Court Dismisses Case Against MMIC for Denial of Malpractice Insurance Coverage 

October 17, 2024

On October 14, the Minnesota Court of Appeals upheld a district court’s granting of summary judgment to MMIC in a lawsuit challenging its decision to deny coverage of a physician’s expenses incurred in defense of a lawsuit.  

The MMA, along with the AMA and the American Society of Aesthetic Plastic Surgery (ASAPS), submitted an amicus or “friend of the court” brief in May in a case involving the denial of medical malpractice insurance coverage by MMIC, filed by Minnesota physician, James A. Hoffman, MD.    

 The initial case that gave rise to the lawsuit against MMIC involved Hoffman, a plastic surgeon, who was sued for discrimination by a transgender patient seeking breast augmentation surgery. Hoffman acknowledged that he did not have the requisite training or experience to perform the surgery, and referred the patient to another specialist.  

The discrimination case against Hoffman was dismissed because the court found “no evidence” that Hoffman or his clinic “were motivated by a purpose or intent to discriminate against transgender people when they referred [the patient] to the University of Minnesota.”   

MMIC, Hoffman’s medical liability insurer, denied coverage for Hoffman’s legal expenses in the discrimination case, citing a policy exclusion for claims based on “violations of Minnesota law.” Hoffman sued MMIC for its denial of coverage and the district court granted summary judgment to MMIC. The case was appealed to the Minnesota Court of Appeals, which upheld the district courts granting of summary judgment to MMIC. 

In its amicus brief, the MMA, AMA, and ASAPS argued that determining the type of care a physician is or is not qualified to perform, and referring the patient to an appropriately qualified physician, are precisely the types of medical decision-making a malpractice insurer is expected to cover in its liability policies. The brief further noted that physicians purchase medical malpractice liability insurance to provide coverage for their medical decision-making. Denying malpractice insurance coverage for a physician who decided not to provide medical care outside of his or her training and experience would have a harmful effect on the quality of care provided to Minnesota patients.   

Hoffman has the option to appeal the ruling to the Minnesota Supreme Court, which can decide whether or not they will review the case.