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 Clifford J. Deyampert (“Petitioner” or “Mr. Deyampert”) pursuant to section 409.910, Florida Statutes (2015),1/ from settlement proceeds received by Mr. Deyampert from a third party.
Findings Of Fact The following findings of fact are based on exhibits accepted into evidence, admitted facts set forth in the pre- hearing stipulation, and matters subject to official recognition. Facts Pertaining to the Underlying Personal Injury Litigation and the Medicaid Lien On July 25, 2015, Mr. Deyampert was attending a party held at a friend’s house and was shot in the throat by another guest. The bullet traveled down Mr. Deyampert’s throat, struck his spinal cord, and caused Mr. Deyampert to be paralyzed from the chest down. As a result, Mr. Deyampert is permanently disabled, disfigured, and wheelchair-bound. In addition, Mr. Deyampert is bowel and bladder incontinent.2/ Medicaid paid $76,944.67 in order to cover Mr. Deyampert’s past medical expenses. No portion of the $76,944.67 paid by Medicaid on Mr. Deyampert’s behalf represents expenditures for future medical expenses, and Medicaid did not make payments in advance for medical care. Mr. Deyampert initiated a personnel injury lawsuit by making a claim against a homeowner’s insurance policy that covered the shooter. Mr. Deyampert’s personal injury action settled for $305,000, and that was the limit of an aforementioned insurance policy.3/ The General Release memorializing the settlement stated the following: Although it is acknowledged that this settlement does not fully compensate Clifford Deyampert 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 Clifford Deyampert for a fraction of the total monetary value of his alleged damages. The parties agree that Clifford Deyampert’s alleged damages have a value in excess of $6,000,000, of which $76,944.67 represents Clifford Deyampert’s claim for past medical expenses. Given the facts, circumstances, and nature of Clifford Deyampert’s injuries and this settlement, the parties have agreed to allocate $3,847.23 of this settlement to Clifford Deyampert’s claim for past medical expenses and allocate the remainder of the settlement toward 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 Clifford Deyampert’s damages. Further, the parties acknowledge that Clifford Deyampert may need future medical care related to his injuries, and some portion of this settlement may represent compensation for future medical expenses Clifford Deyampert will incur in the future. However, the parties acknowledge that Clifford Deyampert, or others on his behalf, have not made payments in the past or in advance for Clifford Deyampert’s future medical care and Clifford Deyampert 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. During the pendency of Mr. Deyampert’s personal injury action, AHCA was notified of the suit and asserted a Medicaid lien in the amount of $76,944.67 against any damages received by Mr. Deyampert. Via a letter issued on July 24, 2017, Mr. Deyampert’s attorney notified AHCA that Mr. Deyampert’s personal injury action had settled. The letter asked AHCA to specify what amount it would accept in satisfaction of the $76,944.67 Medicaid lien. AHCA responded by demanding full payment of the lien. 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.4/ AHCA is seeking to recover $76,944.67 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 F. Emory Springfield represented Mr. Deyampert during the personal injury action and testified during the final hearing. Mr. Springfield has practiced law for 32 years. He owns his own law firm and handles cases involving personal injury, workers’ compensation, and social security disability. Mr. Springfield has experience with jury trials and monitors jury verdicts issued in his fields of practice. Mr. Springfield routinely assesses the value of damages suffered by injured parties. He makes those assessments by determining the injured person’s life expectancy, evaluating the injuries, and conferring with lifecare planners about the injured party’s need for future care. In addition, Mr. Springfield learns as much as possible about the injured party’s past life activities and compares those activities to what the injured party is presently capable of doing. Mr. Springfield also assesses an injured party’s damages by examining jury verdicts from other cases. Mr. Springfield was accepted in this proceeding as an expert regarding the valuation of damages. Mr. Springfield is of the opinion that Mr. Deyampert’s damages (including damages for pain and suffering and economic damages) are well in excess of $6 million. According to Mr. Springfield, the $305,000 settlement does not “come close” to fully compensating Mr. Deyampert for all of his damages. Furthermore, the $305,000 settlement only represents a five percent recovery of the more than $6 million in damages incurred by Mr. Deyampert. Therefore, in Mr. Springfield’s opinion, only five percent (i.e., $3,847.23) of the $76,944.67 in Medicaid payments for Mr. Deyampert’s past medical expenses were recovered. Mr. Deyampert also presented the testimony of R. Vinson Barrett, Esquire, during the final hearing. Mr. Barrett is a trial attorney who has been practicing in North Florida since the mid 1970s. Over the last 30 years, he has focused his practice on the areas of medical malpractice, medical products liability, and pharmaceutical liability. Mr. Barrett routinely handles jury trials and monitors jury verdicts issued in his practice areas. Mr. Barrett routinely assesses the value of damages suffered by injured parties. According to Mr. Barrett, a personal injury attorney must be skilled at estimating the value of a client’s claim. Otherwise, the high cost of bringing a case to trial can result in a personal injury attorney losing money and going bankrupt. Mr. Barrett was accepted in this proceeding as an expert regarding the valuation of damages. Mr. Barrett gave the following testimony regarding Mr. Deyampert’s damages: This man not only is a paraplegic, but during all this, and I couldn’t really tell from the records I read whether the bullet caused this or some intubation in the hospital, but he got air into the space between his lung and his diaphragm, which can be a very painful problem, he had to be intubated to get that out. He developed, I believe, sepsis, at some point in his -- in his treatment; and it’s already evidence early on in his situation that he’s going to be, and is very susceptible to pressure ulcers on his skin. His skin is going to be prone to breakdown from prolonged periods of sitting in the same position and that sort of thing. Fortunately, he has enough strength left in his upper body that he’s able to ameliorate that somewhat. He’s able actually, on his own, and after a lot of rehab, to roll over in his bed to different positions even though his lower extremities are not working at all. He’s able to -- he’s able to reposition himself in his chair using the strength of his arms, so that will cut down a little bit on that. But he had already developed a pressure ulcer or two by the time he got into rehab in this case. He – so, he’s got no use at all, it appears, of his lower extremities. He had a number of complications that had to be dealt with. He was in the hospital a long time. His overall prospects after rehabilitation -– and he was still in some rehabilitation as early as about February of this year, so I’m not totally sure he’s through all his rehab yet. He has to take rehabilitation courses to learn -– relearn how to do things. He’ll need his home made wheelchair accessible, cabinets, and thing[s] like that, all the things that a person normally does without thinking about, are going to be challenges for him just in daily household stuff. He will have to have modifications, most likely, of his kitchen, his bathroom, that sort of thing. And so, yeah, there’s quite a bit to work within this case to come up with an evaluation. Mr. Barrett opined that $6 million was a “very conservative” estimate of the damages suffered by Mr. Deyampert. Mr. Barrett also opined that allocating five percent of the $76,000 claim (i.e., $3,847.23) to past medical expenses was a reasonable and rational allocation to past medical expenses and reflected the ratio of the amount recovered to the actual value of Mr. Deyampert’s damages. Findings Regarding the Testimony Presented at the Final Hearing The undersigned finds that the testimony from Mr. Springfield and Mr. Barrett 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. Springfield’s and Mr. Barrett’s decades of experience with litigating personal injury lawsuits make them very compelling witnesses regarding the valuation of damages suffered by injured parties such as Mr. Deyampert.5/ Accordingly, the undersigned finds that Mr. Deyampert proved by a preponderance of the evidence that $3,847.23 constitutes a fair and reasonable recovery for past medical expenses actually paid by Medicaid.
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 payable under section 409.910, Florida Statutes,1/ in satisfaction of Respondent's Medicaid lien on settlement proceeds received by Petitioner, Victor Hugo Herrera, Sr., from a third party.
Findings Of Fact On July 29, 2014, unbeknownst to Mr. Herrera, an individual (hereinafter Assailant) entered the common area where Mr. Herrera rented an office. The Assailant stalked Mr. Herrera and forced his way into Mr. Herrera’s office. The Assailant attacked Mr. Herrera in his office and shot Mr. Herrera in the leg. As a result of being shot in the leg, Mr. Herrera had his leg medically amputated above the knee, suffered a collapsed lung, and was comatose for nearly two months. As a result of his severe injuries, Mr. Herrera is now permanently disabled, disfigured, and wheelchair-bound, unable to walk. Mr. Herrera’s medical expenses related to his injuries were paid by Medicaid, which provided $271,344.06 in benefits. Mr. Herrera brought a personal injury lawsuit to recover all of his damages associated with his injuries against the owner of the office and security company responsible for providing security (Defendants). The $271,344.06 paid by Medicaid constituted Mr. Herrera’s entire claim for past medical expenses. On December 11, 2015, Mr. Herrera compromised and settled his personal injury action against the Defendants for $925,000. The General Release of Claims memorializing the settlement with the Defendants stated, inter alia: The First Party, the Second Party and their respective counsel acknowledge that this settlement does not fully compensate the First Party for the damages he has allegedly suffered, but as provided herein this settlement shall operate as a full and complete release as to all claims against Second Party, without regard to this settlement only compensating the First Party for a fraction of the total monetary value of his alleged damages. These parties agree that the damages suffered by the First Party have a value in excess of $5,000,000.00, of which $271,344.06 represents First Party’s claim for past medical expenses. Given the facts, circumstances, and nature of the First Party’s alleged injuries and this settlement, $50,198.65 of this settlement has been allocated to the First Party’s claim for past medical expenses and the remainder of the settlement has been allocated toward 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 First Party’s alleged damages. Further, the parties acknowledge that the First Party may need future medical care related to his alleged injuries, and some portion of this settlement may represent compensation for those future medical expenses the First Party may incur in the future. However, the parties acknowledge that the First Party, or others on his behalf, have not made payments in the past or in advance for the First Party’s future medical care and the First Party 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 payments made to secure future medical care. During the pendency of Mr. Herrera’s personal injury lawsuit, the Agency for Health Care Administration (AHCA) was notified of the lawsuit and AHCA, through its collections contractor Xerox Recovery Services, asserted a $271,344.06 Medicaid lien against Mr. Herrera’s cause of action and settlement of that action. By letter of January 22, 2016, AHCA was notified by Mr. Herrera’s personal injury attorney of the settlement and provided a copy of the executed release and itemization of Mr. Herrera’s $10,114.38 in litigation costs. This letter explained that Mr. Herrera’s damages had a value in excess of $5,000,000, and the $925,000 settlement represented only an 18.5 percent recovery of Mr. Herrera’s damages. Accordingly, he had recovered only 18.5 percent of his $271,344.06 claim for past medical expenses, or $50,198.65. This letter requested AHCA to advise as to the amount AHCA would accept in satisfaction of the $271,344.06 Medicaid lien. AHCA did not respond to Mr. Herrera’s attorney’s letter of January 22, 2016. AHCA has not filed an action to set aside, void, or otherwise dispute Mr. Herrera’s settlement. AHCA has not commenced a civil action to enforce its rights under section 409.910. The Medicaid program spent $271,344.06 on behalf of Mr. Herrera, all of which represents expenditures paid for Mr. Herrera’s past medical expenses. No portion of the $271,344.06 paid by the Medicaid program on behalf of Mr. Herrera represents expenditures for future medical expenses, and AHCA did not make payments in advance for medical care. Mr. Herrera and AHCA agree that application of the formula at section 409.910(11)(f) to Mr. Herrera’s $925,000 settlement would require payment to AHCA of the full $271,344.06 Medicaid lien. Petitioner has deposited the full Medicaid lien amount into an interest-bearing account 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. Zebersky, who represented Mr. Herrera in his underlying personal injury action, testified and was accepted, without objection, as an expert in the valuation of damages suffered by injured parties. Mr. Zebersky has been an attorney for 27 years and has demonstrated considerable experience in handling plaintiffs’ personal injury and insurance class action claims in South Florida. In rendering his opinion as to the value of Mr. Herrera’s claim, Mr. Zebersky explained that, as a routine and daily part of his practice, he makes assessments concerning the value of damages suffered by injured parties and he explained his process for making these determinations. Mr. Zebersky was familiar with and gave a detailed explanation of the circumstances giving rise to Mr. Herrera’s claim. In making his valuation determination, Mr. Zebersky reviewed the police report, the State Attorney’s file on the shooting, all of Mr. Herrera’s medical records, and met numerous times with Mr. Herrera and his family. Mr. Zebersky testified that through his representation of Mr. Herrera, review of Mr. Herrera’s file, and based on his training and experience, he had developed the opinion that the value of Mr. Herrera’s damages was $5,000,000. Mr. Zebersky suggested that the $5,000,000 amount was conservative, by testifying that “five million dollars, you know, is probably what the pain and suffering value is especially in Broward County.” In addition to his first-hand experience with Mr. Herrera’s claim, Mr. Zebersky further supported his valuation opinion by explaining that he had “round-tabled” the case with other experienced attorneys and they agreed that the value of Mr. Herrera’s damages was $5,000,000. Further, Mr. Zebersky testified that he had reviewed jury verdicts in developing his opinion and the jury verdicts in Petitioner’s Exhibit 12 were comparable to Mr. Herrera’s case and support the valuation of Mr. Herrera’s damages at $5,000,000. Mr. Zebersky’s testimony 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 40 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 Mr. Herrera’s injuries through review of pertinent medical records and Petitioner’s Exhibits, including the police report, pictures of Mr. Herrera, Mr. Herrera’s complaint and Mr. Herrera’s General Release of Claims, Mr. Barrett offered his opinion, based upon his professional training and experience, that “five million was a conservative estimate” for the value of Mr. Herrera’s damages and that Mr. Herrera’s damages were “undoubtedly at least five million dollars.” Mr. Barrett also reviewed the jury verdicts in Petitioner’s Exhibit 12 and opined that those verdicts were comparable and supported his valuation of Mr. Herrera’s damages. Mr. Barrett’s testimony was credible and is accepted. AHCA’s designated expert, Mr. Bruner, was not available for testimony at the final hearing. Instead of asking for a continuance, the parties agreed to take Mr. Bruner’s deposition after the final hearing and then file the transcript with DOAH. Further, during the final hearing, AHCA agreed that Mr. Bruner would not be testifying as to the value of Mr. Herrera’s damages. In accordance with that agreement, Mr. Brunner’s deposition was subsequently taken and his deposition transcript was filed on August 3, 2016. At Mr. Bruner’s deposition, AHCA proffered Mr. Bruner as an expert in evaluation of cases and settlements. Petitioner objected on the grounds that Mr. Bruner lacked experience or expertise in personal injury cases and should not be allowed to testify as an expert. Further, Petitioner objected to the relevance of Mr. Bruner’s testimony based on AHCA’s earlier agreement that he would not be testifying concerning the value of the damages suffered. Counsel for AHCA responded to Petitioner’s objection to the relevance of Mr. Bruner’s testimony by agreeing that AHCA would not be seeking any “expert testimony as to evaluation of damages,” but would only be using Mr. Bruner’s testimony to “evaluate” the jury verdicts in Petitioner’s Exhibit 12. While Mr. Bruner does not have the same level of experience in personal injury claims as the experts offered by Petitioner, Mr. Bruner has sufficient experience to offer an opinion on the jury verdicts set forth in Petitioner’s Exhibit 12, and to that extent, his expertise in the evaluation of cases is accepted. However, because of his lack of recent experience in settling personal injury claims, Mr. Brunner is not accepted as an expert in personal injury settlements.2/ In his deposition testimony, Mr. Bruner criticized the relevance of the 12 verdicts in Petitioner’s Exhibit 12 on the grounds that, while the verdicts involved amputations of legs, there were factual differences in the mechanism of injury. Mr. Bruner further asserted that, to the extent the verdicts in Petitioner’s Exhibit 12 included awards for future medical expenses, they should not be considered because, according to Mr. Bruner’s understanding, Mr. Herrera did not recover any future medical expenses in the settlement. Finally, while the juries in the 12 jury verdicts had determined the value of the damages, Mr. Bruner criticized the verdicts because he asserted that it was possible that the cases may have settled post-verdict for less, or that the injured parties may have received less, due to reductions for comparative negligence. On this last point, it appears that Mr. Bruner confused the issue of the value of the damages with the settlement value of the case. The value of the damages is the estimation of the monetary value a jury would assign to the damages. On the other hand, the settlement value of the case is the amount it settled for with the considerations of liability, causation, the Defendant’s ability to pay, risk of trial, and other limiting factors, which are a calculus in every settlement. Despite Mr. Bruner’s criticisms of the jury verdicts in Petitioner’s Exhibit 12, the undersigned finds those verdicts supportive of the valuation opinions offered by Petitioner’s experts. Further, Petitioner’s experts’ opinions were not primarily reliant on those 12 verdicts, but were rather based upon their knowledge of Mr. Herrera’s injury and their extensive experience in handling cases involving catastrophic injury, including jury trial experience. Mr. Bruner’s testimony did not provide an alternative value of the damages suffered by Petitioner. The value of $5,000,000 for Mr. Herrera’s claim opined by Petitioner’s experts is unrebutted. Considering the valuation of Mr. Herrera’s claim in the amount of $5,000,000, his $925,000 settlement represents only an 18.5 percent recovery of Mr. Herrera’s damages. Applying that same 18.5 percent to the $271,344.06 paid by Medicaid for past medical expenses results in the sum $50,198.65 from the settlement proceeds available to satisfy AHCA’s Medicaid lien.
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 (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 What amount of Petitioner’s malpractice settlement must be paid to Respondent, Agency for Health Care Administration (Agency), to satisfy the Agency’s $13,904.06 Medicaid Lien?1/
Findings Of Fact On September 12, 2015, [Petitioner] was a 28-year-old single male living alone in Tampa, Florida and enrolled as a student at the University of South Florida working on his master’s degree in education. Because he recently ceased his employment with the Hillsborough County School Board, [Petitioner] had no health insurance. He called 911 for emergency medical services due to severe abdominal pain and was taken by EMS to the Emergency Department at St. Joseph’s Hospital where he was diagnosed with acute pancreatitis and admitted. His condition worsened and was complicated by abdominal distention that made his breathing difficult. In the evening of September 13th, [Petitioner] was transferred to the Medical Intensive Care Unit (“ICU”) because of a rapidly worsening condition and need for close monitoring. Over the next several hours, vital sign monitoring showed high heart and respiratory rates. A consulting physician found “acute respiratory insufficiency likely developing ARDS,” and directed he be “monitor closely, may need to be on mechanical ventilation, his work of breathing is hard to keep current sats [sic]”. During the early morning of September 14, [Petitioner’s] heart rate and respiratory rates remained high, he was short of breath, and given multiple doses of Morphine for severe pain and Ativan for agitation/anxiety, which drugs are known to suppress respiratory function. Throughout the morning, [Petitioner] was in a perilous condition due to a combination of his prolonged efforts to breathe, suppressive medications, and systemic complications of acute pancreatitis including electronical abnormalities associated with hypokalemia and hypocalcemia, and with electrocardiographic changes resulting in arrhythmia, conduction abnormalities and changes in cardiac T wave and QT period. At around 11:30, [Petitioner] attempted to perform a breathing exercise as instructed earlier that morning which required him to get on his hand and knees to relieve the pressure on his chest. [Petitioner’s mother], a licensed and practicing RN herself, was present and attempted to help him when his cardiac monitoring leads became disconnected. At this time, the attending RN was on break. An unknown RN reported [Petitioner] to have a change in the condition “with increased confusion and restlessness” and a call was made to the ICU specialist who issued verbal orders for Haldol, a medication used for sedation but in combination with the Morphine, Ativan and Labetatol, further lowers blood pressure and is contraindicated for cardiac arrhythmias. Without informing [Petitioner or his mother], the nursing staff mistakenly issued a "code grey" to control [Petitioner] and the nursing supervisor approved the administration of the Haldol without any physician assessment or knowing his cardiac status because the monitor was not connected. The ICU specialist who ordered the Haldol was close by in the ICU area but did not evaluate [Petitioner] or assess his condition, cardiac status and need for mechanical ventilation before the Haldol was administered. Immediately upon administration of the Haldol, [Petitioner] became “agonal” and his heart was thrown into a cardiac arrhythmia (PEA) causing a prolonged time period where his brain was deprived of oxygen that resulted in permanent hypoxic encephalopathy so that [Petitioner] now lives in a persistent minimally conscious state. The acute pancreatitis which [Petitioner] initially sought treatment resolved without further complications. His current medical condition is only complicated by the sequelae of his hypoxic encephalopathy and persistent minimally conscious state. Petitioner complied with all requirements of Chapter 766, Florida Statutes, including, all pre-suit requirements and presuit investigation of claims against the treating Hospital, the ICU Specialist and her employer that were corroborated by an expert witness, which were rejected. On October 27, 2017, Petitioner filed a lawsuit in the Circuit Court for Hillsborough County Florida, Case No. 17-CA-009829, against the treating Hospital and the ICU Specialist asserting claims for medical negligence. Based on the foregoing limitations, the medical malpractice claims were settled for a total of $1,975,000, which was approved by the Court to be in the best interest of [Petitioner]. [The Agency], through its Medicaid program, provided medical assistance to [Petitioner] in the amount of $13,904.36. During the pendency of the medical negligence case, [the Agency] was notified of the action and asserted a $13,904.06 Medicaid lien against Petitioner's cause of action and settlement. [The Agency] did not commence a civil action to enforce its rights under §409.910 or intervene or join in [Petitioner’s] action against Defendants. [The Agency] did not file a motion to set-aside, void or otherwise dispute Petitioner's settlement with Defendants. Application of the formula at §409.910(1l)(f) to the settlement requires payment to [the Agency] in the amount of the full $13,904.06 Medicaid lien. Petitioner deposited the full Medicaid lien amount in an interest-bearing account for the benefit of [the Agency] pending an administrative determination of [the Agency’s] rights, and this constitutes "final agency action" for purposes of chapter 120, pursuant to §409.910(17). Credible, Unimpeached, and Unrebutted Testimony Mr. Tonelli is the only person who testified about the value of the various elements of damages making up Petitioner’s malpractice claim. Mr. Tonelli has practiced law for 44 years. He has practiced in Tampa, Florida, the venue where Petitioner’s case would have been tried if it had not settled. He first practiced primarily in the area of personal injury defense. Presently, Mr. Tonelli spends over 25 percent of his time as a mediator. Since 1985, he has mediated many medical negligence cases. Mr. Tonelli also serves as a guardian ad litem in approximately 50 cases per year. Usually two to five of the cases involve catastrophic injury. Mr. Tonelli has served as counsel in 50 to 75 civil trials. Approximately 20 were jury trials. Mr. Tonelli’s practice includes review of medical records and life care plans. He also consults with economists about lost wage claims and works with doctors to identify the nature and extent of injuries and costs of medical services for injured persons. Mr. Tonelli participates in regular intake review of personal injury cases for his firm. The review includes evaluating the recoverable damages. He informs himself about jury awards and settlement amounts through his firm work, his participation in the American Board of Trial Attorneys, and his mediation practice. Mr. Tonelli was Petitioner’s Guardian Ad Litem. He reviewed the case and the proposed settlement and reported to the court about whether the settlement was in Petitioner’s best interests. Mr. Tonelli’s knowledge, skill, and experience qualify him to provide an opinion about the value of the elements of the damages for Petitioner’s malpractice claims against the hospital and the physician. Mr. Tonelli reviewed Petitioner’s hospital and physician medical records. He also reviewed the deposition of Roland Snyder, M.D., who prepared the life care plans admitted into evidence. Between Mr. Tonelli’s service as Guardian Ad Litem for Petitioner and his record review to prepare for his testimony, he had sufficient facts and data to form an opinion about the value of elements of damages of Petitioner’s malpractice claims. Also, he reasonably and reliably applied principles and methods based upon his knowledge, skill, and experience to provide a credible and conservative determination of the value of each element of damages that make up Petitioner’s malpractice claim. His testimony was unrebutted, unimpeached, credible, and persuasive. Injuries and Negligence Petitioner suffers from profound anoxic encephalopathy. This brain damage leaves him in a permanent, minimally conscious state, just barely more conscious than a patient in a vegetative state. He cannot speak, walk, or care for himself. Petitioner lives in pain. He breathes and eats only with the assistance of a tracheostomy. He takes nourishment through a “G-tube.” This is a gastrojejunostomy tube that delivers nutrients directly to the stomach. Petitioner requires daily care and assistance in every task of life from eating to waste elimination. His condition will not change for his estimated 20-year remaining life span. Petitioner’s multiple, severe medical conditions require that he live those 20 years in a long-term care facility with medical services, such as a skilled nursing home. This condition resulted from treatment he received for pancreatitis, a condition from which he fully recovered. While in the hospital, Petitioner developed cardiac and respiratory problems. A cascading series of improper prescriptions exacerbated Petitioner’s medical problems leading to catastrophic injuries resulting in his current condition. Damages The elements of damages for Petitioner’s malpractice claims are past medical expenses, future medical expenses, loss of current income, loss of future income, pain and suffering, and loss of enjoyment of life. The value of the damages in Petitioner’s malpractice claims falls within a range of $25,000,000 to $35,000,000. The amount of $25,000,000 is a reasonable, conservative value to place on Petitioner’s damage claims. The only evidence of past medical expenses is the stipulation that Medicaid paid $13,904.36. Consequently, that is the amount of past medical expenses. Future medical expenses in the form of costs for continued treatment and supports necessary to maintain Petitioner’s existence are a significant part of the damages. As explicated in two detailed life care plans, those expenses will range from $14,535,508.26, for residence in a modified home with supportive caregivers, to $31,082,301.36, for residence in a skilled long-term nursing facility. Loss of current income, comparatively, is not a major factor in this case. Loss of future income is. Petitioner was 30 years old earning $34,000 per year teaching “at-risk” children who would have otherwise been suspended from school. He was dedicated to his profession, volunteered at Boys and Girls Clubs, and had just been accepted to a master’s degree program. Petitioner’s lost future income ranges between $750,000 to $1,000,000. Petitioner’s injuries and resulting conditions are catastrophic. Pain and suffering damages and loss of enjoyment of life damages easily range between 10 and 20 million dollars. They could reasonably exceed 50 million dollars. Consideration of the value of the elements of damages affirms that the total damages that would have been proven if Petitioner’s claims had been tried would have been at least $25,000,000. Settlement Realities Petitioner’s claims were not tried. Petitioner had a strong malpractice claim against the doctor. The doctor, however, had only $500,000 worth of insurance coverage. There is no evidence of assets of the doctor that could have been reached to enforce a judgment. Petitioner’s claim against the hospital was not as strong. The hospital had significant liability and causation defenses. The doctor was not an employee or agent of the hospital. Hospital employees in most instances were following the doctor’s instructions, including when administering the medications that caused the damages. The limits of the doctor’s insurance coverage and the liability and causation issues of the claim against the hospital resulted in the decision to settle. Uncertainty about the provability or amount of damages was not a factor. The trial court approved the settlement. The settlement amount is 7.9 percent of the value of Petitioner’s claims. The stipulated amount of medical expenses the Agency paid through the Medicaid program is $13,904.36. The reasonable inference from the record in this case is that applying the 7.9 percent ratio of claims value to settlement recovery to the stipulated amount of medical expenses paid by the Medicaid program demonstrates that $1,098.44 of Petitioner’s settlement recovery was for past medical expenses. The Agency did not call witnesses, present evidence of the value of damages, or propose an alternative way to value damages.
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 in this proceeding is the amount to be reimbursed to Respondent, Agency for Health Care Administration, for medical expenses paid on behalf of Petitioner, Joni M. Doheny, from a settlement received by Petitioner from a third party.
Findings Of Fact On July 7, 2014, Ms. Doheny, who was then 57 years old, was a passenger on a motorcycle whose drunk driver veered into oncoming traffic and was struck by a sports utility vehicle (SUV), ejecting her from the point of impact approximately 100 feet through the air and over pavement. As a result of the accident, Ms. Doheny suffered severe, catastrophic and horrible injuries with wounds to her head, wounds to her arms, wounds to her hands and her left leg almost ripped from her body at the knee. Ms. Doheny was intubated at the scene and airlifted to Tampa General Hospital. She was diagnosed with compound fractures of her left tibia and fibula, puncture wound of her right knee, severe injury to her left arm and hand resulting in amputation of her left ring finger, a laceration to her forehead, and a traumatic brain injury. Amputation of her leg was recommended, but Petitioner elected to save her leg. She underwent numerous surgeries associated with her leg and other extensive injuries and was in the hospital until September 12, 2014. Ms. Doheny was again admitted to the hospital for treatment of her injuries on December 2 through 9, 2014, and January 21 through February 5, 2015. Throughout the process, she was in extreme pain and remains in pain to date. Currently, Petitioner cannot walk and requires a wheelchair for mobility. She has no significant function of her left hand and no significant function in her left leg. She is dependent on others for activities of daily living. She also has severe impacts to her emotional well-being and suffers from depression, anxiety and pain. Her condition is permanent and she most likely will not be able to obtain employment sufficient to support herself or replace the income/earning capacity she had as a realtor prior to her injuries. She is no longer a Medicaid recipient. Petitioner’s past medical expenses related to her injuries were paid by both personal funds and Medicaid. Medicaid paid for Petitioner’s medical expenses in the amount of $257,640.53. Unpaid out-of-pocket expenses totaled $119,926.41. Thus, total past healthcare expenses incurred for Petitioner’s injuries was $377,566.94. Ms. Doheny brought a personal injury claim to recover all her damages against the driver of the SUV (Driver) who struck the motorcycle Ms. Doheny was riding, her Uninsured/Underinsured Motorist Policy (UM Policy), and the restaurant which had served alcohol to the driver of the motorcycle (Restaurant). Towards that end, Petitioner retained James D. Gordon, III, an attorney specializing in personal and catastrophic injury claims for over 30 years, to represent Petitioner in her negligence action against the Defendants. The Driver maintained a $10,000 insurance policy. On November 10, 2014, prior to suit being filed, Ms. Doheny settled her claim against the Driver for an unallocated $10,000. Ms. Doheny’s UM Policy had a policy limit of $300,000. Likewise, on November 10, 2014, Ms. Doheny settled her claim against her UM Policy for an unallocated $300,000. The Restaurant maintained a $1,000,000 liquor liability insurance policy. On September 2, 2015, and again prior to suit being filed, Ms. Doheny settled her claim against the Restaurant for $1,000,000. The settlements totaled $1,310,000.00 and do not fully compensate Petitioner for the total value of her damages. As indicated, $310,000.00 of the settlements was not apportioned to specific types of damages, such as economic or non-economic, past or future. One million dollars of the settlements was apportioned with 20 percent of those funds allocated to past medical expenses. No dollar amount was assigned to Ms. Doheny’s future medical care needs, and there remains uncertainty as to what those needs will be. Additionally, neither Petitioner nor others on her behalf made payments in the past or in advance for her future medical care, and no claim for reimbursement, restitution or indemnification was made for such damages or included in the settlement. However, given the loss of earning capacity and the past and present level of pain and suffering, the bulk of the settlement was clearly intended to provide future support for Ms. Doheny. Respondent was notified of Petitioner’s negligence action, around September 3, 2015. Thereafter, Respondent asserted a Medicaid lien in the amount of $257,640.53 against the proceeds of any award or settlement arising out of that action. Respondent was not a party to the 2015 settlements and did not execute any of the applicable releases. Mr. Gordon’s expert very conservative valuation of the total damages suffered by Petitioner is at least $5 million. In arriving at this valuation, Mr. Gordon reviewed the facts of Petitioner’s personal injury claim, vetted the claim with experienced members in his law firm and examined jury verdicts in similar cases involving catastrophic injury. The reviewed cases had an average award of $6,779,214 for total damages and $4,725,000 for non-economic damages (past and future pain and suffering). Mr. Gordon’s valuation of total damages was supported by the testimony of one additional personal injury attorney, R. Vinson Barrett, who has practiced personal injury law for more than 30 years. In formulating his opinion on the value of Petitioner’s damages, Mr. Barrett reviewed the discharge summaries from Petitioner’s hospitalizations. Mr. Barrett also reviewed the jury trial verdicts and awards relied upon by Mr. Gordon. Mr. Barrett agreed with the $5 million valuation of Petitioner’s total damages and thought it could likely have been higher. The settlement amount of $1,310,000 is 26.2 percent of the total value ($5 million) of Petitioner’s damages. By the same token, 26.2 percent of $377,566.54 (Petitioner’s past medical expenses paid in part by Medicaid) is $98,922.54. Both experts testified that $98,922.54 is a reasonable and rational reimbursement for past medical expenses. Their testimony is accepted as persuasive. Further, the unrebutted evidence demonstrated that $98,922.54 is a reasonable and rational reimbursement for past medical expenses since Petitioner recovered only 26.2 percent of her damages thereby reducing all of the categories of damages associated with her claim. Given these facts, Petitioner proved by clear and convincing evidence that a lesser portion of the total recovery should be allocated as reimbursement for past medical expenses than the amount calculated by Respondent pursuant to the formula set forth in section 409.910(11)(f). Therefore, the amount of the Medicaid lien should be $98,922.54.
The Issue The issue is the amount of Petitioner’s $800,000 personal injury settlement payable to Respondent, Agency for Health Care Administration (“AHCA”), to satisfy AHCA’s $187,950.01 Medicaid lien.
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: Background On July 13, 2008, Carissa Gaudio (Carissa), then 26 years old, suffered severe physical injury and catastrophic brain damage when her car was struck by a train. Carissa received extensive medical intervention to save her life and address her injuries. Eventually, her medical condition stabilized and she was discharged to her parent’s home. While Carissa demonstrated consciousness and awareness, due to her catastrophic brain damage, she was unable to speak, ambulate, eat, toilet or care for herself in any manner. She was totally dependent on others for every aspect of her daily care. Carissa’s past medical expenses related to her injuries suffered on July 13, 2008, were paid by private health insurance through Blue Cross Blue Shield of Florida, Medicare, and Medicaid. Blue Cross Blue Shield of Florida provided $494,868.51 in benefits, Medicare provided $6,364.89 in benefits, and Medicaid provided $187,950.01 in benefits. The combined amount of these benefits is $689,183.41, and this $689,183.41 represented Carissa’s entire claim for past medical expenses. Carissa, or others on her behalf, did not make payments in the past or in advance for Carissa’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. Due to Carissa’s incapacity, Carissa’s mother, Roseann Gaudio, was appointed her legal guardian. Roseann Gaudio, as Carissa’s mother and guardian, brought a personal injury action in Broward County, Florida to recover all of Carissa’s damages against the railway company and train engineer (“Tortfeasor”). On January 10, 2015, Roseanne Gaudio, as Carissa’s mother and guardian, settled Carissa’s personal injury lawsuit for $800,000. In making this settlement, the settling parties agreed that: 1) the settlement did not fully compensate Carissa for all her damages; 2) Carissa’s damages had a value in excess of $16,000,000, of which $689,183.41 represents her claim for past medical expenses; and 3) allocation of $34,459.17 of the settlement to Carissa’s claim for past medical expenses was reasonable and proportionate. Because Carissa was incapacitated, her settlement required Court approval. Accordingly, by Order Approving Settlement dated February 11, 2015, the Circuit Court Judge, Honorable Jack Tuter, approved Carissa’s settlement. As a condition of Carissa’s eligibility for Medicaid, Carissa assigned to AHCA her 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 Carissa’s lawsuit, AHCA was notified of the lawsuit and AHCA, through its collections contractor, Xerox Recovery Services Group, asserted a $187,950.01 Medicaid lien against Carissa’s cause of action and future settlement of that action. By letter of February 17, 2015, Carissa’s personal injury attorney notified AHCA of the settlement and provided AHCA with a copy of the executed Final Release and a copy of the Order Approving Settlement. This letter requested AHCA to advise as to the amount AHCA would accept in satisfaction of the Medicaid lien. AHCA did not respond to Carissa’s attorney’s letter of February 17, 2015. AHCA did not file an action to set aside, void, or otherwise dispute Carissa’s settlement with the Tortfeasor. The Florida Medicaid program spent $187,950.01 on behalf of Carissa, all of which represents expenditures paid for Carissa’s past medical expenses. Carissa died on August 12, 2015 (Death Certificate filed by Petitioner on September 11, 2015). No portion of the $187,950.01 paid by the Medicaid program represents expenditures for future medical expenses, and AHCA did not make payments in advance for medical care. AHCA has determined that of Carissa’s $226,478.73 in litigation costs, $210,463.10 are taxable costs for purposes of the section 409.910(11)(f) formula calculation. Based on $210,463.10 in taxable costs, the section 409.910(11)(f) formula applied to Carissa’s $800,000 settlement, requires payment of $194,768.45 to AHCA in satisfaction of its $187,950.01 Medicaid lien. Since $187,950.01 is less than the $194,768.45 amount required to be paid to AHCA under the section 409.910(11)(f) formula, AHCA is seeking reimbursement of $187,950.01 from Carissa’s $800,000 settlement in satisfaction of its Medicaid lien. The full Medicaid lien amount has been deposited into an interest-bearing account 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)(b). At hearing, Petitioner called Joseph J. Slama, a board-certified civil trial lawyer. Mr. Slama handles aviation crash, products liability, roadway defect, and automobile accident cases, including handling catastrophic brain injury cases through jury trial. He stays abreast of jury verdicts through review of publications and participation in trial attorney organizations. He testified that he routinely evaluates his client’s injuries and makes assessments concerning the value of their damages, and he explained his process for making these determinations based on his experience and training. Mr. Slama was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Slama testified that he represented Carissa in relation to her personal injury action. He explained that he first met with Carissa and her mother after she was discharged home from the hospital. Mr. Slama testified that he had reviewed the accident report, Carissa’s medical records, taken depositions of witnesses and experts, and reviewed the Life Care Plan prepared by Craig H. Lichtblau, M.D. Mr. Slama explained in great detail the facts and circumstances of Carissa’s accident. He explained that Carissa’s car became stuck on the railroad tracks. Unfortunately, a train approached and shortly before impact, Carissa exited her vehicle. Her vehicle was struck by the train and she was propelled 167 feet from the point of impact. Mr. Slama testified that as a result of the accident, Carissa suffered catastrophic physical injury and brain damage. He testified that due to this catastrophic brain injury, Carissa was left in a semi-vegetative state and was unable to ambulate. While she was conscious and aware of her condition, she was unable to communicate other than with limited facial expressions. She lived in her parents’ living room where she received around the clock care, provided by her family, until her recent death. Mr. Slama testified that through his representation of Carissa, interactions with her, review of her medical records and reports, and based on his training and experience in similar cases, it was his opinion that the “minimum reasonable value” of Carissa’s damages was $16,000,000. He testified that this $16,000,000 would be the amount a jury would award in damages if the question of damages alone was presented to the jury, and he would be disappointed in this result because he would ask for much more in damages. Mr. Slama explained that the basis of his opinion was her past expenses, her need for future life care needs, and her non-economic damages, including pain and suffering, which would have been awarded from the date of her injury by a jury and would be a huge amount. Mr. Slama explained that Carissa’s lawsuit to recover all her damages had issues related to comparative negligence and disputed facts that called into question the responsibility of the defendants to pay for Carissa’s damages. He testified that based on these issues, Carissa’s lawsuit was settled for $800,000. Mr. Slama testified that this $800,000 settlement did not fully compensate Carissa for the full value of her damages and that based on the $16,000,000 valuation of all Carissa’s damages, the $800,000 settlement represented a five percent recovery of Carissa’s damages. He testified that because she only recovered five percent of her damages in the settlement, she “only recovered 5 percent of each and every element of her damages, including only 5 percent of her $689,183.41” claim for past medical expenses, or $34,459.17. R. Vincent Barrett has been a trial attorney since 1977 and is a partner with the Tallahassee law firm of Barrett, Fasig & Brooks. He practices in the area of medical malpractice and medical and pharmaceutical product liability. He has handled catastrophic injury cases and handled numerous jury trials. Mr. Barrett stays abreast of jury verdicts by reviewing Jury Verdict Reports, talking with other lawyers, and attending seminars. He testified that as a routine part of his practice, he ascertains the value of damages suffered by injured parties and has served as an expert in the valuation of damages in civil cases. Mr. Barrett was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Barrett testified that he was very familiar with Carissa’s injuries and had reviewed a substantial amount of Carissa’s medical records, the Life Care Plan, accident report, before and after pictures of Carissa, Day in the Life Video, the Second Amended Complaint, the Release, and the Order Approving Settlement. Mr. Barrett explained that he was familiar with the type of injury suffered by Carissa because he had handled a number of traumatic brain and orthopedic injury cases with injuries similar to Carissa’s. He testified that with respect to virtually every injury that Carissa suffered, he had handled a case that involved one or more of those injuries. Mr. Barrett stated that Carissa’s case is “one of the worst cases I’ve ever seen,” and he described Carissa’s accident and extensive injuries. Mr. Barrett explained that Carissa’s injuries were “horrible” and “dramatic” and that “tractor trailer versus car, train versus car, those kinds of cases are worth in a jury trial generally twice as much as in a regular car accident just because of the dramatic traumatic nature of the impact it has on jurors.” Mr. Barrett testified that Carissa’s damages had a value of at least up in the $30,000,000 range and that the valuation of her damages at $16,000,000 was extremely conservative. He explained that he had reviewed jury verdicts in developing his opinion as to the value of Carissa’s damages, and he compared a number of the verdicts he had reviewed with Carissa’s case, including the Mosley 2014 Broward verdict for $75,543,527, noting that the Mosley plaintiff, unlike Carissa, was left with limited verbal language and the ability to walk short distances with assistance. Mr. Barrett stated in relation to the $16,000,000 valuation of Carissa’s damages that, “in Broward County for a pretty, young, 26-year old, gainfully employed, Hispanic lady, who was engaged, it’s got to be the limit. I mean, some of those verdicts were $75 million and some of those people weren’t hurt as bad as Carissa. So, yes, it’s very conservative.” The testimony of Mr. Slama and Mr. Barrett that the minimum reasonable value of Carissa’s damages was $16,000,000 was unrebutted, and is credible. Respondent’s position is that it should be reimbursed for its Medicaid expenditures on behalf of Petitioner pursuant to the formula set forth in section 409.910(11)(f). Under the statutory formula, the lien amount is computed by deducting a 25 percent attorney’s fee ($200,000) and taxable costs ($210,463.10) from the $800,000 recovery, which yields a sum of $389,536.90, then dividing that amount by two, which yields a result of $194,768.45. 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. Since the Medicaid lien amount is $187,950.01, which is less than the $194,768.45 amount required to be paid to AHCA under the section 409.910(11)(f) formula, AHCA is seeking reimbursement of $187,950.01 from Carissa’s $800,000 settlement in satisfaction of its Medicaid lien. 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 urges Respondent should be reimbursed $34,459.17 in satisfaction of its Medicaid lien. The settlement amount of $800,000 is five percent of the reasonable total value ($16 million) of Petitioner’s damages. By the same token, five percent of $689,183.41 (Petitioner’s past medical expenses paid by both Medicaid and private insurance) is $34,459.17. Petitioner proved by clear and convincing evidence that a lesser portion of the total recovery should be allocated as reimbursement for past medical expenses than the amount calculated by Respondent pursuant to the formula set forth in section 409.910(11)(f).
The Issue The issue is the amount of money, if any, that must be paid to the Agency for Health Care Administration (AHCA) to satisfy its Medicaid lien under section 409.910, Florida Statutes (2013).
Findings Of Fact Harry Silnicki, at age 52, suffered devastating brain injuries when a ladder on which he was standing collapsed. Mr. Silnicki, now age 59, has required, and will for the remainder of his life require, constant custodial care as a result of his injuries. He has been, and will be into the indefinite future, a resident of the Florida Institute of Neurological Rehabilitation (FINR) or a similar facility that provides full nursing care. Debra Silnicki is the wife and guardian of Mr. Silnicki. Mr. Silnicki, through his guardian, brought a personal injury lawsuit in Broward County, Florida, against several defendants, including the manufacturer of the ladder, the seller of the ladder, and two insurance companies (Defendants), contending that Mr. Silnicki's injuries were caused by a defective design of the ladder. The lawsuit sought compensation for all of Mr. Silnicki's damages as well as his wife's individual claim for damages associated with Mr. Silnicki's damages. When referring to the personal injury lawsuit, Mr. and Mrs. Silnicki will be referred to as Plaintiffs. During the course of the trial, before the jury reached its verdict, the Plaintiffs entered into a High-Low Agreement (HLA) with the Defendants by which the parties agreed that, regardless of the jury verdict, the Defendants would pay to the Plaintiffs $3,000,000 if the Plaintiffs lost the case, but would pay at most $9,000,000 if the Plaintiffs won the case. After a lengthy trial, on March 27, 2013, the jury returned a verdict finding no liability on the part of the manufacturer or any other defendants. Consequently, the jury awarded the Plaintiffs no damages. The Defendants have paid to the Plaintiffs the sum of $3,000,000 pursuant to the HLA (the HLA funds). The HLA constitutes a settlement of the claims the Plaintiffs had against the Defendants.1/ As shown in their Closing Statement (Petitioners' Exhibit 7), dated September 23, 2013, the Silnickis' attorneys have disbursed $1,100,000 of the HLA funds as attorney's fees and $588,167.40 as costs. The sum of $1,011,832.602/ was paid under the heading "Medical Liens/Bills to be Paid/Waived/Reduced by Agreement Pending Court Approval." Included in that sum were payments to Memorial Regional Hospital in the amount of $406,464.49 and a payment to FINR in the amount of $600,000.00. Also included was the sum of $245,648.57, which was to be deposited in an interest-bearing account. Subject to court approval, the Closing Statement earmarked, among other payments, $100,000 for a special needs trust for Mr. Silnicki and a $100,000 payment to Mrs. Silnicki for her loss of consortium claim. AHCA has provided $245,648.57 in Medicaid benefits to Mr. Silnicki. AHCA has asserted a Medicaid lien against the HLA funds in the amount of $245,648.57. As required by section 409.910(17)(a), the amount of the Medicaid lien has been placed in an interest-bearing account. The Closing Statement reflects that should Petitioners prevail in this proceeding by reducing or precluding the Medicaid lien, any amounts returned to Petitioners will be split 50% to FINR, 25% to attorney's fees, and 25% to the Petitioners. Section 409.910(11)(f) provides as follows: (f) Notwithstanding any provision in this section to the contrary, in the event of an action in tort against a third party in which the recipient or his or her legal representative is a party which results in a judgment, award, or settlement from a third party, the amount recovered shall be distributed as follows: After attorney's fees and taxable costs as defined by the Florida Rules of Civil Procedure, one-half of the remaining recovery shall be paid to the agency up to the total amount of medical assistance provided by Medicaid. The remaining amount of the recovery shall be paid to the recipient. For purposes of calculating the agency's recovery of medical assistance benefits paid, the fee for services of an attorney retained by the recipient or his or her legal representative shall be calculated at 25 percent of the judgment, award, or settlement. The parties stipulated that the amount of Petitioners' "taxable costs as defined by the Florida Rules of Civil Procedure" is $347,747.05. The parties have also stipulated that if the section 409.910(11)(f) formula is applied to the $3,000,000 settlement funds received by Mr. and Mrs. Silnicki, the resulting product would be greater than the amount of AHCA's Medicaid lien of $245,648.57. That amount is calculated by deducting 25% of the $3,000,000 for attorneys' fees, which leaves $2,250,000. Deducting taxable costs in the amount of $347,747.05 from $2,250,000 leaves $1,902,352.95. Half of $1,902,352.95 equals $951,176.48 (the net amount). The net amount exceeds the amount of the Medicaid lien. Section 409.910(17)(b) provides the method by which a recipient can challenge the amount of a Medicaid lien as follows: (b) A recipient may contest the amount designated as recovered medical expense damages payable to the agency pursuant to the formula specified in paragraph (11)(f) by filing a petition under chapter 120 within 21 days after the date of payment of funds to the agency or after the date of placing the full amount of the third-party benefits in the trust account for the benefit of the agency pursuant to paragraph (a). The petition shall be filed with the Division of Administrative Hearings. For purposes of chapter 120, the payment of funds to the agency or the placement of the full amount of the third-party benefits in the trust account for the benefit of the agency constitutes final agency action and notice thereof. Final order authority for the proceedings specified in this subsection rests with the Division of Administrative Hearings. This procedure is the exclusive method for challenging the amount of third-party benefits payable to the agency. In order to successfully challenge the amount payable to the agency, the recipient must prove, by clear and convincing evidence, 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 (11)(f) or that Medicaid provided a lesser amount of medical assistance than that asserted by the agency. Scott Henratty and his firm represented the Plaintiffs in the underlying personal injury case. Mr. Henratty is an experienced personal injury attorney. Mr. Henratty testified that the Plaintiffs asked the jury for a verdict in the amount of $50,000,000 for Mr. Silnicki for his total damages, not including his wife's consortium claim. Mr. Henratty valued the claim at between $30,000,000 and $50,000,000. There was no clear and convincing evidence that the total value of Mr. Silnicki's claim exceeded $30,000,000. Mr. Henratty testified that Plaintiffs presented evidence to the jury that Mr. Silnicki's past medical expenses equaled $3,366,267, and his future medical expenses, reduced to present value, equaled $8,906,114, for a total of $12,272,381. Those two elements of damages equal approximately 40.9% of the total value of the claim if $30,000,000 is accepted as the total value of the claim.3/ The Closing Statement reflects that more than the amount of the claimed Medicaid lien was to be used to pay past medical expenses. Petitioners assert in their Petition and Amended Petition three alternatives to determine what should be paid in satisfaction of the Medicaid lien in the event it is determined that the HLA funds are subject to the lien. All three alternatives are premised on the total value of Mr. Silnicki's recovery being $30,000,000 (total value) and compare that to the recovery under the HLA of $3,000,000, which is one-tenth of the total value. All three methods arrive at the figure of $24,564.86 as being the most that can be recovered by the Medicaid lien, which is one-tenth of the Medicaid lien. Future medical expenses is not a component in these calculations. The portion of the HLA funds that should be allocated to past and future medical expenses is, at a minimum, 30% of the recovery.4/
