Mirkin v. Medical Mutual Liability Insurance Society

KARWACKI, Judge. Gabe Mirkin, M.D., appeals from an order of the Circuit Court for Baltimore City which reversed a determination by the Insurance Commissioner that Medical Mutual Liability Insurance Society of Maryland (Medical Mutual) violated ⁵⁴² McLCode Ann., Art. 48A, § 234A 1 when it attempted to cancel appellant’s professional liability insurance. This litigation arose under the following circumstances. On March 4, 1982, 24 year old Tom Bennington, Jr., accompanied by his father, went to see Dr. Mirkin to have a wart removed from his thumb.

Dr. Mirkin examined Bennington’s thumb as well as a black lesion on his left leg. Dr. Mirkin told Bennington that the lesion looked cancerous and recommended that a biopsy be performed to determine whether it was malignant. Dr. Mirkin’s secretary anesthetized the area for a biopsy excision. Because this was Bennington’s first visit to Dr. Mirkin, the physician’s secretary also filled out a billing record for Bennington and wrote on it “Exc nevus left leg 11 mm, multicolored changing” denoting the excision of the lesion 11 millimeters in length from Bennington’s left leg.

She also noted “Exc wart right thumb” on the billing record, describing the excision of the wart. The wart was removed, but before Dr. Mirkin removed the lesion, Bennington’s father told Dr. Mirkin that they did not have insurance to cover medical expenses. In response, Dr. Mirkin said that he was so certain the lesion was cancerous that the biopsy was not really necessary and that he could remove the lesion and a section of tissue around it in his office at that time. This would eventually have to be done, he explained, and it saved Bennington the expense of the biopsy.

The Benningtons agreed with this suggestion and the lesion and a section of tissue around it were removed. A copy of the billing record, which was the only record made of Bennington’s visit to Dr. Mirkin’s office, was given to Bennington. It was not changed, however, to reflect the procedure that was actually performed. Following the procedure,-Dr. Mirkin had the lesion and tissue specimen sent to Cytopathological Associates for a pathological examination.

The Tissue Examination Report ⁵⁴³ confirmed that the lesion was cancerous and contained a description of the specimen as “a single pinkish tan tissue with a dark brown pigmented center, measuring 20 x 10 [millimeters.]” A copy of the report was given to Bennington by Dr. Mirkin on a follow up visit. In August of 1982, Bennington began to experience swelling in his left groin area, and he consulted Dr. Jeremy Cooke. Dr. Cooke diagnosed Bennington as having disseminating cancer. He informed Dr. Mirkin of this and told him that he was now treating Bennington.

Dr. Cooke made a notation in his records that the scar on Bennington’s leg as a result of Dr. Mirkin’s excision was five centimeters in length. Dr. Cooke also referred Bennington to a surgeon, Dr. Kreupz, who later surgically removed a lymph node from Bennington’s groin which was also found to be malignant. In September of 1982, Bennington saw Dr. Max Cohen, a surgical oncologist. Dr. Mirkin, at Bennington’s request, sent Dr. Cohen a copy of the Tissue Examination Report prepared by Cytopathological Associates.

On September 23, 1982, Dr. Cohen performed a resection of the original excision on Bennington’s left leg and removed a lymph node. It was not cancerous. At about this time, Dr. Cohen contacted Dr. Mirkin and expressed his opinion that the excision on Bennington’s left leg seemed to be much larger than 20 by ten millimeters as stated on the Tissue Examination Report. On April 4, 1983, Dr. Mirkin wrote to Cytopathological Associates, informing them that the specimen that he submitted to them for testing was much larger than 20 by 10 millimeters as stated in its Tissue Examination Report. “The specimen was huge ...

I am sure that the total amount of skin was 18 centimeters by about 7 cm,” Dr. Mirkin wrote. Four days later, Dr. William Lee, a pathologist with Cytopathological Associates, sent Dr. Cohen an amended pathology report, which, the report noted, was “made with the aid of Dr. Gabe Mirkin’s operative description.” It stated that the “[e]ntire specimen measure[d] 18 ⁵⁴⁴ cm x 7 cm x 7-9 mm in thickness. There is a deeply pigmented slightly elevated lesion in the center measuring 20 mm x 10 mm in size.” Dr. Mirkin then called Dr. Sanford Barsky at Cytopathological Associates and discussed the amended report. Shortly thereafter, a second amended report was sent to Dr. Cohen by Dr. Barsky which attempted to explain the discrepancy between the original and amended reports.

This report, which also described the specimen sent to them by Dr. Mirkin as 18 by seven centimeters, explained that the 20 x 10 millimeter specimen referred to in the original Tissue Examination Report was the section used for testing that was cut out of the 18 by seven centimeter, section submitted to the lab by Dr. Mirkin. This report also stated that the lesion itself measured five by four millimeters. On December 8, 1983, Mirkin was contacted by Bennington’s lawyer who requested copies of Bennington’s medical records and bills. On January 9, 1984, Dr. Mirkin sent him a letter enclosing what he termed “my operative notes and the pathology report.” What was actually sent were copies of the second amended Tissue Examination Report completed by Dr. Barsky and a billing record describing Bennington’s visit to Dr. Mirkin.

The billing record enclosed, however, was not the one prepared at the time of Bennington’s visit that described the excision of an 11 millimeter lesion from the patient’s left leg. Rather, the billing record forwarded to Bennington’s attorney was prepared by Dr. Mirkin after receiving the letter requesting Bennington’s medical records, and it described the excision as 18 by seven centimeters, and recommended that the patient see another doctor for follow up treatment for the cancer. This record, although handwritten by Dr. Mirkin sometime between December 8 and December 19, 1983, was dated March 4, 1982, the date that Mirkin performed the excisions on Bennington’s thumb and left leg. In addition, Dr. Mirkin also sent a letter to the claims department of his insurer, Medical Mutual, along with a copy of the letter from Bennington’s attorney, the second amended Tissue Examination Report ⁵⁴⁵ and a billing record.

This billing record, however, was different from both the original and the one forwarded to Bennington’s attorney. The billing record sent to Bennington’s attorney indicated that Dr. Mirkin spoke to Bennington about getting follow up care on March 11, 1982 and the billing record sent to Medical Mutual stated that this conversation took place on March 4, 1982. Furthermore, Dr. Mirkin did not mention to either Bennington’s attorney or to Medical Mutual the existence of the original billing record. He also later testified that at the time that he prepared the second and third billing records he “had an idea” that Bennington might file a malpractice claim against him.

To summarize, the correspondence that Dr. Mirkin sent to Medical Mutual and Bennington’s attorney did not mention the existence of the original billing record, nor did it mention the fact that the billing record that was forwarded was not prepared at the time Bennington was treated by Dr. Mirkin but was drafted some 21 months later and was backdated to the time of the treatment. On May 23, 1984, Bennington filed a claim against Dr. Mirkin with the Health Claims Arbitration Office alleging that Dr. Mirkin was negligent in failing “to properly excise the malignant melanoma with sufficient margins to prevent recurrence” and in failing “to schedule follow-up examination after the excision for the purpose of early detection and treatment of any recurrence.” In August of 1985, Dr. Mirkin’s deposition was taken and the existence of the original billing record, a copy of which was given to Bennington at the time of his treatment, was made known to Medical Mutual. Shortly thereafter, Medical Mutual’s claims agent, Kathleen Killeavy, discussed the matter of the different billing records with Dr. Mirkin, who was notified by Medical Mutual claims manager Richard L. Donniez on December 2,1985 that “the possibility exists that there may have been additions or alterations made by you to your office notes and bills. If these alterations or additions should prove to be prejudicial and material, we reserve the ⁵⁴⁶ right to withdraw coverage and the defense of this civil action against you.” On January 21, 1987, after a hearing, the Health Claims Arbitration Panel determined that Dr. Mirkin was liable to Bennington for negligence in the amount of $650,000.

During the course of that hearing, Dr. Mirkin testified that none of the three billing records were accurate. Kevin McCarthy, Esq., the attorney retained by Medical Mutual to represent Dr. Mirkin, reported to Killeavy that the chairman of the panel that heard the case told him, off the record, that the panel’s decision was based on Dr. Mirkin’s improper follow up and that “[n]o member of the panel believed that Dr. Mirkin was credible as a witness.” On September 21, 1987 Medical Mutual notified Dr. Mir-kin that his insurance would be cancelled as of October 17, 1987, for “alteration of records.” On October 2, 1987, Dr. Mirkin filed a complaint with the Insurance Commissioner alleging that Medical Mutual had violated § 234A(a) of the Insurance Code, 2 which proscribes, inter alia, the cancellation of insurance for any arbitrary or capricious reason or for a reason other than one that involves “the application of standards which are reasonably related to the insurer’s ⁵⁴⁷ economic and business purposes.” A hearing on this complaint was held before the Insurance Commissioner on April 22, 1988 and continued on May 18, 1988 and August 16, 1988. At this hearing, Medical Mutual stated that the underwriting standard it applied in cancelling Dr. Mirkin’s insurance was as follows: Professional liability insurance will not be provided to any physician who, in connection with a prior claim, materially altered medical records after becoming aware of the possibility of a claim arising from an act or omission in the furnishing of professional services. Alteration includes any addition, correction or change to or written supplementation of the patient’s medical records occurring after the creation of those records unless the subsequent addition, correction, change or supplementation is clearly labeled to indicate that it is not a contemporaneous record.

The Insurance Commissioner concluded that this standard satisfied § 234A, but had been improperly applied because