MISTY MOBLEY AND TAVARIS SANDERS, INDIVIDUALLY AND ON BEHALF OF TAVARION SANDERS, A MINOR,
Case No. 20-4033MTR
vs.
Respondent.
Pursuant to notice, on October 22, 2020, Administrative Law Judge (ALJ) Lynne A. Quimby-Pennock of the Division of Administrative Hearings (DOAH) conducted an administrative hearing via Zoom conference from Tallahassee, Florida.
For Respondent: Alexander R. Boler, Esquire
The issue in this case is the amount that must be paid to Respondent, Agency for Health Care Administration (AHCA or Respondent), from the proceeds of Petitioners’ confidential settlement to satisfy Respondent’s
Medicaid lien against the proceeds pursuant to section 409.910, Florida Statutes (2020).1
On September 9, 2020, Misty Mobley and Tavaris Sanders, individually and on behalf of Tavarion Sanders, a minor (Petitioners), filed a petition at DOAH for a determination of the amount payable to AHCA in satisfaction of Respondent’s Medicaid lien against the proceeds of a confidential settlement.
The case was assigned to the undersigned. Following receipt of the Response to Initial Order, the hearing was scheduled for October 22, 2020, via Zoom technology and was completed as planned.
On October 15, 2020, the parties filed a Joint Pre-hearing Stipulation in which they stipulated to 11 factual statements.2 The parties’ stipulations are incorporated below, to the extent relevant.
At hearing, Petitioners presented the testimony of Todd E. Copeland, Esquire, and Maria D. Tejedor, Esquire. Petitioners’ Exhibits 1 through 63 were received into evidence without objection. Petitioners’ Exhibits 7 through 11 are officially recognized.
Respondent presented no witnesses. Respondent’s Exhibit A was received in evidence without objection.
1 All citations will be to the 2020 edition of the Florida Statutes, unless otherwise indicated.
2 The 11th “factual” statement concerned the admissibility of Petitioners’ Exhibits 1 through 6, Respondent’s Exhibit A, and the official recognition of Petitioners’ Exhibits 7 through 11.
3 Exhibit 2a is included in the admitted exhibits: it was a late filed exhibit based on a testimony received during the hearing.
At the conclusion of the hearing, it was agreed that proposed final orders (PFOs) would be due within ten days after the hearing transcript was filed. The one-volume Transcript of the proceeding was filed on November 25, 2020.4 The PFOs were timely filed. Each PFO has been considered in the preparation of this Final Order.
Paragraphs 1 through 10 are the enumerated stipulated facts admitted and agreed upon by the parties, and required no proof at hearing.
Petitioners commenced a medical malpractice action in 2013 to recover damages related to the injuries sustained by Tavarion Sanders at the time of his birth in 2009. Tavarion Sanders was born September 16, 2009.
Misty Mobley is Tavarion Sanders’ mother.
The medical malpractice action contains a cause of action asserted on behalf of Tavarion Sanders’ parents, Misty Mobley and Tavaris Sanders, for their own injuries, including for the loss of services, earnings, companionship, society, and affection of the infant, and for the value and expense of the infant’s hospitalizations in the past and future.
The injuries related to Tavarion Sanders’ medical malpractice claim include hypoxic brain damage, cerebral palsy with decreased muscle tone in all four extremities, global developmental delays, and a neurogenic bowel and bladder. As a result of these permanent injuries, Tavarion Sanders requires, for the rest of his life, total assistance with all of his activities of daily living, including dressing, feeding, grooming, bathing, and toileting.
Medicaid first made payments for medical care on behalf of Tavarion Sanders in 2010.
4 Page one of the Transcript provides that “the Honorable Lawrence P. Stevenson, Administrative Law Judge” heard this case. That is inaccurate. The undersigned was assigned this case on September 9, 2020. As found on page four of the Transcript, the undersigned called this hearing to order and presided throughout the hearing.
In 2020, the medical malpractice action settled for a confidential amount. Petitioners assert that the settlement amount was not for the full value of Petitioners’ claims because of the challenges with proving liability and the risk of litigating the case to trial.
AHCA was properly notified of the medical malpractice action, and the instant Petition was timely commenced by Petitioners.
AHCA has asserted a lien against Tavarion Sanders’ settlement proceeds in the amount of $129,939.87.
AHCA paid $129,939.87 on behalf of Tavarion Sanders, related to his claim against the liable third parties in the Petitioners’ medical malpractice action.
The amount of the settlement in the medical malpractice action, and the allocation of the proceeds of the settlement as between Tavarion Sanders and Misty Mobley, is identified in Petitioners’ Lien Allocation and Reduction Worksheet. (Petitioners’ Exhibit 25).
Petitioners’ Exhibit 1 is an August 18, 2020, letter (lien letter) from Conduent Payment Integrity Solutions, a subcontractor to Health Management Systems, which is an authorized agent of AHCA “to operate the Florida Medicaid Casualty Recover Program.” In addition to directing Tavarion Sanders’ counsel to review section 409.910 to determine the “responsibilities to Florida Medicaid,” Mark Lyles, Conduent’s case manager and author of this letter also posted the amount of the lien asserted by AHCA: $129,939.87.6
Ms. Tejedor is a Florida board-certified civil trial lawyer with 23 years’ experience in personal injury law. She focuses on “birth-related injuries of
5 As noted in footnote 3 above, Petitioners’ Exhibit 2 was amended during the course of the hearing, and Exhibit 2a was filed at the conclusion of the hearing.
6 At some time during the course of this proceeding, Petitioners challenged approximately
$3,000.00 of the stipulated amount. However, at hearing, Ms. Tejedor conceded and confirmed as correct the figure found in Petitioners’ Exhibit 2a: the stipulated amount,
$129,939.87.
children suffering birth injuries during delivery.” As part of her ongoing practice, she routinely evaluates the damages suffered by injured clients. Ms. Tejedor relies on her own experience including her daily legal practice, three of her most recent medical malpractice trials, plus her review of other jury verdicts to gauge any likely recovery. Ms. Tejedor continues to handle cases involving similar injuries suffered by Tavarion Sanders.
Ms. Tejedor met and observed Tavarion Sanders; met with
Tavarion Sanders’ family and discussed Tavarion Sanders’ condition with his parents and treating medical personnel; and reviewed Tavarion Sanders’ medical information, including the actual medical records of the treating physicians and the multiple MRI reports.
Ms. Tejedor represented Petitioners in the civil litigation. She testified to the difficulties associated with this type of medical malpractice litigation in general, and then focused on the problematic causation and liability issues related to Tavarion Sanders and his injuries.
Ms. Tejedor credibly testified regarding the evaluations she made of Tavarion Sanders’ injuries and the legal actions she orchestrated.7 In addition to the stipulated injuries listed in paragraph 4 above, Ms. Tejedor described, in laymen’s terms, Tavarion Sanders’ injuries based upon the evidence discovered in the civil litigation: Tavarion Sanders has a severe brain injury; a form of cerebral palsy with motor impairment and cognitive delays; significant mental retardation with seizure disorders; and he is essentially nonverbal. She also explained Tavarion Sanders’ current situation as he is “really not capable of learning;” will never be “gainfully employed any time in the future;” will “require 24/7 care;” and will never live alone.
7 The medical malpractice action was initially brought through the “Neurological Impairment Compensation Association: fund and dismissed because the presiding ALJ found that Tavarion Sanders had not suffered a birth-related neurological injury. Following an appeal, the civil medical malpractice action was restarted, which resulted in a confidential settlement.
Ms. Tejedor’s unrefuted testimony placed the total full value of Tavarion Sanders’ damages conservatively at $21,972,186.87. Included in this total value are: Tavarion Sanders’ future medical care, $14,516,878.00; Tavarion Sanders’ loss of earnings capacity, $2,325,369.00; Tavarion Sanders’ pain and suffering, $5,000,000.00; and the past medical expenses, stipulated to by Petitioners and AHCA, $129,939.87. Further, using the $21,972,186.87 valuation amount and the confidential settlement proceeds, Ms. Tejedor averred she used the same formula to determine that 6.8% is the ratio of the settlement to the full value of Tavarion Sanders’ claim. Ms. Tejedor followed the formula as set forth in: Valeria Alcala, a Minor, by Yobany E. Rodriguez- Camacho and Manuel E. Alcala, as Natural Guardians and next friends vs. Agency for Health Care Administration, Case No. 20-0605MTR, 2020 Florida Division of Administrative Hearings, 2020 WL 4934729 (Fla. DOAH August 18, 2020); and Amy Lopez, Individually and as Parent and Natural Guardian of A.F., a Minor, vs. Agency for Health Care Administration, Case
No. 20-2124MTR (Fla. DOAH Sept. 3, 2020). Ms. Tejedor testified she used the “same formula that other jurisdictions in Florida have followed, which is the, you know, Ahlborn[8] decision, which basically ... lists out how you determine the percentage that ... the percentage of the value of the case that represents past medical expenses, and that’s exactly the way we did it in this case.” Ms. Tejedor’s testimony was competent, substantial, persuasive and uncontradicted on this point.
Mr. Copeland is a Florida civil trial lawyer with 28 years’ experience in personal injury law, with an active civil trial practice. He has handled and continues to practice in the areas of products liability and medical malpractice litigation. As part of his every day practice, Mr. Copeland is involved in resolving liens.
8 Ark. Dept of Health & Human Serv. v. Ahlborn, 547 U.S. 268 (2006).
In addition to serving as a witness for damage valuation cases and an expert in the reduction of liens, Mr. Copeland has worked with the legislation that deals with “damages, calculation of damages, and to some extent on occasion lien resolution was part of those calculations.” Mr. Copeland has “spent quite a bit of time testifying before committees in the House and Senate,” and on “Blue Ribbon panels appointed by governors that dealt in part with damages, and evaluating personal injury statutes.” Mr. Copeland’s expert testimony has always been accepted in evidence.
Mr. Copeland was tendered and without objection was accepted as an “expert witness in the valuation of damages in medical malpractice actions and in the resolution of health care liens.”
Mr. Copeland testified that Florida “courts generally are following the Ahlborn formula.” Mr. Copeland routinely works with life care planners and economists in his practice, and used the economic damage numbers provided to him for this case.
Further, Mr. Copeland testified that he based his opinion on Tavarion Sanders’ future medical care expense, lost earnings capacity, the medical expenses identified in the lien letter, Tavarion Sanders’ loss of enjoyment for the capacity of life, and Tavarion Sanders’ pain and suffering (both past and future) “just like you’re going through a jury verdict form” in Florida. Mr. Copeland opined that the full value of Tavarion Sanders’ claim, using his conservative approach, was $21,972,186.87.
Using the Ahlborn pro rata methodology or formula, that is, using the
$21,972,186.87 valuation amount and the confidential settlement proceeds, Mr. Copeland testified that Tavarion Sanders recovered only 6.8% of the full measure of all his damages. Then, by applying that 6.8% to the full amount that Medicaid claimed of $129.939.87, the full satisfaction of the lien is
$8,835.91. Mr. Copeland’s testimony was uncontradicted and persuasive on this point.
The testimony of Petitioners’ expert regarding the total value of damages was credible, unimpeached, and unrebutted. Petitioners proved that the confidential settlement does not fully compensate Tavarion Sanders for the full value of his damages.
AHCA did not call any witnesses, present any evidence as to the value of damages, or propose a different methodology to the valuation of the damages. In short, Petitioners’ evidence was unrebutted. Respondent’s attempt to quibble with how many significant figures were used in determining the appropriate percentage for the pro rata methodology calculation is tenuous and unpersuasive.
The parties stipulated to the value of the services provided by Florida Medicaid as $129,939.87. It is logical and rational to conclude that this figure is the amount expended for Tavarion Sanders’ past medical expenses.
Respondent explored an additional past medical expense of $762.66, however the parties stipulated to the past medical expense figure. There is a lack of evidence to support this purported additional past medical expense, and the undersigned is not persuaded to amend the stipulated amount.
Applying the 6.8% pro rata ratio to $129,939.87 equals $8,835.91, which is the portion of the settlement representing reimbursement for past medical expenses and the amount recoverable by AHCA for its lien.
Petitioners proved by a preponderance of the evidence as set forth in section 409.910(11)(f) that AHCA should be reimbursed at the lesser amount:
$8,835.91.
CONCLUSIONS OF LAW
DOAH has jurisdiction over the subject matter and the parties in this case, and final order authority pursuant to sections 120.569, 120.57(1), and 409.910(17)(b), Florida Statutes.
The parties, in the Pre-hearing Stipulation, agreed to Petitioners’ standard of proof in this case: a preponderance of the evidence. § 120.57(1)(j), Fla Stat.
AHCA is the state agency authorized to administer Florida’s Medicaid program. § 409.902, Fla. Stat.
The Medicaid program “provide[s] federal financial assistance to States that choose to reimburse certain costs of medical treatment for needy persons.” Harris v. McRae, 448 U.S. 297, 301 (1980). Though participation is optional, once a State elects to participate in the Medicaid program, it must comply with federal requirements governing the same. Id.
As a condition for receipt of federal Medicaid funds, states are required to seek reimbursement for medical expenses incurred on behalf of beneficiaries who later recover from third-party tortfeasors. Ahlborn, 547
U.S. at 276.
The Florida Legislature has enacted section 409.910, which authorizes and requires the State to be reimbursed for Medicaid funds paid for a recipient’s medical care when that recipient later receives a personal injury judgment or settlement from a third party. Smith v. Ag. for Health Care Admin., 24 So. 3d 590 (Fla. 5th DCA 2009).
The Florida Supreme Court has determined that the state’s recovery of certain portions of settlement funds received by a Medicaid recipient to be the amount in a personal injury settlement fairly allocable to past medical expenses. Giraldo v Ag. for Health Care Admin., 248 So. 3d 53, 56 (Fla. 2018).9
Section 409.910(6) provides in pertinent part:
9 The Eleventh Circuit Court of Appeals determined that amounts in a settlement agreement fairly allocable to both past and future medical expenses are subject to the agency’s lien.
Gallardo v Dudek, 963 F.3d 1167 (11th Cir.. 2020). This is contrary to the Florida Supreme Court’s holding in Giraldo. Generally, state courts are not required to follow the decisions of intermediate federal appellate courts on questions of federal law. As a result, the undersigned has limited her inquiry to that portion of Tavarion Sanders’ settlement allocable to past medical expenses.
When the agency provides, pays for, or becomes liable for medical care under the Medicaid program, it has the following rights, as to which the agency may assert independent principles of law, which shall nevertheless be construed together to provide the greatest recovery from third-party benefits:
* * *
(c) The agency is entitled to, and has, an automatic lien for the full amount of medical assistance provided by Medicaid to or on behalf of the recipient for medical care furnished as a result of any covered injury or illness for which a third party is or may be liable, upon the collateral, as defined in s. 409.901.
AHCA’s recovery is limited to those proceeds allocable to past medical expenses. Respondent’s position that the past medical expenses are different than that which was stipulated is disingenuous as the parties stipulated that AHCA’s lien was for a specific amount: $129,939.87.
Section 409.910(11)(f) provides:
Notwithstanding any provision in this section to the contrary, in the event of an action in tort against a third party in which the recipient or his or her legal representative is a party which results in a judgment, award, or settlement from a third party, the amount recovered shall be distributed as follows:
After attorney’s fees and taxable costs as defined by the Florida Rules of Civil Procedure, one-half of the remaining recovery shall be paid to the agency up to the total amount of medical assistance provided by Medicaid.
The remaining amount of the recovery shall be paid to the recipient.
For purposes of calculating the agency’s recovery of medical assistance benefits paid, the fee for services of an attorney retained by the recipient or his or her legal representative shall be calculated at 25 percent of the judgment, award, or settlement.
Notwithstanding any provision of this section to the contrary, the agency shall be entitled to all medical coverage benefits up to the total amount of medical assistance provided by Medicaid. For purposes of this paragraph, “medical coverage” means any benefits under health insurance, a health maintenance organization, a preferred provider arrangement, or a prepaid health clinic, and the portion of benefits designated for medical payments under coverage for workers’ compensation, personal injury protection, and casualty.
Section 409.910(11)(f) provides a presumptive formula for AHCA’s recovery for a Medicaid lien as one-half of the total award, after deducting attorney’s fees of 25% of the recovery and all taxable costs, not to exceed the total amount actually paid by Medicaid on the recipient’s behalf. See Ag. for Health Care Admin. v. Riley, 119 So. 3d 514, 515 n.3 (Fla. 2d DCA 2013).
Pursuant to the formula, the amount payable to AHCA is $129,939.87, as the parties stipulated.
The administrative procedure created by section 409.910(17)(b) provides a means by which a Medicaid recipient may contest the amount designated as recovered Medicaid expenses. Section 409.910(17)(b) provides in pertinent part:
If federal law limits the agency to reimbursement from the recovered medical expense damages, a recipient, or his or her legal representative, may contest the amount designated as recovered medical expense damages payable to the agency pursuant to the formula specified in paragraph (11)(f) by filing a petition under
chapter 120 within 21 days after the date of payment of funds to the agency or after the date of placing the full amount of the third-party benefits in the trust account for the benefit of the agency pursuant to paragraph (a). The petition shall be filed with the Division of Administrative Hearings. For purposes of chapter 120, the payment of funds to the agency or the placement of the full amount of the third-party benefits in the trust account for the benefit of the agency constitutes final agency action and notice thereof. Final order authority for the proceedings specified in this subsection rests with the Division of Administrative Hearings. This procedure is the exclusive method for challenging the amount of third-party benefits payable to the agency. In order to successfully challenge the amount designated as recovered medical expenses, the recipient must prove, by clear and convincing evidence, that the portion of the total recovery which should be allocated as past and future medical expenses is less than the amount calculated by the agency pursuant to the formula set forth in paragraph (11)(f). Alternatively, the recipient must prove by clear and convincing evidence that Medicaid provided a lesser amount of medical assistance than that asserted by the agency.
Where uncontradicted testimony is presented, there must be a “reasonable basis in the record” to reject it. Giraldo, 248 So. 3d at 56. Here, the testimony was clear, concise, credible, and uncontradicted. There is no reasonable basis to reject that testimony.
In the instant case, the past medical expenses are $129,939.87.
Petitioners proved by a preponderance of the evidence that the settlement proceeds represented only 6.8% of the claim valued conservatively at $21,972,186.87. Therefore, it is concluded that AHCA’s full Medicaid lien amount should be reduced by the percentage that Petitioners’ recovery represents of the total value of Petitioners’ claim.
The application of the 6.8% ratio to the total past medical expenses of
$129,939.87 results in $8,835.91. This amount represents that share of the settlement proceeds fairly and proportionately attributable to expenditures that were actually paid by AHCA for Tavarion Sanders’ past medical expenses.
Based on of the forgoing Findings of Fact and Conclusions of Law, it is hereby ordered that the Agency for Health Care Administration is entitled to
$8,835.91 in satisfaction of its Medicaid lien.
DONE AND ORDERED this 21st day of December, 2020, in Tallahassee, Leon County, Florida.
LYNNE A. QUIMBY-PENNOCK
Division of Administrative Hearings this 21st day of December, 2020.
Alexander R. Boler, Esquire
Shevaun L. Harris, Acting Secretary Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 1
Bill Roberts, Acting General Counsel Agency for Health Care Administration 2727 Mahan Drive, Mail Stop 3
Richard J. Shoop, Agency Clerk
Thomas M. Hoeler, Esquire
A party who is adversely affected by this Final Order is entitled to judicial review pursuant to section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing the original notice of administrative appeal with the agency clerk of the Division of Administrative Hearings within 30 days of rendition of the order to be reviewed, and a copy of the notice, accompanied
by any filing fees prescribed by law, with the clerk of the district court of appeal in the appellate district where the agency maintains its headquarters or where a party resides or as otherwise provided by law.
