Shumake v. Travelers Ins. Co.

• Decision Date: 21 March 1986
• Docket Number: Docket No. 79850
• Citation: 383 N.W.2d 259,147 Mich.App. 600
• Parties: James SHUMAKE and Norma Shumake, Plaintiffs-Appellees, v. TRAVELERS INSURANCE COMPANY, Defendant-Appellant.
• Court: Court of Appeal of Michigan — District of US

Page 259

383 N.W.2d 259

147 Mich.App. 600

James SHUMAKE and Norma Shumake, Plaintiffs-Appellees, v. TRAVELERS INSURANCE COMPANY, Defendant-Appellant.

Docket No. 79850.

Court of Appeals of Michigan.

Submitted July 8, 1985.

Decided Dec. 16, 1985.

Released for Publication March 21, 1986.

Catchick & Dodge by James M. Catchick, Grand Rapids, for plaintiffs-appellees.

Smith, Haughey, Rice & Roegge by Lance R. Mather, Grand Rapids, for defendant-appellant.

Before WAHLS, P.J., and ALLEN and RAVITZ, ^* JJ.

ALLEN, Judge.

In this declaratory judgment action, plaintiffs sought reimbursement for Laetrile (amygdalin) and related nutritional therapy prescribed for James Shumake by his physician, Philip E. Binzel, M.D. Dr. Binzel determined that Shumake suffered from a metabolic disorder, a diagnosis he reached based primarily on the fact that Shumake had developed lung cancer. The Laetrile and nutritional supplements were prescribed as a treatment for the metabolic disorder. The trial court held that under the terms of the policy, plaintiffs were entitled to reimbursement in the amount of $17,478.20. Defendant appeals as of right.

Plaintiffs were insured under a group health insurance policy issued by defendant Travelers Insurance Company to James Shumake's former employer, Service Reproduction Company. On May 26, 1978, Shumake underwent surgery for removal of the right upper lobe of his right lung after a cancerous tumor was discovered. His prognosis was guarded, with doctors estimating his chances of survival over the ensuing five years as between 15 and 25 percent. Shumake consulted a general practitioner, Dr. Binzel, who prescribed a course of treatment involving a regimen of Laetrile, enzymes and vitamins, and certain nutritional guidelines. Defendant paid all expenses associated with this treatment from June, 1978, to January 31, 1981. Defendant then notified plaintiffs that expenses for Laetrile and Laetrile-related nutritional supplements were not covered under the subject insurance policy.

The policy at issue provides coverage for 80 percent of "covered medical expenses" which are "necessarily incur[red]". "Covered medical expense" is defined as:

"[T]he actual expense to the Employee of the reasonable charges (as defined) [ ¹ not hereinafter excepted incurred by the Employee on account of himself or his Dependent upon the recommendation and approval of the attending physician for the services and supplies listed below and required in connection with the treatment of the Employee or his Dependent for any [accidental bodily injury or sickness]."

Included in the list of covered medical expenses are "medical supplies", which are defined to include "[d]rugs and medicines covered by written prescription of a physician".

The insurance policy does not contain any exclusion which would specifically preclude coverage for Laetrile and Laetrile-related nutritional supplements. Nonetheless, defendant maintains that coverage was properly denied, advancing three arguments: (1) the expenses were not occasioned by "accidental bodily injury or sickness"; (2) the expenses were not "necessarily incurred" or "required" in connection with treatment for a sickness; and (3) the nutritional supplements were not "covered by written prescription of a physician" since they could be purchased over-the-counter.

Defendant argues that Shumake was not sick within the meaning of the policy since all of the cancer had been surgically removed and there was no evidence that the cancer had spread. Regardless of these indicators, plaintiffs were informed after the surgery was completed that Shumake's chances of survival were poor, that he had at least a 75 percent chance of cancer reappearing, and that he would most likely die from the cancer. Further, he was advised to consult an oncologist for further treatment, despite the fact that his doctors believed all of the cancer had been removed. Dr. Melvin L. Reed, a defense expert who examined Shumake four years after his surgery, testified that, as a post-operative treatment, radiation therapy to the middle chest would have been advisable. In light of these factors and testimony at trial indicating that cancer is not considered "cured" until five years have passed without incident, we do not believe that the trial court erred in finding that Shumake was suffering from a "sickness" at the time he received the Laetrile treatment.

Defendant argues in the alternative that cancer was not the "sickness" for which Shumake was receiving treatment. A treatment agreement entered into between Shumake and Dr. Binzel states that Binzel was treating Shumake for a metabolic disorder. Defendant maintains that since laboratory tests were not performed to verify the disorder, no "sickness" was established.

Dr. Binzel testified that he did not order laboratory tests because numerous tests would be required to isolate specific nutritional deficiencies and the tests would have been costly. Moreover, he believed that the presence of cancer was indicative of a metabolic disorder and that monitoring the patient's response during the course of therapy was a preferred method for determining whether deficiencies were being adequately treated. It appears from the record before us that Laetrile practitioners generally operated on the central premise that cancer resulted from metabolic imbalances. Proponents believed that if the disorder could be cured, the body's defense mechanisms would then operate to avert a recurrence of cancer.

This issue appears to pose two distinct concerns. First, defendant places substantial weight on the treatment agreement indicating that Shumake was being treated for a metabolic disorder and not for cancer. Yet, the metabolic disorder and the cancer were intricately related. The purpose of the treatment was to enhance the body's defense mechanisms so that they would take over to ward off cancer. The treatment would never have been prescribed if Shumake had not contracted cancer. By way of affidavit, Binzel stated that he was treating Shumake "for lung cancer and its attendant side effects". Moreover, the crux of defendant's argument on the question of whether Laetrile therapy was "necessarily incurred" is the assertion that the treatment was ineffective in the treatment of cancer--not that it was ineffective in the treatment of a metabolic disorder. Regardless of the efficacy of treatment and the disclaimers in the agreement, we believe that the inescapable result is that Shumake received this treatment because of the cancer. Since we have already determined that he was suffering from a "sickness" as a result of the cancer, coverage cannot be denied on this basis.

In addition, defendant's argument relative to whether Shumake was sick goes to a basic tenet upon which Laetrile practitioners operated, i.e., that cancer was indicative of a metabolic disorder. Although defendant presented substantial evidence which challenges the logic of this reasoning, defendant failed to negate the fact that at the time Shumake's treatment commenced there was a strong and viable minority in the medical community which adhered to these basic tenets and believed that Laetrile was an effective means of controlling cancer. We recognize that the weight of authority held a contrary view. However, we are not prepared to determine as a matter of law that a diagnosis subject to conflicting medical opinions is fallacious merely because a majority of the medical community would arrive at a distinct conclusion. Accordingly, we believe that the evidence presented was sufficient to establish a "sickness".

The next issue presented for our consideration is whether Laetrile and related nutritional treatments were necessarily incurred covered medical expenses and required in connection with Shumake's treatment. Defendant maintains that the treatments have been demonstrated to be ineffective and that, as a result, they cannot be regarded as necessary or required for the treatment of cancer.

The trial court found that "necessarily incurred" was an ambiguous term. It then relied on Van Vactor v. Blue Cross Association, 50 Ill.App.3d 709, 8 Ill.Dec. 400, 365 N.E.2d 638 (1977), to hold that the necessity of a medical treatment or expense should be determined by the attending physician. Defendant points out that such a construction of medical necessity could lead to absurd results. For example, such a construction of the policy would require coverage where a physician prescribed bizarre or archaic treatments, such as bloodletting, simply because the physician deemed it necessary. Defendant therefore urges us to follow the reasoning of Free v. Travelers Ins. Co., 551 F.Supp. 554 (D.Md.,1982), which, in construing an identical provision of an insurance policy, found that the language was unambiguous. The Free court went on to hold that Laetrile could not be regarded as necessary for the treatment of cancer since the evidence presented at trial overwhelmingly indicated that Laetrile had no value in the treatment of cancer.

We cannot agree with the initial premise of the Free opinion, that the terms "necessarily incurred" and "required" for treatment are unambiguous. Three distinct definitions of the term "necessary" are cited at 551 F.Supp. 558: Abernathy v. Prudential Ins. Co. of America, 274 S.C. 388, 264 S.E.2d 836 (1980) (equating "necessary" with "appropriate"); Victum v. Martin, 367 Mass. 404, 326 N.E.2d 12 (1975) (necessary means "wise in the light of facts known at the time rendered"); and Group Hospitalization, Inc. v. Levin, 305 A.2d 248 (D.C.App.,1973) ("necessary" means "reasonably calculated to shorten and relieve an ordeal of agonizing pain and thereby effectuate the most rapid recovery possible"). Reference to McLaughlin v. Connecticut General Life Ins. Co., 565 F.Supp. 434 (N.D.Cal.,1983), illustrates that Free's list of definitions was not exhaustive. McLaughlin cites, inter alia, Fassio v. Montana...