MEDICAL SERVICES EXCLUSION PRECLUDES COVERAGE

In LCS Corrections Services, Inc. v. Lexington Insurance Company, No. 14-40494 (5^th Cir. 9/2/2015), the court concluded that Lexington was not required to defend LCS if the allegations in the complaint fell within the meaning of subpart (a) of the medical services exclusion.  Relevant here, the medical services exclusion denied coverage of “any liability of the Insured arising out of the . . . failure to render ‘Medical Services.’”  Thus, the court looked to whether the injury related to the failure to render “medical services” where “services” are defined as “medical, surgical, dental or nursing treatment.”  Although LCS argued that Garcia died as a result of LCS’s adhering to its administrative policy, and not from a failure to render medical services, the court found the distinction proved unavailing.  The court concluded that Garcia’s death was caused by the failure to provide a prescribed drug, which was a failure to render a professional service.  “It may be true that no professional decision was made in denying medicine”, but “providing and administering medicine to an inmate in a prison is a medical service, which LCS failed to render, for whatever reasons.  The court also concluded that there was no duty to indemnify for the same reasons that the court concluded there was no duty to defend – the medical services exclusion plainly excluded from coverage any liability that was based on the failure of LCS to render medical services, including the failure to provide medications, to inmates.