The Issue The matter concerns the amount of the money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Mark Crain, 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 $100,000 settlement from a third party. The Agency asserts that it is entitled to recover $35,700, which is the amount it calculated using the formula set forth in section 409.410(11)(f). The facts that gave rise to this matter are found pursuant to a stipulation of the parties.3/ On June 23, 2016, Petitioner was working for a tree pruning company. Petitioner’s employer assigned him to remove several branches from a tree. As directed, Petitioner climbed to the top of the tree and secured himself with one rope lanyard. Unfortunately, after he began pruning, Petitioner cut through the rope lanyard, lost his balance, and plummeted 30 feet to the ground. As a result of the fall, Petitioner suffered significant physical and neurological injuries. Petitioner underwent multiple surgeries. His medical procedures included an open reduction with internal fixation on his right wrist, lumbar fusion surgery, and a lumbar laminectomy. At the final hearing, Petitioner’s counsel represented that Petitioner’s medical prognosis is not fully known at this time. However, what is known is that Petitioner will continue to experience serious neurologic deficits. Petitioner’s injuries have left him with overall mobility issues and have affected his ability to walk normally. He suffers from a right foot drop and has limited feeling below his waist. The parties also stipulated that Petitioner has completed all medical treatment and therapy related to his accident. However, Petitioner is uncertain whether or not he will be able to return to normal activities in the future. Petitioner incurred sizable medical expenses due to his injuries. The charges for Petitioner’s medical procedures totaled approximately $375,000. However, only $62,067.28 has actually been paid for his medical care. Of this amount, the Florida Medicaid program paid $41,992.33. (In addition to the $41,992.22 paid by Medicaid, other health insurance covered $20,075.06.) Petitioner did not present evidence of monetary damages other than his past medical expenses. Petitioner subsequently initiated a civil cause of action for negligence against his (former) employer. Petitioner alleged that he was not properly trained how to safely secure himself to the tree. According to Petitioner’s counsel, Petitioner’s employer should have instructed him to use two lanyards instead of one. After two years of litigation, Petitioner settled his negligence action for $100,000. The settlement did not allocate Petitioner’s award between past medical expenses and other damage categories. The Agency, through the Florida Medicaid program, paid a total of $41,992.33 for Petitioner’s medical treatment resulting from the accident.4/ All of the expenditures that Florida Medicaid spent on Petitioner’s behalf are attributed to past medical expenses. Under section 409.910, the Agency is to be repaid for its Medicaid expenditures out of any recovery from liable third parties. Accordingly, when the Agency was notified of the settlement of Petitioner’s lawsuit, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect $37,500 to satisfy the medical costs it paid on Petitioner’s behalf. (As discussed in endnote 7, the “default” formula in section 409.910(11)(f) allows the Agency to collect $37,500 to satisfy its Medicaid lien.) The Agency maintains that it should receive the full amount of its lien regardless of whether Petitioner settled for less than what Petitioner believes is the full value of his damages. Petitioner, on the other hand, asserts that the Agency should be reimbursed a lesser portion of the settlement than the amount calculated using the section 409.910(11)(f) formula. Exercising its right to challenge the Medicaid lien pursuant to section 409.910(17)(b), Petitioner specifically argues that, taking into account the full value of Petitioner’s damages, the Agency’s Medicaid lien should be reduced proportionately. 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 past medical expenses. Petitioner requests the Agency’s allocation from Petitioner’s third-party recovery be reduced to $4,199.23. To establish the value of his damages, Petitioner submitted the medical bills from his accident, as well as relied upon the stipulated facts. Petitioner’s medical bills show that he sustained the injuries identified above, as well as underwent surgery on his spine and wrist. To place a monetary value on Petitioner’s injuries, Petitioner’s counsel represented that his law firm appraised Petitioner’s injuries at no less than $1 to 2 million. However, Petitioner did not introduce any evidence or testimony corroborating this injury valuation or substantiating an amount Petitioner might have recovered at trial in his personal injury cause of action.5/ Neither did Petitioner offer evidence of additional damages Petitioner might be facing from his accident, such as future medical expenses, loss of quality of life, loss of employment or wages, or pain and suffering. Based on his estimate, Petitioner’s counsel asserted that the $100,000 settlement is far less than the actual value of Petitioner’s injuries and does not adequately compensate Petitioner for his damages. Therefore, 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 full value of Petitioner’s damages (conservatively estimated at $1,000,000) compared to the amount that Petitioner actually recovered ($100,000). Using these numbers, Petitioner’s settlement represents a 10 percent recovery of Petitioner’s damages. In like manner, the Medicaid lien should be reduced to 10 percent or $4,199.23 ($41,992.33 times .10). Therefore, Petitioner asserts that $4,199.23 is the portion of his third- party settlement that represents the equitable and fair amount the Florida Medicaid program should recoup for its payments for Petitioner’s medical care. The Agency was not a party to Petitioner’s negligence action or Petitioner’s $100,000 settlement. No portion of the $100,000 settlement represents reimbursement for future medical expenses. The undersigned finds that, based on the evidence in the record, Petitioner failed to prove, by a preponderance of the evidence, that a lesser portion of Petitioner’s settlement should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Accordingly, the Agency is entitled to recover $37,500 from Petitioner’s recovery of $100,000 from a third party to satisfy its Medicaid lien.
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 Amora Gonzalez, a Medicaid recipient, following Petitioner’s recovery from a third party.
Findings Of Fact On August 14, 2015, Amora, who was then five years old, was the backseat passenger in a car driven by her mother, Nicalea R. Gonzalez. Amora was secured in a child seat. While Ms. Gonzalez was stopped at a traffic light, a commercial cargo van collided directly into the rear end of her car at a speed of approximately 50 to 60 miles per hour. The impact crumpled the back of Ms. Gonzalez’s vehicle. The collision also severed the seat belt securing Amora’s child seat. Amora was thrown violently forward. Following the accident, Amora was found lying on the back floor of the vehicle, wedged between the front seats. When emergency services personnel arrived, Amora was found lying on the ground exhibiting signs of a severe brain injury. Subsequent CT scans and an MRI revealed that Amora had suffered diffuse axonal injury to her corpus callosum region of the brain, a temporal lobe hematoma, and a subdural hematoma in her right tentorial region. Due to elevated cranial pressure, Amora underwent neurosurgery for placement of an external ventricular drain, and she was placed in a medically induced coma. Amora also underwent a decompressive craniotomy due to continued intracranial pressure. Amora was diagnosed with a neuro cognitive disorder due to traumatic brain injury with a behavioral disorder. As a result of her brain injury, Amora suffers from serious cognitive impairment, executive functioning level disabilities, and behavioral disturbances. Amora’s past medical expenses related to the 2015 automobile accident total $108,725.29. Of that amount, the Agency, through the Medicaid program, paid $108,656.31 for Petitioner’s medical care and services. Petitioner did not make any payments on Amora’s behalf for past medical care or in advance for Amora’s future medical care. Ms. Gonzalez pursued a personal injury claim as Natural Guardian and Legal Guardian of the Property of Amora to recover all of Amora’s damages against the driver/owner of the vehicle that caused the car accident (the “Tortfeasor”). The Tortfeasor maintained an insurance policy with limits of $1,000,000 and had no other collectable assets. Prior to filing the lawsuit, the Tortfeasor tendered the $1,000,000 insurance policy limit in compromise and settlement of Amora’s claim for damages. No evidence or testimony was presented at the final hearing indicating that a specific portion of the $1,000,000 settlement was designated to cover past medical expenses. Neither was there any evidence or testimony offered segregating the $1,000,000 settlement between medical and non-medical expenses. The Agency was not a party to the settlement or settlement agreement. When notified of Ms. Gonzalez’s recovery on behalf of Amora, the Agency asserted a Medicaid lien for $108,656.31, the full amount of its medical expenses paid for Amora’s medical costs and services. This administrative proceeding centers on the amount the Agency should be reimbursed to satisfy its Medicaid lien following Petitioner’s recovery of $1,000,000 from a settlement with 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 the full amount of its Medicaid lien ($108,656.31) regardless of the actual value of Petitioner’s damages. Using the section 409.910(11)(f) formula, the Agency subtracted a statutorily recognized attorney fee of $250,000 from $1,000,000 leaving $750,000. One-half of $750,000 is $375,000. Because the $375,000 formula amount exceeds the Medicaid lien, the Agency seeks the full $108,656.31. 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 under section 409.910(11)(f). Petitioner specifically argues that the Medicaid lien must be reduced pro rata, taking into account the full value of Amora’s injuries which Petitioner calculates as $8,000,000. 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). Petitioner contends that the Agency’s allocation from Petitioner’s recovery should be reduced to the amount of $13,590.66. To establish the full value of Amora’s injuries, Petitioner presented the testimony of attorneys Paul Catania and Vince Barrett. Mr. Catania represented Petitioner in the underlying personal injury claim and obtained the $1,000,000 settlement for Amora. Mr. Catania explained that prior to finalizing the settlement, he explored the possibility of collecting a verdict in excess of the policy limits. Mr. Catania concluded that not only were the defendants uncollectable, but multiple claimants were going after the same insurance proceeds. Consequently, Mr. Catania believed that it was in his clients’ best interest to settle expeditiously for the tendered insurance policy limits. Mr. Catania also opined on what he considered to be the actual value of Amora’s damages. Mr. Catania heads a plaintiff’s injury firm and has represented plaintiffs in personal injury cases for over 28 years. Mr. Catania has extensive experience handling cases involving automobile accidents, including catastrophic injury claims and traumatic brain injuries to children. Mr. Catania expressed that he routinely evaluates damages suffered by injured parties as part of his practice. He stays current on jury verdicts throughout Florida and the United States. Mr. Catania was accepted as an expert in the valuation of damages suffered by injured parties. Mr. Catania valued Amora’s damages as conservatively between $8,000,000 and $10,000,000. In deriving this figure, Mr. Catania reviewed the neuro psychological report in Amora’s discharge summary, as well as the subsequent neuro psychological updates that were performed on Amora approximately one year later. Mr. Catania noted Amora’s memory problems, inattention, hyperactivity, and behavioral issues. Mr. Catania relayed how these deficits will affect Amora’s ability to learn and be gainfully employed over her lifetime. Amora will need ongoing speech and occupational therapy. Mr. Catania also considered Amora’s past medical expenses, her wage loss or lost wage capacity, and her past and future pain and suffering. Finally, Mr. Catania testified that, in placing a dollar value on Amora’s injuries, he reviewed nine jury verdicts involving catastrophic injuries similar to Amora’s. Based on these sample results, Mr. Catania was comfortable valuing Amora’s damages conservatively in the $8 million to $10 million range given her injuries and her life expectancy. Mr. Catania testified that the $1,000,000 settlement did not fully or fairly compensate Amora for her injuries. Therefore, Mr. Catania urged that a lesser portion of Petitioner’s settlement be allocated to reimburse the Agency instead of the section 409.910(11)(f) formula amount of $108,656.31. Mr. Catania proposed applying a ratio based on the true value of Amora’s injuries ($8,000,000) compared to the amount Petitioner actual recovered ($1,000,000). Using his estimate of $8 million, the settlement represents a 12.5 percent recovery of the total value of all Amora’s damages. In like manner, the amount of medical expenses should also be reduced to 12.5 percent or $13,590.66. Therefore, in Mr. Catania’s professional judgment, $13,590.66 is the portion of Amora’s settlement that represents her compensation for past medical expenses. Mr. Catania testified that no portion of the settlement represents future medical expenses.2/ Mr. Catania expressed that allocating $13,590.66 for Amora’s past medical expenses is “reasonable” and “rational” under the circumstances. Mr. Barrett also testified on behalf of Petitioner. Mr. Barrett is a trial attorney with almost 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 many catastrophic injury matters involving catastrophic injuries and traumatic brain injury to children. Mr. Barrett was accepted as an expert in valuation of damages in personal injury cases. Prior to the final hearing, Mr. Barrett had reviewed Amora’s medical records, as well as Petitioner’s exhibits. He also reviewed the sample jury verdicts Petitioner presented at the final hearing as Exhibit 14. Based on his valuation of Amora’s injuries and his professional training and experience, Mr. Barrett expressed that injuries similar to Amora’s would result in jury awards averaging between $8 and $20 million dollars. In light of Amora’s “catastrophic” injuries, Mr. Barrett valued Amora’s injuries as at least $8 million. Mr. Barrett opined that Mr. Catania’s valuation of $8 million to $10 million was appropriate, if conservative. Mr. Barrett supported Mr. Catania’s proposed method of calculating a reduced portion of Petitioner’s $1,000,000 to represent past medical expenses. With injuries valued at $8 million, the $1,000,000 settlement only compensated Amora for 12.5 percent of the total value of her damages. Therefore, because Amora only recovered 12.5 percent of her damages, the most “reasonable and rational” manner to apportion the $1,000,000 settlement is to apply that same percentage to determine Amora’s recovery for past medical expenses. Petitioner asserts that applying the same ratio to the total amount of medical costs produces a definitive value of that portion of Petitioner’s $1,000,000 settlement that represents compensation for past medical expenses, i.e., $13,590.66 ($108,725.29 times 12.5 percent). The undersigned finds that the competent substantial evidence in the record establishes, clearly and convincingly, that the full value of Amora’s injuries is $8 million. However, the evidence in the record is not sufficient to prove that a lesser portion of Petitioner’s $1,000,000 settlement 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 $108,656.31 from Petitioner’s recovery from a third party to satisfy its Medicaid lien.
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 to be decided is the amount to be paid by Petitioner to Respondent, Agency for Health Care Administration (Agency), out of her settlement proceeds as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes (2018).
Findings Of Fact On April 21, 2011, Ms. Puzanskas gave birth to her son. After birth, Ms. Puzanskas began experiencing symptoms of nervousness, panic attacks, and being overwhelmed. On June 21, 2011, she called her doctor's office and described her symptoms to her midwife. Her midwife concluded that Ms. Puzanskas was depressed or experiencing "baby blues." Based on this telephonic diagnosis, the midwife arranged for a prescription of the anti-depressant psychotropic drug, Zoloft, to be called into Ms. Puzanskas' pharmacy. The next day after taking the Zoloft, Ms. Puzanskas again called her doctor's office with complaints that the Zoloft was causing her to feel strange and jittery. Ms. Puzanskas was instructed to continue taking the medication. On June 24, 2011, Ms. Puzanskas began suffering from severe depression and hallucinations. That same day, she went into her back yard and doused herself with gasoline and set herself on fire. She suffered third-degree full thickness burns over 30 percent of her body requiring multiple skin grafts, with scarring over 60 percent of her body from all burns and grafts. Ms. Puzanskas' medical care for the injuries was paid by Medicaid, which provided $54,171.70 in benefits associated with her injuries. This amount constituted her entire claim for past medical expenses. As a condition of her eligibility for Medicaid, Ms. Puzanskas assigned to the Agency her right to recover from liable third-party medical expenses paid by Medicaid. Ms. Puzanskas brought a medical malpractice action against the medical staff responsible for her care to recover all of her damages associated with her injuries. During the pendency of the lawsuit, the Agency was notified of the action. Although it did not dispute the ultimate settlement received by Petitioner or otherwise participate in any aspect of the litigation, the Agency asserted a $54,171.70 Medicaid lien against Ms. Puzanskas' cause of action and settlement of the action. In preparation for the trial, Petitioner's counsel used mock jury panels to evaluate their trial strategies, value of damages, and the likelihood of a defense verdict. Mock jurors split. Some would have returned a verdict for the defense, finding no liability, while others would have returned a verdict for Ms. Puzanskas and given her some limited damages. Still others would have given her a very high amount of damages. See Pet'r Ex. 9. Eleven mock jurors provided verdicts from approximately $16,554,000 down to approximately $554,000. The remaining six jurors would have returned zero-dollar verdicts. The average award in the 17 verdicts was $3,741,000. Nine of the 11 jurors who produced a verdict for Petitioner included approximately $54,000 in their verdict, and then added amounts ranging from $500,000 to $16,500,000. The $54,000 is representative of Petitioner's rounded hospital bills. The insurance policy covering the incident had limits of $250,000 and the medical providers had no collectable assets. After the first day of trial, the medical providers offered $500,000 to settle the case, and this was accepted. However, this amount did not fully compensate Petitioner for her injuries. Mr. Moore, an experienced trial attorney who represented Petitioner, testified that based on his training and experience, Petitioner's damages had a value in excess of $3,700,000. However, using a conservative number for purposes of this case, he valued her damages at $3,000,000. Thus, the $500,000 settlement represented a recovery of 16.6 percent of the value of her damages, and a similar percentage for past medical expenses. Therefore, he testified that an allocation of $8,992.50, or 16.6 percent of $54,171.70, would be a reasonable and conservative portion of the settlement for past medical expenses. Based on his training and experience and review of the medical records and file, Mr. Barrett, a trial attorney, valued Petitioner's damages between three and five million dollars. He also opined that $3,000,000 would be a very conservative figure. Using the same allocation method advocated by trial counsel, Mr. Barrett applied a 16.6 percent ratio to the Medicaid expenses, and concluded that an allocation of $8,992.50 of the settlement to past medical expenses is reasonable, rational, and appropriate. This testimony was not rebutted by the Agency, and the Agency did not present any evidence proposing a differing valuation of damages or contest the methodology used to calculate the $8,992.50 allocation to past medical expenses. The testimony from Mr. Moore and Mr. Barrett is compelling and persuasive. Accordingly, the undersigned finds that Petitioner has proven by a preponderance of the evidence that $8,992.50 of the settlement represents reimbursement for past medical expenses.
The Issue The issue to be decided is the amount to be paid by Petitioner to Respondent, Agency for Health Care Administration (Agency), out of her settlement proceeds, as reimbursement for past Medicaid expenditures pursuant to section 409.910, Florida Statutes.
Findings Of Fact On August 11, 2014, Amanda Baker, then 15 years old, was transferred from a medical center to a specialty pediatric hospital where she presented with complaints and symptoms of back pain, weakness, and paresthesia in her lower extremities. Over the next few days, she underwent examinations and assessments, but no steps were taken to prevent her development of blood clots/embolisms due to her immobility nor were signs and symptoms of her development of blood clots/embolisms recognized. On August 13, 2014, Amanda suffered two cardiac arrests due to blood clots/embolisms traveling to her heart and lungs. She was resuscitated, but due to a lack of oxygen to her brain, Amanda suffered a catastrophic hypoxic brain injury. She is now in a persistent vegetative state. The Agency provided $162,146.65 in Medicaid benefits associated with Amanda's injuries, all of which represent expenditures paid for her past medical expenses. Amanda's parents brought a medical malpractice action against the medical providers responsible for her care to recover all of the damages associated with her injuries, as well as their individual damages associated with their daughter's injuries. Seven defendants maintained insurance policies with a policy limit of $250,000. The medical malpractice action was settled for each of the insurance policy limits, resulting in a lump sum unallocated settlement of $1,750,000. This settlement was approved by the court. During the pendency of the malpractice action, the Agency was notified of the action. It asserted a $162,146.65 Medicaid lien against the Bakers' cause of action and settlement of that action. However, it did not institute, intervene in, or join in the action to enforce its rights, as provided in section 409.910(11), or participate in any aspect of the litigation. Application of the formula in section 409.910(11)(f) to Amanda's $1,750,000 settlement requires full payment of the Medicaid lien. Petitioner presented the testimony of Daniel Moody, Esquire, a Lakeland attorney with 30 years' experience in personal injury law, including medical malpractice. He represented Amanda and her family in the medical malpractice action. As a routine part of his practice, he makes assessments concerning the value of damages suffered by injured clients. He also stays abreast of jury verdicts in his area by reviewing jury verdict reporters and discussing cases with other trial attorneys. He has been accepted as an expert in valuation of damages. Based on his training and experience, Mr. Moody opined that the damages recoverable in Amanda's case had a conservative value of $30 million. Petitioner also presented the testimony of R. Vinson Barrett, Esquire, a Tallahassee trial attorney with more than 40 years' experience. His practice is dedicated to plaintiff's personal injury, as well as medical malpractice, medical products liability, and pharmaceutical products liability. He routinely makes assessments concerning the value of damages suffered by injured parties. He was accepted as an expert in the valuation of damages. Based on his training and experience, Mr. Barrett opined that Amanda's damages are "worth at a bare minimum – and we're talking very conservatively here -- $30,000,000." Both experts testified that using $30,000,000 as the value of all damages, Amanda only recovered 5.83 percent of the value of her damages. Accordingly, they opined that it would be reasonable, rational, and conservative to allocate 5.83 percent of the settlement, or $9,453.15, to past medical expenses paid by the Agency through the Medicaid program. The Agency did not call any witnesses, present any evidence as to the value of damages, propose a different valuation of the damages, or contest the methodology used to calculate the allocation to past medical expenses. In short, Petitioner's evidence was unrebutted. The testimony from Mr. Moody and Mr. Barrett is compelling and persuasive. Accordingly, the undersigned finds that Petitioner has proven by a preponderance of the evidence that $9,453.15 of the settlement represents reimbursement for past medical expenses.
The Issue This matter concerns the amount of money to be reimbursed to the Agency for Health Care Administration for medical expenses paid on behalf of Scott R. Brown, a Medicaid recipient, following a settlement recovered from a third party.
Findings Of Fact This proceeding determines the amount the Agency should be paid to satisfy a Medicaid lien following Petitioner’s recovery of a $300,000.00 settlement from a third party. The Agency asserts that it is entitled to recover the full amount of its $112,500.00 lien. The incident that gave rise to this matter occurred on December 22, 2010. On that day, Petitioner, a Florida resident, was visiting relatives in Talladega County, Alabama. Petitioner was shot while sitting in the backseat of a car. The bullet struck Petitioner in his abdomen. Immediately following the incident, Petitioner was taken to UAB Hospital in Birmingham, Alabama. Petitioner received medical care and treatment from December 22, 2010, through January 27, 2011, which included surgical repair of his abdominal injuries. Following his release from UAB Hospital, Petitioner was admitted to Spain Rehabilitation on January 28, 2011. There, Petitioner was diagnosed with a T-10 ASIA-A spinal cord injury, which caused paralysis from the waist down, as well as: a T-12 vertebral fracture; L1 - 2 vertebral fracture; small bowel injury; pancreatic head laceration; and duodenal laceration. Petitioner was also noted to be incontinent and required assistance for all transfers and bed mobility. In short, the gunshot rendered Petitioner a paraplegic. He will continue to require medical treatment for the rest of his life. In June 2011, Petitioner brought a negligence lawsuit in Alabama against the two gunmen. Petitioner was represented by Michael J. Crow, Esquire. Mr. Crow litigated Petitioner’s case over the course of two years. In 2013, Mr. Crow was able to resolve the lawsuit for $300,000, which was the full amount of the gunmen’s homeowner’s insurance. At the final hearing, Mr. Crow testified that the homeowner’s insurance policy was the only available coverage or recoverable asset he identified that could be used to compensate Petitioner for his injuries. Consequently, Mr. Crow believed that it was in Petitioner’s best interests to settle the lawsuit for the policy limits. A portion of Petitioner’s medical care was paid for by the Medicaid programs in Alabama and Florida in the total amount of $262,536.95.2/ Following Petitioner’s settlement, the Alabama Medicaid Agency asserted a lien of $139,169.94 against Petitioner’s recovery. On November 21, 2013, Mr. Crow was able to settle the Alabama Medicaid lien for $6,000.00. This amount represents approximately 4.31 percent of the total Alabama Medicaid lien. Mr. Crow testified that he thought the settlement payment should have been lower based on the full value he placed on Petitioner’s damages (discussed below) versus the actual amount Petitioner recovered. However, he believed that it was in Petitioner’s best interests to settle the Alabama Medicaid lien to avert protracted litigation. The Agency, through the Florida Medicaid program, paid a total of $123,366.95 for Petitioner’s medical treatment from the gunshot injury. All of the expenditures that Florida Medicaid spent on Petitioner’s behalf are attributed to past medical expenses. No portion of the Agency’s Medicaid lien represents future medical expenses. Under section 409.910, the Agency is to be repaid for its Medicaid expenditures out of any recovery from liable third parties. Accordingly, when the Agency was notified of the settlement of Petitioner’s lawsuit, it asserted a Medicaid lien against the amount Petitioner recovered. The Agency claims that, pursuant to the formula set forth in section 409.910(11)(f), it should collect $112,500.00 to satisfy the medical costs it paid on Petitioner’s behalf. (As discussed below, the formula in section 409.910(11)(f) allows the Agency to collect $112,500.00 to satisfy its Medicaid lien.) The Agency maintains that it should receive the full amount of its lien regardless of the fact that Petitioner settled for less than what Petitioner believes is the full value of his damages. Petitioner, on the other hand, asserts that, pursuant to section 409.910(17)(b), the Agency should be reimbursed a lesser portion of the settlement than the amount it calculated using the section 409.910(11)(f) formula.3/ Petitioner specifically argues that the Agency’s Medicaid lien should be reduced proportionately, taking into account the full value of Petitioner’s damages. Otherwise, the application of the default statutory formula would permit the Agency to collect more than that portion of the settlement that fairly represents Petitioner’s compensation for past medical expenses. Petitioner insists that reimbursement of the full lien amount violates the federal Medicaid law’s anti-lien provision (42 U.S.C. § 1396p(a)(1)) and Florida common law. Petitioner requests that the Agency’s allocation from Petitioner’s recovery be reduced to $1,389.00. To establish the value of his damages, Petitioner testified regarding the extent of, and the impact on his life from, the injuries he suffered from the gunshot wound. Petitioner relayed that he has received 18 surgeries on his stomach and intestines. Petitioner further described his future medical expenditures. Petitioner anticipates receiving a hernia operation. Petitioner also requires medication and medical supplies to address his pain and infections. In addition, Petitioner desires a handicap-equipped van that he can use for transportation to his medical visits. Petitioner would also like to install “trapeze” bars in his home to help him exercise. Mr. Crow also testified regarding the full value of Petitioner’s injuries. Mr. Crow has practiced law for 32 years and is a partner with the law firm of Beasley Allen in Montgomery, Alabama. In his practice, Mr. Crow handles serious personal injury and death cases involving car and truck litigation, premise liability cases, and brain injury cases. Mr. Crow has been involved in 15 to 25 lawsuits involving paralyzed clients. As part of his personal injury practice, Mr. Crow regularly evaluates damages similar to those Petitioner suffered. Mr. Crow asserted that the $300,000 settlement was far less than the true value of the injuries Petitioner suffered from this incident. Mr. Crow opined that the full value of Petitioner’s damages equals $26,639,170.00. Mr. Crow explained that this figure consists of $6.5 million present value for Petitioner’s future medical expenses, $5 million for pain and suffering, $10 million for mental anguish and loss of quality of life, $139,170 for the Alabama Medicaid lien, and $5 million in punitive damages. In deriving the value of Petitioner’s injuries, Mr. Crow considered that Petitioner is a younger individual suffering from paraplegia. Mr. Crow explained that Petitioner can live in his community with appropriate nursing support. However, he will require pain management on a monthly basis. His current medications include Baclofen, Colace, Cymbalta, Lopressor, Neurontin, Oxycodone, Senokot, and Glycerine suppositories. Petitioner will also need attendant care to help administer his medications, as well as with bathing, cooking, cleaning, dressing, grooming, and personal hygiene. In addition, Petitioner will require follow-up treatment involving physiatry, physical therapy, urology, and a wheelchair clinic. Furthermore, although Petitioner does not have sensory awareness from his waist down, he continues to experience severe pain in his back and legs. Mr. Crow represented that Petitioner is able to propel himself in a wheelchair, but he can only travel short distances due to fatigue and pain. Petitioner does not have access to a power wheelchair. Regarding transportation, Petitioner will need assistance to drive a van with a wheelchair lift. Finally, Petitioner offered the testimony of David A. Paul, Esquire. Mr. Paul has practiced law in Florida for 22 years as a plaintiff personal injury lawyer and is board- certified in Civil Trial Law by the Florida Bar. Mr. Paul handles catastrophic and serious personal injury cases involving birth injuries, medical malpractice, trucking accidents, and wrongful death. As part of his practice, Mr. Paul regularly evaluates catastrophic injuries. Mr. Paul testified that he has handled many cases with similar injuries to Petitioner. Mr. Paul was accepted as an expert regarding the value of personal injury damages and resolving liens in personal injury cases. At the final hearing, Mr. Paul supported Mr. Crow’s valuation of Petitioner’s injuries. Mr. Paul opined that a “fair full value” of Petitioner’s damages equals in excess of $26 million. In formulating his injury valuation, Mr. Paul considered Petitioner’s past medical expenses, anticipated future medical expenses, the cost of attendant care with daily living activities, past and future lost wages, pain and suffering, as well as mental anguish and loss of quality of life. Regarding the Medicaid liens, Mr. Paul relayed that the norm when resolving liens in Florida is to compare the total value of the injured party’s injuries to the amount of the actual recovery. The lien is then reduced proportionally by this ratio. Mr. Paul commented that he typically resolves Medicaid liens in workers compensation cases using this “equitable formula.” Based on the testimony from Mr. Crow and Mr. Paul that the $300,000 settlement did not fully compensate Petitioner for his damages, Petitioner argues that a lesser portion of the settlement should be allocated to reimburse Florida Medicaid, instead of the full amount of the lien. Petitioner proposes that a ratio should be applied based on the ultimate value of Petitioner’s damages ($26,639,170.00) compared to the amount that Petitioner actually recovered ($300,000). Using these numbers, Petitioner’s settlement represents approximately a 1.126 percent recovery of the full value of Petitioner’s damages. In like manner, the Florida Medicaid lien should be reduced to 1.126 percent or approximately $1,389.00 ($123,366.95 times .01126). Therefore, Petitioner asserts that $1,389.00 is the portion of his third-party settlement that represents the equitable, fair, and reasonable amount the Florida Medicaid program should recoup for its payments for Petitioner’s medical care. The Agency was not a party to the Alabama wrongful injury lawsuit or Petitioner’s settlement. Petitioner was aware of both the Alabama and Florida Medicaid liens and past medical expense damages at the time he settled the lawsuit. No portion of the $300,000 settlement represents reimbursement for future medical expenses. The undersigned finds that Petitioner met his burden of proving, by a preponderance of the evidence, that the full value of his damages from this incident equals $21,639,170.00.4/ Further, based on the evidence in the record, Petitioner proved that a lesser portion of Petitioner’s settlement should be allocated as reimbursement for medical expenses than the amount the Agency calculated pursuant to the formula set forth in section 409.910(11)(f). Finally, the undersigned finds that the evidence establishes that the Agency should be reimbursed in the amount of $5,317.95 from Petitioner’s recovery of $300,000 from a third party to satisfy the Florida Medicaid lien.
The Issue The issue in this proceeding is how much of Petitioner’s settlement proceeds should be reimbursed to Respondent, Agency for Health Care Administration (“AHCA”), to satisfy AHCA's Medicaid lien under section 409.910, Florida Statutes, from settlement proceeds he received from a third party.
Findings Of Fact The following findings are based on testimony, exhibits accepted into evidence, and admitted facts stated in the Joint Pre-Hearing Stipulation. Facts Concerning Underlying Personal Injury Matter and Giving Rise to Medicaid Lien On January 6, 2012, Arnie Solheim, a then 15-year-old boy, ran away from his group home and was struck by a vehicle while walking up an interstate ramp. Mr. Solheim had a history of running away from his group home residence. As a result of the incident, Mr. Solheim suffered permanent and severe injuries including brain damage, blindness in one eye, and paralysis. Due to his injuries, Mr. Solheim will require 24 hours-a-day supervision for the remainder of his life. Mr. Solheim’s medical care related to the injury was paid by Medicaid, and Medicaid through AHCA provided $187,302.46 in benefits. Accordingly, $187,302.46 constituted Mr. Solheim’s full claim for past medical expenses. Mr. Solheim’s mother, Rosepatrice Solheim, was appointed Mr. Solheim’s Plenary Guardian. Rosepatrice Solheim, as Mr. Solheim’s Guardian, filed a personal injury action against the parties allegedly liable for Mr. Solheim’s injuries (“Defendants”) to recover all of Mr. Solheim’s damages, as well as her and her husband’s individual damages associated with their son’s injuries. Mr. Solheim’s personal injury action was settled through a series of confidential settlements in a lump-sum unallocated amount. This settlement was approved by the circuit court. During the pendency of Mr. Solheim’s personal injury action, AHCA was notified of the action and AHCA asserted a Medicaid lien of $187,302.46 against Mr. Solheim’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 Mr. Solheim’s action against the Defendants. By letter dated October 9, 2019, AHCA was notified of Mr. Solheim’s settlement. To date, AHCA has not filed a motion to set-aside, void, or otherwise dispute Mr. Solheim’s settlement. The Medicaid program through AHCA spent $187,302.46 on behalf of Mr. Solheim, all of which represents expenditures paid for Mr. Solheim’s past medical expenses. Mr. Solheim’s taxable costs incurred in securing the settlement totaled $76,229.38. Application of the formula at section 409.910(11)(f) to Mr. Solheim’s settlement requires payment to AHCA of the full $187,302.46 Medicaid lien. Expert Testimony Petitioner called two experts to testify on his behalf pertaining to valuation of Petitioner’s damages, Richard Filson and Karen Gievers. Mr. Filson, an attorney practicing law at Filson and Fenge law firm in Sarasota, Florida, has been practicing law for 36 years. He represented Mr. Solheim in the underlying case. In addition to Petitioner’s case, he has represented clients in personal injury matters representing children and childrens’ rights cases, including cases involving brain injury and paralysis. Mr. Filson evaluated Petitioner’s case and opined that $10 million was a conservative valuation of the case. The valuation of the case encompasses past medical expenses, future medical expenses, economic damages, and pain and suffering. Mr. Filson pursued the action against three defendants. He testified that there would be no admission of liability. The group home was alleged to have failed to appropriately evaluate the risk and placement of Mr. Solheim, including placing Mr. Solheim in a locked unit to maintain his safety. However, there were issues with recovering from the facility. There was a dispute regarding the director’s degree of responsibility for Mr. Solheim’s elopement. As a result, Mr. Filson opined that Petitioner settled the case for a lower amount because of liability and collectability issues with the group home. Mr. Filson opined that Mr. Solheim’s $1,150,00.00 settlement represented 11.5 percent of the full $10 million value of his claim, including past medical expenses. He relied upon the comprehensive plan and the extent of Mr. Solheim’s catastrophic injuries to assess the value of the case. Mr. Filson opined that the allocation formula is 11.5 percent. The past medical expenses totaled $187,302.46. That figure multiplied by 11.5 percent would result in recovery of $21,539.78 of the settlement proceeds allocated to past medical expenses. Karen Gievers also testified as an expert regarding valuation of Mr. Solheim’s claim. Ms. Gievers, a licensed attorney for 42 years and a former circuit court judge, focuses her practice on civil litigation. In her practice as an attorney, she has handled personal injury cases involving catastrophic injuries similar to Mr. Solheim’s injuries. Like Mr. Filson, she has also represented children in her practice. Ms. Gievers opined that the value of Mr. Solheim’s case was conservatively estimated at $10 million. She opined that Mr. Solheim’s settlement amount of $1,150,000.00 resulted in a recovery of 11.5 percent of the full value of his claim. She opined that applying the 11.5 percent to each damage category is the appropriate way to allocate the amount of damages across all categories. Thus, applying the allocation formula of 11.5 percent to the $187,302.46 claim for past medical expenses would be $21,539.78. Ms. Gievers looked at Mr. Solheim’s economic and noneconomic damages in her valuation of the case. She reviewed the comprehensive care plan and noted that all costs were not included, which would add to the value of the case being greater than Mr. Solheim’s actual recovery. Petitioner asserted that the $1,150,000.00 settlement is far less than the actual value of Petitioner’s injuries and does not adequately compensate Mr. Solheim for his full value of damages. Therefore, a lesser portion of the settlement should be allocated to reimburse AHCA, instead of the full amount of the lien. Ultimate Findings of Fact Mr. Filson and Ms. Gievers credibly opined that a ratio should be applied based on the full value of Petitioner’s damages, $10,000,000.00, compared to the amount that Petitioner actually recovered, $1,150,000.00. Based on this formula, Petitioner’s settlement represents an 11.5 percent recovery of Petitioner’s full value of damages. Similarly, the AHCA lien should be reduced and the amount of reimbursement to AHCA should be 11.5 percent of the Medicaid lien. Therefore, $21,539.78 is the portion of the third- party settlement that represents the amount AHCA should recover for its payments for Mr. Solheim’s past medical care. The expert witnesses’ testimony was supported by their extensive experience in valuing damages and their knowledge of Mr. Solheim’s injuries. AHCA, on the other hand, did not offer any witnesses or documentary evidence to question the credentials or opinions of either Mr. Filson or Ms. Gievers. AHCA did not offer testimony or documentary evidence to rebut the testimony of Mr. Filson or Ms. Gievers as to valuation or the reduction ratio. AHCA did not offer alternative opinions on the damage valuation method suggested by either Mr. Filson or Ms. Gievers. Based on the record, the testimony of Petitioner's two experts regarding the total value of damages was credible, unimpeached, and unrebutted. Based on the evidence in the record, the undersigned finds that, Petitioner proved by a preponderance of the evidence that a lesser portion of Mr. Solheim’s settlement should be allocated as reimbursement for past medical expenses than the amount AHCA calculated. Accordingly, AHCA is entitled to recover $21,539.78 from Petitioner’s recovery of $1,150,000.00 to satisfy the Medicaid lien.
The Issue The issue to be decided in this proceeding is the amount to be paid to Respondent, the Agency for Health Care Administration (Agency or AHCA), from the proceeds of a personal injury settlement received by Sergio Museguez to reimburse Medicaid for expenditures made on his behalf.
Findings Of Fact Sergio Museguez was catastrophically injured as a result of being struck by lightning on June 15, 2012. Mr. Museguez has been diagnosed with a traumatic brain injury and suffers from cognitive dysfunction, including, but not limited to, significant problems with memory, orientation, initiating and executive functions. Mr. Museguez is also incontinent as to bowel and bladder. The above-described conditions are permanent and will never resolve. Mr. Museguez’s employer, MG3 Developer Group (MG3), failed to carry workers’ compensation insurance or any other effective insurance coverage that would cover the injuries he sustained on June 2012, or that would cover his wife Leidi Hernandez’s loss of consortium suffered as a result of the accident. An action was filed in Miami-Dade County Circuit Court, Case No. 14-025861 CA 06, against MG3 for damages related to Mr. Museguez’s injuries and for Ms. Hernandez’s loss of consortium. MG3’s insurance carrier denied coverage and refused to defend the company because its insurance policy excluded coverage for employees. The Museguezes and MG3 entered into a settlement agreement in which they agreed to a judgment against MG3 in the amount of $5,000,000, but which included a payment schedule through which $1,000,000 would actually be paid to Petitioner by MG3. Only that $1,000,000 of the judgment has been or will be recovered by Mr. Museguez against MG3, because of MG3’s lack of available insurance coverage, and the lack of anticipated avenues of recovery pursuant to the terms of the settlement, dated June 16, 2016. The settlement agreement provided that the parties “acknowledge and agree that the One Million ($1,000,000) Dollar payment set forth above only represents twenty percent of the total injury/damage value of Museguez’s claim, and this fails to fully compensate Museguez for the injuries sustained in the incident at issue. Therefore, Museguez is specifically recovering only twenty percent (20%) of their damages for past medical expenses.” Ms. Hernandez waived her right to an apportionment of the recovery for her consortium claim in light of her husband’s condition and his need for extensive medical care and treatment for the rest of his life. She opted for any amount that would have been apportioned to her claim instead be apportioned directly to her husband. Mr. Museguez’s condition and need for continuing care is not in dispute. A life care plan identifying the goods and services necessary for Mr. Museguez was prepared by Lawrence S. Forman, an expert in rehabilitation life care planning. Mr. Forman has concluded that Mr. Museguez will require 24-hour attendant medical care for the rest of his life, in addition to a significant amount of future costs associated with his medical condition as a result of his injury. Mr. Forman’s opinions are outlined in his report dated April 8, 2016. Frederick A. Raffa, an economist, reviewed the life care plan for Mr. Museguez and determined that the present value of the anticipated medical expenses for Mr. Museguez is $7,943,963. He testified, unrebutted, that Mr. Museguez’s total losses were $8,424,028. In short, Mr. Museguez’s needs far outweigh the recovery received in this case. According to the United States Life Tables, 2012, Mr. Museguez is expected to live another 24.8 years. Todd Michaels is an attorney who was appointed as guardian ad litem for Mr. Museguez in the personal injury case. Mr. Michaels testified that he was appointed for the purpose of determining whether the settlement of Mr. Museguez’s claim was fair to him. Mr. Michaels concluded that the settlement was the product of an arm’s-length transaction and was a fair settlement of the claim. Mr. Michaels also was asked to provide an opinion regarding the value of Mr. Museguez’s claim. Mr. Michaels has practiced personal injury law for 15 years, and is generally familiar with the awards related to claims involving catastrophic injuries and, specifically, traumatic brain injuries. With respect to Mr. Museguez’s claim, Mr. Michaels described it as conservative but necessary given the lack of insurance coverage and significant possibility of insolvency should the case go to verdict. He noted that “without a settlement there was almost zero likelihood of recovery in that the issues of both the fact and law were hotly contested.” He acknowledged that the settlement was less than Mr. Museguez’s future medical needs, and ignored any claim for pain and suffering, as well as the consortium claim. He stated, “I understand what the situation was and they could have pushed forward and gotten a verdict of 30 million dollars and it would have been worth the paper it was printed on because of the circumstances.” Without the very real limitations provided in this case, where there was no insurance coverage, Mr. Michaels believed that the fair settlement value would be about $13 to $15 million. However, his explanation as to how he reached that range was conclusory at best. Mr. Michaels testified that he did not “physically parse it out.” He started with the number $8,424,000 and went from there. He did not consult other attorneys, or do specific jury verdict research, but simply relied on his knowledge from practicing in this area and reviewing jury verdicts on a regular basis. It seems that the “fair value” of a claim must by necessity consider not only the level of a plaintiff’s damages, but the likelihood of success and any issues of liability, comparative fault, collectability, and the like. Here, while Petitioner’s damages are unfortunately much higher than the settlement amount, Petitioner’s witness testified that under the circumstances of this case, the settlement was fair. The undersigned finds that the fair settlement value of this case, given all of the circumstances, is the amount reflected in the settlement, i.e., $5,000,000. The undersigned also finds, consistent with the language in the settlement agreement, that Petitioner recovered only 20 percent of his past medical expenses. The taxable costs associated with the action at law were $27,812.46. While the parties in this proceeding stipulated to the amount of these costs, they did not stipulate to the amount of the attorney’s fees related to the claim, and it does not appear that any evidence to substantiate the amount of attorney’s fees actually paid was included in this record. Mr. Museguez received medical services from Medicaid. On December 1, 2016, the Agency notified counsel for Mr. Museguez that Medicaid’s lien for medical expenses paid on his behalf was $116,032.84. There was no evidence presented to indicate that the Agency was a party to the settlement negotiations between Petitioner and MG3, or whether the Agency was notified of the litigation prior to the execution of the settlement. Petitioner deposited the amount of the Medicaid lien into an interest-bearing account for the benefit of the Agency in accordance with the requirements of section 409.910, and in compliance with the requirements of bringing an action to contest the amount of the lien before the Division of Administrative Hearings. Petitioner’s actions constitute “final agency action” for purposes of chapter 120, Florida Statutes, pursuant to section 409.910(17)(b). Application of the formula contained in section 409.910(11)(f) to Petitioner’s $1,000,000 settlement would require payment to the Agency in the amount of $116,032.84, the actual amount of the funds expended by Medicaid.
The Issue The issue in this proceeding is how much of Petitioner’s settlement proceeds should be paid to Respondent, Agency for Health Care Administration (“AHCA”), to satisfy AHCA's Medicaid lien under section 409.910, Florida Statutes.1/
Findings Of Fact On July 31, 2012, Luca Weedo’s natural mother, who was 30 weeks pregnant with Luca, was walking on the sidewalk on the east shoulder of Airport Pulling Road in Naples, Florida. At the same time, a Jeep Wrangler was traveling on Airport Pulling Road. As the Jeep Wrangler approached Luca’s natural mother, the left front tire and wheel separated from the Jeep Wrangler. The separated wheel bounced along the roadway at a high rate of speed, crossing the median and northbound lane of Airport Pulling Road. The wheel approached Luca’s natural mother at such a high rate of speed that she was unable to avoid it. She was struck by the wheel and knocked to the ground, which caused her to lose consciousness and suffer a ruptured placenta. Luca’s natural mother was transported to Lee Memorial Hospital. Upon admission, she underwent emergency surgery due to abdominal trauma. Luca was delivered via emergency C-section. Luca was born with extreme fetal immaturity and catastrophic brain damage. Luca remained in the hospital for three months, undergoing numerous medical procedures associated with his serious medical needs and brain damage. Luca now suffers from catastrophic brain damage and a seizure disorder that causes him to have multiple seizures every day. He is unable to ambulate, speak, eat, toilet, or care for himself in any manner. Prior to Luca’s birth, his natural mother had decided to place Luca up for adoption. Accordingly, when Luca was discharged from the hospital, the Florida Department of Children and Families asked Debra and Kenneth Weedo to take Luca into their home as a foster child. Kenneth Weedo is a retired truck driver and his wife Debra is a foster parent for medically needy children. Debra and Kenneth Weedo took Luca into their home and adopted him on May 2, 2013. Luca’s past medical expenses related to his injuries were paid by Medicaid, which provided $319,188.20 in benefits. This $319,188.20 paid by Medicaid constituted Luca’s entire claim for past medical expenses. Luca, through his parents and guardians, Debra and Kenneth Weedo, brought a personal injury action to recover all his damages. The lawsuit was initially brought against the owner/driver of the Jeep Wrangler. However, through discovery, it was determined that the party responsible for the wheel separating from the Jeep Wrangler was the tire and rim shop that installed the wheel on the Jeep Wrangler approximately a year prior to the accident (“Tire Shop”). The Tire Shop maintained insurance with a policy limit of $1 million. The Tire Shop’s insurance company tendered the $1 million insurance policy limit, which was accepted by Debra and Kenneth Weedo in settlement of Luca’s claim for damages against the Tire Shop. The General Release and Hold Harmless Agreement (“Release”), executed on December 21, 2015, memorialized the settlement with the Tire Shop as follows, in relevant part: Although it is acknowledged that this settlement does not fully compensate LUCA ALECZANDER WEEDO for all of the damages that he has allegedly suffered, this settlement shall operate as a full and complete Release as to Second Parties without regard to this settlement only, compensating LUCA ALECZANDER WEEDO for a fraction of the total monetary value of his alleged damages. LUCA ALECZANDER WEEDO has alleged his damages have a value in excess of $25,000,000, of which $319,188.20 represents LUCA ALECZANDER WEEDO’s claim for past medical expenses. Given the facts, circumstances, and nature of LUCA ALECZANDER WEEDO’s injuries and allegations, $12,767.53 of this settlement has been allocated to LUCA ALECZANDER WEEDO for LUCA ALECZANDER WEEDO’s claim for past medical expenses and the remainder of the settlement towards the satisfaction of claims other than past medical expenses. LUCA ALECZANDER WEEDO alleges that this allocation is reasonable and proportionate based on the same ratio this settlement bears to the total monetary value of all LUCA ALECZANDER WEEDO’s damages. Further, LUCA ALECZANDER WEEDO acknowledges that he may need future medical care related to his injuries, and some portion of this settlement may represent compensation for future medical expenses that LUCA ALECZANDER WEEDO will incur in the future. However, LUCA ALECZANDER WEEDO alleges that his family and/or others on his behalf have not made payments in the past or in advance for LUCA ALECZANDER WEEDO’s future medical care and LUCA ALECZANDER WEEDO 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, it is LUCA ALECZANDER WEEDO’s contention that no portion of this settlement represents reimbursement for future medical expenses. Because Luca was a minor, Court approval of the settlement was required. Accordingly, on February 17, 2016, Collier County Circuit Court Judge James Shenko approved the settlement by entering an Agreed Order on Petitioner’s Unopposed Petition to Approve Minor’s Settlement. As a condition of his eligibility to receive Medicaid benefits, Luca assigned to AHCA his right to recover from liable third-parties medical expenses paid by Medicaid. See 42 U.S.C. § 1396a(a)(25)(H) and § 409.910(6)(b), Fla. Stat. AHCA was notified of Luca’s personal injury action during its pendency. Through its collections contractor, Xerox Recovery Services, AHCA has asserted a Medicaid lien in the amount of $314,747.23 against Luca’s cause of action and settlement of the personal injury action. This is the amount that the Medicaid program spent on behalf of Luca for his past medical expenses.2/ Application of the formula set forth in section 409.910(11)(f) requires that AHCA be reimbursed for the full $314,747.23 Medicaid lien. Neither Luca nor others on his behalf made payments in the past or in advance for his future medical care. 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. Debra Ann Weedo attended the final hearing along with Luca. Ms. Weedo is a foster parent for medically needy children. She testified that she currently has four children in her home: three-year-old Luca; a six-year-old in more or less the same condition as Luca; a five-year-old who is “basically normal”; and an autistic eight-year-old. Ms. Weedo first met Luca in the hospital during his post-birth hospitalization. She was asked to take him as a foster child and visited him several times in the hospital before taking him home at age three months. Ms. Weedo stated that when she brought Luca home, the whole family fell in love with him and “he became our family.” As soon as it was possible, Ms. Weedo and her husband adopted Luca. Ms. Weedo testified that Luca’s siblings interact with him and that Luca knows the voices of his caregivers and “will kind of try to talk to us.” At the hearing, the undersigned observed that Luca is somewhat aware of his surroundings and responsive to voices. Ms. Weedo testified that her family does everything together. Luca travels, goes on vacations, and goes out to eat as part of the family. Ms. Weedo testified that Luca requires 24-hour supervision and that his condition will become progressively worse as he ages. Luca has been on oxygen since December 2014. He must use a BiPAP (Bilevel Positive Airway Pressure) machine when he sleeps because the oxygen saturation level in his blood tends to be perilously low. He receives his nutrition through a gastrostomy tube. Civil trial attorney Todd Rosen testified on behalf of Petitioner as a fact witness and an expert on the valuation of damages. Mr. Rosen has been an attorney for 15 years and is the principal of the Todd Rosen Law Group in Coral Gables. Mr. Rosen stated that his practice is exclusively devoted to representing plaintiffs in personal injury cases. Mr. Rosen is a member of the American Association for Justice, the Florida Justice Association, the American Trial Lawyers Association, and the Dade County Bar Association. Mr. Rosen has handled many jury trials and has represented plaintiffs who have suffered catastrophic brain injuries. A daily part of his practice is to assess the value of damages to injured persons. He stays abreast of jury verdicts in his area and routinely “round-tables” legal issues and damage valuations with other attorneys. Mr. Rosen testified that he was hired by Luca Weedo’s parents to investigate the potential claims they might have on behalf of their son. Mr. Rosen reviewed thousands of pages of Luca’s medical records, the accident report, and insurance policies for the defendants. The records indicated that Luca suffered catastrophic brain damage as a result of placental abruption and that this injury had a permanent and devastating impact on the child’s life. Mr. Rosen explained that he could not file a lawsuit until the adoption process was complete, about eight months after the accident. He initially brought the suit against the driver of the Jeep, who had only PIP and property damage insurance and no collectable assets. Mr. Rosen interviewed the Jeep owner and learned the name of the Tire Shop. He made a demand for payment of the Tire Shop’s $1 million insurance policy. The full policy amount was tendered very soon after Mr. Rosen’s demand. Mr. Rosen testified that no life care plan or economist’s report was prepared in this case because the case settled so quickly. He believed that it would have been imprudent to spend money out of the $1 million settlement on a life care plan when the Weedos were not facing the prospect of a jury trial. Mr. Rosen testified that Luca’s past medical care related to the accident was paid by Medicaid. He testified that Medicaid provided $319,188.20 in benefits, representing Luca’s entire claim for past medical expenses. Mr. Rosen testified that Luca, or others on his behalf, did not make payments in the past or in advance for future medical care and no claim was brought to recover reimbursement for past payments for future medical care. Mr. Rosen opined that Luca’s damages had a value “well in excess of” $25 million. Mr. Rosen explained that based on his experience in other cases, he believed the value of Luca’s future life care needs “would be well in excess of at least 10 to 15 million dollars” and that Luca’s non-economic damages would have a high value. Mr. Rosen noted that a jury would also take into account how “wonderful” Debra and Kenneth Weedo are to have devoted their lives to caring for Luca and other children in similar circumstances. Mr. Rosen believed that the $25 million valuation on Luca’s damages was “very conservative.” Mr. Rosen stated that the Tire Shop’s insurance counsel believed they had a strong argument that the owner of the Jeep must have done something to the tires after the Tire Shop put them on the car. However, despite the contested liability, the insurance company readily agreed during informal settlement discussions to pay the policy limits because the lawyers believed they were facing a verdict of up to $50 million. Mr. Rosen testified that the biggest cost factor in assessing Luca’s damages is the 24-hour attendant care that he will require for the rest of his life. Depending on how many caregivers are employed, the skill level required, and the location, attendant care may range from $25 to $40 per hour. Mr. Rosen estimated that a life care plan for Luca would be in the neighborhood of $10 million, including attendant care, nursing, and medical expenses. Mr. Rosen testified that the $1 million settlement did not come close to fully compensating Luca for the full value of his damages. Based on the conservative valuation of all Luca’s damages at $25 million, the $1 million settlement represented a recovery of four percent of the value of Luca’s damages. Mr. Rosen testified that because Luca only recovered four percent of the value of his damages in the settlement, he only recovered four percent of his $319,188.20 claim for past medical expenses, or $12,767.53.3/ Mr. Rosen noted that the settling parties agreed in the Release that Luca’s damages had a value in excess of $25 million, as well as to the allocation of $12,767.53 to past medical expenses. Mr. Rosen testified that the allocation of $12,767.53 of the settlement to past medical expenses was reasonable, rational, and more than fair because it was based on a conservative estimate of Luca’s damages. He stated, “Me, personally, I believe it should be less, but yes, that is fair just being conservative.” Mr. Rosen testified that because no claim was made to recover reimbursement for past payments for future medical care, no portion of the settlement represented reimbursement for past payments for future medical care. He noted that the parties agreed in the Release that no claim was made for reimbursement of past payments for future medical care, and no portion of the settlement represented reimbursement for future medical expenses. Because Luca was a minor, court approval of his settlement was required. The court appointed another experienced attorney to act as Luca’s Guardian ad Litem to review the terms of the settlement and make a report to the court as to its appropriateness. The Guardian ad Litem recommended approval of the settlement, and the court adopted that recommendation. Also testifying on behalf of Petitioner as an expert in the valuation of damages was R. Vinson Barrett, a partner in the Tallahassee firm of Barrett, Fasig and Brooks, which Mr. Barrett described as a mid-sized firm that exclusively undertakes personal injury and products liability cases. Mr. Barrett stated that he has been a trial lawyer for 40 years and for the last 15 years has confined his practice to medical malpractice, medical products liability, and pharmaceutical products liability cases. Mr. Barrett testified that he has done many jury trials. He discussed the importance of accurately estimating the value of the damages suffered by his clients because of the heavy investment that a trial firm must make in a complex case. Mr. Barrett stated that a firm can easily spend a quarter of a million dollars on experts and discovery, as well as life care plans, economic analyses, and vocational rehabilitation analyses, among other items required to establish damages. He stated that it is essential not to spend so much money in putting on the case that the client has nothing left after the verdict. Mr. Barrett stated that he has reviewed dozens of life care plans and economist reports, many for children with the same kind of injuries suffered by Luca Weedo. Mr. Barrett testified that he was familiar with Luca’s injuries and had reviewed the accident report, hospital birth records, records from a second hospitalization, medical records from Luca’s neurologist, the Guardian ad Litem report, the court order approving the settlement, Mr. Rosen’s demand letter to the insurance carrier, and each of Petitioner’s exhibits. He had also spoken to Debra Weedo by phone concerning Luca’s medical condition. Mr. Barrett gave a detailed explanation of Luca’s injuries and extent of his disability. He concluded that Luca’s injury “is as bad an injury as you can possibly receive and stay alive . . . . It could not be more catastrophic.” The medical records indicate that Luca will not get better and his prognosis is poor. Mr. Barrett opined that Luca’s life care plan alone would probably exceed $25 million. He conceded “that seems like a huge, huge, huge amount of money,” but explained that it really is not such a large sum when one considers that Luca is supposed to have 24-hour attendant care throughout his lifetime. Life care plans are not limited to the cost of services provided by Medicaid, which is a safety net that “takes care of things that are absolutely essential to keep on breathing.” However, Medicaid does not cover many things that medically needy children require for quality of life, such as wheelchair-equipped vans. The life care plan includes all of the child’s needs. Mr. Barrett testified that a life care planner accounts for every cost, “pill by pill, wheelchair replacement by wheelchair replacement,” then reduces it to present value. Mr. Barrett testified that based on his experience working with life care planners in trial preparation, and his extensive experience in evaluating damages in cases similar to that of Luca Weedo, he had no doubt that $25 million is a conservative estimate of Luca’s pure losses. Mr. Barrett testified that the settlement did not come close to compensating Luca for the full value of his damages. Using $25 million as the conservative measure of all his damages, Luca had recovered only four percent of the value of his damages. Mr. Barrett testified that “by equity and basically, now by federal law, you look at the same ratio for the lien that you look at [for] the claimant.” Accordingly, Mr. Barrett testified that the settlement provided Luca with only four percent of Medicaid’s $319,188.20 claim for past medical expenses, or $12,767.53. Mr. Barrett testified that the settling parties’ allocation of $12,767.53 of the settlement to past medical expenses was reasonable, rational, and conservative. Both Mr. Rosen and Mr. Barrett testified at some length about comparable jury verdicts and prior DOAH Medicaid lien cases involving children with catastrophic brain injuries. This discussion had some value in establishing that $25 million was by no means an unreasonable estimate of Luca Weedo’s damages, but was secondary and supplemental to the directly expressed expert opinions of Mr. Rosen and Mr. Barrett. AHCA presented the testimony of attorney James Bruner, who was accepted as an expert for the limited purpose of comparing the jury verdicts in the cases cited by Petitioner to the facts of the instant case. Mr. Bruner correctly noted that it can be misleading to cite the numbers from a jury verdict without reference to later reductions made on appeal or via settlement pending appeal. Mr. Bruner also effectively demonstrated that there is never a precise correlation between the facts of one case and those of another, and therefore that there cannot be a precise comparison of damages from one case to another.4/ However, the undersigned did not look to the comparative verdicts for such a strict comparison, but simply for the purpose of establishing a range of reasonableness in broadly similar cases. AHCA called no witness to directly contest the valuation of damages made by Mr. Rosen or to offer an alternative methodology to calculate the allocation to past medical expenses. No evidence was presented that the settlement agreement was not reasonable given all the circumstances of the case. It does not appear that the parties colluded to minimize the share of the settlement proceeds attributable to Medicaid’s payment of costs for Petitioner’s medical care. In fact, the evidence established that the settlement was conservative in its valuation of Petitioner’s claim and that the settling parties could have reasonably apportioned less to Medicaid than they actually did. AHCA was not a party to the settlement of Petitioner’s claim. AHCA correctly computed the lien amount pursuant to the statutory formula in section 409.910(11)(f). Deducting the 25 percent attorney’s fee, or $250,000, as well as $8,112.70 in taxable costs, from the $1 million recovery, leaves $741,887.30, half of which is $370,943.65. That figure exceeds the actual amount expended by Medicaid on Petitioner’s medical care. Application of the formula would provide sufficient funds to satisfy the Medicaid lien of $314,747.23. Petitioner proved by clear and convincing evidence that the $25 million total value of the claim was a reasonable, even somewhat conservative, amount. Petitioner proved by clear and convincing evidence, based on the strength and sympathy of his case and on the fact that it was limited only by the inability to collect the full amount of the likely judgment, that the amount agreed upon in settlement of Petitioner’s claims constituted a fair settlement, including the portion attributed to the Medicaid lien for medical expenses.
The Issue The amount to be reimbursed to Respondent, Agency for Health Care Administration (“Respondent” or “AHCA”), for medical expenses paid on behalf of Petitioner, Mitchell Fowler, from settlement proceeds received by Petitioner from third parties.
Findings Of Fact On September 4, 2016, Mr. Fowler suffered a catastrophic and permanent spinal cord injury when he fell at a boat ramp. Mr. Fowler is now a paraplegic unable to walk, stand, or ambulate without assistance. Mr. Fowler’s medical care related to his injury was paid by Medicaid. Medicaid, through AHCA, provided $74,693.24 in benefits and Medicaid, through a Medicaid Managed Care Plan known as Humana, provided $7,941.28 in benefits. The sum of these Medicaid benefits, $82,634.52, constituted Mr. Fowler’s entire claim for past medical expenses. Mr. Fowler pursued a personal injury action against the owner/operator of the boat ramp where the accident occurred (“Defendants”) to recover all his damages. The personal injury action settled through a series of confidential settlements in a lump-sum unallocated amount of $800,000. As a condition of Mr. Fowler’s eligibility for Medicaid, Mr. Fowler assigned to AHCA his right to recover from liable third-parties medical expenses paid by Medicaid. See § 409.910(6)(b), Fla. Stat. During the pendency of the medical malpractice action, AHCA was notified of the action and AHCA asserted a $74,693.24 Medicaid lien associated with Mr. Fowler’s cause of action and settlement of that 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. By letter, AHCA was notified of the settlements. AHCA has not filed a motion to set aside, void, or otherwise dispute the settlements. The Medicaid program through AHCA spent $74,693.24 on behalf of Mr. Fowler, all of which represents expenditures paid for past medical expenses. No portion of the $74,693.24 paid by AHCA through the Medicaid program on behalf of Mr. Fowler represented expenditures for future medical expenses. The $74,693.24 in Medicaid funds paid towards the care of Mr. Fowler by AHCA is the maximum amount that may be recovered by AHCA. In addition to the foregoing, Humana spent $7,941.28 on Mr. Fowler’s medical expenses. Thus, the total amount of past medical expenses incurred by Mr. Fowler is $82,634.52. The taxable costs incurred in securing the settlements totaled $45,995.89. Application of the formula at section 409.910(11)(f) to the $800,000 settlement requires payment to AHCA of the full $74,693.24 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 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 the total of Mr. Fowler’s economic damages, including future medical expenses, were $5,652,761.00 which, added to the $82,634.52 in past medical expenses, results in a sum of $5,735,395.52 in economic damages. Based on the experience of the testifying experts, and taking into account jury verdicts in comparable cases, Petitioner established, by clear and convincing evidence that was unrebutted by AHCA, that non-economic damages alone could reasonably be up to $26,000,000. When added to the economic damages, a value of Mr. Fowler’s total damages well in excess of $30,000,000 would not be unreasonable. However, in order to establish a very conservative figure against which to measure Mr. Fowler’s damages, both experts agreed that $15,000,000 would be a reasonable measure of Mr. Fowler’s damages for purposes of this proceeding. Based on the forgoing, it is found that $15,000,000, as a full measure of Mr. Fowler’s damages, is very conservative, and is a fair and appropriate figure against which to calculate any lesser portion of the total recovery that should be allocated as reimbursement for the Medicaid lien for past medical expenses. The $800,000 settlement is 5.33 percent of the $15,000,000 conservative value of the claim.
