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Veurink v. Murphy

United States District Court, D. South Dakota, Southern Division

June 25, 2019

DR. JILL MURPHY Defendant.



         Pending before the Court is Defendant, Dr. Jill Murphy's ("Dr. Murphy"), Motion for Partial Summary Judgment on Plaintiff, Angela Veurink's ("Ms. Veurink") claim for fraud and deceit. Doc. 23. For the following reasons, the motion is denied.


         Dr. Murphy is a board-certified plastic surgeon, and during the events at issue in this case, practiced with Plastic Surgery Associates of South Dakota ("PSA") from August 2014 through April 2018. Doc. 25, ¶¶ 2, 3; Doc. 29, ¶¶ 2, 3.

         On October 4, 2016, Ms. Veurink had her first appointment with Dr. Murphy for a plastic surgery consultation. Doc. 25, ¶ 1; Doc. 29, ¶l. During the October 4, 2016, appointment, Dr. Murphy and Ms. Veurink discussed an abdominoplasty ("tummy tuck") with liposuction and umbilical hernia repair. Doc. 25, ¶ 10; Doc. 29, ¶ 10. Although Dr. Murphy's medical notes from this visit do not mention breast surgery, Dr. Murphy and Ms. Veurink both recall that they discussed breast surgery. Doc. 25, ¶ 11; Murphy Dep. 44:11-25. While it is disputed as to exactly what Dr. Murphy and Ms. Veurink discussed during this initial meeting about her breast surgery, both Dr. Murphy and Ms. Veurink agree that Ms. Veurink talked about wanting to have a smaller breast size. Doc. 25, ¶ 11; Doc. 29, ¶ 11. Dr. Murphy testified during their first meeting, Ms. Veurink did not talk about submitting her breast reduction procedure to insurance, and Ms. Veurink testified that she and Dr. Murphy did not discuss insurance until her second visit. Murphy Dep. 41:5-23; Veurink Dep. 66:20-22. Dr. Murphy testified that because they had not talked about the breast surgery being billed through insurance, she gave Ms. Veurink a quote for a mastopexy, which is what Dr. Murphy calls a breast lift, with or without a breast reduction, when the patient is paying for the procedure out-of-pocket. Murphy Dep. 41:16-22.

         A mastopexy is a breast lift and is typically done as a cosmetic or self-pay procedure with the stated goal of reducing the skin envelope so everything is lifted up higher on the breasts for a more aesthetic appearance. Doc. 25, ¶ 12; Doc. 29, ¶ 12; Steele Dep. 64:14-23; Murphy Dep. 10:6-12. In a mastopexy, the surgeon may remove some tissue, but it is mainly skin. Steele Dep. 66:10-12. Breast reductions, on-the-other-hand, can either be self-pay or covered by insurance and the purpose of a breast reduction is to make the breasts smaller. Steele Dep. 65:14-24; Murphy Dep. 41:16-23. Nearly all breast reductions include a breast lift and during Ms. Veurink's October 4, 2016, appointment, Dr. Murphy explained that her breast reduction would also include a breast lift. Doc. 25, ¶¶ 13, 14; Doc. 29, ¶¶ 13, 14.

         If a breast reduction is a self-pay procedure, technically, there is no minimum amount of breast tissue that has to be removed before a procedure can qualify as a breast reduction. Steele Dep. 66:1-6. Dr. Steele testified that the goal of a breast reduction is to remove enough breast tissue, 300-800 grams, to make the breasts smaller for symptomatic relief. Steel Dep. 66:14-22; Jodi Pierret ("Ms. Pierret"), the clinic manager at PSA for 27 years, also testified that breast reductions generally have a larger amount of grams of tissue removed. Pierret Dep. 51:15-52:3. By contrast, Dr. Murphy testified that by definition, any amount of breast tissue that is removed from the breast qualifies as a breast reduction. Murphy Dep. 24:25-25:19 ("[W]hen you remove breast tissue, you are reducing the size of the breast. And so by definition, it is a breast reduction."). Dr. Murphy did acknowledge that just removing skin would be a mastopexy, not a breast reduction, but said "as part of a mastopexy, it is accepted that you can remove breast tissue and thereby perform a breast reduction as part of a mastopexy." Murphy Dep. 23:15-24:7. Dr. Murphy testified that there can be different volumes-small reductions and large reductions, but that any time you remove breast tissue, you are reducing the size of the breast. Murphy Dep. 25:11-25:19.

         Dr. Murphy testified that the main difference between a mastopexy and a breast reduction, from a patient's perspective, is who is paying for it and whether there is a minimal amount of breast tissue that must be removed. Murphy Dep. 9:14-25. Dr. Murphy testified that if a patient is paying for the surgery out-of-pocket, "the amount of breast tissue taken out would be 100 percent based on what the patient's goal is" as they would not be required to take a minimum amount out in order to qualify as a breast reduction surgery by the insurance company's standards. Murphy Dep. 80:25-81:24.

         After Ms. Veurink's initial appointment with Dr. Murphy on October 4, 2016, Ms. Veurink received a price quote for the procedures she and Dr. Murphy had discussed. When Ms. Veurink saw "mastopexy" on the quote, she did not know what it meant and went online to research what it was and saw a lot of people referring to it as a breast lift. Ms. Veurink Dep. 71:16-19. On October 13, 2016, Ms. Veurink scheduled surgery at Rivers Edge Aesthetic Surgery ("REAS") for November 15, 2016, and a second consult visit with Dr. Murphy for November 1, 2016. Doc. 25, ¶¶ 32-35. Ms. Veurink testified that she wanted to be sure that she and Dr. Murphy were "on the same page as far as the breast reduction goes." Veurink Dep. 66:16-20. On October 28, 2016, the computerized scheduling information that REAS and PSA use to schedule clinic visits and surgeries shows that on October 28, 2016, Ms. Veurink changed the date of her surgery from November 15, 2016 to November 3, 2016. Doc. 27, ¶¶ 3, 4; Doc. 25, ¶ 32.

         Ms. Veurink testified that during her November 1, 2016, consultation, Dr. Murphy asked her what size she wanted to be and that Ms. Veurink expressed that she would like to be a large B/small C. Ms. Veurink Dep. 74:7-12. Dr. Murphy's medical notes from the November 1, 2016, consultation state that "breast reduction was discussed in detail" and that Ms. Veurink expressed her desire to be a large B/small C. Preheim Aff, Ex. 6. Although Dr. Murphy and Dr. Steele testified that they never guarantee a patient will be a certain cup size after surgery because cup sizes can vary so much between brands of bras, they both testified that a patient's answer to this question can give them a frame of reference for how large the patient wants their breasts to be in proportion to their frame. Murphy Dep. 51:24-53:7; Steele Dep. 70:3-12. Given Ms. Veurink's DD breast size, reducing Ms. Veurink's breasts to a large B/small C would make Ms. Veurink's breasts smaller in proportion to her frame. Steele Dep. 51:23-52:4. Despite the fact that Ms. Veurink told Dr. Murphy that she wanted to be a large B/small C, Dr. Murphy testified that Ms. Veurink wanted to be proportional to her frame. Murphy Dep. 39:22-40:3; 53:8-12. Ms. Veurink testified that she recalled telling Dr. Murphy that "proportionality" was not something she was concerned about, but rather the alleviation of her symptoms. Veurink Dep. 80:21-25.

         Although Ms. Veurink testified that Dr. Murphy told her during this visit that she could remove about 250 - 350 grams of tissue from each side of the breast, this fact is in dispute. Veurink Dep. 74:10-12. Dr. Murphy acknowledges that she put these numbers in her medical notes that day, but contends that she did not inform the Ms. Veurink of these numbers because she always added them at the end of the day after she consulted a formula to help her estimate the amount of breast tissue that would need to be removed for insurance purposes. Murphy Dep. 70:5-8; 72:10-14.

         Dr. Murphy's recollection of why Ms. Veurink returned for a second consultation on November 1, 2016, was that she wanted to get the procedure "[they] had talked about before, which was cosmetic breast lift. . . paid for by her insurance as a breast reduction." Murphy Dep. 38:19-23; Murphy Dep. 45:18-24. Dr. Murphy testified that she told Ms. Veurink that there was not really a difference in what they were going to do procedurally, but that they were going to try to get it covered by insurance. Murphy Dep. 38:16-21; 39:14-21; Doc. 25, ¶32 ("The procedure was not going to be any different... ."). Dr. Murphy stated that in order to get it covered by insurance, they needed to document the symptoms Ms. Veurink was experiencing from her large breast size such as open sores, back and neck pain. Murphy Dep. 38:24-39:6. PSA staff took photos to document the scars and sores under Ms. Veurink's breasts to submit along with the insurance pre-authorization form. Veurink Dep. 55:5-14. Dr. Murphy also documented in her medical notes the pain that Ms. Veurink was experiencing due to her large breasts and the alternative therapies that Ms. Veurink had tried which had not alleviated her symptoms. Preheim Aff, Ex. 6. There is no evidence in the record before the Court that Dr. Murphy told Ms. Veurink that insurance companies require a certain amount of breast tissue to be removed in order for it to be a covered service, just that she had to give the insurance company "an estimate of what [she] [thought] she could remove to bring Ms. Veurink down to a size which is the size she wanted to be and where she wanted to be proportionate to her frame.[1]" Murphy Dep. 39:22-40:3. Dr. Murphy testified that she told Ms. Veurink that "based on whatever that particular insurance company's requirements are-they all have different requirements to cover breast reduction, then it would be either approved or not approved," and that they could either appeal or do whatever else is required by the insurance company to get it covered. Murphy Dep. 40:10-24.

         During the November 1, 2016, visit, Dr. Murphy testified that she told Ms. Veurink that she was going to perform a breast reduction, but that they needed to submit to insurance and wait to hear what insurance said before they could determine if Ms. Veurink would be approved for a breast reduction. Murphy Dep. 135:4-20. Dr. Murphy told Ms. Veurink that she would ask for approval from the insurance company, but that if they did not get it, Dr. Murphy could perform the same procedure except that Ms. Veurink would pay for it out-of-pocket. Murphy Dep. 136:6-11. Ms. Veurink testified that it was her understanding that as long as PSA submitted the pre-authorization form to the insurance company, they could proceed with breast reduction surgery and that ultimately, whether the procedure was covered by insurance depended on how Ms. Veurink's insurer, Avera Health Plan, responded to her request for pre-authorization. Veurink Dep. 31:25-32:4; 32:18-21.

         On November 2, 2016, a day before her surgery, Ms. Veurink paid PSA $10, 685 for her surgery with the expectation that she would be reimbursed for amounts paid for the breast portion of her surgery if insurance approved the procedure. Veurink Dep. 69:1-21.

         Ms. Pierret testified that once an insurance company receives a pre-authorization form for a breast reduction, it will respond in approximately 10-15 days with either an approval or a denial of the pre-authorization. Pierret Dep. 121:22-23. Ms. Veurink's November 3, 2016, surgery was already scheduled at the time of her November 1, 2016, follow-up appointment with Dr. Murphy. Doc. 25, ¶ 32 ("On October 28, 2016, at Veurink's request, the date of the surgery was changed from November 15, 2016, to November 3, 2016."). At the end of the November 1, 2016, consultation, Ms. Veurink was under the impression that she would not likely receive pre-authorization prior to her surgery, but that she could proceed with surgery as long as the pre-authorization form had been submitted. Veurink Dep. 76:5-10.

         On November 3, 2018, the day of the surgery, the nursing staff at REAS, where the operation was performed, presented Ms. Veurink with informed consent forms to sign which included a bilateral formal mastopexy which Ms. Veurink understood from her discussions with Dr. Murphy to be the breast reduction. Veurink Dep. 112:18-25. Dr. Murphy told Ms. Veurink prior to surgery that they had not yet heard back from insurance and that she was giving Ms. Veurink the option of whether to send the breast tissue removed to insurance. Veurink Dep. 79:4-18; Preheim Aff, Ex. 6. Ms. Veurink decided that she did not want to send the breast tissue to pathology because she knew that a pathology bill could be expensive and thought that she would save a little money in the event the insurance company denied coverage. Veurink Dep. 79:19-80:1. Dr. Murphy testified that it was her understanding when she went into the operating room that day, that Ms. Veurink wanted to proceed with the procedure out-of-pocket and that they were not going to attempt to get it covered by insurance. Murphy Dep. 212:18-23.

         Although the tissue removed was not sent to pathology, REAS staff weighed the breast tissue in the operating room and documented it in the patient records. Preheim Aff, Ex. 10. Although Dr. Murphy signed the patient record containing the weight of the breast tissue, both she and Ms. Pierret testified that they were unaware that REAS weighed breast tissue independent of pathology if a claim was not being submitted to insurance. Murphy Dep. 213:1-3; Pierret Dep. 107:18-108:2; 128:11-16. The amount of breast tissue that was documented as having been removed was 101 grams from the right breast and 121 grams from the left breast. Preheim Aff, Ex. 10. Ms. Veurink testified that she assumed Dr. Murphy knew that at the time of surgery that the tissue that was removed had been weighed by REAS. Veurink Dep. 95:14-18.

         After the surgery, Ms. Veurink logged into her online patient portal and noticed that there had yet not been a claim submitted to her insurance. Veurink Dep. 101:13-25. On November 28, 2016, and on several occasions thereafter, Ms. Veurink inquired of PSA as to why no claim had yet been submitted to insurance for her breast surgery. Veurink Aff, Ex. C. A breast reduction pre-authorization form was not completed by PSA and submitted to Ms. Veurink's insurer, Avera Health Plans, until more than a month after Veurink's surgery. Pierret Dep. 59:18-21; Preheim Aff, Ex. 7. Ms. Pierret testified that during her 27-year tenure with PSA, she was not aware of another instance in which the clinic submitted a pre-authorization form to an insurance company post-surgery. Pierret Dep. 1212:12-18. The pre-authorization form documented the date of Ms. Veurink's surgery as November 3, 2016, and stated that Ms. Veurink had bilateral macromastia and suffered from permanent shoulder grooving from bra straps, persistent intertrigo at the inframammary folds, and back pain, open sores under breasts with scarring. Preheim Aff, Ex. 7. The estimated breast tissue removed was documented as greater than or equal to 350 grams. Preheim Aff, Ex. 7.

         Ms. Pierret testified that when attempting to complete the pre-authorization form, she did not find anything documented in Ms. Veurink's medical records to be considered a breast reduction and so she spoke to Dr. Murphy about how many grams were removed. Pierret Dep. 65:15-23. Dr. Murphy stated that given she did not weigh the tissue "because [they] didn't do this with the intention of sending it to surgery," and since she alleges that she had no knowledge that the tissue had been weighed by REAS, the best she could do was estimate how much the breast tissue removed felt in her hand which, Dr. Murphy testified, is what she wrote in her addendum to the operative report. Murphy Dep. 209:11-210:10. Specifically, Dr. Murphy's addendum stated as follows:

Addendum to original operative report. Breast tissue was removed from both the right and left breasts. Intra-op this amount of tissue felt consistent with about 35Og per side.[2] Tissue was not sent to pathology per patient request.

         Preheim Aff, Ex. 8.

         Approximately 45 days after Ms. Veurink's surgery, PSA received the pre-authorization back from Avera Health Plans agreeing to insure Ms. Veurink's surgery as a breast reduction. Pierret Dep. 57:19-21. Thereafter, PSA submitted an insurance claim for a breast reduction on behalf of Ms. Veurink to Avera Health Plans. Pierret Dep. 57:17-21; 106:16-20; 115:6-11. The amount charged by PSA for the breast reduction that was submitted to insurance was $10, 000, but pursuant to the contract that PSA had with Avera Health Plans, PSA was required to write off $6, 446.66, so the procedure was approved for $3, 553.34. Pierret Dep. 116:4-25.

         Two months prior to Ms. Veurink's surgery, Dr. Murphy had become partner at PSA where she no longer received a salary, but rather a percentage of revenue she brought in minus her percentage of overhead and expenses. Pierret Dep. 91:9-11; 92:17-18; 98:6-9. If Ms. Veurink's breast reduction was billed through insurance, Dr. Murphy's compensation would be based on the $3, 553.34 that the insurance company approved for the procedure, whereas the price for a mastopexy paid for out-of-pocket was $4, 250, although Ms. Veurink received a 50% multiple procedure discount and was thus quoted $2, 125 for the mastopexy. Pierret Dep. 68:3-18; 113:23-114:2; 117:7:10.

         After receiving the insurance proceeds from the breast portion of Veurink's surgery, PSA refunded Veurink $1, 776.93 that she had paid out-of-pocket for the breast portion of the surgery. Pierret Dep. 115:12-15; Hinton Aff, Ex. Veurink 8.

         After her surgery, Ms. Veurink had three post-operative visits with Dr. Murphy in November 2016, December 2016, and February 2017. Veurink Dep. 86:19-21; 87:1-4. During her February 2017 visit, Ms. Veurink told Dr. Murphy that she was not happy with the size of her breasts and that she still fit her DD bras. Veurink Dep. 88:18-22. When Dr. Murphy inquired what size she wanted to be, Ms. Veurink replied that as they had discussed in her November 1, 2016, visit, she had wanted to be a large B/small C. Veurink Dep. 88:18-22. Dr. Murphy's medical notes from the February 2017 visit confirm that Ms. Veurink told her she was still fitting in her DD bra, was unhappy with the size of her breasts, and that she wanted to be smaller, a size B/C. Preheim Aff., Ex. 6.

         On or around March 14, 2017, Ms. Veurink submitted a letter to Avera Health Plans stating that she did not believe she had received a breast reduction and did not think that her insurance company should have compensated PSA for a breast reduction. Veurink Aff., Ex. B. Ms. Veurink stated that the surgical notes stated that 101 grams and 121 grams of tissue were removed from the right and left breasts respectively and further stated that she believed that Dr. Murphy's addendum to the surgical report, estimating that greater than or equal to 350 grams of tissue was removed from each breast, was fabricated in order to have insurance retro-authorize the procedure. Veurink Aff, Ex. B. Both Ms. Pierret and Dr. Murphy testified that they had not realized REAS had actually weighed the breast tissue that had been removed during Ms. Veurink's surgery until they received a letter from Ms. Veurink referencing the weight of the tissue documented in the surgical report. Pierret Dep. 127:5-10; 128:17-22.

         After receiving Ms. Veurink's complaint, Avera Health Plans conducted a review and determined that Ms. Veurink's records showed that a breast reduction was not performed, and only a breast lift was completed. Veurink Aff., Ex. B. Accordingly, PSA refunded to Avera Health Plans the money it received for Ms. Veurink's breast surgery. Pierret Dep. 115:16-20. Ms. Veurink has not repaid PSA the amounts that she was refunded for her insurance company's coverage of her breast surgery. Pierret Dep. 115:21-24.

         On February 16, 2018, Ms. Veurink filed a complaint against Dr. Murphy and an amended complaint on July 3, 2018, alleging claims for medical negligence, and fraud and deceit. Docs. 1, 15. In her claim for relief, Ms. Veurink seeks the following damages resulting from Dr. Murphy's alleged unlawful conduct: 1) past and future medical expenses; 2) past and future physical, mental, and emotional pain and suffering; 3) past and future loss of bodily function; 4) past and future loss of enjoyment of life; 5) lost wages and other consequential financial damages; 6) punitive damages; and 7) interest. In the event that the jury's verdict exceeds the statutory maximum allowed ...

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