13-004130MTR Debra L. Savasuk And Terry Savasuk, As Duly Appointed Guardians Of The Person And Property Of Taya Rose Savasuk-Maldonado, A Minor vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Wednesday, January 29, 2014.

Summary: Petitioner did not prove that AHCA should recover less than the amount of its Medicaid lien claim.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEBRA L. SAVASUK AND TERRY

SAVASUK, AS DULY APPOINTED

GUARDIANS OF THE PERSON AND

PROPERTY OF TAYA ROSE SAVASUK -

MALDONADO, A MINOR ,

Petitioners ,

vs. Case No. 13 - 4130MTR

AGENCY FOR HEALTH CARE

ADMINISTRATION ,

Respon dent .

/

FINAL ORDER

On December 16, 2013, a final administrative hearing was

held in this case by video teleconferencing, with sites in

Fort Myers and Tallahassee, before J. Lawrence Johnston,

Administrative Law Judge, Division of Administrative Hearings.

APPEARANCES

For Petitioner: Elizabeth Minor van den Berg, Esquire

Goldstein, Buckley, Cechman,

Rice and Purtz, P.A.

1515 Broadway

Fort Myers, Florida 33901

For Res pondent: Adam James Stallard, Esquire

Xerox Recovery Services Group

2316 Killearn Center Boulevard

Tallahassee, Florida 32309

STATEMENT OF THE ISSUE

The issue in this case is the amount of the Petitioners '

personal injury settlement re quired to be paid to the Agency for

Health Care Administration (AHCA) to satisfy its Medicaid lien

under section 409.910, Florida Statutes (2013).

PRELIMINARY STATEMENT

On October 18, 2013, the Petitioners filed a Petition to

Determine Medicaid Lien. The parties filed a Joint Pre - hearing

Stipulation, and a hearing was held on December 16, 2013. At the

hearing, the Petitioners called two witnesses, Debra Savasuk and

David Goldberg, Esquire, and Petitioners ' Exhibit A was received

in evidence. Pertinent le gal authorities were officially

recognized.

The Transcript of the final hearing was filed, and the

parties filed proposed orders that have been considered.

FINDING S OF FACT

1. The Petitioners are the grandparents and legal guardians

of Taya Rose Savasuk - Maldonado, who is 11 years old.

2. On October 2, 2010, Taya and six family members were

involved in a horrific car crash. The driver of another car (the

tortfeasor) failed to stop at an intersection and slammed into

the family van, which rolled over, ejecting three passengers,

including Taya and her great - grandparents. The great -

grandparents died on the pavement next to Taya, and Taya suffered

severe injuries, including a skull fracture, pancreatitis,

bleeding in her abdomen, and severe road rash tha t required

multiple skin graft surger ies and dressing changes so painful

that anesthesia was required. Taya has significant, permanent

scarring, which has left her self - conscious and unwilling to wear

any clothing that exposes her scars, including bathing suits and

some shorts. Taya ' s emotional injuries include nightmares and

grief over the loss of both great - grandparents. Other family

members also suffered injuries.

3. Taya required emergency and subsequent medical care that

has totaled $257,567 to d ate. It is not clear from the evidence

how much, if any, of that total was reduced when providers

accepted Medicaid. Future medical expenses are anticipated, but

there was no evidence as to the amount of future medical

expenses.

4. The tortfeasor had a $100,000/$300,000 Hartford

insurance liability policy on the car he was driving at the time

of the accident. Hartford agreed to pay the policy limits. The

injured family members agreed that $200,000 of the policy limits

should be paid to Taya. On Octo ber 14, 2013, Hartford and the

Petitioners agreed that the Petitioners would release Hartford,

the tortfeasor and his wife (the other owner of the car) in

return for payment of $200,000 to be held in trust by the

Petitioners ' attorneys for distribution as follows: $60,000 to

be paid to the Prudential Assigned Settlement Services

Corporation to fund future payments to Taya beginning in year

2020; up to $84,095 to lienholders in amounts to be determined;

and the balance to the Petitioners ' attorneys. The pa rties to

that agreement, which did not include AHCA, agreed that $51,513

of the $200,000 should be allocated to payment of Taya ' s medical

bills, with the rest allocated to claims other than medical

expenses. There was no evidence that anything has been pa id to

AHCA towards its Medicaid lien, or that anything has been paid

into an interest - bearing trust account for the benefit of AHCA

pending the determination of the amount of its Medicaid lien,

which at the time was claimed to be $55,944.

5. T he owner o f the family van involved in the accident had

a $10,000/$20,000 GEICO underinsured motorist policy, which also

paid the policy limits. Although the evidence was not clear, the

Petitioners appear to concede that all $20,000 was recovered by

them for Taya ' s benefit. There was no evidence as to when the

family ' s claim against the GEICO policy settled, or as to any

agreement how the $20,000 should be allocated between medical

expenses and other kinds of damages. There was no evidence that

any of the $20,000 was paid to AHCA towards its Medicaid lien, or

into an interest - bearing trust account for the benefit of AHCA

pending the determination of the amount of its Medicaid lien.

6. I n addition to the insurance policy settlements, the

owners of the other car p aid the family approximately $250,000

from their own assets, which the family members agreed to

apportion among themselves in a manner that was not disclosed by

the evidence. There was no evidence as to when those funds were

paid to the family, or when an y of those funds was paid to Taya ' s

benefit, if any. The evidence was not clear whether any of those

funds was paid towards Taya ' s medical expenses that were not paid

by Medicaid. The evidence suggested that some of the $250,000

was paid towards Taya ' s m edical expenses to date, but it is

possible that some of those expenses were reduced when providers

accepted Medicaid. There was no evidence that any of those funds

w as p aid to AHCA towards its Medicaid lien claim, or into an

interest - bearing trust accoun t for the benefit of AHCA , pending a

determination of the amount of its Medicaid lien.

7. A personal injury lawyer, who also was Taya ' s guardian

ad litem, testified that the value Taya ' s claims against the

owners of the other car was approximately $1.4 to $1.8 million.

He did not testify as to the amount future medical expenses would

contribute to the total value he estimated.

8 . AHCA has paid $55,710.98 in Medicaid benefits to treat

Taya for her accident injuries. (The Petitioners stipulated to

thi s amount.)

9. Lee Memorial Hospital provided medical services for Taya

and claims that it is owed $38,317.05, for which it appears to

claim a statutory lien. The evidence was that Lee Memorial

refused to accept Medicaid in payment for those services. If

Medicaid were accepted, the amount of AHCA ' s lien would be more

than $55,710.98, but probably not $38,317.05 more.

CONCLUSIONS OF LAW

10. Section 409.910(11)(f), Florida Statutes (2013),

provides essentially that AHCA is entitled to payment for all

me dical assistance it provides for a Medicaid recipient who

suffers a tort injury, up to 37.5 percent of benefits recovered

from third parties. Assuming that Taya received no third - party

recoveries other than the $200,000 from the Hartford settlement,

the s tatutory cap would be $75,000, which exceeds the amount of

AHCA ' s Medicaid lien claim.

11. Subsection (17)(b) of that statute provides in part:

A recipient may contest the amount designated

as recovered medical expense damages payable

to the agency pur suant 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).

Paragraph (a) of subsection (17) states:

A recipient or his or her legal

representative or any person representing, or

acting as agent for, a recipient or the

recipient ' s legal representative, who has

notice, excluding notice charged solely by

reason of the recording of the lien pursuant

to paragraph (6)(c), or who has actual

knowledge of the agency ' s rights to third -

party benefits under this section, who

receives any third - party benefit or proceeds

for a covered illness or injury, must, within

60 days after receipt of settlement proceeds,

pay the agency the full amount of the third -

party benefits, but not more than the total

medical assistance provided by Medicaid, or

place the full amount of the third - party

benefits in an interest - bearing trust account

for the benefit of the agency pending an

administrative determination of the agency ' s

right to the benefits under this subsection.

12. In this case, the parties stipulated that the only

issue to be deter mined is whether the Petitioners met their

burden of proof under paragraph (b) of subsection (17), which is

the equivalent of a stipulation that the requirements of

paragraph (a) were met.

13. Paragraph (b) of subsection (17) goes on to say:

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

calcu lated 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.

The Petitioners submit alternative theories why AHCA ' s Medicaid

lien claim shoul d be reduced under this provision of the statute.

14. Under their first theory, the Petitioners would reduce

the $51,513 that was allocated by the parties to the $200,000

Hartford settlement agreement to payment of Taya ' s past medical

bills by a 27 - perce nt recovery cost (which is the attorneys '

contingency fee percentage), resulting in a net allocation of

$37,604. They would then apportion the $37,604 between the AHCA

Medicaid lien claim and the Lee Memorial lien claim, resulting in

a payment of $22,284 to AHCA for its Medicaid lien.

15. The Petitioners ' first theory is rejected for several

reasons. First, in effect , it would bind AHCA to the $51,513

allocation made by the parties to the Hartford settlement. AHCA

was not a party to that agreement and is not bound by it.

Second, the Hartford agreement made the $51,513 allocation

without respect to any recovery fee, and there is no basis in the

statute for reducing the allocation by the attorneys ' contingency

fee. Third, there is no basis in the statut e for reducing the

allocation because of Lee Memorial ' s lien claim. Fourth, the

theory ignores the $20,000 GEICO recovery and does not address

the $250,000 paid by the tortfeasors to the injured family

members.

16. Under their second theory, the Petitio ners would reduce

AHCA ' s $55,710.98 Medicaid lien in proportion to the 14 - percent

ratio that Taya ' s $220,000 recovery from the two insurance

companies bears to the full value of her claim, which they assert

is $1.6 million, resulting in a payment of $7,794 to AHCA for its

Medicaid lien.

17. The Petitioners ' second theory also is rejected for

several reasons. For one thing, it ignores the $51,513

allocation to past medical expenses made by the parties to the

Hartford settlement, which is only approximatel y $4,000 less than

AHCA ' s Medicaid lien claim. This agreement is an admission as to

the Petitioners , but not as to AHCA, which was not a party to the

agreement.

18. Disregarding their admission to the $51,513 allocation

to past medical expenses , the Pet itioners did not prove by clear

and convincing evidence that Taya did not recover more than

$220,000 from third parties. They also did not prove by clear

and convincing evidence that the total value of Taya ' s claim for

damages against the tortfeasors was $1.6 million. Even assuming

that those facts were proven, the second theory ignores Lee

Memorial's lien, and there was no evidence as to what portion of

the total value of Taya ' s claim for damages should be attributed

to future medical expenses.

19. For these reasons, the Petitioners did not prove by

clear and convincing evidence that less than AHCA ' s $55,710.98

Medicaid lien should be allocated as reimbursement for past and

future medical expenses under paragraph (b) of subsection (17) of

the statute.

20. Citing Arkansas Dep artment of Health and Human Serv ice s

v. Ahlborn , 547 U.S. 268, 126 S. Ct. 1752, 164 L. Ed. 2d 459

(2006), and Wos v. E.M.A. ex rel. Johnson , __ U.S. __ ,

133 S. Ct. 1391, 185 L. Ed. 2d 471 (2013), the Petitioners

contend that unless the Florida Statutes are interpreted and

applied so as to reduce AHCA ' s Medicaid lien claim in accordance

with one of their two theories, those statutes are preempted by

federal law that prohibits states from imposing a lien against

the property of a Medi caid recipient prior to the death of the

recipient. To the contrary, under those decisions, the federal

anti - lien law does not preempt the Florida Statutes because they

provide the required evidentiary procedure to determine what

portion of the Medicaid r ecipient ' s total recovery should be

allocated as reimbursement for past and future medical expenses .

DISPOSITION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is DETERMINED that the amount of AHCA ' s Medicaid lien

payable from the Pet itioners ' $200,000 Hartford settlement is

fixed at $55,710.98, as claimed by AHCA.

DONE AND ORDERED this 2 9 th day of January , 2014 , in

Tallahassee, Leon County, Florida.

S

J. LAWRENCE JOHNSTON

Administrative Law Judge

Di vision of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 2 9 th day of Ja nuary , 2014 .

COPIES FURNISHED:

Elizabeth Dudek, Secretary

Agency for Health Care Administration

Mail Stop 1

2727 Mahan Drive

Tallahassee, Florida 32308

Stuart Williams, General Counsel

Agency for Health Care Administration

Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308

Elizabeth Minor van den Berg, Esquire

Goldstein, Buckley, Cechman,

Rice and Purtz, P.A.

1515 Broa dway

Fort Myers, Florida 33901

Jennifer Barrett, Esquire

Agency for Health Care Administration

2727 Mahan Drive

Tallahassee, Florida 32308

Mark E. Lyles

ACS Recovery Services

Post Office Box 12188

Tallahassee, Florida 32317 - 2188

Adam James Stallard, E squire

Xerox Recovery Services Group

2316 Killearn Center Boulevard

Tallahassee, Florida 32309

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this Final Order is entitled

to judicial review pursuant to section 120.68, Florida S tatutes.

Review proceedings are governed by the Florida Rules of Appellate

Procedure. Such proceedings are commenced by filing the original

notice of administrative appeal with the agency clerk of the

Division of Administrative Hearings within 30 days of rendition

of the order to be reviewed, and a copy of the notice,

accompanied by any filing fees prescribed by law, with the clerk

of the District Court of Appeal in the appellate district where

the agency maintains its headquarters or where a party reside s or

as otherwise provided by law.