The Issue The issue to be determined is the amount to be reimbursed to Respondent, Agency for Health Care Administration (Respondent or AHCA), for medical expenses paid on behalf of Petitioner, Genesis Belinaso (Petitioner), from a medical malpractice settlement received by Petitioner from a third party.
Findings Of Fact Petitioner was born on August 29, 2011. At 11 months of age, Petitioner was diagnosed with Gaucher Disease, Type I. On September 21, 2012, when she was approximately 13 months of age, Petitioner was admitted to the hospital for the insertion of a central venous port (mediport) for treatment of her Gaucher Disease with Cerezyme infusions. The mediport insertion on the right side was unsuccessful, and it was inserted on the left side. Petitioner did not wake up from anesthesia and experienced seizure activity. Radiographic evaluation with CT and MRI of the brain revealed subarachnoid hemorrhage, cerebral edema, and herniation. Petitioner required an emergency craniotomy, duraplasty and partial right temporal lobectomy, with the operative note diagnosing a right internal carotid artery stroke and possible dissecting aneurysm of the internal carotid artery bifurcation. A post-operative CT revealed significant infarction of the right cerebral hemisphere. A subsequent intracranial hemorrhage resulted in recurrent/worsening of cerebral edema. Petitioner was transferred to Jackson Memorial Hospital where she underwent numerous neurological surgeries and procedures associated with catastrophic brain damage from the strokes suffered on September 21, 2012. As a result of the catastrophic brain damage, Petitioner suffers from left side hemiplegia and severe cognitive deficits. She is permanently disabled and unable to care for herself. She will need some form of care for the rest of her life. AHCA, through the Medicaid program, spent $301,085.18 on behalf of Petitioner, all of which represents expenditures paid for Petitioner’s past medical expenses. The $301,085.18 paid by Medicaid constituted Petitioner’s entire claim for past medical expenses. No portion of the $301,085.18 paid by AHCA through the Medicaid program on behalf of Petitioner represented expenditures for future medical expenses, and AHCA did not make payments in advance for medical care. Petitioner’s parents and natural guardians, Cintia Aquino and Jonas Belinaso, brought a medical malpractice claim against Petitioner’s medical providers, including the physician and the hospital, to recover Petitioner’s damages, as well as their damages associated with their child’s injury. The physician responsible for the unsuccessful mediport insertion (“Settling Tortfeasor”), maintained only an insurance policy with a policy limit of $250,000.00. Petitioner’s medical malpractice claim against the Settling Tortfeasor was settled during the pre-suit period for the insurance policy limit of $250,000.00. The Release of All Claims with the Settling Tortfeasor (“Release”) stated, inter alia: Although it is acknowledged that this settlement does not fully compensate Genesis Belinaso and her parents for all of the damages that they have allegedly suffered, this settlement shall operate as a full and complete RELEASE as to RELEASEES without regard to this settlement only compensating Genesis Belinaso and her parents for a fraction of the total monetary value of their alleged damages. The parties agree that the alleged damages sustained by Genesis Belinaso and her parents, have a potential full value in excess of $25,000,000, of which $301,085.18 represents Genesis Belinaso’s claim for past medical expenses. Given the facts, circumstances, and nature of Genesis Belinaso’s injuries and this settlement, the parties have agreed to allocate $3,010.85 of this settlement to the claim for past medical expenses and allocate the remainder of the settlement towards the satisfaction of claims other than past medical expenses. This allocation is a reasonable and proportionate allocation based on the same ratio this settlement bears to the total monetary value of all of the damage claims sustained by Genesis Belinaso and her parents. Further, the parties acknowledge that Genesis Belinaso may need future medical care related to her injuries, and some portion of this settlement may represent compensation for future medical expenses Genesis Belinaso will incur in the future. However, the parties acknowledge that Genesis Belinaso, or others on her behalf, have not made payments in advance for Genesis Belinaso’s future medical care and Genesis Belinaso has not made a claim for reimbursement, repayment, restitution, indemnification, or to be made whole for payments made in the past for future medical care. Accordingly, no portion of this settlement represents reimbursement for future medical expenses. The Release did not further differentiate or allocate the $250,000.00 total recovery. Thus, this proceeding was brought by Petitioner pursuant to section 409.910(17)(b) to establish “that a lesser portion of the total recovery should be allocated as reimbursement for past and future medical expenses than the amount calculated by the agency pursuant to the formula set forth in paragraph [409.910](11)(f).” The acceptance of the Settling Tortfeasor’s policy limits was expressly conditioned on all claims against the hospital being preserved. Because Petitioner was a minor, Court approval of the settlement was required. Accordingly, on July 29, 2015, Circuit Court Judge Maria M. Korvick entered an Order Approving Settlement. There is no evidence that the monetary figure agreed upon by the parties represented anything other than a reasonable settlement. There was no evidence of any manipulation or collusion by the parties to minimize the share of the settlement proceeds attributable to past medical expenses for Petitioner’s medical care. During the pendency of Petitioner’s medical malpractice claim, AHCA was notified of the claim. AHCA, through its collections contractor Xerox Recovery Services, asserted a Medicaid lien in the amount of $301,085.18 against any proceeds received from a third party as a result of Petitioner’s cause of action and settlement of that action. By letter of September 24, 2015, Petitioner’s medical malpractice attorney notified AHCA of the settlement and provided AHCA with a copy of the executed Release and itemization of Petitioner’s $85,095.49 in litigation costs. The letter explained that the damages suffered had a value in excess of $25,000,000, and that the $250,000.00 settlement represented only a one-percent recovery of Petitioner’s $301,085.18 claim for past medical expenses. The letter requested AHCA to advise as to the amount AHCA would accept in satisfaction of the $301,085.18 Medicaid lien. AHCA responded to the September 24, 2015, letter on November 2, 2015. AHCA indicated that it had calculated the section 409.910(11)(f) formula amount owed from the $250,000.00 settlement and, under the formula, $74,735.15 was owed to AHCA in satisfaction of its Medicaid lien. AHCA requested a “check made payable to ‘Agency for Health Care Administration’ in the amount of $74,735.15.” AHCA correctly computed the lien amount pursuant to the statutory formula in section 409.910(11)(f). Deducting the 25 percent attorney’s fee of $62,500.00 from the $250,000.00 recovery left a sum of $187,500.00. AHCA then deducted $38,029.71 in approved taxable costs, which left a sum of $149,470.29, half of which is $74,735.15. That figure establishes the maximum amount that could be reimbursed from the third-party recovery in satisfaction of the Medicaid lien. Thus, application of the formula allows for sufficient funds from the settlement proceeds to satisfy the Medicaid lien amount of $74,735.15. AHCA has not filed an action to set aside, void, or otherwise dispute Petitioner’s settlement, nor has it commenced a civil action to enforce its rights under section 409.910. Petitioner deposited the section 409.910(11)(f) formula 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, pursuant to section 409.910(17). At the final hearing, Petitioner presented the expert testimony of Mr. Rossman. Mr. Rossman, who is board-certified in civil trial practice, demonstrated considerable experience handing personal injury and medical malpractice cases in the Miami area. Mr. Rossman testified that the standard of care in his field of practice requires a careful evaluation of a case from the time of intake through the trial. That evaluation, which includes an assessment of the value of the damages, includes a comparison of other jury verdicts in comparable cases as “the barometer of what is happening.” In assessing the value and worth of a case, it is common practice for counsel to retain a life care planner and an economist, and information provided by such persons is reasonably relied upon by persons in Mr. Rossman’s field of expertise. Mr. Rossman had extensive knowledge of the nature and extent of the injuries suffered by Petitioner, and was familiar with the information provided in Petitioner’s Habilitation Assessment and Present Value Analysis. Mr. Rossman testified that Petitioner’s total economic damages were $8,367,417.18, which included $301,085.18 in past medical expenses; $1,330,634.00 in lost earning capacity over Petitioner’s lifetime; and $6,735,698.00 for future life care needs. The future life care costs included those for future medical, surgical, diagnostic, and therapeutic needs, specialized equipment and supplies, attendant care, and related needs. The $6,735,698.00 amount estimated for future life care needs was the most conservative figure among the scenarios presented in the Present Value Analysis. Mr. Rossman also estimated the non-economic damages associated with Petitioner’s claim to be in the range of $12 million for Petitioner, and $3 million each for Petitioner’s parents, for a total of $18 million. His assessment of non- economic damages was based not only on his own knowledge and experience, but included an analysis of comparable jury verdicts, which is information reasonably relied upon by persons in Mr. Rossman’s field of expertise. As a result of his expert analysis, Mr. Rossman testified that, as a case of absolute liability with full damages awarded, Petitioner’s claim had a minimum value of $25 million dollars. Mr. Rossman’s testimony was credible, and is accepted. At the final hearing, Petitioner also presented the expert testimony of Mr. Barrett. Mr. Barrett has focused his practice for the past 30 years on personal injury cases, with the past 10 years devoted to medical malpractice and pharmaceutical products liability cases. Evaluation of personal injury cases and medical malpractice cases is a daily component of his practice. In preparation for his testimony, Mr. Barrett reviewed the reports of Petitioner’s life care planner and economist, Petitioner’s medical records, and other materials that are included in the record of this proceeding. Mr. Barrett routinely reviews jury verdict reports, and applied his knowledge and experience to Petitioner’s claim. Based on his review, Mr. Barrett concurred that the overall value of Petitioner’s claim was, conservatively, in the $25 million range, with the same general breakdown for economic and non- economic damages. Mr. Barrett’s testimony was credible, and is accepted. The evidence was clear and convincing that the total value of the damages related to Petitioner’s injury was, conservatively, $25 million, and that the settlement amount was one percent of the total value. The evidence was equally clear and convincing that the allocation for past medical expenses reflected in the court-approved Release was of the same ratio to the total past medical expenses as was the settlement amount to the reasonable value of the claim. There was no evidence that the allocation was subject to any form of manipulation to increase or decrease the accounting of past medical expenses.
The Issue The issues are whether, pursuant to section 409.910(17)(b), Florida Statutes (17b), Petitioner1 has proved that Respondent's recovery, under section 409.910(11)(f) (11f), of $685,615 in medical assistance expenditures2 from $10.4 million in proceeds from the settlement of a personal injury action must be reduced to avoid conflict with 42 U.S.C. § 1396p(a)(1) (Anti-Lien Statute)3 ; and, if so, what is the maximum allowable amount of Respondent's recovery.
Findings Of Fact Shortly before midnight, on January 20, 2015, Petitioner, then 11 years old, suffered catastrophic injuries when she was ejected from a vehicle that rolled over on Interstate 75 near Micanopy. Petitioner has been left in a persistent vegetative state after suffering a traumatic brain injury, malignant cerebral edema, a depressed skull fracture, a contrecoup subdural hematoma, bilateral pulmonary hemorrhage, and fractured ribs. The vehicle, a 2003 Ford Expedition, was driven by its owner, a 42-year-old woman who was a friend of a cousin of one of Petitioner's family members. The driver had transported Petitioner, her brother, and two other persons from Tampa to Gainesville. After attending a college basketball game, the driver discovered that the right rear tire was flat, so she called a national automobile service company to install the spare tire. Even though the spare tire was 11 years old, the person whom the company dispatched on the service call replaced the flat tire with the spare tire. While driving south on Interstate 75 in the left lane, the installed spare tire blew out. The driver lost control of the vehicle, which rolled over once, hurdled the guardrail, and came to rest, upright, in the emergency lane adjacent to the left lane of the northbound lanes. The primary liability for the accident was borne by the driver. Two of the tires on the vehicle were so worn as to reveal their steel belts. The driver had ignored a warning five months earlier to replace at least two of the vehicle's tires. Additionally, expert witnesses testified that the driver could have controlled the vehicle after the blowout, so as to avoid the rollover. Due to the age of the tire, it is difficult to find fault with the manufacturer of the vehicle or the manufacturer or vendors of the tire. The automobile service company and the technician bore more blame than the manufacturers, although there was a factual dispute about whether, prior to changing the tire, the technician had warned the driver that it was unsafe. Petitioner herself bore considerable responsibility for her injuries because she was not wearing a seat belt at the time of the blowout. The other passengers were belted, remained within the vehicle, and suffered no more than minor injuries. The roof over Petitioner's seat survived the wreck intact, so she likely would have suffered no more than minor injuries if she had been wearing her seatbelt. Petitioner filed a personal injury action against the manufacturers of the vehicle and the failed tire, vendors of the failed tire, companies responsible for changing the tire, and driver of the vehicle. In confidential settlements, Petitioner obtained $10.4 million, which was unallocated among the damages components. Claiming a true value of $40 million for the case, Petitioner accurately calculates a 74% settlement discount.5 The driver was unable to satisfy a large judgment. The driver carried liability insurance with a policy limit of $25,000, which the insurer immediately offered to avoid a bad-faith claim. The record is silent as to the creditworthiness of the other, less-liable parties. The parties agree that the past medical expenses component of the settlement proceeds was $685,614. This sum represents the total medical assistance expenditures made by Respondent and another agency. 5 From the settlement proceeds, Petitioner's attorneys collected $4 million in attorneys' fees and $400,000 in costs, leaving Petitioner with a net recovery of $6 million, but Petitioner has not sought to reduce Respondent's recovery by a proportional share of these fees and costs. A conservative estimate of the loss of future earning capacity was $1.3 million. These sums support about $2 million of the $40 million putative true value of the case. The question is thus whether another $38 million in damages was supported by other damages components--mostly future medical expenses and past and future noneconomic damages, such as pain and suffering. The 1st Update of the Life Care Plan, dated November 5, 2018 (Life Care Plan), includes all applicable treatments, except the cost of hyperbaric oxygen therapy, which is $7150 per set of 26 sessions. Treatments include periodic evaluations by a neuropsychologist, physiatrist, physical therapist, occupational therapist, speech therapist, pediatric pulmonary consultant, pulmonary consultant, pediatric ear, nose and throat consultant, pediatric gastroenterology consultant, pediatric neurologist, and multidisciplinary team. Other listed expenses include pharmaceuticals; periodic diagnostic services, such as imaging studies and lab work; the preparation and maintenance of orthiotics and durable medical equipment, such as wheelchairs, hospital and shower beds, lifts, suction machines, oxygenation equipment, a home generator, and an augmentive communication device; feeding and incontinence equipment and supplies; in-home skilled care on a continual basis; adaptive vans and medical transportation services; architectural modifications to the home; the installation of a special in-home ventilation system; annual hospitalizations of one-week duration each; and various surgeries. The components of the Life Care Plan, including the costs of the goods and services and the stated intervals on which they are to be provided, all appear to be reasonable and necessary. An important issue regarding the Life Care Plan is the number of years that these costs are reasonably expected to be incurred. The evidentiary record provides no basis to find that Petitioner will recover significant function, so the question is whether the Life Care Plan has incorporated a reasonable remaining life expectancy in light of the catastrophic injuries that Petitioner has suffered. Having progressed from a coma to a minimally conscious state, Petitioner exhibits some awareness of her surroundings and her mother and father, who report that she has verbalized once or twice in the past two years, although she is incapable of speech. Petitioner's youth at the time of the accident may have helped her avoid organic decline, at least over the first five years after the accident. She is now five feet, nine inches tall and weighs 163 pounds. Her height prior to the accident is unavailable, but she weighed 110 to 115 pounds. Petitioner cannot walk or assist with transfer, but she can stand without assistance and can move her limbs. Petitioner no longer is fed by a PEG tube and her ability to swallow is slowly improving. She can open her mouth in response to the sight of a spoon and is able to eat puréed food. Petitioner requires oxygenation and suffers from sleep apnea, but needed a ventilator only for the first six months after the accident. She has had only an occasional respiratory infection and has suffered no seizures. On these facts, the Life Care Plan reasonably projected Petitioner's remaining life expectancy to be slightly in excess of 30 years. Thus, the Life Care Plan conservatively estimates the present value of the future medical expenses at not less than $37 million. The pain and suffering that Petitioner has suffered are considerable, as are other noneconomic damages. Given the relatively short span between the accident and the settlement and the longer span between the settlement and the projected end of Petitioner's life, the greater amount of these noneconomic damages probably will relate to the future. Based on comparable jury verdicts, a reasonable estimate of past and future noneconomic damages is not less than $10 million. The presentation of damages to a jury would not have been impeded by extrinsic factors. Petitioner's family would have made excellent witnesses to support the damages claims. Petitioner's lead trial counsel is experienced in personal injury cases, has produced numerous large verdicts and settlements, and presented himself at hearing as a thoughtful, patient, and effective communicator with a firm grasp of the facts and law--in sum, an attorney who would have maximized Petitioner's chances for a good damages verdict. The settlement discount was partly explained by the family's need for funds to care for Petitioner. Medicaid has not paid for the hyperbaric oxygen treatments that have proven somewhat efficacious, nor for renovations to the family home necessitated by Petitioner's disabilities. Petitioner's family lacks the financial means to pay these expenses on their own. At the time of the accident, Petitioner's father was on full disability due to back injuries, her mother worked as an administrative assistant, and the family's home had been constructed by Habitat for Humanity. The sooner the family received the settlement proceeds, the sooner they could obtain additional goods and services for Petitioner. Petitioner has proved by any standard of proof that the true value of the case exceeds $40 million. Applying the settlement discount of 74% to the past medical expenses component of the settlement proceeds, Respondent's recovery is limited to 26% of $685,614, or $178,260, as Petitioner contends. For the benefit of Respondent, Petitioner has deposited into an interest-bearing account an amount equal to the Medicaid lien, pending a determination of Respondent's proper recovery amount.
The Issue The issue is the amount payable to Respondent, Agency for Health Care Administration ("Respondent" or "ACHA"), in satisfaction of Respondent's Medicaid lien from a settlement received by Petitioner, Jonathan Velez ("Petitioner" or "Velez"), from a third party, pursuant to section 409.910, Florida Statutes (2015).
Findings Of Fact On September 3, 2008, Velez, then a 14-year-old adolescent child was injured while playing football in Clewiston, Florida. On the date of the accident, Petitioner had a helmet to helmet (face to face) collision with another football participant. The collision caused a hyper-extended injury and Velez immediately fell to the ground and lost consciousness. Velez suffered a C5 burst fracture, a spinal cord injury, anterior cord syndrome and subsequent injuries originating from this accident, initially rendering him paralyzed. As a result of the injuries, and subsequent ramifications from said injuries, Velez suffered extensive permanent injuries and required extensive medical treatment in Miami, Florida, from September 3, 2008, through October 28, 2013. Petitioner sued numerous defendants for his injuries, but because of waiver and release forms signed by his guardian, the parties settled the case to avoid the possibility of summary judgment against Petitioner. Petitioner recovered $430,000.00 from a settlement against defendants. The settlement's allocation included: attorney's fees (40 percent) in the amount of $172,000.00; costs in the amount of $4,789.72; past medicals in the amount of $60,000.00; and future medicals in the amount of $20,000.00.1/ ACHA, through the Medicaid program, paid $142,855.89 on behalf of Petitioner for medical benefits related to the injuries sustained by Petitioner. Xerox Recovery Services, Respondent's collection's contractor, notified Petitioner that he owed $142,855.89 to satisfy a Medicaid lien claim from the medical benefits paid to him from the proceeds received from the third-party settlement. Petitioner contested the lien amount. At the final hearing, Petitioner presented, without objection, the expert valuation of damages testimony of Donna Waters-Romero ("Waters-Romero"). Waters-Romero has 30 years' experience in both state and federal courts and has solely practiced in the area of personal injury defense, including cases with similar injuries specific to this type of case. Waters-Romero's experience also encompasses evaluation of personal injury cases based on the review of medical records, case law, and injuries. In preparation for her testimony, Waters-Romero reviewed the pleadings, depositions, answers to interrogatories, evaluations, medical records, and defendant's motion for summary judgment along with the attached documents. She also met with Petitioner's attorneys and reviewed the mediation summary, exhibits, case law on Medicaid liens, letter of discharge, and release and settlement agreement. Waters-Romero also specifically researched three circuit court orders that were entered regarding allocation regarding Medicaid liens. To determine how to value Petitioner's claim, Waters-Romero relied on Wos v. E.M.A., 133 S. Ct. 1391(2013), a United States Supreme Court case, and on the circuit court cases as guidance. She determined that every category of the settlement should be reduced based on the ultimate settlement. During her evaluation, Waters-Romero also acknowledged the litigation risk in Velez's case due to the issues with the liability and the waiver and release. Based on her review, Waters-Romero opined that the overall value of Petitioner's claim was valued conservatively at $2,000,000.00, which was unrebutted. Waters-Romero's testimony was credible, persuasive, and is accepted. The evidence was clear and convincing that the total value of the damages related to Petitioner's injury was $2,000,000.00 and that the settlement amount, $430,000.00 was 21.5 percent of the total value. The settlement does not fully compensate Petitioner for the total value of his damages. ACHA's position is that it should be reimbursed for its Medicaid expenditures pursuant to the statutory formula in section 409.910(11)(f). Under the statutory formula, the lien amount is computed by deducting 25 percent attorney's fee of $107,500.00 from the $430,000.00 recovery, which yields a sum of $322,500.00. In this matter, ACHA then deducted zero in taxable costs, which left a sum of $322,500.00, then divided that amount by two, which yields $161,250.00. Under the statute, Respondent is limited to recovery of the amount derived from the statutory formula or the amount of its lien, whichever is less. Petitioner's position is that reimbursement for past medical expenses should be limited to the same ratio as Petitioner's recovery amount to the total value of damages. Petitioner has established that the settlement amount of $430,000.00 is 21.5 percent of the total value ($2,000,000.00) of Petitioner's damages. Using the same calculation, Petitioner advances that 21.5 percent of $60,000.00 (Petitioner's amount allocated in the settlement for past medical expenses), $12,900.00, should be the portion of the Medicaid lien paid. Petitioner proved by clear and convincing evidence that Respondent should be reimbursed for its Medicaid lien in a lesser amount than the amount calculated by Respondent pursuant to the formula set forth in section 409.910(11)(f).
The Issue The issues are whether, pursuant to section 409.910(17)(b), Florida Statutes (17b),1 Petitioner has proved that Respondent's recovery of $535,312 in medical assistance expenditures2 from $5 million in proceeds from the settlement of a personal injury action must be reduced to avoid conflict with 42 U.S.C. § 1396p(a)(1) (Anti-Lien Statute)3; and, if so, the maximum allowable amount of Respondent's recovery.
Findings Of Fact On September 28, 2005, Petitioner was born by an unremarkable delivery at 42 weeks' gestation at a hospital in West Palm Beach. On October 1, 2005, from all appearances a healthy infant, Petitioner was discharged to home. However, Petitioner was born with an extremely rare metabolic disorder known as B-ketothiolase deficiency (BKT), which prevents the body from processing a protein building block called isoleucine and impedes the body's processing of ketones. A few weeks after Petitioner's birth, the birth hospital began screening that would have detected this condition and permitted timely management and treatment of this serious condition. Petitioner progressed normally until, at the age of five years, she acquired an infection that caused her to suffer a decompensation attack and guardian," and DOAH Case 20-2124MTR identifies by name a parent, "individually and as parent and natural guardian of A. F., a minor." As to the latter case, the same attorneys represent the petitioner and respondent as represent Petitioner and Respondent. 9 Resp.'s proposed final order, footnote 2. metabolic crisis. Over the span of a few hours, Petitioner suffered irreversible and progressive atrophic changes to her basal ganglia. This brain damage produced, among other permanent conditions, intermittent painful spasms, multiple times during the day and night, that cause Petitioner to thrash her head about wildly, to arch her back into an extreme "U-like position," and uncontrollably to scratch her eyes or mouth until the spasm ends or her arms are secured or become entrapped in the wheelchair. Otherwise, Petitioner's arms and legs are in a permanent state of contracture, so as to be of little use to her, and her head is typically deviated to the left. Unable to walk, Petitioner requires the use of a wheelchair for mobility, but chronic pain, especially in her back, prevents her from remaining in the chair for more than 30 minutes at a time. Unable to maintain any position for very long, Petitioner is unable even to watch television or a movie. Petitioner attends school, where she is assisted by a one-to-one paraprofessional, but, due to pain, she typically finds it necessary to leave, often in tears, prior to the end of the school day. Petitioner is completely dependent on others for all of the activities of daily living. She is fed through a gastrostomy tube. Without respite care, Petitioner's mother is unable to leave her daughter unattended and provides nearly all of the required care. Among many other things, the mother secures Petitioner to her bed, changes her position, stretches her, brushes her teeth, and takes her to appointments, including brain stimulation therapy in Gainesville twice weekly to help with the spasms. The impact of Petitioner's condition upon the family is nearly inestimable. For instance, nearly the entire family must accommodate Petitioner's desire to go to an amusement park, as the mother, Petitioner's father, and the older of their other two children must help to get Petitioner into one ride. Petitioner's ability to speak is limited, and she lacks the means of expressive communication by writing or a keyboard. The frustration of these communication barriers is heightened by the fact that Petitioner is likely to be cognitively intact, meaning that she is substantially "locked in," so as to understand what is going on about her, but is unable to express herself, even by body movement or gesture. No single measure adequately conveys the extensive care required just to maintain, to the maximum extent possible, Petitioner's present, limited functionality. When assessed for a life care plan, Petitioner was being seen by nine different physicians, three therapists, and the school nurse; was taking nine different medications; and was served by or consumed nearly two dozen items of equipment or supplies. In 2013, Petitioner filed a personal injury action in circuit court in West Palm Beach against the birth hospital and its corporate parent. The case presented three major problems in establishing liability. At the time of Petitioner's birth, only two hospitals in the state of Florida provided BKT screening at birth, and the birth hospital was not one of them. However, the corporate parent owns numerous hospitals in other states, and at least some of these hospitals were providing BKT screening at the time. Petitioner's ability to establish a favorable standard of care was thus dependent on keeping the corporate parent in the case, even though its liability was attenuated. Petitioner's task was complicated by a Florida statute that explicitly provides that the failure of a healthcare provider to provide supplemental diagnostic tests is not actionable if the provider acted in good faith with due regard to the prevailing standard of care.10 Lastly, Petitioner was confronted by a causation issue because, when informed of Petitioner's rare metabolic condition, the parents did not immediately obtain a screening for her older brother. In September 2017, the circuit judge ordered the parties to submit to two summary jury trials, in which each side had a little over one hour to present the case to actual jurors for a nonbinding verdict. Each party devoted 10 § 766.102(4). nearly all of its allotted time to a presentation on liability, not damages. One jury returned a verdict for the defendants, and the other returned a verdict for the plaintiffs, awarding $23.5 million as follows: the loss of earning capacity and future medical expenses after the age of 18 years--$10.5 million; past and future pain and suffering--$5 million; past and future medical expenses until the age of 18 years--$5 million; and the parents' loss of consortium--$3 million. In the ensuing settlement negotiations, the defendants' counsel did not contest the damages. Significantly, in calculating future medical expenses and loss of earning capacity, both sides chose conservative reduced actuarial values with only four years separating their choices. Additionally, the defendants' counsel did not contend that a timely screening might not have prevented the injuries. Instead, the defendants' counsel argued the above-described liability and causation issues. The plaintiffs' counsel opposed these arguments and, secondarily, argued that the $23.5 million summary jury verdict was too low due to the necessity of counsel's preoccupation with liability during their presentations. Nearly one year after the summary jury verdicts and after extensive discovery and the expenditure of about $200,000 in costs by the plaintiffs, the parties reached the settlement described above. By any standard of proof, Petitioner has proved that the true value of her case was at least $23.5 million, including $535,000 for past medical expenses, and that the $5 million settlement was driven by concerns as to liability and causation, not damages. The only noteworthy damages component in the true value is Petitioner's past and future pain and suffering, which could have supported a larger value based on the Florida Supreme Court's jury instructions on the matter.11 11 Florida Standard Jury Instructions in Civil Cases, Appendix B, Form 2, states in part: What is the total amount of (claimant’s) damages for pain and suffering, disability, physical impairment, disfigurement, mental anguish, inconvenience, aggravation of a disease or physical defect (list any other noneconomic damages) and loss The $5 million settlement represents a discount of $18.5 million or 78.7% when compared to the true value of the case. Applying the same discount to $535,312 results in Respondent's recovery of $114,021.
The Issue The issue to be determined is the amount to be reimbursed to Respondent, Agency for Health Care Administration (Respondent or AHCA), from settlement proceeds received from third parties by Petitioners, Ray A. Siewert and Rose E. Siewert, for medical expenses paid on behalf of Petitioner, Mr. Siewert.
Findings Of Fact Stipulated Findings of Fact On October 15, 2017, the Siewerts were involved in a motorcycle versus automobile crash, which required extensive hospital, skilled nursing, therapy, and other medical treatment including, but not limited to, a four- level spinal fusion procedure and rehabilitative care and services for Mr. Siewert and multiple leg surgeries for Mrs. Siewert, that ultimately led to an above-the-knee amputation (hereinafter referred to as the “auto claims”). On January 3, 2018, Mr. Siewert was discharged from a rehabilitation facility to his home, where he began receiving home health nursing, physician, and therapy services. On January 22, 2018, Mr. Siewert was diagnosed with an abscess near his surgical site, which was allegedly not properly addressed in the days that followed. On January 31, 2018, Mr. Siewert was hospitalized due to worsening neurological deficits, namely in his lower body, and he was transferred to the hospital that had performed his prior spinal surgery. On February 1, 2018, Mr. Siewert had another spinal surgery to address an abscess compressing on his spinal cord, leading to the decreased neurological function. The damage done to his spinal cord preoperatively was significant enough that he has been unable to walk since January 31, 2018, and remains bedbound to present. Mr. Siewert has a neurogenic bladder/bowel, wears diapers, has to be catheterized multiple times per day,1 and is unable to ambulate. To date, he is living with his wife in a single room residence at a skilled nursing facility in the Orlando area, where he is expected to remain.2 The Siewerts brought the following claims: negligence claims relating to the auto claims; nursing home neglect claims under chapter 400, Florida Statutes; and medical malpractice claims under chapter 766, Florida Statutes, each of which were pursued against several companies/entities, individuals, and healthcare providers, seeking, in part, compensable damages to the Siewerts for past bills and future economic needs as well as noneconomic mental pain and suffering and consortium claims for their injuries and losses. In April 2021, the Siewerts settled one of the medical malpractice claims for a limited confidential amount. The Siewerts have had a health plan with Aetna Better Health of Florida, which is a Medicaid plan through AHCA, that has retained the services of Equain relating to the settlement of part of the Siewerts’ medical malpractice claims (referred to below as “Aetna”). Aetna was properly notified of the Siewert’s medical malpractice claims against those defendants and indicated it had paid benefits related to the injuries from the incident in the amount of $75,923.82, as it relates to the settlement at issue. Through their counsel, the Siewerts have asked Aetna to accept a reduced lien amount given the other claims still pending and large 1 The evidence adduced at hearing indicates that Mr. Siewert has now been fitted with a permanent abdominal suprapubic catheter. 2 Though Mrs. Siewert could manage in an assisted living facility, Mr. Siewert could not. Thus, Mrs. Siewert has chosen to stay in the skilled nursing facility to be with her husband. total case value. Nonetheless, Aetna has continued to assert a lien, for the amount of $75,923.82, against the Siewerts’ settlement proceeds relating to the single settlement. Aetna has maintained that it is entitled to application of section 409.910’s formula to determine the lien amount. Applying the statutory reduction formula to this particular settlement would result in no reduction of this lien given the amount of the settlement. The Siewerts also have been covered by AHCA’s fee-for-service Medicaid program. AHCA has contracted with Health Management Systems and Conduent to run its recovery program. AHCA was properly notified of the Siewerts’ medical malpractice claims against those defendants. AHCA provided medical assistance benefits related to the injuries from the incident in the amount of $33,836.09. Through their counsel, the Siewerts have asked AHCA to accept a reduced lien amount. AHCA has continued to assert a lien for the amount of $33,836.09, against the Siewerts’ settlement proceeds relating to the single settlement. AHCA has maintained that it is entitled to application of section 409.910’s formula to determine the lien amount. Applying the statutory reduction formula to this particular settlement would result in no reduction of this lien given the amount of the settlement. AHCA’s $33,836.09 payment and Aetna’s $75,923.82 payment total $109,759.91, and this amount constitutes Mr. Siewert’s claim for past medical expense damages. There remain claims against numerous other defendants which also relate to the AHCA and Aetna liens at issue, including all remaining defendants in the auto and medical malpractice claims. Repayment to AHCA’s Medicaid program is prioritized by law and contract over Medicaid-managed care plans Facts Adduced at Hearing During the pendency of the medical malpractice action, AHCA was notified of the action. AHCA did not commence a civil action to enforce its rights under section 409.910, nor did it intervene or join in the medical malpractice action against the Defendants. AHCA has not filed a motion to set aside, void, or otherwise dispute the settlement. The Medicaid program, through AHCA, spent $33,836.09 on behalf of Mr. Siewert, all of which represents expenditures paid for past medical expenses. No portion of the $33,836.09 paid by AHCA through the Medicaid program on behalf of Mr. Siewert represented expenditures for future medical expenses. The $33,836.09 in Medicaid funds paid by AHCA is the maximum amount that may be recovered by AHCA. There was no evidence of the taxable costs incurred in securing the settlement. Application of the formula at section 409.910(11)(f) to the settlement requires payment to AHCA of the full $33,836.09 Medicaid lien asserted by AHCA, and the full $75,923.82 Medicaid lien asserted by Aetna. Petitioners have 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). There was no suggestion that the monetary figure agreed upon by the parties represented anything other than a reasonable settlement. The evidence firmly established that Mr. Siewert incurred economic damages, consisting of lost future earnings, past medical expenses, and future medical expenses. Mr. Gilbert and Mr. Marx testified that those economic damages totaled roughly $2,000,000. However, the economic loss analysis upon which their testimony was based showed a total of $1,770,775 in future life care needs for Mr. Siewert, reduced to present value.3 The only direct evidence of past medical expenses was the $109,759.91 in Medicaid expenditures. There was no evidence of other economic damages. Thus, the evidence established that economic damages total $1,880,534.90. The total amount of damages for Mr. Siewert was calculated to be $10,000,000, which was described as a conservative figure based on the knowledge and experience of Mr. Gilbert and Mr. Marx, and based on an analysis of representative jury verdicts involving comparable facts and damages. However, Mr. Gilbert engaged in a more detailed analysis of Mr. Siewert’s non-economic damages, which requires review. Although comparable jury verdicts suggest that it could be considerably more, Mr. Gilbert testified that his calculation, though subjective, would include $3,000,000 in non-economic damages in the past three years, and an additional $4,000,000 in non-economic damages into the future based upon a projected 12-year life expectancy, for a total amount of non-economic damages of $7,000,000. That figure was accepted by both of the testifying experts. As part of Petitioners’ calculation of the total value of the claim was $1,000,000 in loss-of-consortium damages incurred by Mrs. Siewert. Although the loss of consortium technically applies to the loss of the full marital relationship previously enjoyed by Mrs. Siewert, who is not the Medicaid recipient, that value was included as an element of the claim and settlement. Based on the forgoing, the evidence supports, and it is found that $9,880,534.90, as a full measure of Petitioners’ combined damages, is a conservative and appropriate figure against which to calculate any lesser 3 Respondent objected to the life care plan on the basis of hearsay. However, the plan was not being offered for the truth of the matter asserted, i.e., that Mr. Siewert would be expected to incur $1,770,775 for future care, but was offered as evidence of the more general value of a claim in litigation. Furthermore, the life care plan, even if inadmissible, could be used as support of an expert opinion as to claim valuation “when those underlying facts are of a type relied upon by experts in the subject to support the opinions expressed.” Charles W. Ehrhardt, Florida Evidence, § 704.1 (2020 Edition). A life care plan is evidence that, for that purpose, would “be sufficiently trustworthy to make the reliance reasonable.” Id. portion of the total recovery that should be allocated as reimbursement for the Medicaid lien for past medical expenses. The full value of the settlement is 5.06 percent of the $9,880,534.90 value of the claim.
The Issue The issue in this case is the amount of money to be reimbursed to Respondent, Agency for Health Care Administration, for medical expenses paid on behalf of Petitioner, Larry J. Griffis, from a personal injury claim settlement received by Petitioner from a third party.
Findings Of Fact Griffis was severely injured in an accident occurring on April 29, 2012. The accident occurred generally as follows: Griffis owned and operated a large truck with a long aluminum dump trailer attached. He hauled hazardous waste and other materials for a living. At the end of each job, Griffis would raise the dump trailer for the purpose of cleaning out any residual material. On the date of the accident, Griffis did not clean his trailer in the usual because of some obstruction on that date. Instead, he drove out into a field next to his house to clean the trailer. When Griffis raised the trailer to clean it, he failed to notice electrical lines just above his trailer. He raised the trailer into the lines, resulting in an extremely high voltage of electricity running through his body. As a result of the accident, Griffis was transported to the burn unit at Shands hospital in Gainesville for treatment of his extensive injuries. He had over 50 medical procedures while at Shands, including debridement, skin grafts, tracheostomies, multiple chest tubes, etc. He had 19 different complications while in the hospital, including infections and kidney failure. Over 30 percent of his body surface area was burned; 23 percent of those burns were third degree. While undergoing treatment, Shands gave him only a 22 percent chance of surviving. Griffis remained in the hospital for three and one half months. The medical bills for Griffis’ treatment totaled Griffis cost $1,363,285.65. Medicaid paid $48,640.57 of that total amount. The Veterans Administration (VA) paid $275,911.87. Shands was eventually paid $324,552.44 of its charges and wrote off over $1 million. Griffis filed a lawsuit against Suwannee Valley Electric Cooperative, Inc. (“Suwannee”), seeking payment of economic and non-economic damages related to Suwannee’s alleged liability for the accident. After negotiations and mediation, a settlement was reached whereby Griffis was to receive the sum of $500,000 from Suwannee in full settlement of all his claims. After the settlement was reached between Griffis and Suwannee, the Agency attempted to enforce its lien, seeking repayment of the entire amount it had paid. Griffis, believing that less than the lien amount was actually owed, filed a Motion for Order Apportioning Damages as part of his pending lawsuit against Suwannee. The purpose of the motion was not to have the circuit court judge determine the amount of the Agency’s lien. The motion was filed to obtain an Order that would apportion the settlement among the lawful elements of damages to which Griffis was entitled. A hearing on the motion was set for April 14, 2015, before Circuit Court Judge Andrew J. Decker, III. The Agency was served a copy of the motion and the notice of hearing. The Agency filed an objection to the motion, seeking to relieve the circuit court of jurisdiction in favor of the Division of Administrative Hearings. See § 409.910 (17)(b), Fla. Stat. Griffis replied to the Agency’s objection, stating that “the purpose of the Motion is to differentiate or allocate the settlement among Mr. Griffis’ different elements of damages [rather than] asking this Court to resolve a Medicaid lien dispute.” At the Circuit Court hearing on Griffis’ motion, the Agency made an appearance and, in fact, cross-examined the expert witness who testified. The only testimony provided at that hearing was from retired District Court of Appeal Judge Edwin B. Browning, Jr. Judge Browning provided expert testimony as to the value of Griffis’ claim, which he set at $6 million. Mr. Smith also provided some argument in support of Griffis’ claim, but as an attorney, rather than a sworn witness. Judge Decker took the $6 million figure, plus economic damages in the sum of $211,518, plus past medical expenses of $324,552.44 for a total of $6,536,070.44. That was then divided into the $500,000 settlement figure amount. That resulted in a factor of 7.649 percent, which, applied to the “value of the case” amount, resulted in a figure of $458,919.49. Applying the factor to economic damages resulted in an amount of $16,179.01. The past medical expenses amount, once factored, resulted in a figure of $24,825.01.1/ After hearing the evidence presented at his motion hearing, Judge Decker entered an Order dated April 21, 2015, establishing the past medical expenses amount, i.e., the Agency’s lien, at $24,901.50. The Order did not address future medical expenses because they were not sought by Petitioner. Inasmuch as his future medical costs would be paid by VA, his attorneys did not add potential medical expenses to the claim.2/ A copy of Judge Decker’s Order was received into evidence in the instant proceeding (although, pursuant to section 90.202, Florida Statutes, it could have been officially recognized by the undersigned Administrative Law Judge). The Order, along with Griffis’ other exhibits and Mr. Smith’s testimony, constituted the evidence in this matter.
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 Petitioner, Shamarion Manley, from a personal injury settlement received by Petitioner from a third party.
Findings Of Fact Based on the stipulations of the parties, evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made: On June 12, 2010, Shamarion Manley (“Shamarion”) suffered a severe left brachial plexus injury, right humerus fracture, neurological injury, and cardiac arrest during his birth. He was hospitalized until July 7, 2010, when he was discharged home to the care of his parents. Due to his severe left brachial plexus injury and other injuries suffered during birth, Shamarion is unable to use his left arm and hand and suffers from a speech impairment. (JPHS p. 8) Shamarion’s past medical expenses related to his injuries were paid in part by Medicaid and Sunshine State Health. Medicaid paid $74,061.27 in benefits and Sunshine State Health paid $106,656.23 in benefits. The amounts paid by Medicaid and Sunshine State Health, together with $22,118 in unpaid medical bills, constituted Shamarion’s entire claim for past medical expenses. Accordingly, Shamarion’s entire claim for past medical expenses was $202,835.50. (JPHS p. 8-9) Shamarion, or others on his behalf, did not make payments in the past or in advance for Shamarion’s future medical care, and no claim for damages was made for reimbursement, repayment, restitution, indemnification, or to be made whole for payments made in the past or in advance for future medical care. Shamarion’s parents and natural guardians, Victoria and Sharmane Manley, brought a medical malpractice action to recover all of Shamarion’s damages, as well as their individual damages associated with their son’s injury, against the medical providers allegedly responsible for Shamarion’s injuries (“Defendants”). (JPHS p. 9) Shamarion’s parents compromised and settled the medical malpractice lawsuit with the Defendants for the amount of $410,000. (JPHS p. 9) In making this settlement, the settling parties agreed that: 1) the settlement did not fully compensate Shamarion for all his damages; 2) Shamarion’s damages had a value in excess of $2,250,000, of which $202,835.50 represented his claim for past medical expenses; and 3) allocation of $36,916.06 of the settlement to Shamarion’s claim for past medical expenses was reasonable and proportionate. In this regard the two (2) Releases (“Releases”) memorializing the settlement stated: Although it is acknowledged that this settlement does not fully compensate Shamarion Manley for all of the damages he has allegedly suffered, this settlement shall operate as a full and complete Release as to RELEASEES without regard to this settlement only compensating Shamarion Manley for a fraction of the total monetary value of his alleged damages. The parties agree that Shamarion Manley’s alleged damages have a value in excess of $2,250,000, of which $202,835.50 represents Shamarion Manley’s claim for past medical expenses. Given the facts, circumstances, and nature of Shamarion Manley’s injuries and this settlement, the parties have agreed to allocate {$36,916.06}[1/] of this settlement to Shamarion Manley’s claim for past medical expenses and allocate the remainder of the settlement towards the satisfaction of claims other than past medical expenses. This allocation is a reasonable and proportionate allocation based on the same ratio this settlement bears to the total monetary value of all Shamarion Manley’s damages. Further, the parties acknowledge that Shamarion Manley may need future medical care related to his injuries, and some portion of this settlement may represent compensation for future medical expenses Shamarion Manley will incur in the future. However, the parties acknowledge that Shamarion Manley, or others on his behalf, have not made payments in the past or in advance for Shamarion Manley’s future medical care and Shamarion Manley has not made a claim for reimbursement, repayment, restitution, indemnification, or to be made whole for payments made in the past or in advance for future medical care. Accordingly, no portion of this settlement represents reimbursement for future medical expenses. (JPHS p. 9) Because Shamarion was a minor, court approval of the settlement was required. Accordingly, on December 14, 2015, the Palm Beach County Circuit Court Judge handling the litigation of the medical malpractice action, the Honorable Edward Artau, approved the settlement by entering an Order on Plaintiffs’ Petition for Approval of Settlement (Order Approving Settlement). (JPHS p. 10) As a condition of Shamarion’s eligibility for Medicaid, Shamarion assigned to AHCA his right to recover from liable third-parties medical expenses paid by Medicaid. See 42 U.S.C. § 1396a(a)(25)(H) and § 409.910(6)(b), Fla. Stat. During the pendency of Shamarion’s medical malpractice action, AHCA was notified of the action, and AHCA, through its collections contractor, Xerox Recovery Services, asserted a $74,061.27 Medicaid lien against Shamarion’s cause of action and settlement of that action. (JPHS p. 9) By letter of January 5, 2016, AHCA was notified by Shamarion’s medical malpractice attorney of the settlement and provided a copy of the executed Releases, Order Approving Settlement, and itemization of $146,540.70 in litigation costs. This letter explained that Shamarion’s damages had a value in excess of $2,250,000, and the $410,000 settlement represented only an 18.2 percent recovery of Shamarion’s damages. Accordingly, he had recovered only 18.2 percent of his $202,835.50 claim for past medical expenses. This letter requested AHCA to advise as to the amount AHCA would accept in satisfaction of its Medicaid lien. (JPHS p. 10) AHCA did not respond to Shamarion’s attorney’s letter of January 5, 2016. (JPHS p. 10) AHCA did not file an action to set aside, void, or otherwise dispute Shamarion’s settlement with the Defendants. (JPHS p. 10) AHCA has not commenced a civil action to enforce its rights under section 409.910. (JPHS p. 10) The Medicaid program spent $74,061.27 on behalf of Shamarion, all of which represents expenditures paid for Shamarion’s past medical expenses. (JPHS p. 10) No portion of the $74,061.27, paid by the Medicaid program on behalf of Shamarion, represents expenditures for future medical expenses, and AHCA did not make payments in advance for medical care. (JPHS p. 10) AHCA has determined that $146,540.70 of Shamarion’s litigation costs are taxable costs for purposes of the section 409.910(11)(f) formula calculation. (JPHS p. 11) Subtracting the $146,540.70 in taxable costs and 25 percent in allowable attorney’s fees, the section 409.910(11)(f) formula, applied to Shamarion’s $410,000 settlement, requires payment of $80,479.65 to AHCA in satisfaction of its $74,061.27 Medicaid lien. Since the $80,479.65 formula amount is more than the $74,061.27 Medicaid lien, AHCA is seeking payment of the full $74,061.27 Medicaid lien from Shamarion’s $410,000 settlement. (JPHS p. 11) 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). (JPHS p. 11) Testimony of Scott M. Newmark Mr. Newmark has been an attorney for 30 years, and during that entire time he has practiced plaintiff personal injury and medical malpractice law. Mr. Newmark testified that he handles jury trials and routinely represents children who have suffered catastrophic injury, particularly at birth. He is a member of the Florida Justice Association, the Palm Beach Justice Association, and the Trial Lawyer Section of the Florida Bar. Mr. Newmark testified that he stays abreast of jury verdicts in his area and that he routinely makes assessments concerning the value of damages suffered by injured parties, explaining his process for these determinations. He testified that he has been accepted as an expert in the valuation of damages suffered by injured parties by DOAH in the past. Mr. Newmark was accepted as an expert in the valuation of damages suffered by injured parties. He represented Shamarion and his parents relative to Shamarion’s medical malpractice action. He explained that as part of his representation, he reviewed Shamarion’s medical records, met with his doctors, met with experts, reviewed expert reports, and met with Shamarion and his parents many times. Mr. Newmark gave a detailed explanation of the injuries suffered by Shamarion during his birth. He explained that during the birth process, improper force was used and Shamarion suffered a brachial plexus injury when the nerves in his left shoulder were ripped off the spinal column. As a result of this injury, he is unable to use his left arm and has no grip strength in his left hand. Mr. Newmark testified that this injury is a permanent neurological injury and for the remainder of his life will continue to have a “tremendously dramatic impact on Shamarion.” Mr. Newmark testified that Shamarion’s claim for past medical expenses related to his injury was $202,835.50, which consisted of $74,061.27 in Medicaid benefits paid by AHCA, $106,656.23 in benefits paid by Sunshine State Health, and $22,118 in unpaid medical bills. Mr. Newmark testified that Shamarion, or others on his behalf, did not make payments in the past or in advance for future medical care, and no claim was brought to recover reimbursement for past payments for future medical care. Mr. Newmark testified that through his representation of Shamarion, review of Shamarion’s file, and based on his training and experience, he had developed the opinion that the value of Shamarion’s damages “would be in excess of $2,250,000.” He explained that he had discussed Shamarion’s case with other experienced attorneys and they concurred in this damage valuation. Further, to supplement his opinion concerning the value of Shamarion’s damages, Mr. Newmark outlined that the jury verdicts in Petitioner’s Exhibit 12 were comparable to Shamarion’s case. He outlined that the Cherenfant v. Lewis 2016 Broward County $4,821,000 verdict was most supportive. Mr. Newmark outlined that in Lewis, the same plaintiff and defense experts were used as were used in Shamarion’s case, and the facts and injury in Lewis were nearly identical to the facts and injury in Shamarion’s case. Mr. Newmark outlined that in Lewis, the jury awarded $3,000,000 in pain and suffering to the child and this underscores that his valuation of all Shamarion’s damages at $2,250,000 is extremely conservative. Mr. Newmark explained that Shamarion’s medical malpractice lawsuit was brought against the obstetrician who delivered Shamarion and the hospital where the birth took place. He noted that there were many considerations that led to settlement, including most importantly that the primarily responsible party, the obstetrician, was uninsured, and the parents needed the certainty of a settlement over the risk of a defense verdict or verdict that may or may not be collectable. Based on these considerations, the case settled for $410,000. Mr. Newmark testified that the settlement did not fully compensate Shamarion for the full value of his damages. He testified that based on the conservative valuation of all Shamarion’s damages of $2,250,000, the settlement represented a recovery of 18.2 percent of the value of Shamarion’s damages. Mr. Newmark testified that because Shamarion only recovered 18.2 percent of the value of his damages in the settlement, he only recovered 18.2 percent of his $202,835.50 claim for past medical expenses, or $36,916.06. Mr. Newmark testified that the settling parties agreed in the Releases that Shamarion’s damages had a value in excess of $2,250,000, as well as the allocation of $36,916.06 of the settlement to past medical expenses. He further testified that the allocation of $36,916.06 of the settlement to past medical expenses was reasonable and rational, as well as “the fair thing to do.” Mr. Newmark testified that the allocation of $36,916.06 to past medical expenses was conservative because it was based on a low-end valuation of Shamarion’s damages of $2,250,000, and if a higher valuation of the damages was used, the amount allocated to past medical expenses would have been much less. Mr. Newmark testified that because no claim was made to recover reimbursement for past payments for future medical care, no portion of the settlement represented reimbursement for past payments for future medical care. Mr. Newmark testified that the parties agreed in the Releases that no claim was made for reimbursement of past payments for future medical care, and no portion of the settlement represented reimbursement for future medical expenses. Mr. Newmark testified that because Shamarion was a minor, court approval of the settlement was required. Mr. Newmark testified that the court reviewed the settlement and entered an order approving it. Testimony of R. Vinson Barrett Mr. Barrett has been a trial attorney since 1977 and has dedicated his practice to handling plaintiff personal injury cases, including medical malpractice, medical products liability, and pharmaceutical products liability. He is the senior partner with the Tallahassee law firm of Barrett, Fasig & Brooks, which exclusively works in the area of plaintiff’s personal injury. Mr. Barrett has handled many jury trials and has handled many catastrophic injury cases, including medical malpractice cases involving injury to children. Mr. Barrett testified that he has handled a number of cases involving brachial plexus birth injuries similar to Shamarion’s injury. Mr. Barrett testified that he stays abreast of jury verdicts and he daily makes assessments concerning the value of damages suffered by injured parties explaining his process for making these determinations. He testified that he has been accepted as an expert in the valuation of damages by DOAH in Medicaid lien dispute proceedings in other cases. Mr. Barrett was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Barrett testified that he was familiar with Shamarion’s injuries and had reviewed Shamarion’s medical records and the exhibits filed in this proceeding. He provided a detailed explanation of Shamarion’s brachial plexus birth injury noting that “he’s probably never going to be able to have anywhere near a normal childhood or work-hood because of the limitations that he has from this injury.” Mr. Barrett testified that based on his review of Shamarion’s case, and based on his professional experience and training, Shamarion’s damages had a value higher than the $2,250,000 value used by the settling parties. Mr. Barrett testified that Shamarion’s damages have a value of $2,500,000. He further testified that Shamarion’s “loss of enjoyment of life is going to be huge for him, remember, he is going to have birth to death in actual pain and suffering . . . so with all that in mind, you know, the opinion that I have $2,000,000 wouldn’t trouble me as a jury verdict for pain and suffering and loss of enjoyment of life” alone. Mr. Barrett outlined that the jury verdicts in Petitioner’s Exhibit 12 were comparable with Shamarion’s case and supported his valuation of the damages. Consistent with Mr. Newmark’s testimony, Mr. Barrett identified the Lewis $4,821,000 verdict as most relevant and comparable to Shamarion’s case. Mr. Barrett testified that he was aware of the settlement amount and he testified that the settlement did not fully compensate Shamarion for the full value of his damages. He explained that he was aware that the parties had allocated $36,916.06 to past medical expenses based on a valuation of all damages of $2,250,000. Mr. Barrett testified that he believes allocation of $36,916.06 to past medical expenses was reasonable, rational, and conservative. “I think it’s conservative because it’s based on a total damage number ($2,250,000) which I think is conservative.” AHCA did not propose a differing valuation of Shamarion’s damages or contest the methodology used by the parties to calculate the $36,916.06 allocation to past medical expenses. Consequently, the testimony and evidence presented concerning the value of Petitioner’s damages and the allocation to past medical expense was unrebutted. The Agency was not a party to settlements or written settlement agreements, if any exist, separate and apart from the Releases. Nor were the Defendants signatories to the settlement agreement, apparently accepting the Releases signed by Petitioners in exchange for the settlement payments. No value of Shamarion’s future medical expenses was advanced by either party. As noted earlier, both Releases contained the following provision: Further, the parties acknowledge that Shamarion Manley may need future medical care related to his injuries, and some portion of this settlement may represent compensation for future medical expenses Shamarion Manley will incur in the future. Given the nature and severity of Shamarion’s injury, it can reasonably be expected that Shamarion will incur future medical expenses. Notably, Mr. Newmark testified that Shamarion has suffered a permanent neurological impairment, and has “already had five surgeries down at Miami Children’s with Dr. Grossman and Dr. Price.” Moreover, the Life Care Plan prepared for Shamarion reflects regular pediatric orthopedist and psychiatric evaluations and treatments to age 18. Mr. Newmark further testified that Shamarion’s total damages would be in excess of $2,250,000, which “would take into account his future life care needs, his past medicals, his future earning and earning capacity, benefits, losses.” Petitioner offered in evidence a Preliminary Economic Damages Analysis, which presented life care cost computations and earnings capacity losses. A summary of those computations is presented below: BASIC INFORMATION Shamarion Manley All Figures are in Present Value LOW AVERAGE HIGH LIFE CARE PLAN: EARNINGS LOSSES: BENEFIT LOSSES: $556,109.16 $858,606.03 $1,161,102.90 $262,214.24 $262,214.24 $262,214.24 $52,442.85 $52,442.85 $52,442.85 Overall Range LOW AVERAGE HIGH $870,766.24 $1,173,263.11 $1,475,759.99 Mr. Newmark also noted that some portion of the $2,250,000 valuation would be for non-economic (pain and suffering) damages. Mr. Newmark testified that Shamarion’s non- economic damages would be factored in “at over a million dollars.” Other than the Life Care Plan and Preliminary Economic Damages Analysis, at hearing, Petitioner did not advance a valuation for future medical expenses. However, given the figures contained in the economic damages analysis, it is clear that the vast majority of future economic damages will relate to the costs associated with the life care plan, including future medical expenses. Petitioner has not proven by clear and convincing evidence that $36,916.06 of the settlement represents reimbursement for past medical expenses and payment for future medical expenses. Petitioner has not proven by clear and convincing evidence that a lesser portion of the total recovery should be allocated as reimbursement for past medical expenses than the $74,061.27 amount calculated by Respondent pursuant to the formula set forth in section 409.910(11)(f).
The Issue The issue to be determined is the amount to be reimbursed to Respondent, Agency for Health Care Administration (Respondent or AHCA), for medical expenses paid on behalf of Petitioner, Patrick Osmond (Petitioner), from settlement proceeds received by Petitioner from third parties.
Findings Of Fact Petitioner was injured in a single-vehicle collision after he and several underage friends were served alcoholic beverages at an Applebee’s restaurant, owned by Neighborhood Restaurant Partners, LLC (Applebee’s). As a result of his injuries, Petitioner brought suit against Applebee’s, for dram shop liability, and against Joseph Raub, the driver of the vehicle in which Petitioner was a passenger, for negligence. The Complaint also included a claim against the bartender from Applebee’s, however, she was eventually dropped from the lawsuit. After a two-week jury trial, the jury returned a verdict in favor of Petitioner, awarding a total of $41,956,473.73 in damages, allocated as follows: Past Medical Expenses: $436,473.73 Future Medical Expenses: $15,000,000.00 Past Lost Wages: $20,000.00 Future Loss of Earning Capacity: $1,500,000.00 Past Non-Economic Damages: $5,000,000.00 Future Non-Economic Damages: $20,000,000.00 The past medical expenses included $303,757.77 for payments made by Medicaid through AHCA, $13,985.96 for payments administered through the Rawlings Company, and $118,730.00 which represented an outstanding bill from Petitioner’s neurosurgeon. After the verdict, Petitioner reached a settlement agreement with Applebee’s, whereby Applebee’s agreed to pay the sum of $4,300,000.00 to Petitioner. As a condition of the settlement with Applebee’s, the parties executed a Release that included the following language: 1.6 The parties agree that Patrick Osmond’s damages have a total value of $41,956,473.73 (Forty-One Million, Nine Hundred Fifty-Six Thousand, Four Hundred Seventy-Three Dollars and Seventy-Three Cents), of which $317,743.73 (Three Hundred Seventeen Thousand, Seven Hundred Forty-Three Dollars and Seventy-Three Cents)[1/] represents the past medical expenses paid for by Medicaid. Given the facts, circumstances and nature of Patrick Osmond’s injuries and this settlement, $35,568.73 (Thirty-Five Thousand, Five Hundred Sixty-Eight Dollars and Seventy-Three Cents) of this settlement has been allocated to Patrick Osmond’s claim for past medical expenses paid by Medicaid and the remainder of the settlement has been allocated toward the satisfaction of claims other than past medical expenses paid by Medicaid. After the jury verdict was rendered, Petitioner recovered $25,000.00 in settlement from Joseph Raub and his insurers. As a condition of the settlement with Mr. Raub, the parties executed a Release that included the following language: The parties agree that Patrick Osmond’s damages have a total value of $41,956,473.73 (Forty-One million, Nine Hundred Fifty-Six Thousand, Four Hundred Seventy-Three Dollars and Seventy-Three Cents), of which $317,743.73 (Three Hundred Seventeen Thousand, Seven Hundred Forty-Three Dollars and Seventy-Three Cents) represents the past medical expenses paid for by Medicaid. Given the facts, circumstances and nature of Patrick Osmond’s injuries and this settlement, $190.43 (One Hundred ninety Dollars and Forty-Three Cents) of this settlement has been allocated to Patrick Osmond’s claim for past medical expenses paid by Medicaid and the remainder of the settlement has been allocated toward the satisfaction of claims other than past medical expenses paid by Medicaid. After the verdict, Petitioner’s insurer, Geico General Insurance Company (“Geico”), paid its policy limits of $10,000.00 to Petitioner under his Uninsured and/or Underinsured Motorist Coverage. The documentary evidence did not reflect that payment, but its existence was acknowledged by both parties during the argument, and is accepted as a stipulation. The purpose for the payment was not disclosed. The burden in this case is on Petitioner to prove “that a lesser portion of the total recovery should be allocated as reimbursement for past and future medical expenses.” There is no proof that the Geico settlement should be excluded from the amount available to satisfy the Medicaid lien. The $303,757.77 in Medicaid funds paid by AHCA is the maximum amount that may be recovered by AHCA. There was no evidence to suggest that statutory conditions precedent to AHCA asserting its claim or Petitioner bringing this action were not met. The Pre-hearing Stipulation, Respondent’s statement, the stipulation of facts, and the statement of issues of fact that remained to be litigated, indicate clearly that the issue of allocation of the settlement proceeds under sections 409.910(11)(f) and 409.910(17)(b) were the only issues in dispute remaining for disposition. There was no evidence that the monetary figure agreed upon by the parties represented anything other than a reasonable settlement. There was no evidence of any manipulation or collusion by the parties to minimize the share of the settlement proceeds attributable to past medical expenses for Petitioner’s medical care. However, an issue remains as to the correct amount of “past medical expenses” to be used in establishing the proportional amount of those expenses vís-a-vís the total settlement. No portion of the $303,757.77 paid by AHCA through the Medicaid program on behalf of Petitioner represented expenditures for future medical expenses, with all amounts reflected in its Provider Processing System Report being for past medical expenses incurred.
The Issue On October 3, 2016, Petitioners, Ammar Al Batha, as Personal Representative of the Estate of Abdel-Kader Al Batha, deceased, and Shahira Alshami, individually, filed a Petition to Determine Amount Payable to Agency for Health Care Administration in Satisfaction of Medicaid Lien (Petition) with the Division of Administrative Hearings (DOAH) pursuant to section 409.910(17)(b), Florida Statutes (2016).1/ The final hearing was scheduled for December 14, 2016. On November 30, 2016, Respondent filed a Motion for Summary Final Order. In the Motion for Summary Final Order, Respondent asserted that Petitioners, as a matter of law, cannot successfully challenge the amount payable to AHCA under section 409.910(17)(b) because Petitioners are not the Medicaid recipients. On December 2, 2016, Petitioners filed a Motion for Continuance and Extension of Time to Respond to Motion for Summary Final Order. That motion was granted by the undersigned on December 6, 2016, and the hearing scheduled for December 14, 2016, was canceled. On December 12, 2016, Petitioners filed an Objection to Respondent’s Motion for Summary Final Order, asserting that a Medicaid recipient’s right to challenge the payment of a Medicaid lien through DOAH does not die with the recipient, and the recipient’s representative is entitled to challenge the amount payable to AHCA under the procedure in section 409.910(17)(b). Both Respondent’s Motion for Summary Final Order and Petitioners’ Objection to Respondent’s Motion for Summary Final Order have been duly considered in preparation of this Summary Final Order.
Findings Of Fact Based on the record as a whole, the following Findings of Fact are made: On July 2, 2015, Abdel-Kader Al Batha (Mr. Al Batha) was involved in a car accident in Broward County, Florida. In this accident, Mr. Al Batha suffered catastrophic physical and neurological injuries, and, as a result, died on July 20, 2015. Mr. Al Batha was survived by his spouse, Shahira Alshami (Ms. Alshami). Mr. Al Batha’s medical care related to his injury was paid by Medicaid, and AHCA, through the Medicaid program. Medicaid provided $143,663.18 in benefits associated with Mr. Al Batha’s injury. This $143,663.18 represented the entire claim for past medical expenses. Mr. Al Batha’s funeral expenses were in the amount of $3,850. As a result of Mr. Al Batha’s injury and death, Ms. Alshami suffered economic and non-economic damages, which are defined and limited by the Florida Wrongful Death Act to loss of support, services, companionship, and protection from the date of injury, as well as her mental pain and suffering from the date of injury per section 768.21, Florida Statutes. In addition, the Estate of Abdel-Kader Al Batha (the Estate) suffered economic damages, which are defined and limited, by the Florida Wrongful Death Act, to medical expenses, funeral expenses, and loss of net accumulations per section 768.21(6). Altogether, the total combined monetary value of Ms. Alshami and the Estate’s individual damages, and the value a jury would assign to these damages, are no less than $2,500,000 to $5,000,000. Ammar Al Batha, as the Personal Representative of the Estate, brought a wrongful death action to recover both the individual statutory damages of Ms. Alshami, as well as the individual statutory damages of the Estate, against the driver/owner of the vehicle that caused the accident (Defendant). While Ms. Alshami and the Estate’s damages have an exceedingly high monetary value in excess of $2,500,000 to $5,000,000, there were significant limitations to recovering the full value of these damages from the Defendant associated with disputed facts, liability, and policy insurance limits of the primary responsible parties. Based on these significant limiting factors, the wrongful death action was settled through a confidential settlement. While settlement was appropriate given the limiting factors, that does not negate that in the settlement, Ms. Alshami and the Estate are not being fully compensated for all their damages, and they are only receiving a fraction of the total monetary value of all their damages. Understanding that the settlement does not fully compensate Ms. Alshami and the Estate for all their damages, and in the settlement they are only receiving a fraction of the total monetary value of all the damages, including only a fraction of the $143,663.18 claim for past medical expenses, the parties to the settlement made an allocation to the claim for past medical expenses. This allocation was based on the calculation of the ratio the settlement bore to the total monetary value of all damages. Using the conservative valuation of all damages of $2,500,000, the parties calculated that Ms. Alshami and the Estate were receiving 44.5 percent of the total monetary value of all their damages in the settlement, and accordingly they were receiving in the settlement 44.5 percent, or $63,930.12, of their $143,663.18 claim for past medical expenses. In making this allocation, the parties agreed that: The settlement does not fully compensate Mr. Al Batha’s surviving spouse and the Estate of Abdel-Kader Al Batha for all the damages they have suffered and the settlement only compensates them for a fraction of the total monetary value of all the damages; The damages have a value in excess of $2,500,000; The claim for past medical expenses was $143,663.18; and Allocation of the $63,930.12 of the settlement to past medical expenses, and the remainder of the settlement toward the satisfaction of claims other than the past medical expenses, is reasonable and proportionate based on the same ratio this settlement bears to the total monetary value of all the damages. The parties memorialized the allocation of $63,930.12 of the settlement to past medical expenses in the General Release (Release). The Release stated: Although it is acknowledged that this settlement may not fully compensate Releasing Party for all of the damages they have allegedly suffered, this settlement shall operate as a full and complete Release as to Released Parties without regard to this settlement only compensating Releasing Party for a fraction of the total claimed monetary value of their alleged damages. The parties agree that Releasing Party’s alleged damages may have a value in excess of $2,500,000, of which approximately $143,663.18 represents the claimed amount for past medical expenses. Given the facts, circumstances, and nature of Releasing Party’s damages and this settlement, the parties have agreed to allocate $63,930.12 of this settlement to Releasing Party’s claim for past medical expenses and allocate the remainder of the settlement towards the satisfaction of claims other than past medical expenses. This allocation is a reasonable and proportionate allocation based on the same ratio this settlement bears to the claimed total monetary value of all Releasing Party’s damages. As a condition of Mr. Al Batha’s eligibility for Medicaid, Mr. Al Batha, before his death, assigned to AHCA his right to recover from liable third parties, medical expenses paid by Medicaid. During the pendency of the wrongful death action, AHCA was notified of the action, and AHCA, through its collections contractor, Xerox Recovery Services, asserted a $143,663.18 Medicaid lien against the Estate’s cause of action and settlement of that action. The attorney handling the wrongful death claim notified AHCA of the settlement by letter and provided AHCA with a copy of the executed General Release. The letter explained that the damages had a value in excess of $2,500,000, and the settlement represented only a 44.5 percent recovery of the $143,663.18 claim for past medical expenses, or $63,930.12. The letter requested AHCA to advise as to the amount AHCA would accept in satisfaction of the $143,663.18 Medicaid lien. AHCA calculated its payment pursuant to the formula in section 409.910(11)(f) based on the gross settlement, which includes those funds compensating Ms. Alshami for her individual claim for pain and suffering and loss of support, services, and companionship. This resulted in AHCA demanding payment for the full amount of the Medicaid lien, or $143,663.18.
