Barnes

Susan Barnes appeals from the district court’s grant of summary judgment in favor of Independent Automobile Dealers Association of California Health & Welfare Benefit Plan (“the Plan”). The district court found that the subrogation clause in the Plan’s benefit agreement prevented Barnes from recovering for medical expenses. We conclude that Barnes is entitled to recover for medical expenses and remand for entry of summary judgment in her favor.

FACTS

Susan Barnes was an employee beneficiary of the Plan, a self-funded employee medical benefit program. The Plan entitled Barnes to payment of medical bills incurred as the result of an accident.

In October 1990, Barnes’ car was hit from behind by a car driven by Catherine Clark. Clark disputed liability. Barnes underwent back surgery two months later, incurring medical bills totalling $23,075.40. As a result of the accident, Barnes lost time from work and incurred substantial pain and suffering. Barnes’ automobile insurance policy provided for $5000 in medical payments.

Barnes sued Clark in California state court in January 1991, including a damage claim for medical bills. In February, Barnes submitted an accident claim form to the…