Justia Medical Malpractice Opinion SummariesArticles Posted in Insurance Law
California ex rel. State Farm Mutual Automobile Ins. Co. v. Rubin
Plaintiff State Farm Mutual Automobile Insurance Company (State Farm) filed an Insurance Fraud Protection Act (IFPA) action alleging defendants Sonny Rubin, M.D., Sonny Rubin, M.D., Inc., and Newport Institute of Minimally Invasive Surgery (collectively, defendants) fraudulently billed insurers for various services performed in connection with epidural steroid injections. A month prior, however, another insurer, Allstate, filed a separate IFPA lawsuit against the same defendants, alleging they were perpetrating a similar fraud on Allstate. The trial court sustained defendants’ demurrer to State Farm’s complaint under the IFPA’s first-to-file rule, finding it alleged the same fraud as Allstate’s complaint. State Farm appealed, arguing its complaint alleged a distinct fraud. After review, the Court of Appeal agreed the demurrer was incorrectly sustained, but for another reason. The Court found the trial court and both parties only focused on whether the two complaints alleged the same fraudulent scheme, but in this matter of first impression, the Court found the IFPA’s first-to-file rule required an additional inquiry. "Courts must also review the specific insurer-victims underlying each complaint’s request for penalties. If each complaint seeks penalties for false insurance claims relating to different groups of insurer-victims, the first-to-file rule does not apply. A subsequent complaint is only barred under the first-to-file rule if the prior complaint alleges the same fraud and seeks penalties arising from the false claims, submitted to the same insurer-victims." Judgment was reversed and the matter remanded for further proceedings. View "California ex rel. State Farm Mutual Automobile Ins. Co. v. Rubin" on Justia Law
State ex rel. W. Va. Mutual Insurance Co. v. Honorable Salango
The Supreme Court granted a writ of prohibition sought by West Virginia Mutual Insurance Company (Mutual) from the order of the circuit court denying Mutual's motion for summary judgment on common law bad faith claims brought by Michael Covelli, M.D., holding that Mutual demonstrated that the writ of prohibition was appropriate.A jury awarded Dominique Adkins almost $5.8 million on her medical malpractice claim against Dr. Covelli, which was above the limits of his medical malpractice insurance. However, Mutual, Covelli's insurer, settled Adkins's suit within policy limits before the circuit court reduced the verdict to judgment. When a second patient of Dr. Covelli learned of Adkins's large jury award, that patient too sued Dr. Covelli for malpractice. Mutual also settled that claim within policy limits. Thereafter, Dr. Covellie sued Mutual for common law bad faith. At issue was the order of the circuit court denying Mutual's motion for summary judgment on Dr. Covelli's claims. The Supreme Court granted the writ, holding that the circuit court clearly erred by denying Mutual's motion for summary judgment. View "State ex rel. W. Va. Mutual Insurance Co. v. Honorable Salango" on Justia Law
Merritt v. Catholic Health Initiatives, Inc.
The Supreme Court affirmed the judgment of the court of appeals affirming the trial court's grant of summary judgment for the defendants in this insurance dispute, holding that the Legislature has clearly and unequivocally excluded captive insurers from the requirements of the Kentucky Unfair Claims Settlement Practices Act (USCPA), Ky. Rev. Stat. 304.12-230.Plaintiff brought this action against various healthcare defendants. The medical negligence claims were eventually settled. Thereafter, the circuit court denied Plaintiff's motion for declaratory relief as to his bad faith insurance claim against First Initiatives Insurance, Ltd., a foreign captive insurance entity that provides self-insurance for Catholic Health Initiatives, Inc. The court granted summary judgment for Catholic Health and First Initiatives. The court of appeals affirmed. The Supreme Court affirmed, holding that First Initiatives, as a captive insurer, is not subject to the USCPA. View "Merritt v. Catholic Health Initiatives, Inc." on Justia Law
Grp. Health Coop. v. Coon
Group Health Cooperative (GHO) provided health insurance benefits to Nathaniel (Joel) Coon, who suffered a serious fungal infection and amputation following knee surgery at the Everett Clinic (TEC). The Coon family later settled potential negligence claims against TEC, and GHO initiated this lawsuit seeking reimbursement of its payments from the settlement proceeds. At issue before the Washington Supreme Court was whether genuine issues of material fact remained to preclude summary judgment in favor of GHO regarding whether the settlement constituted full compensation to Coon, and whether GHO suffered prejudice from the Coons’ failure to provide notice prior to finalizing the settlement. The Supreme Court concurred with the Court of Appeals’ conclusion that genuine issues of fact still remained, making summary judgment inappropriate. The matter was remanded for further proceedings. View "Grp. Health Coop. v. Coon" on Justia Law
Ghee v. USAble Mutual Insurance Company d/b/a Blue Advantage Administrators of Arkansas
Douglas Ghee, as the personal representative of the estate of Billy Fleming, appealed a circuit court order dismissing a wrongful-death claim brought against USAble Mutual Insurance Company d/b/a Blue Advantage Administrators of Arkansas ("Blue Advantage"). Fleming presented to the emergency department complaining of constipation and abdominal pain. He would ultimately need a colectomy, but the hospital informed him Blue Advantage had decided that a lower quality of care (continued non-surgical management) was more appropriate than the higher quality of care (surgery) that Fleming's surgeon felt was appropriate. Fleming and his family had multiple conversations with agents of Blue Advantage in an unsuccessful attempt to convince the company that the higher surgery was the more appropriate course of care. Ultimately, an agent of Blue Advantage suggested to Fleming that he return to the hospital in an attempt to convince hospital personnel and physicians to perform the surgery on an emergency basis. For five days, Fleming would present to the emergency room, each time he was treated by non-surgical means, then returned home. On the evening of July 15, 2013, Fleming's condition had deteriorated such that he had to be intubated. He died after midnight of septic shock due to a perforated sigmoid colon with abundant fecal material in the peritoneal cavity. A lawsuit was filed against Blue Advantage, asserting that the combined negligence of the hospitals and clinics involved and Blue Advantage, proximately caused Fleming's death. Because the trial court determined that Ghee's allegations against Blue Advantage as stated in the original complaint were defensively preempted by ERISA, the Alabama Supreme Court found Ghee should have had the right to amend his complaint to clarify his state-law claims. Because the Court concluded that Ghee should have been afforded the right to amend his complaint, it reversed the judgment of the trial court and remanded for further proceedings. View "Ghee v. USAble Mutual Insurance Company d/b/a Blue Advantage Administrators of Arkansas" on Justia Law
Surgery Center at 900 North Michigan Avenue, LLC v. American Physicians Assurance Corp., Inc.
SC, an outpatient surgical center, permits outside physicians to perform day surgery at its facility. Its insurance limited APA’s liability to $1 million per claim. In 2002, Dr. Hasson, an outside physician, performed outpatient laparoscopic surgery on Tate at SC. Hasson did not see Tate or sign her discharge instructions before SC released her; SC’s anesthesiologist discharged Tate, giving Tate's boyfriend discharge instructions. Days later, Tate checked into the hospital with a perforated bowel that rendered the previously-healthy 34‐year‐old a quadriplegic. Tate sued Hasson and SC. APA hired attorneys to defend SC. APA set the “Reserve” (money the Michigan Department of Insurance required APA to put aside to cover an adverse verdict) at $560,000. APA believed the damages could exceed the policy limit but that SC was not likely to be found liable. In 2007, APA rejected Tate's offer to settle for policy limits. Hasson’s insurer settled for his policy limit ($1 million). After the Illinois Appellate Court remanded the issue of whether SC’s nursing staff breached the standard of care, APA raised the Reserve to $1 million, stating that it still believed the case was defensible. Before the second trial, APA rejected Tate's second settlement demand for the policy limit. The jury returned a $5.17 million verdict. SC then sued APA for bad faith. The Seventh Circuit affirmed judgment as a matter of law in favor of APA. SC did not establish that anyone involved in litigating the case believed there was more than a mere possibility SC would be found liable; the mere possibility of liability is insufficient under the Illinois Supreme Court’s reasonable probability standard. View "Surgery Center at 900 North Michigan Avenue, LLC v. American Physicians Assurance Corp., Inc." on Justia Law
Medical Protective Co. of Fort Wayne, Indiana v. American International Specialty Lines Insurance Co.
In 2002, in Texas, Dr. Phillips performed a laparoscopic hysterectomy on Bramlett, a 36-year-old mother. While hospitalized, Bramlett suffered internal bleeding and died. Her family filed a wrongful death lawsuit against the hospital and Dr. Phillips, who held a $200,000 professional liability insurance policy with MedPro. He notified MedPro of the lawsuit. In 2003, the hospital settled with the Bramletts for approximately $2.3 million. The Bramletts wrote to Dr. Phillips’s attorney, Davidson, with a $200,000 Stowers demand; under Texas law, if an insurer rejects a plaintiff's demand that is within the insured’s policy limit and that a reasonably prudent insurer would accept, the insurer will later be liable for any amount awarded over the policy limit. MedPro twice refused to settle. The family won a $14 million verdict. The Supreme Court of Texas capped Dr. Phillips’s liability. The family sued MedPro, which settled. MedPro was insured by AISLIC, which declined to cover MedPro’s settlement. The district court granted AISLIC summary judgment, concluding that coverage was excluded because MedPro should have foreseen the family’s claim. An exclusion precluded coverage for “any claim arising out of any Wrongful Act” which occurred prior to June 30, 2005, if before that date MedPro “knew or could have reasonably foreseen that such Wrongful Act could lead to a claim.” The Seventh Circuit reversed in part, finding genuine issues of material fact regarding whether MedPro’s failure to settle was a Wrongful Act and whether MedPro could have foreseen a "claim" before the malpractice trial. View "Medical Protective Co. of Fort Wayne, Indiana v. American International Specialty Lines Insurance Co." on Justia Law
McNamara v. Benchmark Insurance Co.
Pharmacist Joseph McNamara, Jr. appealed the grant of summary judgment in favor of Benchmark Insurance Company ("Benchmark") in Benchmark's indemnity action against McNamara. Benchmark commenced the indemnity action in an effort to recover funds expended to settle a medical-malpractice action brought against Southern Medical, Inc., Benchmark's insured and McNamara's employer. The medical-malpractice action was brought against Southern Medical by Ricky Avant and Kim Avant and was based, at least in part, on the alleged tortious acts and omissions of McNamara. Because the act complained of occurred in January 2010 and Benchmark sued McNamara in February 2014, the Alabama Supreme Court concluded Benchmark's indemnity action was time-barred under section 6-5-482, Ala. Code 1975. Thus, the trial court erred in entering a summary judgment in favor of Benchmark and in denying McNamara's motion for a summary judgment. View "McNamara v. Benchmark Insurance Co." on Justia Law
Essex Ins. Co. v. Angarita
Essex issued a professional liability insurance policy to Galilee Medical Center, covering claims against Galilee physicians, including Angarita. Galilee’s application asked, “Do the Applicant’s employees or independent contractors use drugs for weight reduction for patients?” Galilee answered no. The question continued: “If yes, attach a list of drugs used and percentage of practice devoted to weight reduction.” Galilee did not identify any drugs. Galilee also answered “no” to whether its employees performed any experimental procedures and to “With the exception of surgery for obesity, does your practice include weight reduction or control by other [sic] than diet or exercise? 5.(b) Do you dispense any drugs? 5.(c) Do you use injections for weight control? 9.(a) Do you use experimental procedures, devices, drugs, or therapy in treatment or surgery?” In 2011, Ravelo, Angarita’s former patient, sued Angarita and Galilee for medical negligence based on mesotherapy treatments administered by Angarita. Mesotherapy is a non-surgical treatment involving injections into subcutaneous layers of fat, to dissolve deposits of fat and provide a more desirable body shape. Mesotherapy is not FDA-approved. Angarita admitted to providing mesotherapy treatment to more than 5,000 patients, including Ravelo. Essex denied coverage and sought a declaratory judgment rescinding the Policy. The Seventh Circuit affirmed summary judgment in favor of Essex, based on the misrepresentations in the applications. View "Essex Ins. Co. v. Angarita" on Justia Law
Columbia/CSA-HS Greater Columbia Healthcare System v. So. Carolina Medical Malpractice Liability Joint Underwriting Association
In 1997, Dr. Michael Hayes and Dr. Michael Taillon were working as emergency room physicians at Providence Hospital, presumably as independent contractors. Arthur Sharpe came to the Providence Hospital emergency room complaining of chest pain. Dr. Hayes and Dr. Taillon evaluated Sharpe and diagnosed him as suffering from reflux. Sharpe was discharged. Sharpe had actually suffered a heart attack, which was determined a few days later when he sought further medical care elsewhere. Because of the misdiagnosis, in 1999, Sharpe and his wife filed a medical malpractice and loss of consortium action against Providence Hospital and Dr. Hayes. The Sharpes did not name Dr. Taillon as a defendant. Providence Hospital settled with the Sharpes in 2004. In 2007, Providence Hospital filed this equitable indemnification action against Dr. Taillon and his medical malpractice insurer, The South Carolina Medical Malpractice Liability Joint Underwriting Association (collectively Respondents). Respondents moved for summary judgment on the ground that the medical malpractice statute of repose barred Providence Hospital's claim and the circuit court granted the motion on that basis. Providence Hospital appealed, and the court of appeals affirmed. The issue this case presented for the Supreme Court's review was whether the medical malpractice statute of repose applied to Providence Hospital's indemnity claim. The Court concluded that Providence Hospital's indemnity action was indeed barred by the statute of repose, and as such affirmed the trial court. View "Columbia/CSA-HS Greater Columbia Healthcare System v. So. Carolina Medical Malpractice Liability Joint Underwriting Association" on Justia Law