## Facts

- Zella Milburn bought a long-term care insurance policy issued by Life Investors Insurance Company of America (LIICA).
- The policy paid benefits for confinement in a covered “nursing facility,” described as a facility licensed to primarily provide nursing care to in-patient residents and providing 24-hour skilled nursing services comparable to a licensed nursing home.
- Milburn moved into The Village on Lee, a licensed assisted-living facility in Oklahoma.
- The Village provided daily personal-care services, medication assistance, and unscheduled, intermittent nursing care, but not continuous 24-hour skilled nursing care.
- Milburn submitted a claim for benefits based on her stay at the Village, and LIICA denied the claim on the ground that an assisted-living facility did not meet the policy’s nursing-facility requirements.
- The federal district court granted partial summary judgment to Milburn on the coverage issue and entered final judgment awarding benefits.
- LIICA appealed.

## Issues

1. Whether a licensed assisted-living facility providing intermittent nursing care qualifies as a covered “nursing facility” under a long-term care policy requiring licensing to primarily provide nursing care and 24-hour skilled nursing services.
2. Whether the policy’s nursing-facility coverage language is ambiguous under Oklahoma law such that it must be construed in favor of coverage.

## Decision

- The Tenth Circuit reversed the grant of partial summary judgment and the resulting final judgment for Milburn.
- The court held the Village did not satisfy the policy’s licensing and 24-hour skilled nursing requirements and therefore was not a covered “nursing facility.”
- The court concluded the relevant policy language was unambiguous and enforceable as written.
- The case was remanded for further proceedings consistent with the appellate ruling.

## Legal Principles

- Under Oklahoma law, insurance policies are interpreted according to the plain, ordinary meaning of their terms when unambiguous.
- A policy term is ambiguous only if it is reasonably susceptible to more than one construction; courts may not use strained readings to manufacture ambiguity.
- Contra proferentem (construction against the insurer) applies only after a finding of ambiguity.
- Where coverage depends on facility licensure and level of nursing services, courts may look to the state licensing framework to determine whether the facility meets the policy’s stated requirements.

## Conclusion

The court enforced the policy’s express limitation to facilities licensed to primarily provide nursing care and offering 24-hour skilled nursing, holding that an assisted-living facility providing intermittent nursing services did not qualify for long-term care benefits.


Milburn v. Life Invs. Ins. Co. of Am., 511 F.3d 1285 (10th Cir. 2008)