterpreted the GAO report. The DOD described the GAO report as “recommend[ing] expanding [the government’s] authority to cover no-fault automobile insurance policies. . . .” 57 Fed. Reg. at 41096 (emphasis added). (continued...)
18 Thus, we see that Congress (1) was given a report
detailing problems with collecting reimbursements in states with
no-fault insurance systems; (2) was given a recommendation that the
law be changed to allow the government to obtain reimbursements in
states with no-fault insurance systems; and (3) then passed a law
providing that the government can collect from “no fault insurance
carriers.” Based on these facts, it is clear that by the phrase
“no fault insurance carriers,” Congress meant insurance companies
providing coverage in states with no-fault systems of automobile
insurance. Congress was not referring to insurance companies
providing automobile liability policies which contain coverages
that pay regardless of fault. I found nothing in the legislative
history which refers to the “medpay” coverage involved in the
policies in this case.
In passing the 1990 amendments to § 1095, Congress
provided that “[i]n cases in which tort liability is created upon
some third person, collection from a third-party payer that is an
automobile liability insurance carrier shall be governed by the
provisions of [the FMCRA].” 10 U.S.C. § 1095(i)(2). Stated
differently, when a third-party tortiously injures a service member
in a state which uses traditional tort liability, the government
(...continued) The GAO report did not refer to insurance policies, but instead recommended that “Congress enact legislation to enable recovery by the government in states with no-fault automobile insurance laws.” GAO report at 4 (emphasis added).
19 must recover through the FMCRA, rather than § 1095. This provision
shows that Congress was concerned with state systems of fault or
no-fault based insurance, rather than with individual insurance
plans. The fact that Congress was concerned with state insurance
systems in § 1095(i)(2) is further evidence that Congress was
referring to state systems of insurance when it used the term “no
fault insurance carrier” in § 1095(h)(1).
Additional evidence that Congress was referring to no-
fault systems when it amended § 1095 is found in a 1991 technical
amendment to the statute. Section 1095(i)(2) originally provided
that “[i]n cases in which tort liability is created upon some third
person, collection from a third-party that is an automobile
liability or no fault insurance carrier shall be governed by the
[FMCRA].” (Emphasis added). Congress quickly realized that the
language “or no fault insurance” was out of place in a section
concerning tort liability, so the phrase was deleted. Pub.L. 102-
190, § 714. The House Report makes clear that this change is a
“technical amendment” and that no substantive change is intended.
H.Rep. No. 60, § 717, reprinted in 1991 U.S.C.C.A.N. 918, 971.
Section 1095(i)(2) concerns states which have retained traditional
tort liability.12 If the term “no fault insurance carrier” refers
to particular policies, then it would properly be included in §
12 As discussed above, in a state with a no-fault system there is no tort liability, so the situation described in § 1095(i)(2) (the creation of tort liability upon a third party) will not occur.
20 1095(i)(2), as there can be no-fault coverages in auto liability
policies when there is tort liability.13 If, however, “no fault
insurance carrier” refers to systems, then it is out of place in a
section discussing tort liability.
Based on the foregoing, it is apparent that the harm
Congress sought to remedy with its 1990 amendments to § 1095 was
the government’s inability to get reimbursement for medical
payments in states with no-fault insurance systems. Considering
the legislative history and the 1991 technical amendments, I find
that § 1095 is not ambiguous. Congress clearly intended “no fault
insurance carrier” to refer to state systems that have eliminated
tort as a theory of recovery and substituted insurance requirements
that pay without regard to fault. Congress has clearly spoken to
the issue, and we, as well the executive branch, must defer to
Congress. Mississippi Poultry, 31 F.3d at 299 (“core democratic
principle of congressional primacy” requires that we defer to
Congress’ clearly expressed intent). Therefore, I would not follow
the Department of Defense regulation defining no-fault insurance,
32 CFR §220.12(I), because it is contrary to Congress’ clearly
expressed intent.
13 For example, the tort-feasor could have insufficient insurance, so the no-fault policy would be needed to cover the medical expenses.
21 III.
Medpay is not no-fault insurance. Therefore, USAA is not
a “third-party payer” under § 1095 and, thus, is not required to
reimburse the government for the medical expenses that the
government incurred. I would affirm the district court’s grant of
summary judgment in favor of USAA and, therefore, I respectfully
dissent.