Philamcare Health Systems, Inc. vs Court of Appeals of the fact that they are voiding the agreement.

are voiding the agreement. Therefore, Philamcare

should pay the expenses paid by Julita.
FACTS:
In 1988, Ernani Trinos applied for a health care insurance
under the Philamcare Health Systems, Inc. He was asked if he was
ever treated for high blood, heart trouble, diabetes, cancer, liver
disease, asthma, or peptic ulcer; he answered no. His application was
approved and it was effective for one year. His coverage was
subsequently renewed twice for one year each. While the coverage
was still in force in 1990, Ernani suffered a heart attack for which he
was hospitalized. The cost of the hospitalization amounted to
P76,000.00. Julita Trinos, wife of Ernani, filed a claim before
Philamcare for the latter to pay the hospitalization cost. Philamcare
refused to pay as it alleged that Ernani failed to disclose the fact that
he was diabetic, hypertensive, and asthmatic. Julita ended up paying
the hospital expenses. Ernani eventually died. In July 1990, Julita
sued Philamcare for damages. Philamcare alleged that the health
coverage is not an insurance contract; that the concealment made by
Ernani voided the agreement.
ISSUE:
Whether or not Philamcare can avoid the health coverage
agreement.
HELD:
No. The health coverage agreement (health care agreement)
entered upon by Ernani with Philamcare is a non-life insurance
contract and is covered by the Insurance Law. It is primarily a contract
of indemnity. Once the member incurs hospital, medical or any other
expense arising from sickness, injury or other stipulated contingent,
the health care provider must pay for the same to the extent agreed
upon under the contract. There is no concealment on the part of
Ernani. He answered the question with good faith. He was not a
medical doctor hence his statement in answering the question asked
of him when he was applying is an opinion rather than a fact. Answers
made in good faith will not void the policy.
Further, Philamcare, in believing there was concealment, should have
taken the necessary steps to void the health coverage agreement prior
to the filing of the suit by Julita. Philamcare never gave notice to Julita