Moody v. Oscar Insurance Company

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
LAUREN MOODY, §
§
Plaintiff, §
§
v. § CIVIL ACTION NO. H-25-2577
§
OSCAR INSURANCE COMPANY, §
§
Defendant. §
MEMORANDUM OPINION AND ORDER
Plaintiff, Lauren Mood (“Moody” or “Plaintiff”), individually
and on behalf of all others similarly situated, brings this action
against defendant, Oscar Insurance Company (“Oscar” or
“Defendant”), asserting causes of action for breach of non-ERISA
medical insurance policies issued or renewed in Texas on or after
January 1, 2022 (Count I), violation of Texas Insurance Code
§ 542.058(a) for non-payment or under payment of a claim
(Count II), and violation of Texas Insurance Code
§ 541.060(a)(2)(a) for failing to attempt in good faith to
effectuate a prompt, fair and equitable settlement of a claim with
respect to which its liability had become reasonably clear
(Count III).1 Pending before the court is Defendant Oscar
Insurance Company’s Motion to Dismiss Complaint which has been
converted to a Motion for Summary Judgment (“Oscar’s MSJ”) (Docket
1Plaintiff’s Original Class Action Complaint, Docket Entry
No. 1 (“Plaintiffs’ Complaint”), pp. 15-19. All page numbers for
docket entries refer to the pagination inserted at the top of the
page by the court’s electronic filing system, CM/ECF.
United States District Court
Southern District of Texas
ENTERED
February 09, 2026
Nathan Ochsner, Clerk
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Entry No. 17) with respect to Counts I and II of Plaintiff’s
Complaint, and carried with respect to Count III.2 Also pending
are Plaintiff Lauren Moody’s Supplemental Brief in Support of Her
Response to Defendant Oscar Insurance Company’s Motion for Summary
Judgment (“Moody’s First Supplemental Brief”) (Docket Entry
No. 25), Defendant’s Supplemental Brief in Support of Motion to
Dismiss Converted to a Motion for Summary Judgment (“Oscar’s First
Supplemental Brief”) (Docket Entry No. 26), Plaintiff Lauren
Moody’s Response, and Brief in Support, to Defendant’s Supplemental
Brief in Support of Motion to Dismiss Converted to a Motion for
Summary Judgment (“Moody’s Second Supplemental Brief”) (Docket
Entry No. 32), and Supplemental Brief in Support of Defendant Oscar
Insurance Company’s Motion for Summary Judgment (“Oscar’s Second
Supplemental Brief”) (Docket Entry No. 33). For the reasons stated
below, Oscar’s MSJ on Counts I and II of Plaintiff’s Complaint will
be granted, Defendant’s Motion to Dismiss Count III of Plaintiff’s
Complaint will be granted, and this action will be dismissed.
I. Background
Moody initiated this action on June 4, 2025, by filing
Plaintiff’s Class Action Complaint (Docket Entry No. 1). On
September 2, 2025, Oscar filed its Motion to Dismiss for failure to
2See Memorandum Opinion and Order, Docket Entry No. 24, p. 2
(converting Defendant’s Motion to Dismiss Counts I and II of
Plaintiff’s Complaint to a Motion for Summary Judgment).
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state a claim for which relief may be granted under Federal Rule of
Civil Procedure 12(b)(6) (Docket Entry No. 17). On October 10,
2025, the court entered a Memorandum Opinion and Order that
converted Oscar’s Motion to Dismiss Counts I and II of Plaintiff’s
Complaint to a motion for summary judgment because those causes of
action raise a single issue of statutory interpretation, which is
a question of law for the court to decide, and because briefing
submitted by both parties referred to matters outside of the
pleadings with respect to that issue.3 The court allowed the
parties time to submit additional briefing, and carried Oscar’s
Motion to Dismiss Count III of Plaintiff’s Complaint until it ruled
on the MSJ.4
II. Undisputed Facts
Oscar provides non-ERISA health insurance to individuals in
Texas and elsewhere.5 At all relevant times, Moody was insured by
the Oscar Gold Classic Standard (Choice) Policy, which referred to
policyholders as “Members.”6 Oscar Members receive both a Schedule
3Memorandum Opinion and Order, Docket Entry No. 24, pp. 7-13.
4Id. at 18-19.
5Plaintiff’s Complaint, Docket Entry No. 1, pp. 1 ¶ 1, and 3
¶ 7 n. 2.
6Id. at 1 n. 1 and 5-6 ¶ 12. See also Schedule of Benefits
(“SOB”), Exhibit A to Plaintiffs’ Complaint, Docket Entry No. 1-2,
and Oscar Insurance Company Individual EPO Plan Effective January
(continued...)
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of Benefits (“SOB”) and Evidence of Coverage (“EOC”) for each
policy year.7 Oscar’s “SOB outlines the fees associated with each
type of covered health care service, including the relevant
deductible, co-pay, coinsurance, and out-of-pocket maximum amounts,
along with those services provided at no cost to the member.”8 The
SOB for Moody’s 2023 Policy listed her annual deductible as
$2,000.00, and it listed “$0 copayment not subject to deductible”
for “Preventive Care Visits” and “25% coinsurance after deductible”
for “X-rays and Diagnostic Imaging.”9
Oscar’s “EOC details the specific coverage and benefits
available to the policyholder.”10 The EOC for the 2023 plan year
6(...continued)
1, 2023 Policy (“Policy”), Exhibit B to Plaintiff’s Complaint,
Docket Entry No. 1-3; Defendant’s First Supplemental Brief, Docket
Entry No. 26, p. 6 (citing Declaration of Laura Doser-Neeley in
Support of Defendant’s Motion to Dismiss Converted to a Motion for
Summary Judgment (“Doser-Neeley Declaration”), Docket Entry No. 28,
p. 2 ¶ 2 (“Plaintiff Lauren R. Moody received healthcare coverage
from Oscar from April 2023 until November 2024 under an Oscar Gold
Classic Standard (choice) on-exchange plan.”).
7Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 6
(citing Doser-Neeley Declaration, Docket Entry No. 28, p. 3 ¶ 6).
8Id. (citing Doser-Neeley Declaration, Docket Entry No. 28,
p. 2 ¶ 4). See also Gold Classic Standard (Choice) On-Ex Schedule
of Benefits 2023, Docket Entry No. 28-1, and Gold Classic Standard
(Choice) On-Ex Schedule of Benefits 2024, Docket Entry No. 28-2.
9Plaintiff’s Complaint, Docket Entry No. 1, p. 6 ¶ 13. See
also Gold Classic Standard (Choice) Schedule of Benefits 2023,
Docket Entry No. 28-1, p. 2.
10Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 6
(citing Doser-Neeley Declaration, Docket Entry No. 28, pp. 2-3
(continued...)
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explained that Moody’s Policy provided coverage without cost share
for one screening mammogram per benefit period for members 35 years
of age and older, and for members of any age if medically
necessary.11 The EOC for the 2023 plan year also explained that
Moody’s Policy provided coverage for diagnostic imaging “subject to
the cost share set forth on [her] Schedule of Benefits,” i.e.,
$2,000.00 annual deductible and 25% coinsurance after the
deductible is satisfied.12 The EOCs for Moody’s Policy include a
provision that amends the Policy to conform to the minimum
requirements of applicable law.13
In May of 2023 Moody received diagnostic breast imagining at
Memorial MRI and Diagnostic LLC (“Memorial”) for a previously
detected abnormality in her breast.14 Although Memorial charged
$ 578.00 for the imaging, in an explanation of benefits (“EOB”)
letter dated June 11, 2023, Oscar allowed Memorial’s claim in the
10(...continued)
¶ 5). See also EOC 2023, Docket Entry No. 28-3, and EOC 2024,
Docket Entry No. 28-4.
11Doser-Neeley Declaration, Docket Entry No. 28, p. 2 ¶ 4. See
also Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 7
(citing EOC 2023, Docket Entry No. 28-3, p. 84).
12Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 7
(citing EOC 2023, Docket Entry No. 28-3, pp. 76-77, 88-89).
13Plaintiff’s Complaint, Docket Entry No. 1, pp. 8-9 ¶ 18. See
also Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 7
(citing EOC 2023, Docket Entry No. 28-3, p. 145). See also EOC
2024, Docket Entry No. 28-4, p. 149.
14Plaintiff’s Complaint, Docket Entry No. 1, p. 10 ¶ 21. See
also Oscar’s First Supplemental Brief, Docket Entry No. 26, p. 7.
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amount of $161.22 (“allowed amount”), but required Moody to pay
that amount towards her annual deductible of $2,000.00.15
By letter dated August 10, 2023, Moody appealed Oscar’s EOB
arguing that her Policy had been amended to conform to Texas
Insurance Code § 1356.005(a-1) and that the Policy, as amended,
required Oscar to pay 100% of the cost of her breast ultrasound.16
By letter dated September 8, 2023, Oscar denied Moody’s appeal
stating in pertinent part, “[i]n your state, Texas, diagnostic
mammograms are subject to cost share.”17
III. Oscar Is Entitled to Summary Judgment on Counts I and II
For Count I of Plaintiff’s Complaint Moody alleges that
[a]ll Oscar non-ERISA medical insurance policies issued
or renewed in Texas on or after January 1, 2022, as
conformed to Texas law, require Oscar to pay 100% of the
cost of breast-related “diagnostic imaging,” as that term
is defined in Tex. Ins. Code § 1356.001(1-a)[sic]. In
violation of Tex. Ins. Code § 1356.005(1-a) [sic] and in
breach of the Policies, Oscar has been requiring the
insureds who make up the Class to pay deductibles and
15Plaintiff’s Complaint, Docket Entry No. 1, p. 10 ¶ 21. See
also June 11, 2023, EOB for Claim Z31MWXNZ, Exhibit C to
Plaintiff’s Complaint, Docket Entry No. 1-4, p. 1; Defendant’s
First Supplemental Brief, Docket Entry No. 26, pp. 7-8.
16Plaintiff’s Complaint, Docket Entry No. 1, p. 10 ¶ 22. See
also August 10, 2023, Appeal of Claim Z31MWXNZ, Exhibit D to
Plaintiff’s Complaint, Docket Entry No. 1-5; Defendant’s First
Supplemental Brief, Docket Entry No. 26, p. 8.
17Plaintiff’s Complaint, Docket Entry No. 1, pp. 10-11 ¶ 23
(quoting September 8, 2023 Letter Denial of Appeal, Exhibit E to
Plaintiff’s Complaint, Docket Entry No. 1-6, p. 2); Defendant’s
First Supplemental Brief, Docket Entry No. 26, p. 8.
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coinsurance for diagnostic breast imaging. This class
action seeks to recover all amounts Oscar required
Plaintiff Moody and the Class to pay for diagnostic
breast imaging.18
Moody alleges that her Oscar policies “fail to comply with Texas
Insurance Code § 1356.005(a-1) because the requirement for Members
to pay part of the costs of diagnostic imaging is less favorable
than the coverage for screening mammograms (paid 100% by Oscar with
no cost sharing by the Members).”19
Oscar argues that Moody’s allegations
fail[] as a matter of law because [Moody] admits that
Oscar did exactly what the law requires. Section
1356.005 dictates that Oscar “must” impose the same
deductible on diagnostic breast imaging as it does on
other radiological examinations. Oscar did exactly that.
That is following the law, not violating it. Indeed, if
Oscar had done as [Moody] asks — disregarding the
deductible rather than applying the same deductible as
the law requires — that would have been a violation.20
Oscar argues that Moody’s interpretation of § 1356.005 is refuted
by the plain terms of the statute itself, its legislative history,
and rules of statutory construction.21 Moody responds that her
interpretation of § 1356.005 is reasonable, while Oscar’s
interpretation is not reasonable because her interpretation
harmonizes § 1356.005 in its entirety, while Oscar’s interpretation
18Plaintiff’s Complaint, Docket Entry No. 1, pp. 1-2 ¶ 1.
19Id. at 9 ¶ 19.
20Oscar’s MSJ, Docket Entry No. 17, p. 6 (emphasis in
original).
21Id. at 11-14.
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does not.22 Oscar replies that
the plain and clear language of [§] 1356.005, which
controls above all else, purposefully distinguishes
between “coverage for” diagnostic imaging and “dollar
limits, deductibles, and coinsurance for such procedures.
. .
. . .
[T]he plain and clear language of [§] 1356.005 supports
[its] interpretation that [§ 1356.005] mandates ‘coverage
for’ diagnostic imaging that is no less favorable than
coverage for screening mammograms, but subject to the
same cost sharing applicable to other radiological
examinations.23
The arguments that both parties make with respect to the
breach of contract claim alleged in Count I of Moody’s Complaint,
raise a single issue of statutory interpretation, i.e., whether
Tex. Ins. Code § 1356.005 requires Oscar to pay 100% of the cost
for diagnostic breast imaging.24
In Count II of Plaintiff’s Complaint Moody alleges that
36. Oscar violated Tex. Ins. Code § 542.058(a) by
failing to pay in full the Allowed Amounts of the
diagnostic breast imaging claims of Moody and the
22Plaintiff Lauren Moody’s Response, and Brief in Support, to
Defendant Oscar Insurance Company’s Motion to Dismiss Complaint
(“Plaintiff’s Response”), Docket Entry No. 22, pp. 10-18. See also
Moody’s First Supplemental Brief, Docket Entry No. 25, pp. 3-7;
Moody’s Second Supplemental Brief, Docket Entry No. 32, pp. 3-5.
23Defendant Oscar Insurance Company’s Reply in Support of its
Motion to Dismiss Complaint (“Defendant’s Reply”), Docket Entry
No. 23, p. 2. See also Oscar’s First Supplemental Brief, Docket
Entry No. 26, pp. 8-13; Oscar’s Second Supplemental Brief, Docket
Entry No. 33, pp. 5-11.
24See Plaintiff’s Response, Docket Entry No. 22, p. 9 (stating
that Counts I and I present a single question of law).
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other Class members for more than 60 days after
receiving the claims from their medical providers.
. . .
37. Pursuant to Tex. Ins. Code § 542.060(a) & (b),
Oscar is liable to Moody and the Class for 18%
interest on the amounts not paid for them by Oscar,
plus their reasonable and necessary attorneys’ fees
incurred in connection with their claims, which
attorneys’ fees shall be taxed as part of the costs
of the case.25
Oscar argues that Moody’s assertion of this cause of action fails
because “Oscar had no obligation to pay the $161.22 sum,” and
because “[t]here can be no wrongful late payment when no payment is
owed in the first instance.”26 Moody responds that “the Policy as
conformed to Tex. Ins. Code § 1356.005(a-1) unambiguously required
it to pay 100% of [her] claim for diagnostic imaging and it paid
none of her claim because it applied the deductible.”27 The
parties’ arguments regarding Oscar’s Motion for Summary Judgment on
the claim alleged in Count II of Plaintiff’s Complaint raise the
same single issue of statutory interpretation raised by Moody’s
breach contract claim alleged in Count I, i.e., whether Tex. Ins.
Code § 1356.005 requires Oscar to pay 100% of the cost of
diagnostic breast imaging.
25Plaintiff’s Complaint, Docket Entry No. 1, p. 16 ¶¶ 36-37.
26Oscar’s MSJ, Docket Entry No. 17, p. 15. See also
Defendant’s Reply, Docket Entry No. 23, pp. 11-13.
27Plaintiff’s Response, Docket Entry No. 22, pp. 23-24. See
also Moody’s First Supplemental Brief, Docket Entry No. 25, pp. 3-
7; Moody’s Second Supplemental Brief, Docket Entry No. 32, pp. 3-5.
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A. Standard of Review
Summary judgment is authorized if the movant establishes that
there is no genuine dispute about any material fact, and the law
entitles it to judgment. Fed. R. Civ. P. 56. Factual disputes are
“genuine” if the evidence is such that a reasonable jury could
return a verdict for the nonmoving party. Anderson v. Liberty
Lobby, Inc., 106 S. Ct. 2505, 2511 (1986). The Supreme Court has
interpreted the plain language of Rule 56 to mandate the entry of
summary judgment “after adequate time for discovery and upon
motion, against a party who fails to make a showing sufficient to
establish the existence of an element essential to that party’s
case, and on which that party will bear the burden of proof at
trial.” Celotex Corp. v. Catrett, 106 S. Ct. 2548, 2552 (1986).
“[T]he party moving for summary judgment must ‘demonstrate the
absence of a genuine issue of material fact,’ but need not negate
the elements of the nonmovant’s case.” Little v. Liquid Air Corp.,
37 F.3d 1069, 1075 (5th Cir. 1994) (en banc) (per curiam) (quoting
Celotex, 106 S. Ct. at 2553). If the moving party meets this
burden, the nonmovant must go beyond the pleadings and show by
affidavits, depositions, answers to interrogatories, or other
admissible evidence that facts exist over which there is a genuine
issue for trial. Id. (citing Celotex, 106 S. Ct. at 2553-2554).
“For any matter on which the non-movant would bear the burden of
proof at trial . . . the movant may merely point to the absence of
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evidence and thereby shift to the non-movant the burden of
demonstrating by competent summary judgment proof that there is an
issue of material fact warranting trial.” Transamerica Insurance
Co. v. Avenell, 66 F.3d 715, 718–19 (5th Cir. 1995) (per curiam)
(citing Celotex, 106 S. Ct. at 2552-2553). To prevent summary
judgment, “the non-moving party must come forward with specific
facts showing that there is a genuine issue for trial.” Matsushita
Electric Industrial Co., Ltd. v. Zenith Radio Corp., 106 S. Ct.
1348, 1356 (1986) (citation omitted) (emphasis in the original).
“[T]he court must draw all reasonable inferences in favor of the
nonmoving party, and it may not make credibility determinations or
weigh the evidence.” Reeves v. Sanderson Plumbing Products, Inc.,
120 S. Ct. 2097, 2110 (2000). Factual controversies are to be
resolved in favor of the nonmovant, “but only when there is an
actual controversy, that is, when both parties have submitted
evidence of contradictory facts.” Little, 37 F.3d at 1075.
B. Texas Law of Statutory Interpretation
Issues of statutory interpretation are questions of law for
the court to decide. See In the Interest of J.S., 670 S.W.3d 591,
596 (Tex. 2023)(citing Aleman v. Texas Medical Board, 573 S.W.3d
796, 802 (Tex. 2019)). See also Dresser v. Meba Medical & Benefits
Plan, 628 F.3d 705, 708 (5th Cir. 2010)(per curiam) (“A district
court’s interpretation of a statute . . . is a question of law.”).
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“When interpreting a Texas statute, [federal courts] use the same
methods of statutory interpretation used by the Texas Supreme
Court.” Camacho v. Ford Motor Co., 993 F.3d 308, 311 (5th Cir.
2021). “Under Texas law, the court’s ‘fundamental goal when
reading statutes “is to ascertain and give effect to the
Legislature’s intent.”’” CANarchy Craft Brewery Collective, L.L.C.
v. Texas Alcoholic Beverage Commission, 37 F.4th 1069, 1074 (5th
Cir. 2022) (quoting Cadena Comercial USA Corp. v. Texas Alcoholic
Beverage Commission, 518 S.W.3d 318, 325 (Tex. 2017) (quoting Texas
Mutual Insurance Co. v. Ruttiger, 381 S.W.3d 430, 452 (Tex.
2012))).
Texas courts look for legislative “intent first and foremost
in the plain language of the . . . statutory provision.” Bexar
Appraisal District v. Johnson, 691 S.W.3d 844, 847 (Tex. 2024)
(quoting Odyssey 2020 Academy, Inc. v. Galveston Appraisal
District, 624 S.W.3d 535, 540 (Tex. 2021)). Texas courts “read
statutes as a whole so as to render no part inconsistent,
superfluous, or devoid of meaning.” Levinson Alcoser Associates,
L.P. v. El Pistolón II, Ltd., 513 S.W.3d 487, 493 (Tex. 2017). See
also Tex. Gov’t Code § 311.021(2). “Statutory terms usually bear
their common, ordinary meaning.” Johnson, 691 S.W.3d at 847
(quoting Silguero v. CSL Plasma, Inc., 579 S.W.3d 53, 59 (Tex.
2019)). “If the statute’s plain language is unambiguous, [courts]
interpret its plain meaning, presuming that the Legislature
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intended for each of the statute’s words to have a purpose and that
the Legislature purposefully omitted words it did not include.”
Id. “Where text is clear, text is determinative of [legislative]
intent.” Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 437
(Tex. 2009). Only if the text is ambiguous should courts consider
rules of construction or other interpretive aids. Id. (citing In
re Estate of Nash, 220 S.W.3d 914, 917 (Tex. 2007) (“If a statute
is clear and unambiguous, [courts] apply its words according to
their common meaning without resort to rules of construction or
extrinsic aids.”)). “A statute is ambiguous if it is susceptible
of more than one accepted meaning.” United Services Automobile
Association v. Perry, 102 F.3d 144, 146 (5th Cir. 1996) (per
curiam). The Court must “enforce the law as written” and “should
always refrain from rewriting text that lawmakers chose.” Entergy,
282 S.W.3d at 443. See also Lippincott v. Whisenhunt, 462 S.W.3d
507, 508 (Tex. 2015) (“A court may not judicially amend a statute
by adding words that are not contained in the language of the
statute. Instead, it must apply the statute as written.”).
C. Application of the Law to the Undisputed Facts
Moody argues that Texas Insurance Code § 1356.005
unambiguously requires Oscar to pay 100% of the cost of breast-
related “diagnostic imaging,” as that term is defined in Tex. Ins.
Code § 1356.001(a-1), while Oscar argues that § 1356.005
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unambiguously requires it to apply the same cost sharing to
diagnostic breast imaging as it applies to other radiological
examinations. Alternatively, the parties argue that § 1356.005 is
ambiguous and that their competing interpretations are more
reasonable than that of their opponent. For the reasons stated
below the court concludes that Tex. Ins. Code § 1356.005 is
unambiguous and does not require Oscar to pay the full cost of
Moody’s diagnostic breast imaging.
When Texas enacted the initial version of what is now Chapter
1356 of the Texas Insurance Code, it required all medical insurance
policies in Texas to provide coverage for annual screening
mammograms for women 35 years of age and older and that the
coverage for screening mammograms be no less favorable than that
for other radiological examinations and subject to the same dollar
limits, deductibles, and coinsurance factors. See Tex. Ins. Code
art. 3.70-2(H) (Vernon 1989).28
In 2010 Congress enacted the Patient Protection and Affordable
Care Act (“ACA”), which requires all United States medical
insurance policies to provide coverage for annual screening
mammograms at no out-of-pocket cost to insureds (i.e., no
deductible, no co-pay, and no co-insurance). In pertinent part the
ACA states that
28Exhibit A to Plaintiff Lauren Moody’s Response, and Brief in
Support, to Defendant Oscar Insurance Company’s Motion to Dismiss
Complaint, Docket Entry No. 22-1, p. 5.
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[a] group health plan and a health insurance issuer
offering group or individual health insurance coverage
shall, at a minimum provide coverage for and shall not
impose any cost sharing requirements for –
(1) evidence-based items or services that have in
effect a rating of “A” or “B” in the current
recommendations of the United States Preventive
Services Task Force;
. . .
(4) with respect to women, such additional preventive
care and screenings not described in paragraph (1)
as provided for in comprehensive guidelines
supported by the Health Resources and Services
Administration [“HRSA”] for purposes of this
paragraph;
(5) for the purposes of this chapter, and for the
purposes of any other provision of law, the current
recommendations of the United States Preventive
Service Task Force regarding breast cancer
screening, mammography, and prevention shall be
considered the most current other than those issued
in or around November 2009.
Nothing in this subsection shall be construed to prohibit
a plan or issuer from providing coverage for services in
addition to those recommended by United States Preventive
Services Task Force or to deny coverage for services that
are not recommended by such Task Force.
42 U.S.C. § 300gg-13(a)(1), (4) & (5). In 2023 when Moody received
the imaging at issue in this action, the HRSA guidelines referenced
in 42 U.S.C. § 300gg(a) recommended that breast cancer screening
for average-risk women initiate no earlier than age 40 and no later
than age 50, occur at least biennially and as frequent as annually,
and continue through at least age 74.29
29See Health Resources & Services Administration, Women’s
(continued...)
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In 2021 Texas added subsection (a-1) to § 1356.005. That
subsection provides that, effective January 1, 2022, all medical
insurance policies issued or renewed in Texas must provide coverage
for diagnostic breast imaging no less favorable than coverage for
a screening mammogram. Thus, since 2021 § 1356.005 has stated that
(a) A health benefit plan that provides coverage to a
female who is 35 years of age or older must include
coverage for an annual screening by all forms of
low-dose mammography for the presence of occult
breast cancer.
(a-1)A health benefit plan that provides coverage
for a screening mammogram must provide
coverage for diagnostic imaging that is no
less favorable than the coverage for a
screening mammogram.
(b) Coverage required by this section:
(1) may not be less favorable than coverage for
other radiological examinations under the
plan; and
(2) must be subject to the same dollar limits,
deductible, and coinsurance factors as
coverage for other radiological examinations
under the plan.
Tex. Ins. Code § 1356.005.
29(...continued)
Preventive Services Guidelines, www.hrsa.gov/womens-guidelines-2019
(last viewed February 4, 2026). A Notice published in the Federal
Register on December 30, 2024, announced updated guidelines that
included the following language: “Women may require additional
imaging to complete the screening process or to address findings on
the initial screening mammography. If additional imaging (e.g.
[magnetic resonance imaging] MRI, ultrasound, mammography) and
pathology exams are indicated, those services are also recommended
to complete the screening process for malignancies.” 89 F.R.
106523, 2024 WL 5238385 (Dec. 30, 2024).
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“Diagnostic imaging” means:
[A]n imaging examination using mammography, ultrasound
imaging, or magnetic resonance imaging that is designed
to evaluate:
(A) a subjective or objective abnormality detected
by a physician or patient in a breast;
(B) an abnormality seen by a physician on a
screening mammogram;
(C) an abnormality previously identified by a
physician as probably benign in a breast for
which follow-up imaging is recommended by a
physician; or
(D) an individual with a personal history of
breast cancer or dense breast tissue.
Tex. Ins. Code § 1356.001(1-a).
Because § 1356.005(a-1) states that “[a] health benefit plan
that provides coverage for a screening mammogram must provide
coverage for diagnostic imaging that is no less favorable than the
coverage for a screening mammogram,” and because in compliance with
the ACA, her Oscar Policy provided screening mammograms at no out-
of-pocket cost to members, Moody argues that § 1356.005(a-1)
requires Oscar to pay 100% of the cost for the diagnostic breast
imaging she received in May of 2023.30 Moody’s argument is based
on a misreading that the term “coverage” used throughout § 1356.005
includes cost sharing, and a misreading of the term “other
30See Plaintiff’s Response, Docket Entry No. 22, p. 9 (stating
that Counts I and I present a single question of law). See also
Moody’s First Supplemental Brief, Docket Entry No. 25, pp. 3-7;
Moody’s Second Supplemental Brief, Docket Entry No. 32, pp. 3-5.
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radiological examinations under the plan” used in §§ 1356.005(b)(1)
and (b)(2) that means “screening mammograms.”
Pursuant to § 1356.005(b)(1) coverage for both screening
mammograms required by § 1356.005(a) and for diagnostic imaging
addressed in § 1356.005(a-1) “may not be less favorable than
coverage for other radiological examinations under the plan;” and
pursuant to § 1356.005(b)(2) that coverage “must be subject to the
same dollar limits, deductible, and coinsurance factors as coverage
for other radiological examinations under the plan.” Use of the
words “subject to” in § 1356.005(b)(2) unambiguously shows that the
legislature differentiated “coverage” from cost sharing. Moody,
however, conflates “coverage” and cost sharing by arguing that her
Oscar Policy, as written, violated Texas Insurance Code
§ 1356.005(a-1) “because the requirement for Members to pay part of
the costs of diagnostic imaging is less favorable than the coverage
for screening mammograms (paid 100% by Oscar with no cost sharing
by the Members).”31 Moody also conflates the term “screening
mammogram” used in § 1356.005(a) and (a-1) with the term “other
radiological examinations under the plan” used in § 1356.005(b)(1)
and (b)(2) by arguing that “a [s]creening [m]ammogram is the
‘[o]ther [r]adiological [e]xamination’ that [p]rovides the [c]ost
31Plaintiff’s Complaint, Docket Entry No. 1, p. 9 ¶ 19. See
also Moody’s First Supplemental Brief, Docket Entry No. 25, pp. 3-
5.
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[s]haring that [m]ust [a]pply to [d]iagnostic [i]maging.”32
Acceptance of Moody’s arguments would render superfluous
§ 1356.005(b)(2)’s requirement that the “coverage” for screening
mammograms and diagnostic imaging required by § 1356.005(a) and (a-
1) “must be subject to the same dollar limits, deductibles, and
coinsurance factor as coverage for other radiological examinations
under the plan.” See Levinson Alcoser, 513 F.3d at 493 (“[Texas
courts] read statutes as a whole so as to render no part
inconsistent, superfluous, or devoid of meaning.”).
The plain language of § 1356.005(b)(2) of the Texas Insurance
Code unambiguously differentiates “coverage” from cost sharing by
stating that the “coverage required by this section . . . must be
subject to the same dollar limits, deductible, and coinsurance
factors as coverage for other radiological examinations under the
plan.” In her Complaint Moody admits that other radiological
examinations covered by her Oscar Policy were subject to the
$2,000.00 annual deductible and 25% coinsurance.33 This admission
implicitly — if not directly — acknowledges that the term “other
radiological examinations” used in both her Policy and
§ 1356.005(b) means radiological examinations other an screening
32Moody’s First Supplemental Brief, Docket Entry No. 25, p. 5.
33Plaintiff’s Complaint, Docket Entry No. 1, p. 6 ¶ 13. See
also Gold Classic Standard (Choice) On-Ex Schedule of Benefits
2023, Docket Entry No. 28-1, p. 2.
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mammograms. The court concludes therefore, that in 2023 when Moody
received the diagnostic imaging at issue, neither her Policy nor
§ 1356.005 of the Texas Insurance Code required Oscar to pay 100%
of the cost for Moody’s diagnostic breast imaging.
The court’s conclusion that in 2023 § 1356.005 did not require
Oscar to pay 100% of the cost for Moody’s diagnostic imaging is
supported by that section’s legislative history. In 2021 Senator
Alvarado introduced Texas Senate Bill 1065, which amended
§ 1356.005 by adding subsection (a-1). The statement of intent for
that bill said that it sought to provide “favorable cost-sharing
for certain diagnostic examinations;”34 not that it sought to
eliminate cost sharing entirely. If the Texas Legislature intended
to eliminate cost sharing for diagnostic imaging, it could have
eliminated subsection (b)(2), or expressly prohibited cost-sharing
for diagnostic imaging. But the Texas Legislature failed to take
either of those actions. Moreover, in February of 2025, Senator
Alvarado introduced Texas Senate Bill 1747, which sought to amend
§ 1356.005 by removing subsection (b)(2) and by adding subsection
(a-2) to read “[a] health benefit plan may not impose a cost-
sharing requirement on coverage for a screening mammogram,
34Exhibit 1 to Oscar’s MSJ, Docket Entry No. 17-2, p. 2. See
also 2021 Tex. Sess. Law Serv. Ch. 867 (S.B. 1065) (Vernon’s).
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diagnostic imaging, or supplemental breast examination.”35 Senate
Bill 1747 died in committee. If, as Moody argues, § 1356.005
prohibits deductibles and coinsurance for diagnostic imaging,
Senator Alvarado would have had no reason to introduce Senate Bill
1747.
Moody’s first cause of action for breach of contract is based
on the argument that her Oscar Policy, as written, violated Texas
Insurance Code § 1356.005(a-1) “because the requirement for Members
to pay part of the costs of diagnostic imaging is less favorable
than the coverage for screening mammograms (paid 100% by Oscar with
no cost sharing by the Members).”36 But § 1356.005 does not
prohibit cost sharing for diagnostic imaging or for screening
mammograms. To the contrary, § 1356.005(b)(2) states that
“coverage required by this section,” i.e., for coverage for both
screening mammograms addressed in subsection (a) and diagnostic
imaging addressed in subsection (a-1), “must be subject to the same
dollar limits, deductibles, and coinsurance factors as coverage for
other radiological examinations.” The Policy provision pursuant to
which screening mammograms are provided to Oscar policy members at
no out-of-pocket cost is not based on § 1356.005 or any other
35Exhibit 2 to Oscar’s MSJ, Docket Entry No. 17-3, p. 2. See
also Texas S.B. 1747, 89th Leg. (Alvarado, 2025), available at
https://legiscan.com/TX/bill/SB1747/2025 (last visited February 4,
2026).
36Plaintiff’s Complaint, Docket Entry No. 1, p. 9 ¶ 19.
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section of the Texas Insurance Code but, instead, on the ACA, i.e.,
federal law. Moody’s failure to show that Texas Insurance Code
§ 1356.005 prohibits deductibles or coinsurance for diagnostic
imaging is fatal to her breach of contract cause of action. The
court concludes, therefore, that Oscar is entitled to summary
judgment on Moody’s breach of contract cause of action.
Count II of Plaintiff’s Complaint asserts a cause of action
for failure to promptly pay amounts due in violation of Texas
Insurance Code § 542.058(a) and seeks damages under Texas Insurance
Code § 542.060(a)&(b).37 This cause of action fails for the same
reason as Moody’s first cause of action for breach of contract.
Because Moody does not dispute that when she received the
diagnostic imaging for which she was charged $161.22 she had not
satisfied her annual deductible, Oscar had no obligation to pay the
$161.22 that Plaintiff alleges she was wrongly charged. Because
Oscar had no obligation to pay the $161.22 that Moody argues she
was owed under her Policy, Moody cannot prevail on a cause of
action for late payment. See Barbara Technologies Corp. v. State
Farm Lloyds, 589 S.W.3d 806, 813 (Tex. 2019), superseded by statute
on other grounds as stated in Rodriguez v. Safeco Insurance Co. of
Indiana, 684 S.W.3d 789, 794 (Tex. 2024) (“To prevail under a claim
for TPPCA damages under [§] 542.060, the insured must establish:
37Id. at 16 ¶¶ 36-37.
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(1) the insurer’s liability under the insurance policy, and
(2) that the insurer failed to comply with one or more of the
statutory requirements for processing or paying the claim.”). The
court concludes, therefore, that Oscar is entitled to summary
judgment on Moody’s cause of action for failure to promptly pay
amounts due in violation of the Texas Insurance Code § 542.058(a)
and § 542.060(a)&(b).
IV. Oscar is Entitled to Dismissal of Count III
Count III of Plaintiff’s Complaint, which alleges that “Oscar
violated Texas Insurance Code § 541.060(a)(2)(a) by failing to
attempt in good faith to effectuate a prompt, fair and equitable
settlement of a claim with respect to which its liability had
become reasonably clear,”38 fails for the same reason as her first
and second causes of action fail. Moody alleges that Oscar
violated § 541.060 by failing to pay the claim when its liability
was “reasonably clear,” i.e., because Oscar failed to recognize
that § 1356.005 modified her Policy to require Oscar to pay for
diagnostic imaging without a deductible.39 These allegations fail
because, for the reasons stated in the preceding section of this
Memorandum Opinion and Order, Oscar did not violate § 1356.005 by
requiring Moody to pay a deductible for diagnostic imaging,
38Plaintiff’s Complaint, Docket Entry No. 1, p. 17 ¶ 39.
39Id.
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liability under her Policy did not exist and, therefore, could not
have been “reasonably clear.” See USAA Texas Lloyds Co. v.
Menchaca, 545 S.W.3d 479, 500 (Tex. 2018) (“An insured cannot
recover any damages based on an insurer’s statutory violation
unless the insured establishes a right to receive benefits under
the Policy or an injury independent of a right to benefits.”).
Moody also alleges that Oscar violated § 541.060 by failing to
explain the basis for its decision requiring her to pay $161.22 for
diagnostic imaging that she received in May of 2023.40 This
allegation fails because Oscar’s September 8, 2023, letter
notifying Moody that her appeal had been denied explained that
“[i]n your state, Texas, diagnostic mammograms are subject to cost
share,” that her Policy obligated her to pay the full allowed
amount for diagnostic imaging until her annual deductible amount of
$2,000.00 had been met, and that she had not satisfied that
deductible amount at the time of her claim.41 The court concludes,
therefore, that Oscar is entitled to dismissal of Moody’s third
cause of action for failure to attempt in good faith to effectuate
a prompt, fair and equitable settlement of a claim with respect to
which its liability had become reasonably clear in violation of
Texas Insurance Code § 541.060(a)(2)(a).
40Id. at 17-18 ¶ 40.
41Exhibit E to Plaintiff’s Complaint, Docket Entry No. 1-6,
p. 2.
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V. Conclusions and Order
For the reasons stated above in § III, the court concludes
that Oscar is entitled to summary judgment on Counts I and II of
Plaintiff's Complaint. For the reasons stated above in§ IV, the
court concludes that Oscar is entitled to ssal of Count III of
Plainti 's Complaint.
been converted to a mot
Defendant's Motion to Dismiss, which has
for summary judgment with respect to
Counts I and II, and which remains a motion to dismiss with respect
to Count III, Docket Entry No. 17, is GRANTED.
SIGNED at Houston, Texas, this 9th day of February, 2026.
SENIOR UNITED STATES DISTRICT JUDGE
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