The Issue The issue for the undersigned to determine is the amount payable to Respondent, Agency for Health Care Administration (AHCA), as reimbursement for medical expenses paid on behalf of Petitioner Nigel Carter (Mr. Carter), by and through Bernice Bonnett, plenary guardian of Mr. Carter (Petitioner), pursuant to section 409.910, Florida Statutes (2019), from settlement proceeds Mr. Carter received from third parties.
Findings Of Fact AHCA is the state agency charged with administering the Florida Medicaid program, pursuant to chapter 409, Florida Statutes. On November 24, 2016, Mr. Carter, age 20, visited friends at the Hilltop Village Apartments, 1646 West 45th Street, Jacksonville, Duval County, Florida. During this visit, an unknown assailant shot Mr. Carter. Mr. Carter sustained gunshot wounds to his head and ankle. As a result of the November 24, 2016, incident, Mr. Carter suffered a traumatic brain injury. Mr. Carter does not have the full use of the left side of his body, cannot walk or ambulate independently, and requires 24-hour assistance. Mr. Carter can speak, but has occasional emotional outbursts. Mr. Carter’s life expectancy is significantly reduced. Mr. Carter made a claim for personal injury damages against Southport Financial Services, Inc., d/b/a Hilltop Village Apartments, and SP Hilltop Village, LP (Hilltop Village Apartments). Petitioner entered into a settlement agreement with Hilltop Village Apartments for $1,900,000. Petitioner contends that Mr. Carter’s injuries were millions of dollars in excess of the settlement. Mr. Carter has not received any other recovery for the injuries suffered as a result of the shooting on November 24, 2016, and Petitioner does not expect to make any other recovery on behalf of Mr. Carter. The value of Mr. Carter’s personal injury claim that arose from the November 24, 2016, incident at the Hilltop Village Apartments is $21,966,575.18. This amount consists of the following sum of Mr. Carter’s damages: Past medical costs: $1,023,371.05; Future medical costs: $9,959,916.54; and Past and future pain and suffering, mental anguish, and loss of enjoyment of life: $10,983,287.59.1 Gerri Pennachio has the expertise to create Mr. Carter’s life plan, and did so based upon facts not disputed by the parties. Ms. Pennachio’s life plan for Mr. Carter confirms the valuation of Mr. Carter’s future life care needs at $9,959,916.54, which is consistent with the parties’ stipulated value of Mr. Carter’s future medical costs. AHCA, through its Florida Medicaid program, provided $240,587.85 in medical assistance payments for the benefit of Mr. Carter, and has asserted a statutory lien in this amount against Petitioner’s recovery from the third parties. Molina Healthcare of Florida paid $27,179.81 for medical expenses associated with Mr. Carter’s gunshot wounds and has also imposed a lien seeking a recovery for that entire amount. Petitioner has deposited the full Medicaid lien amount in an interest- bearing account pending a determination of AHCA’s rights, which, under 1 The parties note that this amount was determined based upon the practice of multiplying the economic damages to determine the non-economic damages. Here, a multiplier of 1 was used for the non-economic damages. Thus, this amount is the sum of the past and future medical costs. chapter 120, Florida Statutes, constitutes “final agency action” pursuant to section 409.910(17). The parties stipulated that the value of Mr. Carter’s personal injury claim is $21,966,575.18. The parties have also stipulated that Mr. Carter’s settlement ($1,900,000.00) represents 10 percent of the true value of his personal injury claim.2 However, the undersigned finds that Mr. Carter’s settlement actually represents 8.6 percent of the stipulated value of his personal injury claim. Strangely, AHCA states, in its proposed final order, that it “accepts the stipulated 10% figure as the recovery rate, despite the seeming incongruity.” Accordingly, the undersigned finds that the preponderance of the evidence establishes that the total value of Petitioner’s personal injury claim is $21,966,575.18, and that the $1,900,000.00 settlement resulted in Petitioner recovering 8.6 percent of Mr. Carter’s past medical expenses. In addition, the preponderance of the evidence establishes that Mr. Carter’s total past medical expenses (i.e., the amounts provided by Medicaid and Molina Healthcare) are $267,767.66. The 8.6 percent of $267,767.66 is $23,028.02. Thus, the undersigned further finds that the preponderance of the evidence establishes that $23,028.02 amounts to a fair and reasonable determination of the past medical expenses actually recovered by Petitioner and payable to AHCA.
The Issue The issue in this matter concerns the amount of the money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Malk S. Sunwabeh, a Medicaid recipient, following a settlement recovered from a third party by the Personal Representative of the Mr. Sunwabeh’s estate.
Findings Of Fact This proceeding determines the amount the Agency should be paid to satisfy a Medicaid lien following Petitioner’s recovery of a $275,000 settlement from a third party. The Agency asserts that it is entitled to recover the full amount of its $85,279.65 lien. Malk S. Sunwabeh, the person who received the benefit of the Agency’s Medicaid payments, died as a result of a hit-and-run accident. Petitioner is the duly appointed Personal Representative of Mr. Sunwabeh’s estate and is authorized to bring this action on his behalf. The accident that gave rise to this matter occurred on October 29, 2013. Early that morning, in pre-dawn darkness, Mr. Sunwabeh left his residence to walk to his high school. The well-worn path he followed led him to a divided roadway that ran in front of his school. With no crosswalk or intersection nearby, Mr. Sunwabeh walked straight across the road. Just after Mr. Sunwabeh stepped into the road, he was struck from behind by a car driven by another student. As he lay sprawled on the pavement, a second vehicle (a gas truck) ran over his body. After the accident, Mr. Sunwabeh was transported by ambulance to Shands Hospital in Jacksonville. He immediately underwent surgery. Tragically, Mr. Sunwabeh died during surgery. He was 16 years old. The Agency, through the Medicaid program, paid Shands Hospital a total of $85,279.65 for Mr. Sunwabeh’s medical care, which was the full amount of his medical expenses following the accident.3/ All of the expenditures Medicaid spent on Mr. Sunwabeh’s behalf are attributed to past medical expenses. No portion of the $85,279.65 Medicaid lien represents future medical expenses. Mr. Sunwabeh’s aunt, Kapitola Morgan (Petitioner), was appointed Personal Representative of Mr. Sunwabeh’s estate. Petitioner brought a wrongful death action to recover both the damages of Mr. Sunwabeh’s estate, as well as the individual statutory damages of Mr. Sunwabeh’s mother, against both drivers who hit Mr. Sunwabeh. Johnny Pineyro, Esquire, represented Petitioner in the wrongful death lawsuit. On June 10, 2015, Mr. Pineyro negotiated a $275,000 settlement for Petitioner with the second driver. 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 wrongful death settlement, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect the full amount of the medical costs it paid on Mr. Sunwabeh’s behalf ($85,279.65). 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 represents is the full value of the damages. (As discussed below, the formula in section 409.910(11)(f) allows the Agency to collect the full Medicaid lien.) Petitioner, on the other hand, asserts that, pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of the settlement than the amount it calculated using the section 409.910(11)(f) formula. Petitioner specifically argues that the Agency’s Medicaid lien should be reduced proportionately, taking into account the “true” value of Petitioner’s damages. Otherwise, the application of the default statutory formula would permit the Agency to collect more than that portion of the settlement that fairly represents compensation for past medical expenses. Petitioner insists that such reimbursement violates the federal Medicaid law’s anti-lien provision (42 U.S.C. § 1396p(a)(1)) and Florida common law. Therefore, Petitioner requests that the Agency’s allocation from Petitioner’s recovery be reduced to the amount of $9,065.23. To establish the value of Petitioner’s damages, Petitioner presented the testimony of Mr. Pineyro. Mr. Pineyro heads the Florida Injury Law Firm in Celebration, Florida. He has practiced law for over 20 years and focuses on personal injury, wrongful death, and aviation law. Mr. Pineyro handles jury trials and cases involving catastrophic injury. In his practice, he regularly reviews accident reports, expert reports, and medical records. Mr. Pineyro stays abreast of jury verdicts. He also discusses jury results with members of his firm and other personal injury attorneys. Mr. Pineyro testified that as a routine part of his practice, he ascertains the value of damages suffered by injured parties, and he explained his process for making these determinations. Mr. Pineyro was accepted as an expert in the valuation of damages suffered by injured (and deceased) parties. Mr. Pineyro opined that the conservative value of Mr. Sunwabeh’s damages, as well as his mother’s claim for pain, suffering, and loss of her son’s companionship under the Florida Wrongful Death Act, at between $2,500,000 and $5,000,000.4/ In deriving this figure, Mr. Pineyro considered the accident and homicide reports, the medical examiner’s report, and Petitioner’s medical records. Regarding Mr. Sunwabeh’s mother’s damages, Mr. Pineyro described comparable jury verdicts which involved the death of a child. Mr. Pineyro also testified regarding the significant obstacles Petitioner faced to recovering the full amount of damages in the wrongful death lawsuit based on the disputed facts and circumstances of the accident, as well as insurance policy limits. As part of his representation of Petitioner, Mr. Pineyro deposed several fact and expert witnesses and visited the accident scene. Mr. Pineyro conveyed that the first driver who hit Mr. Sunwabeh was not covered by bodily injury insurance, nor did she possess recoverable assets. Therefore, collecting a full damages award against her would prove challenging. Furthermore, Mr. Pineyro expressed that Petitioner did not have a strong liability case against the second driver based on causation and comparative negligence issues. (Mr. Sunwabeh was wearing all black clothes which concealed his fallen body on the road in the early morning gloom.) Mr. Pineyro was prepared to argue a negligence theory asserting that the second driver failed to use reasonable caution and react in time to avoid driving over Mr. Sunwabeh. However, during his testimony, Mr. Pineyro conceded that a defense verdict in favor of the second driver was a real possibility. Consequently, Mr. Pineyro believed that it was in Petitioner’s best interests to settle the lawsuit. Based on Mr. Pineyro’s testimony that the $275,000 settlement did not fully compensate Ms. Sunwabeh’s estate or his mother for their damages, Petitioner argues that a lesser portion of the settlement should be allocated to reimburse Medicaid instead of the full amount of the lien. Petitioner proposes that a ratio should be applied based on the “true” value of Petitioner’s damage claim ($2,585,279) compared to the amount that was actually recovered ($275,000). Using these numbers, the settlement represents a 10.63 percent recovery of the total value of Petitioner’s damages. In like manner, the amount of the Medicaid lien should also be reduced to 10.63 percent or approximately $9,065.23. Therefore, Petitioner asserts that $9,065.23 is the portion of the third-party settlement that represents the fair and reasonable reimbursement of the amount Medicaid paid for Mr. Sunwabeh’s medical care. The Agency was not a party to the wrongful death lawsuit or Petitioner’s settlement. Petitioner was aware of the Medicaid lien and past medical expense damages at the time she settled the lawsuit. No portion of the $275,000 settlement represents reimbursement for future medical expenses. The undersigned finds that Petitioner did not meet her burden of proving that the “true” value of Petitioner’s damages from this accident equaled $2,585,279.65. Further, based on the evidence in the record, Petitioner failed to prove, by a preponderance of the evidence, that a lesser portion of Petitioner’s total recovery should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Accordingly, the Agency is entitled to recover $85,279.65 from Petitioner’s recovery of $275,000 from a third party to satisfy its Medicaid lien.
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/
The Issue The issue to be determined is the amount to be reimbursed to Respondent, Agency for Health Care Administration (Respondent or AHCA), from settlement proceeds received from third parties by Petitioners, Ray A. Siewert and Rose E. Siewert, for medical expenses paid on behalf of Petitioner, Mr. Siewert.
Findings Of Fact Stipulated Findings of Fact On October 15, 2017, the Siewerts were involved in a motorcycle versus automobile crash, which required extensive hospital, skilled nursing, therapy, and other medical treatment including, but not limited to, a four- level spinal fusion procedure and rehabilitative care and services for Mr. Siewert and multiple leg surgeries for Mrs. Siewert, that ultimately led to an above-the-knee amputation (hereinafter referred to as the “auto claims”). On January 3, 2018, Mr. Siewert was discharged from a rehabilitation facility to his home, where he began receiving home health nursing, physician, and therapy services. On January 22, 2018, Mr. Siewert was diagnosed with an abscess near his surgical site, which was allegedly not properly addressed in the days that followed. On January 31, 2018, Mr. Siewert was hospitalized due to worsening neurological deficits, namely in his lower body, and he was transferred to the hospital that had performed his prior spinal surgery. On February 1, 2018, Mr. Siewert had another spinal surgery to address an abscess compressing on his spinal cord, leading to the decreased neurological function. The damage done to his spinal cord preoperatively was significant enough that he has been unable to walk since January 31, 2018, and remains bedbound to present. Mr. Siewert has a neurogenic bladder/bowel, wears diapers, has to be catheterized multiple times per day,1 and is unable to ambulate. To date, he is living with his wife in a single room residence at a skilled nursing facility in the Orlando area, where he is expected to remain.2 The Siewerts brought the following claims: negligence claims relating to the auto claims; nursing home neglect claims under chapter 400, Florida Statutes; and medical malpractice claims under chapter 766, Florida Statutes, each of which were pursued against several companies/entities, individuals, and healthcare providers, seeking, in part, compensable damages to the Siewerts for past bills and future economic needs as well as noneconomic mental pain and suffering and consortium claims for their injuries and losses. In April 2021, the Siewerts settled one of the medical malpractice claims for a limited confidential amount. The Siewerts have had a health plan with Aetna Better Health of Florida, which is a Medicaid plan through AHCA, that has retained the services of Equain relating to the settlement of part of the Siewerts’ medical malpractice claims (referred to below as “Aetna”). Aetna was properly notified of the Siewert’s medical malpractice claims against those defendants and indicated it had paid benefits related to the injuries from the incident in the amount of $75,923.82, as it relates to the settlement at issue. Through their counsel, the Siewerts have asked Aetna to accept a reduced lien amount given the other claims still pending and large 1 The evidence adduced at hearing indicates that Mr. Siewert has now been fitted with a permanent abdominal suprapubic catheter. 2 Though Mrs. Siewert could manage in an assisted living facility, Mr. Siewert could not. Thus, Mrs. Siewert has chosen to stay in the skilled nursing facility to be with her husband. total case value. Nonetheless, Aetna has continued to assert a lien, for the amount of $75,923.82, against the Siewerts’ settlement proceeds relating to the single settlement. Aetna has maintained that it is entitled to application of section 409.910’s formula to determine the lien amount. Applying the statutory reduction formula to this particular settlement would result in no reduction of this lien given the amount of the settlement. The Siewerts also have been covered by AHCA’s fee-for-service Medicaid program. AHCA has contracted with Health Management Systems and Conduent to run its recovery program. AHCA was properly notified of the Siewerts’ medical malpractice claims against those defendants. AHCA provided medical assistance benefits related to the injuries from the incident in the amount of $33,836.09. Through their counsel, the Siewerts have asked AHCA to accept a reduced lien amount. AHCA has continued to assert a lien for the amount of $33,836.09, against the Siewerts’ settlement proceeds relating to the single settlement. AHCA has maintained that it is entitled to application of section 409.910’s formula to determine the lien amount. Applying the statutory reduction formula to this particular settlement would result in no reduction of this lien given the amount of the settlement. AHCA’s $33,836.09 payment and Aetna’s $75,923.82 payment total $109,759.91, and this amount constitutes Mr. Siewert’s claim for past medical expense damages. There remain claims against numerous other defendants which also relate to the AHCA and Aetna liens at issue, including all remaining defendants in the auto and medical malpractice claims. Repayment to AHCA’s Medicaid program is prioritized by law and contract over Medicaid-managed care plans Facts Adduced at Hearing During the pendency of the medical malpractice action, AHCA was notified of the action. AHCA did not commence a civil action to enforce its rights under section 409.910, nor did it intervene or join in the medical malpractice action against the Defendants. AHCA has not filed a motion to set aside, void, or otherwise dispute the settlement. The Medicaid program, through AHCA, spent $33,836.09 on behalf of Mr. Siewert, all of which represents expenditures paid for past medical expenses. No portion of the $33,836.09 paid by AHCA through the Medicaid program on behalf of Mr. Siewert represented expenditures for future medical expenses. The $33,836.09 in Medicaid funds paid by AHCA is the maximum amount that may be recovered by AHCA. There was no evidence of the taxable costs incurred in securing the settlement. Application of the formula at section 409.910(11)(f) to the settlement requires payment to AHCA of the full $33,836.09 Medicaid lien asserted by AHCA, and the full $75,923.82 Medicaid lien asserted by Aetna. Petitioners have deposited the full Medicaid lien amount in an interest-bearing account for the benefit of AHCA pending an administrative determination of AHCA’s rights, and this constitutes “final agency action” for purposes of chapter 120, Florida Statutes, pursuant to section 409.910(17). There was no suggestion that the monetary figure agreed upon by the parties represented anything other than a reasonable settlement. The evidence firmly established that Mr. Siewert incurred economic damages, consisting of lost future earnings, past medical expenses, and future medical expenses. Mr. Gilbert and Mr. Marx testified that those economic damages totaled roughly $2,000,000. However, the economic loss analysis upon which their testimony was based showed a total of $1,770,775 in future life care needs for Mr. Siewert, reduced to present value.3 The only direct evidence of past medical expenses was the $109,759.91 in Medicaid expenditures. There was no evidence of other economic damages. Thus, the evidence established that economic damages total $1,880,534.90. The total amount of damages for Mr. Siewert was calculated to be $10,000,000, which was described as a conservative figure based on the knowledge and experience of Mr. Gilbert and Mr. Marx, and based on an analysis of representative jury verdicts involving comparable facts and damages. However, Mr. Gilbert engaged in a more detailed analysis of Mr. Siewert’s non-economic damages, which requires review. Although comparable jury verdicts suggest that it could be considerably more, Mr. Gilbert testified that his calculation, though subjective, would include $3,000,000 in non-economic damages in the past three years, and an additional $4,000,000 in non-economic damages into the future based upon a projected 12-year life expectancy, for a total amount of non-economic damages of $7,000,000. That figure was accepted by both of the testifying experts. As part of Petitioners’ calculation of the total value of the claim was $1,000,000 in loss-of-consortium damages incurred by Mrs. Siewert. Although the loss of consortium technically applies to the loss of the full marital relationship previously enjoyed by Mrs. Siewert, who is not the Medicaid recipient, that value was included as an element of the claim and settlement. Based on the forgoing, the evidence supports, and it is found that $9,880,534.90, as a full measure of Petitioners’ combined damages, is a conservative and appropriate figure against which to calculate any lesser 3 Respondent objected to the life care plan on the basis of hearsay. However, the plan was not being offered for the truth of the matter asserted, i.e., that Mr. Siewert would be expected to incur $1,770,775 for future care, but was offered as evidence of the more general value of a claim in litigation. Furthermore, the life care plan, even if inadmissible, could be used as support of an expert opinion as to claim valuation “when those underlying facts are of a type relied upon by experts in the subject to support the opinions expressed.” Charles W. Ehrhardt, Florida Evidence, § 704.1 (2020 Edition). A life care plan is evidence that, for that purpose, would “be sufficiently trustworthy to make the reliance reasonable.” Id. portion of the total recovery that should be allocated as reimbursement for the Medicaid lien for past medical expenses. The full value of the settlement is 5.06 percent of the $9,880,534.90 value of the claim.
The Issue The issue is the amount of Petitioner’s personal injury settlement proceeds that should be paid to Respondent, Agency for Health Care Administration (AHCA), to satisfy its Medicaid lien under section 409.910, Florida Statutes (2016).1/
Findings Of Fact AHCA is the state agency authorized to administer Florida’s Medicaid program. See § 409.902, Fla Stat. On July 6, 2011, Petitioner suffered a catastrophic injury to his spinal cord as a passenger in a car involved in a single-car accident. Petitioner was permanently rendered an incomplete quadriplegic unable to walk (for more than 10 to 15 steps), stand, ambulate, eat or toilet without assistance. Prior to the accident, Petitioner was a senior at the University of South Florida, who intended to become a physical therapist. Additionally, he was heavily involved in mixed martial arts and won amateur of the year in 2010. Petitioner’s medical care related to the car accident was paid by Medicaid. Medicaid provided $177,747.91 in benefits associated with Petitioner’s car accident. This amount, $177,747.91, represents the past medical expenses paid on behalf of Petitioner, and for which AHCA seeks reimbursement. There is no dispute that Medicaid paid $177,747.91 for Petitioner’s past medical expenses. Petitioner brought a PI action against the driver of the car, the owner of the car and the insurance carrier providing uninsured/underinsured motorist insurance covering the accident. This PI action sought to recover all of Petitioner’s damages associated with his injuries. During the pendency of Petitioner’s PI action, AHCA was notified of the action. On April 25, 2014, AHCA notified Petitioner’s then counsel (Gene Odom, Esquire) that a preliminary lien of $177,747.91 was in place, and that an itemized accounting would be provided. It was unknown if the defendants, in the PI case, knew of the Medicaid lien during the negotiations. There was no evidence presented that AHCA participated in the PI action, any settlement negotiations, agreed to any settlement(s), or executed the actual settlements. The PI lawsuit was settled in 2017 through a series of confidential settlement(s) totaling $1,000,000.3/ The total settlement was comprised of $100,000 in uninsured/underinsured motorist coverage, $100,000 in bodily injury coverage, $500,000 in coverage from the leased vehicle, and $300,000 in settlement of a bad faith claim. Petitioner’s condition and his need for continuing care are not in dispute. A life-care plan (Petitioner’s Exhibit 2) identifying the “medical basis for life-care planning” for Petitioner was prepared by John L. Merritt, M.D. Dr. Merritt did not testify at hearing. Application of the formula in section 409.910(11)(f) to Petitioner’s settlement requires payment to AHCA of the full $177,747.91 Medicaid lien. Petitioner deposited the full Medicaid lien amount in an interest bearing account for the benefit of AHCA pending an administrative determination of AHCA’s rights, and this constituted “final agency action” for purposes of chapter 120, Florida Statutes, pursuant to section 409.910(17). The Medicaid program spent $177,747.91 towards Petitioner’s past medical expenses. There was no testimony that any portion of this amount was paid for Mr. Eady’s future medical expenses. No testimony was received as to any taxable costs associated with the action at law. The parties did not stipulate to the amount of any attorneys’ fees related to the settlement(s). The parties did not divulge an amount (if any) designated in the settlement(s) to pay for Petitioner’s past medical expenses. Mr. Guito is a PI attorney and Petitioner’s step- father. Mr. Guito is employed by McIntyre, Thanasides, Bringgold, Elliott, Grimaldi and Guito. He has practiced law for 29 years and, in addition to the PI work, handles cases involving civil litigation, medical malpractice, and catastrophic injury. Mr. Guito has tried numerous jury trials and represented individuals who have suffered spinal cord injuries. Mr. Guito stays abreast of jury verdicts as it is important to understand what types of damages juries are awarding, whether they are more conservative or liberal in damages, and how the juries view evidence. As a routine part of his practice, Mr. Guito evaluates the damages suffered by injured people. He has experience in dealing with life-care planners, vocational rehabilitative experts, economists, and other lawyers involved with claims for significant injuries and damages. Mr. Guito assisted attorneys in prosecuting Mr. Eady’s case in order to maximize his recovery.4/ Mr. Guito reviewed the accident report, various engineering expert reports, Mr. Eady’s medical records and his life-care plan. Mr. Guito opined that Mr. Eady’s damages are in excess of $15,000,000. Mr. Barrett is a PI attorney with experience in medical malpractice, medical products and pharmaceutical products liability, and catastrophic injury cases. Mr. Barrett is a seasoned trial attorney. However, “as of a couple of months ago,” he is “in-between law firms” deciding whether to form a new firm or “quit it [the practice of law] all together.” In response to a question about reviewing medical records and life-care plans, Mr. Barrett testified that because these types of cases are handled on a contingency fee basis, he has to evaluate each case to determine whether the contingent fee is enough to “pay a staff of -- in my case, 20 or so employees. Pay a lease, pay for a building, pay for all the things, all the overhead, [and] pay a salary.” Mr. Barrett did not “honestly . . . remember how the tender was stated” when asked if he was tendered specifically as an expert in the allocation of settlements in a Division hearing. When asked if it mattered how damages are allocated in a settlement, Mr. Barrett provided there might be tax consequences because in punitive damages “you don’t get the same percentages,” which “could have an affect [sic] on lien recoveries.” He further qualified his answer by stating “you’ve already . . . won the case because you’ve got an allocation in the jury verdict.” This case is based on confidential settlements, not a jury verdict. Mr. Barrett explained Mr. Eady’s damages: [Mr. Eady] was a passenger in a Jaguar, which, I took from the complaint, was a new car or a car that belonged to an agency. And it was driven by an employee, or Bailee, or something of that agency. Who took too tight a turn and rolled the car. And, apparently, there was some intrusion from the top of the car, from the ceiling of the car. And from the nature of the damage, it’s almost certain that he hit his head on the top of the car and broke, or dislocated several vertebrae in his neck. Such that his fourth cervical vertebrae was – well, I would call it a crush or a burst fracture, down to where it intruded on the fifth cervical vertebrae. And there was extreme, not total, damage to his spinal cord, in the area of the fourth and fifth cervical vertebrae, such that he became what’s called a partial quadriplegic. By “partial,” we can firmly define and say that he had, initially, no feeling or use at all in his lower extremities, with a lot of pain and some partial movement of his upper extremities. *** [H]e was very motivated to recover. . . . [H]e was still striving to get better. And he had made some progress, he was able to -- some use of his arms. Mr. Barrett “paid most attention to . . . [Mr. Eady’s] life care plan,” which Mr. Barrett thought was a “preliminary” plan. Mr. Barrett acknowledged the $1,000,000 settlement, but opined that the settlement did “not in any way” fully compensate Mr. Eady for the full amount of his damages. Mr. Barrett suggested that Petitioner’s damages were in the range of $25,000,000 to $35,000,000. There was no suggestion that the settlement was forced upon Petitioner. Mr. Guito and Mr. Barrett spoke in generalities, speculations, and reasonableness as to the settlement in relation to the Medicaid lien. Each suggested what they thought a jury would do, if presented with the facts in this case. Their testimony suggested that a lesser amount of the total recovery should be allocated for Mr. Eady’s past medical expenses in this instance. Mr. Barrett accepted Mr. Guito’s suggestion that $15,000,000 was a conservative damage estimate. They postulated that because Petitioner only received $1,000,000 in settlement of what should have been at least a $15,000,000 award (or 6.66 percent of the $1,000,000 settlement), then Medicaid should only recover 6.66 percent from the settlement. The witnesses asserted that AHCA’s reimbursement for Petitioner’s past medical expenses should only be $11,838.01, or 6.66 percent of the $1,000,000 settlement amount. This is often referred to as the “proportionality test” or “pro-rata test.” For the reasons set forth below, the undersigned does not agree with Petitioner’s position. Application of the formula contained in section 409.910(11)(f) to Petitioner’s $1,000,000 settlements would require payment to ACHA in the amount of $177,747.91, the actual amount of the funds expended by Medicaid.
The Issue The issue for the undersigned to determine is the amount payable to Respondent, Agency for Health Care Administration (AHCA or Respondent), as reimbursement for medical expenses paid on behalf of Petitioner pursuant to section 409.910, Florida Statutes (2020),1 from settlement proceeds he received from third parties.
Findings Of Fact AHCA is the state agency charged with administering the Florida Medicaid program, pursuant to chapter 409. On September 6, 2019, Mr. St. Surin was severely injured when his motorcycle struck a car. In this accident, Mr. St. Surin suffered severe and permanent injury to his back, neck, scapula, ribs, and knee. 1 All references to Florida Statutes are to the 2020 codification, unless otherwise indicated. Mr. St. Surin’s medical care related to the injury was paid by Medicaid. Medicaid, through AHCA, provided $28,482.15 in benefits. In addition, Medicaid, through a Medicaid managed care organization known as WellCare of Florida, paid $7,278.25 in benefits. The combined total amount of these benefits, $35,760.40, constitutes Mr. St. Surin’s entire claim for past medical expenses. Mr. St. Surin pursued a personal injury claim against the owner and driver of the car who caused the accident (collectively the “Tortfeasors”) to recover all of his damages. The Tortfeasors’ insurance policy limits were $100,000, and the Tortfeasors had no other collectable assets. Mr. St. Surin’s personal injury claim was settled for the insurance policy limits of $100,000. During the pendency of Mr. St. Surin’s personal injury claim, AHCA was notified of the claim and AHCA asserted a Medicaid lien in the amount of $28,482.15 against Mr. St. Surin’s cause of action and the settlement proceeds. AHCA did not commence a civil action to enforce its rights under section 409.910, or intervene or join in Mr. St. Surin’s action against the Tortfeasors. AHCA was notified of Mr. St. Surin’s settlement by letter. AHCA has not filed a motion to set aside, void, or otherwise dispute Mr. St. Surin’s settlement. Application of the formula found in section 409.910(11)(f) would require payment to AHCA of the full $28,482.15 Medicaid lien given the $100,000 settlement. Petitioner has deposited the Medicaid lien amount in an interest- bearing account for the benefit of AHCA pending a final administrative determination of AHCA’s rights. Petitioner presented testimony from Scott Kimmel, Esquire. Mr. Kimmel represented Mr. St. Surin in his personal injury claim against the Tortfeasors. Mr. Kimmel is a personal injury attorney and has practiced law for 30 years. Mr. Kimmel testified that he placed a conservative value of $1 million on Mr. St. Surin’s personal injury claim, but that the personal injury claim was settled for policy limits of $100,000 because the Tortfeasors had no other collectable assets. Using the pro rata allocation methodology, Mr. Kimmel testified that $3,576 of the $100,000 settlement proceeds should be allocated to past medical expenses because the personal injury claim was settled for ten percent of its conservative value. Mr. Kimmel’s testimony was credible, persuasive, and uncontradicted. AHCA did not challenge Mr. Kimmel’s valuation of the personal injury claim, or his use of the pro rata allocation methodology to determine the amount of settlement proceeds that should be allocated to past medical expenses, nor did AHCA offer any evidence from which the undersigned could arrive at a different valuation or allocation. There is no reasonable basis to reject Mr. Kimmel’s testimony, and it is accepted here in its entirety. The undersigned finds that the value of Mr. St. Surin’s personal injury claim is $1 million, and that $3,576.04 of the $100,000 settlement proceeds should be allocated to past medical expenses.
The Issue The issue in this proceeding is the amount payable to Respondent in satisfaction of Respondent's Medicaid lien from a settlement received by Petitioner from a third party, pursuant to section 409.910(17), Florida Statutes.
Findings Of Fact Petitioner is a 35-year-old female who currently resides in Homestead, Florida. Respondent is the state agency authorized to administer Florida's Medicaid program. § 409.902, Fla. Stat. On or about February 15, 2012, Petitioner was struck by a motor vehicle and severely injured while attempting to rescue her young son, who had run into a busy street in front of her home in Hollywood, Florida. Petitioner suffered a fractured skull and broken leg. She was hospitalized and received medical care for her injuries. Subsequently, she was treated by an orthopedic physician and a neurologist. She estimated that she last received care or treatment from these physicians in August 2013. The Florida Medicaid program paid $35,952.47 in medical assistance benefits on behalf of Petitioner. Petitioner filed a lawsuit against the owners of the vehicle that struck her. On January 11, 2013, Petitioner and the owners of the vehicle that struck Petitioner ("Releasees") entered into a "Release and Hold Harmless Agreement" ("Settlement") under which the Releasees agreed to pay Petitioner $150,000 to settle any and all claims Petitioner had against them. Attached to the Settlement was a document titled "Addendum to Release Signed 1/11/13" ("Addendum"), which allocated liability between Petitioner and the Releasees and provided a commensurate allocation of the Settlement proceeds for past and future medical expense claims. The Addendum stated in pertinent part: The parties agree that a fair assessment of liability is 90% on the Releasor, Mirta B. Agras, and 10% on the Releasees. Furthermore, the parties agree that based upon these injuries, and the serious nature of the injuries suffered by the Releasor, Mirta B. Agras, that $15,000.00 represents a fair allocation of the settlement proceeds for her claim for past and future medical expenses. Petitioner testified that she primarily was at fault in the accident. She acknowledged that the statement in the Addendum that she was 90% at fault for the accident and the Releasees were 10% at fault was an estimate that she formulated entirely on her own, without obtaining any legal or other informed opinion regarding the apportionment of respective fault. Petitioner is not a physician, registered nurse, or licensed practical nurse. There was no evidence presented establishing that she has any medical training or expertise. Thus, there is no professional basis for Petitioner's position that 10% of the Settlement proceeds represents a fair, accurate, or reasonable allocation for her medical expenses. Rather, her position appears to be based on the intent to maximize the Settlement proceeds that are allocated to non-medical expenses, so that she is able to retain a larger portion of the Settlement proceeds. Respondent did not participate in discussions regarding the Settlement or Addendum and was not a party to the Settlement. Petitioner acknowledged that she still receives medical bills related to the injuries she suffered as a result of the accident, and that she still owes money for ambulance transportation and physician treatment. She was unable to recall or estimate the amount she owes. No evidence was presented regarding the actual amount of Petitioner's medical expenses incurred due to her injury. Petitioner has not paid any of her own money for medical treatment, and no entities other than Medicaid have paid for her medical treatment. Since being injured, Petitioner continues to experience medical problems, including pain, dizziness, memory loss, difficulty in walking or standing for extended periods, inability to ride in vehicles for extended periods, balance problems, and difficulty watching television or staring at a computer screen for extended periods. Petitioner claims that, nonetheless, she has not been told that she would need additional medical care or treatment. On or about January 31, 2013, Respondent, through ACS, asserted a Medicaid claim pursuant to section 409.910(17), seeking reimbursement of the $35,952.47 in medical assistance benefits it paid on behalf of Petitioner. Petitioner instead sought to reimburse Respondent $15,000, the amount that Petitioner and Releasees agreed in the Addendum represented a fair allocation of the Settlement proceeds for Petitioner's claim for past and future medical expenses. When Petitioner and Respondent were unable to agree on the amount Petitioner owed Respondent in satisfaction of its Medicaid lien, Petitioner paid ACS the $35,952.47 alleged to be owed Respondent and filed the Petition initiating this proceeding.
The Issue The issue to determine in this matter is the amount of the money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Petitioner, a Medicaid recipient, following Petitioner’s recovery from a third party.
Findings Of Fact This administrative matter centers on the amount the Agency is entitled to be paid to satisfy its Medicaid lien following Petitioner’s recovery of a $700,000 settlement from a third party. On November 7, 2010, Petitioner was involved in a devastating automobile accident. While stopped awaiting for oncoming traffic to pass, another vehicle, driven by Nahun Garcia, struck Petitioner from behind at a high rate of speed. Mr. Garcia was cited for careless driving. No evidence indicates that any negligence on the part of Petitioner caused or contributed to the accident or his injury. Petitioner suffered catastrophic injuries from the collision. Immediately following the accident, Petitioner was transported to St. Joseph’s Hospital in Tampa, Florida. There, Petitioner was diagnosed with fractures of his C4-C5 vertebra. Petitioner is now quadriplegic. Petitioner was 26 years old on the date of the incident. Because of the automobile accident, Petitioner is severely disabled and totally dependent on others for his care and well-being. Petitioner’s injuries are continuing and permanent. In addition, Petitioner is no longer able to care for his minor daughter. Petitioner’s medical expenses from the accident equal $264,541.69. Of this amount, the Agency, through the Medicaid program, paid a total of $249,197.80 for Petitioner’s past medical care. Petitioner pursued a personal injury claim against Mr. Garcia. Weldon (“Web”) E. Brennan, Esquire, represented Petitioner in the lawsuit. According to Mr. Brennan’s testimony at the final hearing, initially, Petitioner recovered $10,000 from Mr. Garcia’s automobile insurance company, Progressive Insurance, which was the limit of the property damage liability insurance policy. However, Mr. Brennan was not able to identify any other source of insurance to cover Petitioner’s injuries. Mr. Garcia had no collectible assets. Because the only available insurance was the property damage liability policy, Mr. Brennan evaluated the possibility of pursuing a bad faith claim against Progressive. Mr. Brennan concluded that, based on the circumstances of Petitioner’s initial coverage demand to Progressive, a bad faith claim was a viable option. Therefore, Mr. Brennan’s litigation strategy shifted. First, he would obtain a judgment against the tortfeasor (Mr. Garcia) in trial court. Then, he would seek to impose responsibility for the verdict on Progressive, including an assessment of punitive damages. In May 2017, following six years of litigation, Mr. Brennan was able to negotiate a $700,000 settlement with Progressive. Mr. Brennan represented that Progressive tendered the amount to avoid the risk of a successful bad faith claim.2/ Mr. Brennan explained that in finalizing the settlement with Progressive, he recognized that obtaining additional funds, by fully litigating the bad faith claim, would involve lengthy and intensive litigation. Consequently, Mr. Brennan believed that it was in his client’s best interests to timely settle his lawsuit. On May 9, 2017, Petitioner and Progressive executed a Release of All Claims (the “Release”) formalizing the settlement. In the course of the settlement negotiations, Petitioner and Progressive agreed that the true value for Petitioner’s injuries equaled at least $15 million. The Release specifically stated: The parties were both willing to agree to a consent judgment for $15,000,000 prior to settlement and so they therefore agree that [Petitioner’s] alleged damages have a value in excess of $15,000,000, of which $264,541.69 represents [Petitioner’s] claim for past medical expenses. Given the facts, circumstances, and nature of [Petitioner’s] alleged injuries and this settlement, the parties have agreed to allocate $12,354.10 of this settlement to [Petitioner’s] claim for past medical expenses and allocate the remainder of the settlement towards the satisfaction of claims other than past medical expenses. Under section 409.910, the Agency is to be repaid for its Medicaid expenditures from any recovery from liable third parties. Accordingly, when the Agency was notified of Petitioner’s personal injury settlement, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect the full amount of the medical costs it paid on Petitioner’s behalf ($249,197.80). The Agency maintains that it should receive the full amount of its lien regardless of the fact that Petitioner settled for less than what he represents is the full value of his damages. (As discussed below, the formula in section 409.910(11)(f) allows the Agency to collect the full Medicaid lien.) Petitioner asserts that pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of Petitioner’s settlement than the amount it calculated using the section 409.910(11)(f) formula. Petitioner specifically argues that the Agency’s Medicaid lien should be reduced proportionately, taking into account the full value of Petitioner’s likely recovery in the underlying negligence and bad faith lawsuits. Otherwise, the application of the default statutory formula would permit the Agency to collect more than that portion of the settlement that fairly represents compensation for past medical expenses. Petitioner maintains that such reimbursement violates the federal Medicaid law’s anti-lien provision (42 U.S.C. § 1396p(a)(1)) and Florida common law. Petitioner contends that the Agency’s allocation from Petitioner’s recovery should be reduced to the amount of $11,637.54. To establish the full value of Petitioner’s injuries, Petitioner presented the testimony of Mr. Brennan, as well as Vinson Barrett, Esquire. Mr. Brennan opined on what he considered to be the “true” value of Petitioner’s damages. Mr. Brennan heads a plaintiff’s injury firm and has represented plaintiffs in personal injury cases for over 28 years. Mr. Brennan has extensive experience handling cases involving automobile accidents, including catastrophic injury claims and spinal cord injuries. Mr. Brennan expressed that he routinely evaluates damages suffered by injured parties as part of his practice. He stays current on jury verdicts and settlements throughout Florida and the United States. Mr. Brennan was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Brennan valued Petitioner’s damages conservatively at $15 million, and possibly as high as $45 million. In deriving this figure, Mr. Brennan considered Petitioner’s medical expenses, his lost wage capacity, his past and future pain and suffering, and his life expectancy. Finally, Mr. Brennan testified that, in placing a dollar value on Petitioner’s injuries, he reviewed a number of jury verdicts involving catastrophic injuries similar to Petitioner’s. Mr. Brennan commented that Petitioner faces a meager future. Other than slight movement in his left arm, he is paralyzed from the neck down. Mr. Brennan relayed how the injuries have caused Petitioner to experience depression. He cannot eat independently, nor can he control his bodily functions. Neither is Petitioner able to care for or support his daughter. Mr. Brennan testified that the $700,000 settlement did not fully or fairly compensate Petitioner for his injuries. Therefore, he urged that a lesser portion of Petitioner’s settlement be allocated to reimburse Medicaid instead of the full amount of the lien ($249,197.80). Mr. Brennan proposed applying a ratio based on the true value of Petitioner’s injuries ($15 million) compared to the amount Petitioner actually recovered ($700,000). Using his estimate of $15 million, the settlement represents a 4.67 percent recovery of the total value of all Petitioner’s damages. In like manner, the amount of medical expenses should also be reduced to 4.67 percent or approximately $11,637.54. Therefore, in Mr. Brennan’s professional judgment, $11,637.54 is the portion of Petitioner’s settlement that represents his compensation for past medical expenses. Mr. Brennan expressed that allocating $11,637.54 for Petitioner’s past medical expenses is “logical,” “rational,” and “reasonable” under the circumstances. Mr. Barrett also testified on Petitioner’s behalf. Mr. Barrett is a trial attorney with over 40 years’ experience and works exclusively in the area of plaintiff’s personal injury, medical malpractice, and medical products liability cases. Mr. Barrett has handled a number of catastrophic injury matters involving traumatic spinal cord injuries. Mr. Barrett commented that, as a routine part of his practice, he makes assessments concerning the value of damages suffered by injured parties. Mr. Barrett was accepted as an expert in the valuation of damages suffered by injured persons. Prior to the final hearing, Mr. Barrett reviewed Petitioner’s exhibits, including Petitioner’s medical records, the accident report, and Petitioner’s Release of All Claims executed with Progressive. He also reviewed the sample jury verdicts Petitioner presented at the final hearing as Exhibit 13. Based on his valuation of Petitioner’s injuries and his professional training and experience, Mr. Barrett expressed that injuries similar to Petitioner’s would result in jury awards averaging between $15 and $30 million dollars. In light of Petitioner’s horrific injuries, Mr. Barrett conservatively valued Petitioner’s injuries at $15 million. Mr. Barrett opined that Mr. Brennan’s valuation of $15 million was appropriate, if not undervalued. Mr. Barrett supported Mr. Brennan’s pro rata methodology of calculating a reduced portion of Petitioner’s $700,000 settlement to equitably and fairly represent past medical expenses. With injuries valued at $15 million, the $700,000 settlement only compensated Petitioner for 4.67 percent of the total value of his damages. Therefore, because Petitioner only recovered 4.67 percent of his damages, the most “reasonable” and “rational” manner to apportion the $700,000 settlement is to apply that same percentage to determine Petitioner’s recovery for past 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 $700,000 settlement that represents compensation for past medical expenses, i.e., $11,637.54 ($249,197.80 times 4.67 percent). The Agency was not a party to Petitioner’s negligence lawsuit or Petitioner’s Release with Progressive. All of the expenditures Medicaid spent on Petitioner’s behalf is attributed to past medical expenses. No portion of the $249,197.80 Medicaid lien represents future medical expenses. The undersigned finds that the competent substantial evidence establishes the value of Petitioner’s injuries from his auto accident at $15 million. However, based on the evidence in the record, Petitioner failed to prove, by a preponderance of the evidence, that a lesser portion of Petitioner’s total recovery should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Accordingly, the Agency is entitled to recover $249,197.80 from Petitioner’s recovery of $700,000 from a third party to satisfy its Medicaid lien.
The Issue The issue is to determine the amount payable by Petitioner, Devin F. Price (“Petitioner”), to Respondent, Agency for Health Care Administration (“AHCA”), out of the $3,025,000 gross personal injury settlement proceeds, as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes.
Findings Of Fact On August 20, 2019, Petitioner was catastrophically injured when the motorcycle he was operating collided with an automobile. In this accident, Petitioner suffered a traumatic brain injury, multiple fractures to his upper and lower extremities, a degloving injury to his right arm, and injury to his lower left arm. Petitioner had multiple surgeries as a result of the accident. He is now unable to use his right arm and has only limited use of his left hand. Petitioner’s medical care related to the injury was paid by Medicaid. Medicaid, through AHCA, provided $215,250.64 in benefits, and Medicaid, through a Medicaid Managed Care Organization known as WellCare of Florida, provided $11,625.08 in benefits. The sum of these benefits, $226,875.72, constituted Petitioner’s entire claim for past medical expenses. Petitioner pursued a personal injury action against the parties allegedly liable for his injuries (“Defendants”) to recover all his damages. Because of issues pertaining to liability and limited insurance coverage that was available, Petitioner’s personal injury action was settled through a series of confidential settlements in a lump-sum unallocated amount of $3,025,000. During the pendency of Petitioner’s personal injury action, AHCA was notified of the personal injury action and AHCA asserted a $215,250.64 Medicaid lien against Petitioner’s cause of action and settlement of that action. AHCA did not commence a civil action to enforce its rights under section 409.910 or intervene or join in Petitioner’s action against Defendants. By letter, AHCA was notified of Petitioner’s settlement. AHCA has not filed a motion to set-aside, void, or otherwise dispute Petitioner’s settlement. The Medicaid program, through AHCA, spent $215,250.64 on behalf of Petitioner, all of which represents expenditures paid for Petitioner’s past medical expenses. Petitioner’s taxable costs incurred in securing the settlement totaled $65,366.96. Application of the formula in section 409.910(11)(f) to Petitioner’s $3,025,000 settlement requires payment to AHCA of the full $215,250.64 Medicaid lien. Petitioner has deposited the (11)(f) formula amount in an interest- bearing account for the benefit of AHCA pending an administrative determination of AHCA’s rights, and pursuant to section 409.910(17), this constitutes “final agency action” for purposes of chapter 120, Florida Statutes. At the hearing, Petitioner presented the expert testimony of attorney Jeanmarie Whalen, who represented Petitioner throughout the underlying action against the Defendants. Ms. Whalen has been an attorney for 30 years and devotes a substantial portion of her practice to plaintiff’s personal injury and bad faith cases. She is a partner with the law firm of Domnick Cunningham and Whalen, P.A., in Palm Beach Gardens, Florida. Ms. Whalen is a member of numerous trial attorney associations, including the Florida Justice Association, Palm Beach County Justice Association, and the American Association for Justice. Ms. Whalen serves as a member of the Board of Governors with both the Florida Justice Association and the American Association for Justice, and routinely lectures throughout Florida and the nation regarding civil litigation matters. Ms. Whalen has successfully handled jury trials, and stays abreast of jury verdicts on other personal injury cases in her area. Ms. Whalen frequently represents plaintiffs who have been catastrophically injured in motorcycle accidents. As a routine part of her practice, Ms. Whalen makes assessments concerning the value of damages suffered by her clients. She is very familiar with, and routinely participates in, allocation of settlements in the context of health insurance liens, workers’ compensation liens, Medicare set-asides, and the reduction of jury verdicts by trial judges post-verdict. As lead attorney on Petitioner’s case, Ms. Whalen was familiar with the circumstances surrounding Petitioner’s injury, claims, and current condition, and gave a detailed explanation of them. Ms. Whalen met with Petitioner on many occasions; reviewed Petitioner’s medical records; a life care plan, which details Petitioner’s future medical needs; and an economist's report, which calculated the present value of Petitioner’s future medical care and present value of Petitioner’s lost future earnings. Based upon Petitioner’s life care plan summary and the economist report, Ms. Whalen testified that the probable present value of Petitioner’s past lost wages and future earnings is $1,660,380, and that the present value of future medical expenses is $2,686,295. According to Ms. Whalen, the past medical expenses of $226,875.72 would also be added to arrive at the full value of Petitioner’s economic damages. Ms. Whalen testified that in addition to economic damages, a jury would also be asked to assign a value to past and future noneconomic damages (i.e., pain and suffering and loss of enjoyment of life). Ms. Whalen testified that Petitioner’s claim for noneconomic damages would be significant and “dwarf” the total value of all economic damages because Petitioner would make a very good witness and had a strong story. Ms. Whalen persuasively and credibly testified that the total value of all of Petitioner’s damages would be in excess of $10,000,000, and that valuing Petitioner’s damages at $10,000,000 is a very conservative and low valuation of his damages. Using the pro rata allocation methodology, Ms. Whalen persuasively and credibly testified that the $3,025,000 settlement did not fully compensate Petitioner for the full value of his damages, and that based on a conservative value of all of Petitioner’s damages of $10,000,000, the $3,025,000 settlement represents a recovery of 30.25 percent of the value of his damages. Ms. Whalen persuasively and credibly testified that because Petitioner only recovered in the settlement 30.25 percent of the full value of his damages, he only recovered 30.25 percent of his $226,875.72 claim for past medical expenses, or $68,629.90, and that it would be reasonable to allocate $68,629.90 of the settlement to past medical expenses. Petitioner also presented the expert testimony of R. Vinson Barrett. Mr. Barrett has been a trial attorney for over 43 years and is a partner with the law firm of Barrett Nonni Homola & Ferraro, P.A., in Tallahassee, Florida. His practice is devoted to plaintiff’s personal injury and wrongful death cases. He has handled cases involving catastrophic injury and routinely handles jury trials. He is a member of the Florida Justice Association and the Capital City Justice Association. Mr. Barrett is familiar with reviewing medical records, life care plans, economist reports, and preparing and evaluating plaintiff’s personal injury cases for trial. Mr. Barrett testified that as a routine part of his practice, he makes assessments concerning the value of damages suffered by injured parties and he explained his process for making these assessments. Mr. Barrett testified that it has been part of his law practice to, and he is familiar with, settlement allocation in the context of health insurance liens, Medicare set-asides, and workers’ compensation liens. He further testified that he is familiar with the process of allocating settlements in the context of Medicaid liens and he described that process. Mr. Barrett has been accepted as an expert in the valuation of damages and has testified regarding the pro rata methodology in numerous Medicaid Third-Party Reimbursement (“MTR”) administrative hearings at DOAH. In addition, Mr. Barrett’s expert testimony at DOAH was quoted with approval in Eady v. Agency for Health Care Administration, 279 So. 3d 1249 (Fla. 1st DCA 2019). Prior to testifying, Mr. Barrett familiarized himself with the facts and circumstances of Petitioner’s injuries. He reviewed Petitioner’s medical records, exhibits, the economist's report, and testified regarding the nature and extent of Petitioner’s injuries. Mr. Barrett testified that the full value of Petitioner’s economic damages for loss of earning capacity and future medical expenses is in the range of $5,963,801 to $7,435,147, and that Petitioner’s claim of noneconomic damages would have a significantly high value. Mr. Barrett persuasively and credibly testified that the full value of Petitioner’s damages exceeded $10,000,000, and that valuing Petitioner’s damages at $10,000,000 is conservative and a low valuation of his damages. Using the pro rata allocation methodology, Mr. Barrett persuasively and credibly testified that the $3,025,000 settlement did not fully compensate Petitioner for the full value of his damages, and that based on a conservative value of all of Petitioner’s damages of $10,000,000, the $3,025,000 settlement represents a recovery of 30.25 percent of the value of his damages. Mr. Barrett persuasively and credibly testified that because Petitioner only recovered in the settlement 30.25 percent of the full value of his damages, he only recovered 30.25 percent of his $226,875.72 claim for past medical expenses, or $68,629.90, and that it would be reasonable to allocate $68,629.90 of the settlement to past medical expenses. AHCA did not call any witnesses, present any evidence as to the value of damages, propose a different valuation of the damages, or present evidence contesting the methodology used by the Petitioner’s experts to calculate the $68,629.90 allocation to past medical expenses. The testimony of Petitioner’s expert witnesses regarding the value of the case and the use of the pro rata methodology was not persuasively rebutted or contradicted by AHCA’s counsel on cross-examination, or by any other evidence. In sum, Petitioner proved by clear and convincing evidence that 30.25 percent is the appropriate pro rata share of Petitioner’s past medical expenses to be applied to determine the amount recoverable by AHCA in satisfaction of its Medicaid lien. Following Ms. Whalen’s and Mr. Barrett’s methodology and applying the $10,000,000 valuation to the total past medical expenses of $226,875.72, the settlement portion properly allocable to Petitioner’s past medical expenses to satisfy AHCA’s lien is $68,629.90 ($226,875.72 x 30.25 percent = $68,629.90).
The Issue The issue to be determined in this matter is the amount of money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Petitioner, John Gray, a Medicaid recipient, following Petitioner’s recovery from a third-party.
Findings Of Fact On January 18, 2007, Petitioner was involved in a devastating automobile accident. Another vehicle, driven by Damil Belizaire, crossed a median and collided head-on into the car Petitioner was driving. No evidence indicates that any negligence on the part of Petitioner caused or contributed to the accident or his injury. Petitioner suffered catastrophic injuries from the collision, including a spinal cord injury resulting in paraplegia. Following the accident, Petitioner was transported to UF Health Shands Hospital (“Shands”) in Jacksonville, Florida. Petitioner remained in Shands receiving medical treatment for 77 days. Once Petitioner became medically stable, he was transferred to the Brooks Rehabilitation Center (“Brooks”) in Jacksonville, Florida. There, Petitioner received intensive physical and occupational therapy care. Petitioner remained at Brooks until June 1, 2007, when he was discharged. Petitioner is permanently paraplegic. On April 7, 2008, Petitioner sued Mr. Belizaire seeking to recover his damages from the automobile accident. Petitioner’s lawsuit was filed in the Circuit Court of the Fourth Judicial Circuit, in Duval County, Case No. 16-2008-CA-004366. On April 1, 2013, Petitioner received a jury verdict in his favor and was awarded a Final Judgment against Mr. Belizaire in the amount of $2,859,120.56, including statutory interest. The damages award was allocated as follows: $128,760.56 for past medical expenses; $1,301,268.00 for future medical expenses; $202,670.00 for the loss of earnings in the past; $916,422.00 for loss of earning capacity in the future; $50,000.00 for pain and suffering, disability, physical impairment, disfigurement, mental anguish, inconvenience, and loss of capacity for the enjoyment of life in the past; and $260,000.00 for pain and suffering, disability, physical impairment, disfigurement, mental anguish, inconvenience, and loss of capacity for the enjoyment of life in the future. Despite his verdict awarding damages, Petitioner has only been able to recover $10,000.00 from Mr. Belizaire. Mr. Belizaire’s automobile liability insurance company paid Petitioner $10,000, which was the limit of his bodily injury liability insurance policy. The Agency, through its Medicaid program, paid a total of $65,615.05 for Petitioner’s medical care resulting from the 2007 automobile accident.2/ This administrative matter centers on the amount the Agency is entitled to be paid to satisfy its Medicaid lien following Petitioner’s recovery of $10,000 from a third-party. Under section 409.910, the Agency may be repaid for its Medicaid expenditures from any recovery from liable third-parties. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect $3,750 regardless of the full value of Petitioner’s damages. (The Agency subtracted a statutorily recognized attorney fee of $2,500 from $10,000 leaving $7,500. One-half of $7,500 is $3,750.) Petitioner asserts that pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of Petitioner’s recovery than the amount it calculated using the section 409.910(11)(f) formula. Petitioner specifically argues that the Agency’s Medicaid lien must be reduced pro rata, taking into account the full value of Petitioner’s personal injury claim as determined by the Final Judgment entered in the underlying negligence lawsuit. Otherwise, application of the default statutory formula under section 409.910(11)(f) would permit the Agency to collect more than that portion of the settlement representing compensation for medical expenses. Petitioner maintains that such reimbursement violates the federal Medicaid law’s anti-lien provision, 42 U.S.C. § 1396p(a)(1), and Florida common law. Petitioner contends that the Agency’s allocation from Petitioner’s recovery should be reduced to the amount of $230.00. Based on the evidence in the record, Petitioner failed to prove, by clear and convincing evidence, that a lesser portion of Petitioner’s total recovery should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Accordingly, the Agency is entitled to recover $3,750.00 from Petitioner’s recovery of $10,000 from a third- party to satisfy its Medicaid lien.
