The Issue The amount to be paid by Petitioners, Pedro Garcia, a minor by and through his parents and natural guardians, Jesus Garcia and Norma Cisneros ("Petitioners") to Respondent, Agency for Health Care Administration ("AHCA"), out of the settlement proceeds, as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes.
Findings Of Fact Pedro Garcia ("Pedro") was born on October 30, 2014. When he was two months old, he presented to the emergency room ("ER") with vomiting and excessive crying. The doctors failed to diagnose an intestinal blockage and discharged Pedro home. Pedro was taken again to the ER in dire distress. He was airlifted to a pediatric hospital where emergency surgery was performed to remove 90 percent of his intestine. Pedro now suffers from the effects of having 90 percent of his intestine removed, including: nutritional deficiencies, diarrhea, dehydration, and abdominal distress. He cannot play with exertion and his activities are limited. Pedro will suffer the effects of his injury for the remainder of his life. A portion of Pedro's medical care related to the injury was paid by AHCA through the Medicaid program and Medicaid, through AHCA, provided $71,230.43 in benefits. Pedro's parents and natural guardians, Jesus Garcia and Norma Cisneros, brought a medical malpractice action against the medical providers and staff responsible for Pedro's care ("Defendants") to recover all of Pedro's damages, as well as their individual damages associated with their son's injury. Because of uncertainty on issues of liability and only a $250,000 insurance policy on the most culpable defendant, Pedro's medical malpractice action against the Defendants was settled for a confidential unallocated lump sum of $2,000,000. During the pendency of Pedro's medical malpractice action, AHCA was notified of the action and AHCA asserted a $71,230.43 Medicaid lien against Pedro's cause of action and settlement of that action. The Medicaid program through AHCA, spent $71,230.43 on behalf of Pedro, all of which represents expenditures paid for Pedro's past medical expenses. Another non-AHCA Medicaid provider, Integral Quality Care, provided $223,089.26 in past medical expenses on behalf of Pedro. Another non-AHCA Medicaid provider, Department of Health, Child's Medical Services, provided $168,161.12 in past medical expenses on behalf of Pedro. Accordingly, a total of $462,480.81 was paid for Pedro's past medical expenses. AHCA did not commence a civil action to enforce its rights under section 409.910 or intervene or join in Pedro's action against the Defendants. By letter, AHCA was notified of Pedro's settlement. AHCA has not filed a motion to set-aside, void, or otherwise dispute Pedro's settlement. Application of the formula in section 409.910(11)(f) to Pedro's $2,000,000 settlement requires payment to AHCA of the full $71,230.43 Medicaid lien. At the hearing, Petitioners presented the expert testimony of attorney Edward H. Zebersky, who represented Pedro throughout the underlying medical malpractice action against the Defendants. Without objection, Mr. Zebersky was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Zebersky has been an attorney since 1991. Since 1992, Mr. Zebersky has been a plaintiff's trial lawyer, with a substantial portion of his practice devoted to personal injury cases, including medical malpractice matters. He is a partner with the law firm of Zebersky Payne Shaw Lewenz, LLP and AV rated by Martindale-Hubbell. Mr. Zebersky is a member of numerous trial attorney associations and has held leadership positions in several associations, including president of the Florida Justice Association in 2006 and serving on the Board of Governors of the American Association for Justice for the past ten years. Mr. Zebersky handles jury trials. He has secured multiple eight-figure verdicts and several seven-figure verdicts, and he stays abreast of jury verdicts on other cases in his area. As a routine part of his practice, Mr. Zebersky makes assessments concerning the value of damages suffered by his clients. Mr. Zebersky was accepted as an expert in a Medicaid lien dispute at DOAH in the case of Herrera v. Agency for Health Care Administration, Case No. 16-1270MTR, 2016 Fla. Div. Admin. Hear. LEXIS 493 (Fla. DOAH Oct. 11, 2016). Mr. Zebersky was familiar with the circumstances surrounding Pedro's injury and medical malpractice claims and gave a detailed explanation of them. Mr. Zebersky reviewed Pedro's life care plan, which details Pedro's future medical needs, and an economist report, which calculated the present value of Pedro's future medical care and present value of Pedro's lost future earnings. The economist placed the present value of Pedro's future medical expenses and lost future earnings at approximately $9,500,000. According to Mr. Zebersky, past medical expenses would also be added to arrive at the full value of Pedro's economic damages. Mr. Zebersky testified that in addition to economic damages, a jury would also be asked to assign a value to past and future noneconomic damages (i.e., pain and suffering and loss of enjoyment of life). Mr. Zebersky testified that Pedro's claim for noneconomic damages would have an exceedingly high number, which as a "rule of thumb" is three times the value of his economic damages. Mr. Zebersky persuasively and credibly testified that the total value of all of Pedro's damages would be in excess of $20,000,000, and that valuing Pedro's damages at $15,000,000 is a very conservative and low valuation of his damages. Mr. Zebersky persuasively and credibly testified that the $2,000,000 settlement did not fully compensate Pedro for the full value of his damages. Mr. Zebersky testified that based on a conservative value of all of Pedro's damages of $15,000,000, the $2,000,000 settlement represents a recovery of 13.33 percent of 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 valuation of damages. Mr. Zebersky's testimony regarding the total value of Pedro's damages was credible, unimpeached, and unrebutted. Petitioner proved that the settlement of $2,000,000 does not fully compensate Pedro for the full value of his damages. Mr. Zebersky further testified that because Pedro only recovered in the settlement 13.33 percent of the full value of his damages, he only recovered 13.33 percent of AHCA's $71,230.43 Medicaid lien, or $9,495.01. Mr. Zebersky testified that it would be reasonable to allocate $9,495.01 of the settlement to past medical expenses paid by AHCA through the Medicaid program. Following the settlement, Mr. Zebersky negotiated the non-AHCA Integral Quality Care Medicaid lien from $233,089.26 to $18,737.00, and the non-AHCA Department of Health, Child's Medical Services lien from $168,161.12 to $22,415. On cross-examination, Mr. Zebersky acknowledged that the $233,089.26 and $168,161.12 from Integral Quality Care and Department of Health, Child's Medical Services are part of Pedro's claim for past medical expenses. However, Mr. Zebersky failed to include these past medical expenses in applying the ratio to reduce the Medicaid lien amount owed to AHCA. AHCA successfully contested the methodology used to calculate the allocation to past medical expenses based on Mr. Zebersky's failure to include these past medical expenses in applying the ratio. Accordingly, Petitioners proved by a preponderance of the evidence that 13.33 percent is the appropriate pro rata share of Pedro's past medical expenses to be applied to determine the amount recoverable by AHCA in satisfaction of its Medicaid lien. Total past medical expenses is the sum of AHCA's lien in the amount of $71,230.43, and the past medical expenses in the amounts of $233,089.26 and $168,161.12, which equals $462,480.81. Accordingly, following Mr. Zebersky's methodology and applying the $15,000,000 valuation to the proper amount of total past medical expenses of $462,480.81, the settlement portion properly allocable to Pedro's past medical expenses to satisfy AHCA's lien is $61,648.69 ($462,480.81 x 13.33 percent = $61,648.69).
The Issue The issue to be decided is the amount to be paid by Petitioner to Respondent, Agency for Health Care Administration ("AHCA"), out of her settlement proceeds, as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes.
Findings Of Fact On or about September 17, 2007, Alicia M. Fallon ("Alicia"), then 17 years old, drove to the mall to meet friends and became involved in an impromptu street race. Alicia lost control of the vehicle she was driving, crossed the median into oncoming traffic, and was involved in a motor vehicle crash. Her injuries consisted of traumatic brain injury ("TBI") with moderate hydrocephalus, right subdural hemorrhage, left pubic ramus fracture, pulmonary contusions (bilateral), and a clavicle fracture. Since the time of her accident, she has undergone various surgical procedures including the insertion of a gastrostomy tube, bilateral frontoparietal craniotomies, insertion of a ventriculoperitoneal shunt, and bifrontal cranioplasties. As a result of the accident, in addition to the physical injuries described above, Alicia suffered major depressive disorder, and Post-Traumatic Stress Disorder injuries. She is confined to a wheelchair for mobility, has no bowel or bladder control, and suffers from cognitive dysfunction. Alicia is totally dependent on others for activities of daily living and must be supervised 24 hours a day, every day of the week. A lawsuit was brought against the driver of the other car in the race, as well as the driver's mother, the owner of the vehicle. It could not be established that the tortfeasor driver hit Alicia's car in the race, or that he cut her off. The theory of liability was only that because Alicia and the other driver in the race were racing together, that the tortfeasor was at least partially responsible for what happened. It was viewed that there was no liability on the part of the driver of the third vehicle. The tortfeasor only had $100,000 in insurance policy limits, but the insurance company did not timely offer payment. The tortfeasor had no pursuable assets. The lawsuit was bifurcated and the issue of liability alone was tried. The jury determined that the tortfeasor driver was 40 percent liable for Alicia's damages. Because of the risk of a bad faith judgment, the insurance company for the tortfeasor settled for the gross sum of $2.5 million. AHCA, through its Medicaid program, provided medical assistance to Ms. Fallon in the amount of $608,795.49. AHCA was properly notified of the lawsuit against the tortfeasors, and after settlement, asserted a lien for the full amount it paid, $608,795.49, against the settlement proceeds. AHCA did not "institute, intervene in, or join in" the medical malpractice action to enforce its rights as provided in section 409.910(11), or participate in any aspect of Alicia's claim against the tortfeasors or their insurance company. Application of the formula at section 409.910(11)(f), to the settlement amount requires payment to AHCA in the amount of $608,795.49. Another provider, Optum, provided $592,554.18 in past medical expense benefits on behalf of Ms. Fallon. However, that amount was reduced through negotiation to a lien in the amount of $22,220.78.1/ Petitioner deposited the full Medicaid lien amount in an interest bearing account for the benefit of AHCA pending an administrative determination of AHCA's rights, and this constitutes "final agency action" for purposes of chapter 120, Florida Statutes, pursuant to section 409.910(17). Petitioner, Donna Fallon, the mother of Alicia, testified regarding the care that was and is continuing to be provided to Alicia after the accident. She is a single parent, and with only the assistance of an aide during the day, she is responsible for Alicia's care. Alicia must be fed, changed, bathed, and turned every few hours to avoid bed sores. Alicia can communicate minimally by using an electronic device and by making noises that are usually only discernable by her mother. Although she needs ongoing physical therapy and rehabilitation services, the family cannot afford this level of care. Petitioner presented the testimony of Sean Domnick, Esquire, a Florida attorney with 30 years' experience in personal injury law, including catastrophic injury and death cases, medical malpractice, and brain injury cases. Mr. Domnick is board certified in Civil Trial by the Florida Bar. He represented Alicia and her mother in the litigation against the tortfeasors and their insurance company. As a routine part of his practice, he makes assessments concerning the value of damages suffered by injured clients. He was accepted, without objection, as an expert in valuation of damages. Mr. Domnick testified that Alicia's injuries are as catastrophic as he has handled. Alicia has no strength, suffers contractions and spasms, and is in constant pain. Alicia has impaired speech, limited gross and fine motor skills, is unable to transfer, walk, or use a wheelchair independently. Alicia is unable to self-feed. All of her food must be cooked and cut up for her. Alicia is unable to perform self-hygiene and has no ability to help herself in an emergency and therefore requires constant monitoring. As part of his work-up of the case, Mr. Domnick had a life care plan prepared by Mary Salerno, a rehabilitation expert, which exceeded $15 million on the low side, and $18 million on the high side, in future medical expenses alone for Alicia's care. Mr. Domnick testified that the conservative full value of Alicia's damages was $45 million. That figure included $30 million for Alicia's pain and suffering, mental anguish and loss of quality of life, disability, and disfigurement, extrapolated for her life expectancy, plus the low end of economic damages of $15 million. Petitioner also presented the testimony of James Nosich, Esquire, a lawyer who has practiced primarily personal injury defense for 29 years. Mr. Nosich and his firm specialize in defending serious and catastrophic personal injury/medical malpractice cases throughout Florida. As part of his practice, Mr. Nosich has reviewed more than 1,000 cases of personal injury/medical malpractice cases and formally reported the potential verdict and full value to insurance companies that retained him to defend their insureds. Mr. Nosich has worked closely with economists and life care planners to identify the relevant damages of those catastrophically injured in his representation of his clients. Mr. Nosich has also tried over 30 cases in Broward County in which a plaintiff suffered catastrophic injuries similar to those of Alicia. Mr. Nosich was tendered and accepted, without objection, as an expert in the evaluation of damages in catastrophic injury cases. In formulating his expert opinion with regard to this case, Mr. Nosich reviewed: Alicia's medical records and expenses; her life care plan prepared by Ms. Salerno; and the economist's report. He took into consideration the reputation of Alicia's lawyer (Mr. Domnick); and the venue in which the case would be tried. Mr. Nosich opined that Broward County is known for liberal juries who tend to award high amounts in catastrophic cases. He also testified that Mr. Domnick is known as a lawyer with extreme capability and who has an excellent rapport with juries and the ability to get higher dollar verdicts. Mr. Nosich agreed with Mr. Domnick that the estimated $45 million figure for the total value of Alicia's case was conservative. He agreed with Ms. Salerno's estimated economic damages of $15 million and a doubling of that amount ($30 million) for Alicia's noneconomic damages. Mr. Nosich credibly explained that the $45 million total value was very conservative in his opinion based on Alicia's very high past medical bills and the fact that she will never be able to work. The testimony of Petitioner's two experts regarding the total value of damages was credible, unimpeached, and unrebutted. Petitioner proved that the settlement of $2.5 million does not fully compensate Alicia for the full value of her damages. As testified to by Mr. Domnick, Alicia's recovery represents only 5.55 percent of the total value of her claim. However, in applying a ratio to reduce the Medicaid lien amount owed to AHCA, both experts erroneously subtracted attorney's fees and costs of $1.1 million from Alicia's $2.5 million settlement to come up with a ratio of 3 percent to be applied to reduce AHCA's lien.2/ Further, in determining the past medical expenses recovered, Petitioner's experts also failed to include the Optum past medical expenses in the amount of $592,554.18. AHCA did not call any witnesses, present any evidence as to the value of damages, or propose a different valuation of the damages. In short, Petitioner's evidence was unrebutted. However, through cross-examination, AHCA properly contested the methodology used to calculate the allocation to past medical expenses. Accordingly, the undersigned finds that Petitioner has proven by a preponderance of the evidence that 5.55 percent is the appropriate pro rata share of Alicia's past medical expenses to be applied to determine the amount recoverable by AHCA in satisfaction of its Medicaid lien. Total past medical expenses is the sum of AHCA's lien in the amount of $608,795.49, plus the Optum past medicals in the amount of $592,554.18, which equals $1,201,349.67. Applying the 5.55 percent pro rata ratio to this total equals $66,674.91, which is the portion of the settlement representing reimbursement for past medical expenses and the amount recoverable by AHCA for its lien.
The Issue The issue to be determined is the amount payable to the Agency for Health Care Administration (AHCA or Respondent) in satisfaction of its $157,983.63 Medicaid lien asserted against medical malpractice settlement proceeds received by Hunter Lamendola (Hunter), a minor, by and through his mother and natural guardian, Ashley Lamendola (Petitioner).
Findings Of Fact On June 26, 2012, Petitioner presented to the hospital with a history of contractions for six hours prior to her arrival at the hospital. She had been placed on bed rest for gestational hypertension five days prior to arriving at the hospital. When she arrived, she had hypertension. Petitioner was admitted to the labor and delivery unit at 8:33 p.m. Petitioner was placed on a fetal monitor and progressed through her course of labor. Her initial fetal monitoring showed the baby was healthy and well-oxygenated, however, throughout the course of labor, the fetal monitor exhibited signs that the baby was in significant distress. At 4:01 a.m. on June 27, 2012, Petitioner was given an epidural, and after a course of labor, Hunter was delivered at 3:47 p.m. through an operative vaginal delivery. Hunter suffered permanent and catastrophic brain damage during his birth. As a result, Hunter is unable to eat, speak, toilet, ambulate, or care for himself in any manner. Hunter’s medical care related to the delivery was paid by Medicaid. The Medicaid program through AHCA provided $157,983.63 in benefits. The Medicaid program through the Department of Health Children’s Medical Services Title XIX MMA – Pedicare (DOH), provided $26,189.66 in benefits; the Medicaid program through a Medicaid-managed care organization, known as Amerigroup Community Care (Amerigroup), provided $51,696.99 in benefits; and the Medicaid program through a Medicaid-managed care organization, known as WellCare of Florida (WellCare), provided $13,239.19 in benefits. Accordingly, the sum of these Medicaid benefits, $249,109.47, constituted Hunter’s entire claim for past medical expenses. Petitioner brought a medical malpractice action against the medical providers and staff responsible for Hunter’s care (Defendant medical providers) to recover all of Hunter’s damages, as well as her own individual damages associated with Hunter’s injuries. The medical malpractice lawsuit was settled through a series of confidential settlements totaling $10,000,000 and this settlement was approved by the Court. During the pendency of Hunter’s medical malpractice action, AHCA was notified of the action, and AHCA asserted a $157,983.63 Medicaid lien against Hunter’s cause of action and settlement of that action. AHCA, through the Medicaid program, spent $157,983.63 on behalf of Hunter, all of which represents expenditures paid for Hunter’s past medical expenses. No portion of the $157,983.63 paid through the Medicaid program on behalf of Hunter represent expenditures for future medical expenses, and Medicaid did not make payments in advance for medical care. Application of the formula set forth in section 409.910(11)(f), Florida Statutes, to Hunter’s settlement requires payment to AHCA of the full $157,983.63 Medicaid lien. Petitioner has deposited the full Medicaid lien amount in an interest-bearing account for the benefit of AHCA pending an administrative determination of AHCA’s rights, and this constitutes “final agency action” for purposes of chapter 120, Florida Statutes, pursuant to section 409.910(17). At the final hearing, Mr. Harwin, who represented Hunter and his family in the underlying medical malpractice action, testified, and was accepted, without objection, as an expert in the valuation of damages suffered by injured parties. Mr. Harwin is a member of several trial attorney associations, stays abreast of jury verdicts relative to birth injuries, and ascertains the value of damages suffered by injured parties as a routine part of his practice. Mr. Harwin was familiar with and explained Hunter’s catastrophic brain injury giving rise to Petitioner’s claim. He also explained that, as a result of Hunter’s injury, Hunter is blind, fed through a feeding tube, unable to control his arms, legs or head, and suffers between six to eight seizures per day. Mr. Harwin testified that Hunter’s injury has also had a devastating impact on Hunter’s mother, Ashley Lamendola. According Mr. Harwin, considering Hunter’s past medical expenses, a life care plan for Hunter’s care prepared by an economist, and the extent of non-economic damages, and in light of determinations of mock juries and a jury consultant in this case, as well as Mr. Harwin’s familiarity with jury verdicts reached in similar cases, Hunter and his mother’s damages have a value in excess of $35,000,000. Mr. Harwin’s testimony as to the value of Petitioner’s claim was credible and is accepted. Petitioner also presented the testimony of Mr. Barrett, who was accepted as an expert in the valuation of damages. Mr. Barrett has been accepted as an expert in valuation of damages in a number of other Medicaid lien cases before DOAH. Mr. Barrett has been a trial attorney for 41 years, with a primary focus on plaintiff personal injury cases, including medical malpractice, medical products liability, and pharmaceutical products liability. Mr. Barrett stays abreast of jury verdicts and often makes assessments concerning the value of damages suffered by injured parties. After familiarizing himself with Hunter’s injuries through review of pertinent medical records and Petitioner’s exhibits, Mr. Barrett offered his opinion, based upon his professional training and experience, as well as review of comparable jury verdicts, that a conservative value of the damages suffered would be “$35,000,000 to $50,000,000.” Mr. Barrett’s testimony as to the value of Petitioner’s claim was credible and is accepted. AHCA did not call any witnesses, present any evidence as to the value of Petitioner’s claim, or propose a differing valuation of the damages. Based upon the unrebutted evidence presented by Petitioner’s experts, it is found that a conservative value of Petitioner’s claim is $35,000,000. Attorney’s fees for the underlying medical malpractice case leading to Petitioner’s $10,000,000.00 settlement totaled $4,500,000.00, with costs of $490,486.33. While the formula under section 409.910(11)(f) determines amounts distributable to Medicaid after attorney’s fees and taxable costs, there is no language in section 409.910(17)(b) suggesting that attorney’s fees or costs should be subtracted from settlement proceeds in determining whether a lesser portion of the total recovery should be allocated to reimburse Medicaid. Costs and attorney’s fees are not an element of Petitioner’s damages and were not subtracted from the settlement proceeds in determining whether a lesser portion of the total recovery should be allocated to AHCA’s Medicaid lien. Considering the valuation of Petitioner’s claim at $35,000,000.00, Petitioner’s $10,000,000.00 settlement represents only a 10/35ths recovery of Petitioner’s damages. Multiplying that same 10/35 fraction to the $157,983.63 paid by AHCA through the Medicaid program for past medical expenses results in the proportional sum of $45,138.18 from the settlement proceeds available to satisfy AHCA’s Medicaid lien.
The Issue This matter concerns the amount of money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Gregory McElveen, a Medicaid recipient, following a settlement recovered from a third party.
Findings Of Fact This proceeding determines the amount the Agency should be paid to satisfy a Medicaid lien following Petitioner’s recovery of a $240,000.00 settlement from a third party. The Agency asserts that it is entitled to recover the full amount of its $72,907.93 lien. The incident that gave rise to this matter resulted from alleged medical malpractice. In 2016, Mr. McElveen saw his primary care physician complaining of pain and redness in his hand. The pain was ultimately traced to a metal shaving that had lodged in his finger. Despite repeated visits complaining of pain and swelling, however, Mr. McElveen’s physician failed to locate and remove the foreign object. In the meantime, his health worsened. On July 17, 2017, Mr. McElveen was admitted to the hospital, and was found to be critically ill with septic emboli. On August 15, 2017, Mr. McElveen died as a result of a systemic infection. He was survived by his wife and three daughters.3 2 By requesting a deadline for filing post-hearing submissions beyond ten days after receipt of the Transcript at DOAH, the 30-day time period for filing the Final Order was waived. See Fla. Admin. Code R. 28-106.216(2). 3 Although Mr. McElveen’s three daughters survived his death, in his subsequent wrongful death lawsuit, only one of his daughters was considered a “minor child” under the Florida Wrongful Death Act, because the other two were over the age of 25. § 768.18, Fla. Stat. The Agency, through the Medicaid program, paid a total of $72,907.93 for Mr. McElveen’s medical care, which was the full amount of his past medical expenses. In 2019, Mr. McElveen’s estate brought a wrongful death action against his treating physician.4 Charles T. Moore, Esquire, represented Petitioner’s estate and was the primary attorney handling the litigation. Ultimately, Mr. Moore was able to settle the wrongful death action for $240,000. The Agency was not a party to, nor did it intervene in, Petitioner’s wrongful death lawsuit. Under section 409.910, the Agency is to be repaid for its Medicaid expenditures out of any recovery from liable third parties. Accordingly, when the Agency was notified of the settlement of Petitioner’s lawsuit, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency asserts that, pursuant to the formula set forth in section 409.910(11)(f), it should collect $72,907.93 to satisfy the medical costs it paid on Petitioner’s behalf. The Agency maintains that it should receive the full amount of its lien regardless of the fact that Petitioner settled for less than what Petitioner believes is the full value of his damages. Petitioner, on the other hand, argues that, pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of the settlement than the amount the Agency calculated pursuant to the section 409.910(11)(f) formula. Petitioner specifically asserts that the Medicaid lien should be reduced proportionately, taking into account the full value of Petitioner’s damages. Otherwise, the application of the statutory formula would permit the Agency to collect more than that portion of the settlement that fairly represents Petitioner’s compensation for medical expenses. Petitioner insists that reimbursement of the full lien amount violates the federal Medicaid law’s anti-lien provision (42 U.S.C. § 1396p(a)(1)) and 4 Petitioner Daniel Hallup was appointed Personal Representative of Mr. McElveen’s estate. Florida common law. Petitioner requests that the Agency’s allocation from Petitioner’s recovery be reduced to $5,832.63. To establish the value of Mr. McElveen’s damages, Petitioner offered the testimony of Mr. Moore. Mr. Moore has practiced law for 24 years and is a partner with the law firm of Morgan & Morgan in Tampa, Florida. In his practice, Mr. Moore focuses exclusively on medical malpractice causes of action. Mr. Moore represented that he has taken a number of his cases to jury. As part of his practice, Mr. Moore routinely evaluates damages similar to those Petitioner suffered. This activity includes analyzing jury verdicts to keep current on case values, as well as discussing cases with other attorneys. In calculating the value of Mr. McElveen’s wrongful death claim, Mr. Moore reviewed Mr. McElveen’s medical records. Mr. Moore stated that, based on his professional assessment and experience, Mr. McElveen’s damages equaled between three to five million dollars which is the total monetary value of the survivors’ and estate’s wrongful death damages. Therefore, Mr. Moore opined that a conservative value of Mr. McElveen’s damages is $3,000,000. Based on his evaluation, Mr. Moore asserted that the $240,000 settlement was far less than the value of the actual damages Mr. McElveen suffered. Mr. Moore explained that Petitioner settled for a much lower amount because his potential recovery was limited due to the fact that the one potential defendant (Mr. McElveen’s physician) was retiring and carried minimal insurance coverage ($250,000). Mr. Moore also felt that the other possible liable parties (including the hospital) had met the appropriate standard of medical care when treating Mr. McElveen. Therefore, Mr. Moore believed that he had settled for the best deal he could under the circumstances, and Mr. McElveen’s estate was not likely to recover more. Finally, to support the Petition to reduce the amount of the Medicaid lien, Mr. Moore explained that Petitioner’s estate received only eight percent of the true value of Mr. McElveen’s damages ($3,000,000 divided by $240,000). Because only eight percent of the damages were recovered, in like manner, the $72,907.93 Medicaid lien should be reduced to eight percent, or $5,832.63, as a fair and reasonable allocation of the amount of Petitioner’s past medical expenses recovered the $240,000 settlement. The Agency did not present evidence or testimony disputing Mr. Moore’s valuation of the “true” value of Petitioner’s damages or his calculation of the amount of the settlement that should be allocated as Petitioner’s past medical expenses. Petitioner also offered the testimony of R. Vinson Barrett, Esquire, to established the value of Mr. McElveen’s damages. Mr. Barrett is a trial attorney with over 40 years’ experience. Mr. Barrett works exclusively in the area of plaintiff’s personal injury, medical malpractice, and medical products liability cases. He has also handled wrongful death cases. Mr. Barrett expressed that, as a routine part of his practice, he makes assessments concerning the value of damages suffered by injured parties. In addition, not only does he have personal experience with jury trials, but he stays current in recent jury verdicts and regularly discusses jury results with other attorneys. Mr. Barrett was accepted as an expert in the valuation of damages suffered by injured persons. Prior to testifying, Mr. Barrett familiarized himself with the facts and circumstances of Mr. McElveen’s injuries and death. He reviewed Petitioner’s exhibits, including Petitioner’s medical records. He also reviewed the sample jury verdicts Petitioner introduced as Petitioner’s Exhibit 8. Based on his valuation of Petitioner’s injuries, as well as his professional training and experience, Mr. Barrett placed a “very conservative value” on Petitioner’s injuries at $3,000,000. Mr. Barrett explained that injuries similar to Petitioner’s would result in jury awards averaging approximately $3.5 million dollars. Mr. Barrett supported Mr. Moore’s pro rata methodology of calculating a reduced portion of Petitioner’s $240,000 settlement to equitably and fairly represent past medical expenses. With injuries valued at $3,000,000, the $240,000 settlement only compensated Petitioner for eight percent of the total value of his damages. Therefore, the most “fair” and “reasonable” manner to apportion the $240,000 settlement is to apply that same percentage to determine Petitioner’s recovery of medical expenses. Petitioner asserts that applying the same ratio to the total amount of medical costs produces the definitive value of that portion of Petitioner’s $240,000 settlement that represents compensation for past medical expenses, i.e., $5,823.63 ($72,907.93 times eight percent). Similar to Mr. Moore’s testimony, Mr. Barrett’s expert testimony was unrebutted. Further, the Agency did not offer evidence or testimony proposing a more appropriate or different valuation of Mr. McElveen’s total damages, or contesting the methodology Petitioner used to calculate the portion of the $240,000 settlement fairly allocable to Petitioner’s past medical expenses. Based on the testimony from Mr. Moore and Mr. Barrett that the $240,000 settlement does not fully compensate Petitioner for Mr. McElveen’s damages, Petitioner argues that a lesser portion of the medical costs should be calculated to reimburse Medicaid, instead of the full amount of the lien. Petitioner proposes that a ratio be applied based on the true value of Petitioner’s damages ($3,000,000) compared to the amount that Petitioner actually recovered ($240,000). Using these numbers, Petitioner’s settlement represents approximately an eight percent recovery of the full value of Petitioner’s damages. In similar fashion, the Medicaid lien should be reduced to eight percent or approximately $5,832.63 ($72,907.93 times .08). Therefore, Petitioner asserts that $5,832.63 is the portion of his third-party settlement that represents the equitable, fair, and reasonable amount the Florida Medicaid program should recoup for its payments for Petitioner’s medical care. All of the expenditures Medicaid spent on Petitioner’s behalf are attributed to past medical expenses. No portion of the $72,907.93 Medicaid lien represents future medical expenses. The undersigned finds that the unrebutted testimony at the final hearing demonstrates that the full value of Petitioner’s damages from this incident equals $3,000,000. Further, based on the evidence in the record, Petitioner met his burden of proving, by clear and convincing evidence, that a lesser portion of Petitioner’s settlement should be allocated as reimbursement for medical expenses than the amount the Agency calculated using the formula set forth in section 409.910(11)(f).5 Accordingly, the undersigned finds that the competent substantial evidence adduced at the final hearing establishes that the Agency should be reimbursed in the amount of $5,832.63 from Petitioner’s recovery of $240,000 from a third party to satisfy the Medicaid lien.
The Issue The issue to be determined is the amount to be reimbursed to Respondent, Agency for Health Care Administration (“AHCA”), for medical expenses paid on behalf of Ashley Nunez pursuant to section 409.910, Florida Statutes (2016),1/ from settlement proceeds received by Petitioners from third parties.
Findings Of Fact Facts Pertaining to the Underlying Personal Injury Litigation and the Medicaid Lien On February 13, 2010, Ashley Nunez (“Ashley”), who was three years old at the time, presented to a hospital emergency room with a fever. A chest X-ray indicated that Ashley had left lobe pneumonia. The hospital ordered no blood work or blood cultures and did not investigate the cause of Ashley’s pneumonia. The hospital discharged Ashley with a prescription for Azithromycin. By February 14, 2010, Ashley’s fever was 102.9 degrees, and Ashley’s mother took her to a pediatrician. Rather than attempting to discover the cause of the fever, the pediatrician instructed Ashley’s mother that the prescription needed time to work and instructed her to bring Ashley back if the fever persisted. On February 16, 2010, Ashley’s aunt returned her to the pediatrician because Ashley’s fever was persisting and she had developed abdominal pain. Due to a concern that Ashley was suffering from appendicitis, the pediatrician referred her to an emergency room. Later that day, Ashley’s mother returned her to the emergency room that had treated Ashley on February 13, 2010. A second chest x-ray revealed that Ashley’s pneumonia had gotten much worse, and the hospital admitted her. Ashley’s respiratory condition continued to deteriorate, and blood cultures confirmed that she had streptococcus pneumonia. Two days after her admission, the hospital decided to transfer Ashley to a hospital that could provide a higher level of care. On February 18, 2010, an ambulance transferred Ashley to a second hospital. Even though Ashley’s respiratory condition continued to deteriorate, the paramedics and hospital transport team did not intubate her. Upon her arrival at the second hospital, Ashley had suffered a cardiopulmonary arrest and had to be resuscitated with CPR and medication. The lack of oxygen to Ashley’s brain and other organs resulted in catastrophic harm leading Ashley to be intubated, placed on a ventilator, fed through a gastric feeding tube, and placed on dialysis. The second hospital discharged Ashley two and a half months later. While she no longer required a ventilator or dialysis, the hypoxic brain injury and cardiopulmonary arrest left Ashley in a severely compromised medical condition. Ashley was unable to perform any activities of daily living and was unable to stand, speak, walk, eat, or see. Following her discharge from the second hospital, Ashley required continuous care. She was under a nurse’s care for 12 hours a day, and Ashley’s mother (Anna Patricia Delgado) cared for her during the remaining 12 hours each day. On February 23, 2011, Ashley died due to complications resulting from the hypoxic brain injury. Ashley was survived by her parents, Ms. Delgado and John Nunez. Medicaid (through AHCA) paid $357,407.05 for the medical care related to Ashley’s injury. Ashley’s parents paid $5,805.00 for her funeral. As the Personal Representative of Ashley’s Estate, Ms. Delgado brought a wrongful death action against the first emergency room doctor who treated Ashley, the pediatrician, a pediatric critical care intensivist who treated Ashley after her admission to the first hospital, the two hospitals that treated Ashley, and the ambulance company that transported Ashley to the second hospital. AHCA received notice of the wrongful death action and asserted a Medicaid lien against Ashley’s Estate in order to recover the $357,407.05 paid for Ashley’s past medical expenses. See § 409.910(6)(b), Fla. Stat. (providing that “[b]y applying for or accepting medical assistance, an applicant, recipient, or legal representative automatically assigns to [AHCA] any right, title, and interest such person has to any third party benefit ”). Ms. Delgado ultimately settled the wrongful death action through a series of confidential settlements totaling $2,250,000. No portion of that settlement represents reimbursements for future medical expenses. AHCA has not moved to set aside, void, or otherwise dispute those settlements. Section 409.910(11)(f) sets forth a formula for calculating the amount that AHCA shall recover in the event that a Medicaid recipient or his or her personal representative initiates a tort action against a third party that results in a judgment, award, or settlement from a third party. Applying the formula in section 409.910(11)(f) to the $2,250,000 settlement, results in AHCA being owed $791,814.84 in order to satisfy its lien.2/ Because Ashley’s medical expenses of $357,407.05 were less than the amount produced by the section 409.910(11)(f) formula, AHCA is seeking to recover $357,407.05 in satisfaction of its Medicaid lien. See § 409.910(11)(f)4., Fla. Stat. (providing that “[n]otwithstanding any provision in this section to the contrary, [AHCA] shall be entitled to all medical coverage benefits up to the total amount of medical assistance provided by Medicaid.”). Valuation of the Personal Injury Claim Tomas Gamba represented Petitioners during their wrongful death action. Mr. Gamba has practiced law since 1976 and is a partner with Gamba, Lombana and Herrera-Mezzanine, P.A., in Coral Gables, Florida. Mr. Gamba has been Board Certified in Civil Trial Law by the Florida Bar since 1986. Since the mid-1990s, 90 percent of Mr. Gamba’s practice has been devoted to medical malpractice. Over the course of his career, Mr. Gamba has handled 60 to 70 jury trials as first chair, including catastrophic injury cases involving children. In 2015, the Florida Chapter of the American Board of Trial Advocates named Mr. Gamba its Trial Lawyer of the Year. Mr. Gamba is a member of several professional organizations, such as the American Board of Trial Advocates, the American Association for Justice, the Florida Board of Trial Advocates, the Florida Justice Association, and the Miami-Dade County Justice Association. Mr. Gamba was accepted in this proceeding as an expert regarding the valuation of damages suffered by injured parties. Mr. Gamba testified that Petitioners elected against proceeding to a jury trial (in part) because of the family’s need for closure and the stress associated with a trial that could last up to three weeks. Mr. Gamba also noted that the two hospitals that treated Ashley had sovereign immunity, and (at the time pertinent to the instant case) their damages were capped at $200,000 each. In order to collect any damages above the statutory cap, Petitioners would have had to file a claims bill with the Florida Legislature, and Mr. Gamba testified that “the legislature would be very difficult.” As for the three treating physicians who were defendants in the suit, Mr. Gamba testified that Petitioners achieved a favorable settlement by agreeing to accept $2 million when the physicians’ combined insurance coverage was only $3 million. The decision to settle was also influenced by the fact that Ashley had a pre-existing condition known as hemolytic uremic syndrome, a blood disorder. During discovery, Mr. Gamba learned that the defense was prepared to present expert testimony that the aforementioned condition made it impossible for the defendants to save Ashley. Finally, Mr. Gamba testified that 75 percent of medical malpractice cases heard by juries result in defense verdicts. As for whether the $2,250,000 settlement fully compensated Ashley’s estate and her parents for the full value of their damages, Mr. Gamba was adamant that the aforementioned sum was “a small percentage of what we call the full measure of damages in this particular case.” Mr. Gamba opined that $8,857,407.05 was the total value of the damages that Ashley’s parents and her Estate could have reasonably expected to recover if the wrongful death action had proceeded to a jury trial. Mr. Gamba explained that Florida’s Wrongful Death Act enabled Ashley’s parents to recover for the death of their child and for the pain and suffering they incurred from the date of Ashley’s injury. According to Mr. Gamba, $4,250,000 represented a “conservative” estimate of each parent’s individual claim, and the sum of their claims would be $8,500,000. Mr. Gamba further explained that Ashley’s Estate’s claim would consist of the $357,407.05 in medical expenses paid by Medicaid, resulting in an estimate for total damages of $8,857,407.05. Mr. Gamba’s opinion regarding the value of Petitioners’ damages was based on “roundtable” discussions with members of his firm and discussions with several attorneys outside his firm who practice in the personal injury field. Mr. Gamba’s opinion was also based on 10 reported cases contained in Petitioners’ Exhibit 9. According to Mr. Gamba, each of those reported cases involve fact patterns similar to that of the instant case. Therefore, Gamba testified that the jury verdicts in those cases are instructive for formulating an expectation as to what a jury would have awarded if Ashley’s case had proceeded to trial. In sum, Mr. Gamba testified that the $2,250,000 settlement represents a 25.4 percent recovery of the $8,857.407.05 of damages that Ashley’s parents and Ashley’s Estate actually incurred. Therefore, only 25.4 percent (i.e, $90,781.30) of the $357,407.05 in Medicaid payments for Ashley’s care was recovered. Mr. Gamba opined that allocating $90,781.39 of the total settlement to compensate Medicaid for past medical expenses would be reasonable and rational. In doing so, he stated that, “And I think both – if the parents are not getting their full measure of damages, I don’t think the health care provider, in this case Medicaid, that made the payment should get, you know, every cent that they paid out, when mother and father are getting but a small percentage of the value of their claim.” Petitioners also presented the testimony of Herman J. Russomanno. Mr. Russomanno has practiced law since 1976 and is a senior partner with the Miami law firm of Russomanno and Borrello, P.A. Mr. Russomanno has been Board Certified in Civil Trial Law by the Florida Bar since 1986, and he has served as the Chairman of the Florida Bar’s Civil Trial Certification Committee. Mr. Russomanno is also certified in Civil Trial Practice by the National Board of Trial Advocates and has taught trial advocacy and ethics for 33 years as an adjunct professor at the St. Thomas University School of Law. Mr. Russomanno is a past president of the Florida Bar and belongs to several professional organizations, such as the Florida Board of Trial Advocates, the American Board of Trial Advocates, the Dade County Bar Association, and the Miami-Dade County Trial Lawyers Association. Since 1980, Mr. Russomanno’s practice has been focused on medical malpractice, and he has represented hundreds of children who suffered catastrophic injuries. Mr. Russomanno was accepted in the instant case as an expert in the evaluation of damages suffered by injured parties. Prior to his testimony at the final hearing, Mr. Russomanno reviewed Ashley’s medical records, the hospital discharge summaries, and the Joint Pre-hearing Stipulation filed in this proceeding. He also discussed Ashley’s case with Mr. Gamba and reviewed Mr. Gamba’s file from the wrongful death action. Mr. Russomanno also viewed videos of Ashley taken before and after her injury so he could gain an understanding of the severity of Ashley’s injury and the suffering experienced by her parents. Mr. Russomanno credibly testified that the damages incurred by Ashley’s parents were between $4,250,000 and $7,500,000 for each parent. Mr. Russomanno echoed Mr. Gamba’s testimony by stating that the $2,250,000 settlement did not fully compensate Ashley’s parents and her Estate for their damages. AHCA presented the testimony of James H.K. Bruner. Mr. Bruner has practiced law since 1983 and is licensed to practice law in Florida, New York, Maine, and Massachusetts. Mr. Bruner is a member of professional organizations such as the American Health Lawyers Association and the Trial Lawyers Sections of the Florida Bar. Between 2003 and 2005, Mr. Bruner served as the Department of Children and Families’ risk attorney. That position required him to evaluate personal injury actions filed against the Department and assess the Department’s exposure to liability. Based on his experience in evaluating approximately 200 cases for the Department, Mr. Bruner authored the Department’s manual on risk management and provided training to Department employees on risk management issues. Mr. Bruner has served as the Director of AHCA’s Bureau of Strategy and Compliance. In that position, he dealt specifically with third-party liability collections and Medicaid liens. Beginning in 2008, Mr. Bruner worked for ACS (now known as Xerox Recovery Services) and was engaged in attempting to recover Medicaid liens from personal injury settlements. Over the last several years, Mr. Bruner has spoken at seminars about Medicaid lien resolution and authored publications on that topic. Since April of 2013, Mr. Bruner has been in private legal practice as a solo practitioner. He describes himself as a “jack of all trades” who engages in a “general practice.” Over the last 20 years, Mr. Bruner has not handled a jury trial involving personal injury; and, over the last four years, he has not negotiated a personal injury settlement. The undersigned accepted Mr. Bruner as an expert witness for evaluating the cases contained in Petitioners’ Exhibit 9 and pointing out distinctions between those cases and the instant case. Mr. Bruner did not offer testimony regarding the specific value of the damages suffered by Petitioners. Findings Regarding the Testimony Presented at the Final Hearing Regardless of whether the reported cases in Petitioners’ Exhibit 9 are analogous to or distinguishable from the instant case, the undersigned finds that the testimony from Mr. Gamba and Mr. Russomanno was compelling and persuasive. While attaching a value to the damages that a plaintiff could reasonably expect to receive from a jury is not an exact science, Mr. Gamba and Russomanno’s substantial credentials and their decades of experience with litigating personal injury lawsuits make them very compelling witnesses regarding the valuation of damages suffered by injured parties such as Petitioners. Accordingly, the undersigned finds that Petitioners proved by clear and convincing evidence that $90,781.39 constitutes a fair and reasonable recovery for past medical expenses actually paid by Medicaid. However, and as discussed below, AHCA (as a matter of law) is entitled to recover $357,407.05 in satisfaction of its Medicaid lien.3/
The Issue The issue is whether Petitioner overpaid Respondent Medicaid funds, for which Section 409.913(10), Florida Statutes (2002), authorizes Petitioner to seek repayment from Respondent.
Findings Of Fact During 1998, Respondent was an authorized Medicaid provider, pursuant to Medicaid provider number 105425200, and was a party to a valid Medicaid Provider Agreement with Petitioner. Respondent filed claims with Petitioner for payment, under the Medicaid program, for the goods and services that are the subject of the audit described below, and Petitioner paid Respondent for these claims. The audit period in this case is 1998. During 1998, Respondent submitted to Petitioner 36,257 claims for nearly 5.5 million units of over one thousand types of drugs. These claims totaled $3,075,449.88, which Petitioner paid Respondent. On June 2, 1999, Petitioner sent a letter to Respondent informing it of a review of its pharmacy claims for 1998. The letter requests documentation of all purchases of 12 named drugs for 1998 and documentation of all credits for these drugs during the same period. The letter states that acceptable documentation includes itemized wholesaler sales history reports, itemized manufacturer sales history reports, itemized invoices, and credit return receipts. By letter dated June 5, 1999, Respondent provided the requested information. By letter dated June 23, 2000, Petitioner advised Respondent that it had examined the paid Medicaid claims for 1998 and the acquisition documentation that Respondent had provided in June 1999. The letter states: "You have failed to provide adequate documentation to the effect that the available quantity of certain drugs of given strength was as great as the quantity of those drugs billed to and reimbursed by Medicaid.” Thus, Petitioner made a "provisional" determination that it had overpaid Respondent $1,092,205.32. The letter invites Respondent to provide additional information to reduce the overpayment determination. The June 23 letter contains an Overpayment Attachment that lists ten of the twelve drugs for which Petitioner had sought documentation in its earlier letter. For each of these ten drugs, the Overpayment Attachment lists the generic code, number of units for which Medicaid paid, the total amount of Medicaid payments, the total units documented by Respondent to have been available during the relevant period, and the number of units for which Respondent provided no availability documentation. The Overpayment Attachment also calculates the amount of Medicaid payments attributable to the unavailable units and the total overpayment, which is $1,092,205.32. The overpayment calculations described in the preceding paragraph assume that all available units of the audited drugs were sold to Medicaid patients. The effect of this improbable scenario reduces the amount of the overpayment. The overpayment calculations attempt no extrapolation of overpayments on the over 10,000 other drugs for which Respondent received Medicaid payments during 1998. The effect of limiting the overpayment calculation to the ten listed drugs reduces the amount of the overpayment. However, the ten listed drugs are the drugs that generated the most Medicaid payments to Respondent and account for over one-third of the total Medicaid payments during the relevant period. Respondent provided additional information to Petitioner on August 30 and November 3, 2000. However, after examining the information, Petitioner advised Respondent, by letter dated April 8, 2002, that its final determination was that Respondent owed $1,096,489.77 due to its receipt of Medicaid overpayments. The overpayment increased by over $4000 due to the determination that Respondent's records documented 1000 fewer available units of two dosages of Risperdone than Petitioner had previously determined.
Recommendation It is RECOMMENDED that the Agency for Health Care Administration enter a final order directing Respondent to pay Petitioner $1,096,489.77, plus interest, to repay overpayments that it received from the Medicaid program for the sale of drugs in 1998. DONE AND ENTERED this 3rd day of November, 2003, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of November, 2003. COPIES FURNISHED: Rhonda M. Medows, M.D., Secretary Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3116 Tallahassee, Florida 32308 Valda Clark Christian, General Counsel Agency for Health Care Administration 2727 Mahan Drive Fort Knox Building, Suite 3431 Tallahassee, Florida 32308 Grant P. Dearborn Assistant General Counsel Building 3, Mail Stop 3 2727 Mahan Drive Tallahassee, Florida 32308-5407 Jose M. Herrera Jose M. Herrera, P.A. 1401 Ponce de Leon Boulevard Suite 200 Coral Gables, Florida 33134
The Issue The issue to be decided is the amount to be paid by Petitioner to Respondent, Agency for Health Care Administration (Agency), out of her settlement proceeds, as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes.
Findings Of Fact On August 11, 2014, Amanda Baker, then 15 years old, was transferred from a medical center to a specialty pediatric hospital where she presented with complaints and symptoms of back pain, weakness, and paresthesia in her lower extremities. Over the next few days, she underwent examinations and assessments, but no steps were taken to prevent her development of blood clots/embolisms due to her immobility nor were signs and symptoms of her development of blood clots/embolisms recognized. On August 13, 2014, Amanda suffered two cardiac arrests due to blood clots/embolisms traveling to her heart and lungs. She was resuscitated, but due to a lack of oxygen to her brain, Amanda suffered a catastrophic hypoxic brain injury. She is now in a persistent vegetative state. The Agency provided $162,146.65 in Medicaid benefits associated with Amanda's injuries, all of which represent expenditures paid for her past medical expenses. Amanda's parents brought a medical malpractice action against the medical providers responsible for her care to recover all of the damages associated with her injuries, as well as their individual damages associated with their daughter's injuries. Seven defendants maintained insurance policies with a policy limit of $250,000. The medical malpractice action was settled for each of the insurance policy limits, resulting in a lump sum unallocated settlement of $1,750,000. This settlement was approved by the court. During the pendency of the malpractice action, the Agency was notified of the action. It asserted a $162,146.65 Medicaid lien against the Bakers' cause of action and settlement of that action. However, it did not institute, intervene in, or join in the action to enforce its rights, as provided in section 409.910(11), or participate in any aspect of the litigation. Application of the formula in section 409.910(11)(f) to Amanda's $1,750,000 settlement requires full payment of the Medicaid lien. Petitioner presented the testimony of Daniel Moody, Esquire, a Lakeland attorney with 30 years' experience in personal injury law, including medical malpractice. He represented Amanda and her family in the medical malpractice action. As a routine part of his practice, he makes assessments concerning the value of damages suffered by injured clients. He also stays abreast of jury verdicts in his area by reviewing jury verdict reporters and discussing cases with other trial attorneys. He has been accepted as an expert in valuation of damages. Based on his training and experience, Mr. Moody opined that the damages recoverable in Amanda's case had a conservative value of $30 million. Petitioner also presented the testimony of R. Vinson Barrett, Esquire, a Tallahassee trial attorney with more than 40 years' experience. His practice is dedicated to plaintiff's personal injury, as well as medical malpractice, medical products liability, and pharmaceutical products liability. He routinely makes assessments concerning the value of damages suffered by injured parties. He was accepted as an expert in the valuation of damages. Based on his training and experience, Mr. Barrett opined that Amanda's damages are "worth at a bare minimum – and we're talking very conservatively here -- $30,000,000." Both experts testified that using $30,000,000 as the value of all damages, Amanda only recovered 5.83 percent of the value of her damages. Accordingly, they opined that it would be reasonable, rational, and conservative to allocate 5.83 percent of the settlement, or $9,453.15, to past medical expenses paid by the Agency through the Medicaid program. The Agency did not call any witnesses, present any evidence as to the value of damages, propose a different valuation of the damages, or contest the methodology used to calculate the allocation to past medical expenses. In short, Petitioner's evidence was unrebutted. The testimony from Mr. Moody and Mr. Barrett is compelling and persuasive. Accordingly, the undersigned finds that Petitioner has proven by a preponderance of the evidence that $9,453.15 of the settlement represents reimbursement for past medical expenses.
The Issue The issue is the amount of the Petitioner’s personal injury settlement proceeds that should be paid to the Agency for Health Care Administration (AHCA) to satisfy its Medicaid lien under section 409.910, Florida Statutes (2016).1/
Findings Of Fact The Petitioner’s right hand and wrist were cut by glass in the bathroom of her apartment in March 2012. Her injuries included damage to the tendons and nerves. She was hospitalized and received medical care and treatment, which Medicaid paid in the amount of $4,348.45. The Petitioner also personally owes $123 for physical therapy she received. The Petitioner sued the owner of the apartment, who vigorously contested liability and raised several affirmative defenses alleging that the Petitioner’s negligence or recklessness was wholly or partially responsible for her injuries and that she assumed the risk. The Petitioner’s damages were substantial because she lost the effective use of her right hand. She applied and was approved for Social Security supplemental security income benefits, subject to periodic reviews of her disability status. She presented evidence in the form of her and her attorney’s testimony and a report prepared by a vocational evaluation expert that she will suffer lost wages in the amount of approximately a million dollars, calculated by assuming she would have worked full-time earning $12-15 an hour until age 70, but for her accident, and assuming she cannot be gainfully employed in any capacity as a result of her injury. While that amount of lost wages might be overstated, the Petitioner presented evidence in the form of her attorney’s testimony and a supporting affidavit of another attorney with experience in personal injury case valuations that the monetary value of her damages was no less than approximately $550,000.2/ AHCA’s cross-examination did not reduce the persuasiveness of the Petitioner’s evidence, and AHCA presented no contrary evidence. In March 2017, the Petitioner settled her lawsuit for a mere $55,000 because of her concern that a jury would find for the defendant or reduce the recoverable damages due to comparative negligence. The Petitioner knew at the time of her settlement that AHCA was claiming a $4,348.45 Medicaid lien on the settlement proceeds. The Petitioner offered AHCA $434.85 in full satisfaction of the Medicaid lien claim. AHCA declined and asserts its entitlement to the full amount of the lien claim. The Petitioner’s settlement agreement included an allocation of $434.85 to AHCA’s Medicaid lien, $123 to the other past medical expenses, and the rest to other components of damages (which did not include any future medical expenses). AHCA was not a party to the settlement and did not agree to that allocation. The Petitioner’s attorney testified that the Petitioner’s proposed allocation is fair and reasonable and introduced the concurring affidavit of another attorney. AHCA did not present any evidence but argued that the Petitioner did not prove that AHCA’s Medicaid lien should be reduced and that, as a matter of law, AHCA was entitled to the claimed lien.
The Issue The issue to be determined is what amount of the $10,652.23 Medicaid lien held by Respondent, Agency for Health Care Administration ("Respondent" or "Agency"), is recoverable by Respondent from the $65,000.00 settlement reached by Petitioner, Tya-Marie Savain ("Petitioner" or "Savain"), in her related personal injury action.
Findings Of Fact Based on the stipulation between the parties, the evidence presented and the record as a whole, the undersigned makes the following findings of fact: On the afternoon of May 27, 2015, Petitioner, who was 19 years of age, was a pedestrian walking northbound across Forrest Hill Boulevard in West Palm Beach, Florida. As she was crossing the road in daylight, she was hit by a vehicle operated by Kenneth Knowles. (JPHS p. 5, ¶ 1). As a result of the collision, Petitioner suffered a fractured femur requiring open reduction internal fixation to repair her leg and a second surgery to remove the medical hardware. Petitioner suffered additional injuries (during the accident), including a left eye laceration, and road rash with scarring on her hands, elbows, chin, ears, forehead, mouth, and other body parts. (JPHS p. 5, ¶ 2). Respondent expended $10,652.23 in medical assistance through its Medicaid program for the benefit of Petitioner related to her fractured femur and the two resulting surgeries caused in the accident. (JPHS p. 5, ¶ 4). Petitioner’s extensive injuries necessitated surgery and resulted in significant medical treatment and related medical expenses (see, e.g., Pet. Exs. 2-12, 23). Petitioner brought a personal injury action for negligence against the liable third party and driver, Kenneth Knowles, in Palm Beach County, Florida. Kenneth Knowles had bodily injury coverage with Allstate Insurance Company in the amount of $15,000.00. Knowles paid an additional $50,000.00 out of his pocket resulting in a gross settlement of $65,000.00 for the personal injury claim brought by Savain.4/ (JPHS p. 5, ¶ 3). Following resolution of Petitioner’s personal injury action, her counsel advised the Agency of the settlement through correspondence dated April 10, 2017. Counsel explained to the Agency that Savain would not be recovering the full value of her damages and requested that Respondent accept a reduced amount in full satisfaction of its Medicaid lien. (JPHS p. 5, ¶ 6). Respondent replied to Petitioner’s counsel in writing on June 22, 2017, and stated that Medicaid would not accept any reduction from the full lien amount of $10,652.23. (JPHS p. 6, ¶ 8). There was no evidence that the Agency participated in, approved of, or was consulted concerning Petitioner’s settlement with Kenneth Knowles. In addition to the Medicaid lien, Petitioner had total medical bills of $182,660.42, and has outstanding bills and liens (excluding Respondent’s Medicaid lien) totaling $38,899.51. Accordingly, Petitioner’s total outstanding past medical expenses, including the Agency’s Medicaid lien is $49,551.74. (JPHS p. 6, ¶ 7). Both parties stipulated that the application of the formula at section 409.910(11)(f) to Petitioner’s $65,000.00 settlement requires payment to the Agency in the amount of $10,652.23 in satisfaction of its Medicaid lien. (JPHS p. 5, ¶ 5). There was no evidence presented to prove or suggest that the Agency provided a lesser amount of medical assistance than the $10,652.23 it asserted it had expended. Further, there was no evidence presented to prove what portion of the $65,000.00 settlement was allocated by Petitioner and Kenneth Knowles to her past medical expenses.5/ The affidavit of Attorney Eric Morales, proffered by Petitioner, opined that the "value" of Petitioner’s claim was between $550,000.00 and $750,000.00. (Pet. Ex. 24). These figures supposedly represent the total sum of Petitioner’s range of damages. Morales was of the opinion that the settlement reached by Petitioner represented five percent, on the high end, and 3.6 percent, on the low end, of the actual value of her claim.6/ The undersigned finds and concludes that the affidavit is an out-of-court statement used to prove the truth of the matters asserted in it. It does not supplement or explain other admissible evidence, and Petitioner has advanced no case authority or exception to the hearsay rule which would permit its use or consideration by the undersigned. Morales’s affidavit is classic hearsay. See Fortune v. Fortune, 61 So. 3d 441 (Fla. 2d DCA 2011); and B.C.S., S.R.L. v. Wise, 910 So. 2d 871, 874 (Fla. 5th DCA 2005). As such, it cannot be considered or used by the undersigned to establish or support any findings of fact in this case and is stricken from consideration or use by the undersigned. Petitioner, therefore, did not present any admissible evidence to support a finding of the actual value of her personal injury claim or to support the "pro-rata" or "proportionality" formula she advanced through her counsel’s arguments.7/ To reiterate, there was no evidence presented by Petitioner to prove that (1) a lesser portion of the total recovery should be allocated as reimbursement for past medical expenses than the amount calculated by the Agency, or (2) that Medicaid provided a lesser amount of medical assistance than the $10,652.23 asserted by the Agency.
The Issue This matter concerns the amount of money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Scott R. Brown, a Medicaid recipient, following a settlement recovered from a third party.
Findings Of Fact This proceeding determines the amount the Agency should be paid to satisfy a Medicaid lien following Petitioner’s recovery of a $300,000.00 settlement from a third party. The Agency asserts that it is entitled to recover the full amount of its $112,500.00 lien. The incident that gave rise to this matter occurred on December 22, 2010. On that day, Petitioner, a Florida resident, was visiting relatives in Talladega County, Alabama. Petitioner was shot while sitting in the backseat of a car. The bullet struck Petitioner in his abdomen. Immediately following the incident, Petitioner was taken to UAB Hospital in Birmingham, Alabama. Petitioner received medical care and treatment from December 22, 2010, through January 27, 2011, which included surgical repair of his abdominal injuries. Following his release from UAB Hospital, Petitioner was admitted to Spain Rehabilitation on January 28, 2011. There, Petitioner was diagnosed with a T-10 ASIA-A spinal cord injury, which caused paralysis from the waist down, as well as: a T-12 vertebral fracture; L1 - 2 vertebral fracture; small bowel injury; pancreatic head laceration; and duodenal laceration. Petitioner was also noted to be incontinent and required assistance for all transfers and bed mobility. In short, the gunshot rendered Petitioner a paraplegic. He will continue to require medical treatment for the rest of his life. In June 2011, Petitioner brought a negligence lawsuit in Alabama against the two gunmen. Petitioner was represented by Michael J. Crow, Esquire. Mr. Crow litigated Petitioner’s case over the course of two years. In 2013, Mr. Crow was able to resolve the lawsuit for $300,000, which was the full amount of the gunmen’s homeowner’s insurance. At the final hearing, Mr. Crow testified that the homeowner’s insurance policy was the only available coverage or recoverable asset he identified that could be used to compensate Petitioner for his injuries. Consequently, Mr. Crow believed that it was in Petitioner’s best interests to settle the lawsuit for the policy limits. A portion of Petitioner’s medical care was paid for by the Medicaid programs in Alabama and Florida in the total amount of $262,536.95.2/ Following Petitioner’s settlement, the Alabama Medicaid Agency asserted a lien of $139,169.94 against Petitioner’s recovery. On November 21, 2013, Mr. Crow was able to settle the Alabama Medicaid lien for $6,000.00. This amount represents approximately 4.31 percent of the total Alabama Medicaid lien. Mr. Crow testified that he thought the settlement payment should have been lower based on the full value he placed on Petitioner’s damages (discussed below) versus the actual amount Petitioner recovered. However, he believed that it was in Petitioner’s best interests to settle the Alabama Medicaid lien to avert protracted litigation. The Agency, through the Florida Medicaid program, paid a total of $123,366.95 for Petitioner’s medical treatment from the gunshot injury. All of the expenditures that Florida Medicaid spent on Petitioner’s behalf are attributed to past medical expenses. No portion of the Agency’s Medicaid lien represents future medical expenses. Under section 409.910, the Agency is to be repaid for its Medicaid expenditures out of any recovery from liable third parties. Accordingly, when the Agency was notified of the settlement of Petitioner’s lawsuit, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect $112,500.00 to satisfy the medical costs it paid on Petitioner’s behalf. (As discussed below, the formula in section 409.910(11)(f) allows the Agency to collect $112,500.00 to satisfy its Medicaid lien.) The Agency maintains that it should receive the full amount of its lien regardless of the fact that Petitioner settled for less than what Petitioner believes is the full value of his damages. Petitioner, on the other hand, asserts that, pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of the settlement than the amount it calculated using the section 409.910(11)(f) formula.3/ Petitioner specifically argues that the Agency’s Medicaid lien should be reduced proportionately, taking into account the full value of Petitioner’s damages. Otherwise, the application of the default statutory formula would permit the Agency to collect more than that portion of the settlement that fairly represents Petitioner’s compensation for past medical expenses. Petitioner insists that reimbursement of the full lien amount violates the federal Medicaid law’s anti-lien provision (42 U.S.C. § 1396p(a)(1)) and Florida common law. Petitioner requests that the Agency’s allocation from Petitioner’s recovery be reduced to $1,389.00. To establish the value of his damages, Petitioner testified regarding the extent of, and the impact on his life from, the injuries he suffered from the gunshot wound. Petitioner relayed that he has received 18 surgeries on his stomach and intestines. Petitioner further described his future medical expenditures. Petitioner anticipates receiving a hernia operation. Petitioner also requires medication and medical supplies to address his pain and infections. In addition, Petitioner desires a handicap-equipped van that he can use for transportation to his medical visits. Petitioner would also like to install “trapeze” bars in his home to help him exercise. Mr. Crow also testified regarding the full value of Petitioner’s injuries. Mr. Crow has practiced law for 32 years and is a partner with the law firm of Beasley Allen in Montgomery, Alabama. In his practice, Mr. Crow handles serious personal injury and death cases involving car and truck litigation, premise liability cases, and brain injury cases. Mr. Crow has been involved in 15 to 25 lawsuits involving paralyzed clients. As part of his personal injury practice, Mr. Crow regularly evaluates damages similar to those Petitioner suffered. Mr. Crow asserted that the $300,000 settlement was far less than the true value of the injuries Petitioner suffered from this incident. Mr. Crow opined that the full value of Petitioner’s damages equals $26,639,170.00. Mr. Crow explained that this figure consists of $6.5 million present value for Petitioner’s future medical expenses, $5 million for pain and suffering, $10 million for mental anguish and loss of quality of life, $139,170 for the Alabama Medicaid lien, and $5 million in punitive damages. In deriving the value of Petitioner’s injuries, Mr. Crow considered that Petitioner is a younger individual suffering from paraplegia. Mr. Crow explained that Petitioner can live in his community with appropriate nursing support. However, he will require pain management on a monthly basis. His current medications include Baclofen, Colace, Cymbalta, Lopressor, Neurontin, Oxycodone, Senokot, and Glycerine suppositories. Petitioner will also need attendant care to help administer his medications, as well as with bathing, cooking, cleaning, dressing, grooming, and personal hygiene. In addition, Petitioner will require follow-up treatment involving physiatry, physical therapy, urology, and a wheelchair clinic. Furthermore, although Petitioner does not have sensory awareness from his waist down, he continues to experience severe pain in his back and legs. Mr. Crow represented that Petitioner is able to propel himself in a wheelchair, but he can only travel short distances due to fatigue and pain. Petitioner does not have access to a power wheelchair. Regarding transportation, Petitioner will need assistance to drive a van with a wheelchair lift. Finally, Petitioner offered the testimony of David A. Paul, Esquire. Mr. Paul has practiced law in Florida for 22 years as a plaintiff personal injury lawyer and is board- certified in Civil Trial Law by the Florida Bar. Mr. Paul handles catastrophic and serious personal injury cases involving birth injuries, medical malpractice, trucking accidents, and wrongful death. As part of his practice, Mr. Paul regularly evaluates catastrophic injuries. Mr. Paul testified that he has handled many cases with similar injuries to Petitioner. Mr. Paul was accepted as an expert regarding the value of personal injury damages and resolving liens in personal injury cases. At the final hearing, Mr. Paul supported Mr. Crow’s valuation of Petitioner’s injuries. Mr. Paul opined that a “fair full value” of Petitioner’s damages equals in excess of $26 million. In formulating his injury valuation, Mr. Paul considered Petitioner’s past medical expenses, anticipated future medical expenses, the cost of attendant care with daily living activities, past and future lost wages, pain and suffering, as well as mental anguish and loss of quality of life. Regarding the Medicaid liens, Mr. Paul relayed that the norm when resolving liens in Florida is to compare the total value of the injured party’s injuries to the amount of the actual recovery. The lien is then reduced proportionally by this ratio. Mr. Paul commented that he typically resolves Medicaid liens in workers compensation cases using this “equitable formula.” Based on the testimony from Mr. Crow and Mr. Paul that the $300,000 settlement did not fully compensate Petitioner for his damages, Petitioner argues that a lesser portion of the settlement should be allocated to reimburse Florida Medicaid, instead of the full amount of the lien. Petitioner proposes that a ratio should be applied based on the ultimate value of Petitioner’s damages ($26,639,170.00) compared to the amount that Petitioner actually recovered ($300,000). Using these numbers, Petitioner’s settlement represents approximately a 1.126 percent recovery of the full value of Petitioner’s damages. In like manner, the Florida Medicaid lien should be reduced to 1.126 percent or approximately $1,389.00 ($123,366.95 times .01126). Therefore, Petitioner asserts that $1,389.00 is the portion of his third-party settlement that represents the equitable, fair, and reasonable amount the Florida Medicaid program should recoup for its payments for Petitioner’s medical care. The Agency was not a party to the Alabama wrongful injury lawsuit or Petitioner’s settlement. Petitioner was aware of both the Alabama and Florida Medicaid liens and past medical expense damages at the time he settled the lawsuit. No portion of the $300,000 settlement represents reimbursement for future medical expenses. The undersigned finds that Petitioner met his burden of proving, by a preponderance of the evidence, that the full value of his damages from this incident equals $21,639,170.00.4/ Further, based on the evidence in the record, Petitioner proved that a lesser portion of Petitioner’s settlement should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Finally, the undersigned finds that the evidence establishes that the Agency should be reimbursed in the amount of $5,317.95 from Petitioner’s recovery of $300,000 from a third party to satisfy the Florida Medicaid lien.
