G.R. No. 164041 - Alba vs. Court of Appeals

Respondent Neomi T. Olivares applied for a health care program with petitioner Blue Cross Health Care, Inc., a health maintenance firm.
For coverage period October 16, 2002 to October 15, 2003, respondent paid P11,117, and an additional P1,000 for limitless consultations, fully paid on October 17, 2002.
The application was approved on October 22, 2002.
The health care agreement excluded ailments due to pre-existing conditions from coverage.

On November 30, 2002, 38 days after coverage started, respondent Neomi suffered a stroke and was confined at Medical City, an accredited hospital by petitioner.
Respondent incurred medical expenses amounting to P34,217.20 following hospitalization and laboratory tests.
Petitioner's representative refused to issue a letter of authorization for settlement of medical bills pending submission of a certification from Neomi’s attending physician, Dr. Edmundo Saniel, that the stroke was not caused by a pre-existing condition.
Respondent was discharged on December 3, 2002, but petitioner still refused payment. Respondents then settled the bills themselves on December 5, 2002.

On January 8, 2003, respondents filed a complaint for collection of sum of money against petitioner in the Metropolitan Trial Court (MeTC).
Petitioner, in its January 24, 2003 answer, claimed it was awaiting Dr. Saniel’s report and had not denied the claim.
Dr. Saniel, in a letter dated February 14, 2003, stated that due to patient-physician confidentiality and respondent Neomi’s explicit refusal, he would not release medical information without her approval.
On August 5, 2003, MeTC dismissed the complaint for lack of cause of action, relying on the absence of the required physician’s certification.
On February 2, 2004, the Regional Trial Court (RTC) reversed the MeTC, ordering petitioner to pay the P34,217.20 medical bill, P1,000 consultation fees, P20,000 moral damages, P20,000 exemplary damages, P20,000 attorney’s fees, and costs of suit. The RTC held that petitioner bore the burden of proving the stroke was due to a pre-existing condition and failed to do so.
Petitioner filed a petition for review with the Court of Appeals (CA), which affirmed the RTC decision on July 29, 2005, and denied reconsideration on September 21, 2005.
Petitioner elevated the case to the Supreme Court via a petition for review on certiorari under Rule 45 of the Rules of Court.

The health care agreement defined “pre-existing condition” as “a disability which existed before the commencement date of membership whose natural history can be clinically determined, whether or not the Member was aware of such illness or condition.”
The agreement listed specific conditions constituting pre-existing conditions (e.g., tumors, cardiovascular diseases, diabetes mellitus, hypertension, etc.) and excluded their complications occurring within the first year of coverage.
After continuous 12 months of coverage, the pre-existing condition exclusion would no longer apply except for specific illnesses excluded by endorsement.

Whether petitioner proved that respondent Neomi’s stroke was caused by a pre-existing condition and was therefore excluded from coverage under the health care agreement.
Whether petitioner is liable for moral damages, exemplary damages, and attorney’s fees.