15-003849MTR Larry J. Griffis vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Friday, October 30, 2015.

Summary: Petitioner proved by clear and convincing evidence that the amount of Agency for Health Care Administration's Medicaid lien should be reduced to $24,901.50.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

LARRY J. GRIFFIS ,

Petitioner ,

vs. Case No. 15 - 3849MTR

AGENCY FOR HEALTH CARE

ADMINISTRATION ,

Respondent .

_ /

FINAL ORDER

Pursuant to notice , a final hearing was conducted in this

case on September 9, 2015 , in Tallahassee , Florida, before

Administrative Law Judge R. Bruce McKibben of the Division of

Administrative Hearings (DOAH) .

APPEARANCES

For Petitioner: Joel R. Foreman, Esquire

F oreman, McInnis and Associates, P.A.

Post Office Box 550

Lake City, Florida 32056 - 0550

For Respondent: David N. Perry, Esquire

Xerox Recovery Service, Inc.

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 3 2317

STATEMENT OF THE ISSUE

The issue in this case is the amount of money to be

reimbursed to Respondent, Agency for Health Care Administration,

for medical expenses paid on behalf of Petitioner, Larry J.

Griffis, from a personal injury claim settlement r eceived by

Petitioner from a third party.

PRELIMINARY STATEMENT

Petitioner filed a Petition to Contest Calculation of

Recovered Medical Expense Damages with the Division of

Administrative Hearings on July 7, 2015. The Petition

challenges the AgencyÓs li en for recovery of medical expenses

paid by Medicaid in the sum of $48,640.57. The basis for

GriffisÓ challenge is his assertion that the application of

section 409.910(17(b), Florida Statutes, warrant s reimbursement

of a lesser portion of the total third - party settlement proceeds

than the lien a mount asserted by the Agency. (Unless

specifically stated otherwise herein, all references to the

Florida Statutes will be to the 2015 version.)

At the final hearing, Griff is called one witness,

Stephen A. Smith , Esquire, and offered ten exhibits into

evidence, all of which were accepted. The Agency did not call

any witnesses or offer any exhibits into evidence. The parties

advised that a transcript of this proceeding would be ordered.

By rule, the parties hav e ten days after the transcript is filed

at DOAH to submit p roposed f inal o rders. The T ranscript was

filed on October 1, 2015 . Each of the parties timely filed a

P roposed F inal O rder , and each order was considered in the

preparation of this Final Order.

FINDINGS OF FACT

1. Griffis was severely injured in an accident occurring

on April 29, 2012 . The accident occurred generally as follows:

Griffis owned and operated a large truck with a long aluminum

dump trailer attached. He hauled hazardous waste and other

materials for a living. At the end of each job, Griffis would

raise the dump trailer for the purpose of cleaning out any

residual material. On the date of the accident, Griffis did not

clean his trailer in the usual because of some obstruction on

that date. Instead, he drove out into a field next to his house

to clean the trailer. When Griffis raised the trailer to clean

it, he failed to notice electrical lines just above his trailer.

He raised the trailer into the lines, resulting in an extreme ly

high voltage of electricity running through his body.

2. As a result of the accident, Griffis was transported to

the burn unit at Shands hospital in Gainesville for treatment of

his extensive injuries. He had over 50 medical procedures while

at Sha nds, including debridement , skin grafts, tracheostomies,

multiple chest tubes, etc. He had 19 different complications

while in the hospital, including infections and kidney failure.

Over 30 percent of his body surface area was burned; 23 percent

of those burns were third degree. While undergoing treatment,

Shands gave him only a 22 percent chance of surviving. Griffis

remained in the hospital for three and one half months.

3. The medical bills for GriffisÓ treatment totaled

Griffis cost $1 ,363,285.65 . Medicaid paid $48,640.57 of that

total amount. The Veterans Administration (VA) paid

$275,911.87. Shands was eventually paid $324,552.44 of its

charges and wrote off over $1 million.

4. Griffis filed a lawsuit against Suwannee Valley

Electric Coop erative, Inc. (ÐSuwanneeÑ), seeking payment of

economic and non - economic damages related to SuwanneeÓs alleged

liability for the accident. After negotiations and mediation, a

settlement was reached whereby Griffis was to receive the sum of

$500,000 from S uwannee in full settlement of all his claims.

5. After the settlement was reached between Griffis and

Suwannee, the Agency attempted to enforce its lien, seeking

repayment of the entire amount it had paid . Griffis, believing

that less than the l ien a mo unt was actually owed, filed a Motion

for Order Apportioning Damages as part of his pending lawsuit

against Suwannee. The purpose of the motion was not to have the

circuit court j udge determine the amount of the AgencyÓs lien.

The motion was filed to obt ain an Order that would apportion the

settlement among the lawful elements of damages to which Griffis

was entitled . A hearing on the motion was set for

April 14 , 2015, before Circuit Court Judge Andrew J. Decker,

III. The Agency was served a copy of the motion and the notice

of hearing.

6. The Agency filed an objection to the motion, seeking to

relieve the circuit c ourt of jurisdiction in favor of the

Division of Administrative Hearings. See § 409.910 (17)(b),

Fla. Stat. Griffis replied to the Agenc yÓs objection, stating

that Ðthe purpose of the Motion is to differentiate or allocate

the settlement among Mr. GriffisÓ different elements of damages

[rather than] asking this Court to resolve a Medicaid lien

dispute.Ñ

7. At the Circuit Court hearing o n GriffisÓ motion, the

Agency made an appearance and, in fact, cross - examined the

expert witness who testified. The only testimony provided at

that hearing was from retired District Court of Appeal Judge

Edwin B. Browning, Jr. Judge Browning provided exp ert testimony

as to the value of GriffisÓ claim, which he set at $6 million.

Mr. Smith also provided some argument in support of GriffisÓ

claim, but as an attorney , rather than a sworn witness.

8. Judge Decker took the $6 million figure, plus economic

da mages in the sum of $211,518 , plus past medical expenses of

$324,552.44 for a total of $6,536,070.44. That was then divided

into the $500,000 settlement figure amount . That resulted in a

factor of 7.649 percent , which, applied to the Ðvalue of the

caseÑ amount, resulted in a figure of $458,919.49. Applying the

factor to economic damages resulted in an amount of $ 16,179.01.

The past medical expenses amount, once factored, resulted in a

figure of $ 24, 825 . 0 1 . 1/

9. After hearing the evidence presented at his motion

hearing, Judge Decker entered an Order dated April 21, 2015,

establishing the past medical expenses amount , i.e., the

AgencyÓs lien, at $24,901.50. The Order did not address future

medical expenses because they were not sought by Petitioner.

Inasmuch as his future medical costs would be paid by VA, his

attorneys did not add potential medical expenses to the claim. 2 /

10. A copy of Judge DeckerÓs Order was received into

evidence in the instant proceeding (although, pursuant to

section 90.202 , Florida Statutes , it could have been officially

recognized by the undersigned Administrative Law Judge) . The

Order, along with GriffisÓ other exhibits and Mr. SmithÓs

testimony, constituted the evidence in this matter.

CONCLUSIONS OF LAW

11. The Divis ion has jurisdiction over the parties and

subject matter in this case. §§ 120. 569, 120. 57(1)(k), and

409.910(17), Fla. Stat.

12. The Agency is the state agency authorized to

administer FloridaÓs Medicaid program. § 409.902, Fla. Stat.

13. At issue in this proceeding is section 409.910,

entitled: Responsibility for payments on behalf of Medicaid -

eligible persons when other parties are liable . The statute

states in pertinent part:

(1) It is the intent of the Legislature

that Medicaid be the payor of last resort

for medically necessary goods and services

furnished to Medicaid recipients. All other

sources of payment for medical care are

primary to medical assistance provided by

Medicaid. If benefits of a liable third

party are discovered or become av ailable

after medical assistance has been provided

by Medicaid, it is the intent of the

Legislature that Medicaid be repaid in full

and prior to any other person, program, or

entity. Medicaid is to be repaid in full

from, and to the extent of, any third - p arty

benefits, regardless of whether a recipient

is made whol e or other creditors paid. . . .

* * *

(11)(f) Notwithstanding any provision in

this section to the contrary, in the event

of an action in tort against a third party

in which the recipient or his or her legal

representative is a party which results in a

judgement, award, or settlement from a third

party, the amount recovered shall be

distributed as follows:

1. After attorney Ós fees and taxable costs

as defined by the Florida Rules of Civil

Procedure, one - half of the remaining

recovery shall be paid to the agency up to

the total amount of medical assistance

provided by Medicaid.

* * *

(17) (b) A recipient may contest the amount

designated as recovered medical expense

damages payable to th e agency pursuant to a

formula specified in paragraph 11(f) by

filing a petition under chapter 120 . . . .

The petition shall be filed with the

Division of Administrative Hearings. For

purposes of chapter 120, the payment of

funds to the agency or the pla cement of the

full amount of the third - party benefits in

the trust account for the benefit of the

agency constitutes final agency action and

notice thereof. Final order authority for

the proceedings specified in this subsection

rests with the Division of Administrative

Hearings. This procedure is the exclusive

method for challenging the amount of third -

party benefits payable to the agency. In

order to successfully challenge the amount

payable to the agency, the recipient must

prove, by clear and convinci ng evidence,

that a less portion of the total recovery

should be allocated as reimbursement for

past and future medical expenses than the

amount calculated by the agency pursuant to

the formula set forth in paragraph (11)(f)

or that Medicaid provided a les ser amount of

medical assistance than that asserted by the

agency.

14. The amount to be recovered for Medicaid medical

expenses from a judgment, award, or settlement from a third

party is determined by the formula set forth in section

409.910(11)(f), abo ve, which sets that amount at one - half of the

total recovery, after deducting attorneyÓs fees of 25 percent of

the recovery and all taxable costs, up to but not to exceed the

total amount actually paid by Medicaid on the recipientÓs

behalf. Ag. for Health Care Admin. v. Riley , 119 So. 3d 514,

515 n.3 (Fla. 2d DCA 2013).

15. Application of the formula to GriffisÓ $500,000

settlement results in a maximum reimbursement amount of

$187,500, which exceeds the Medicaid lien sought by the Agency .

Under the fo rmu la, the Agency would receive the sum of

$48,640.58.

16. Where, as in this case, Petitioner is claiming that a

lesser amount should be paid to Medicaid, it must prove its

claim by the clear and convincing evidence standard set forth in

subsection (17)(b), above. C lear and convincing evidence

Ðrequires more proof that a Òpreponderance of the evidenceÓ but

is less than Òbeyond a reasonable doubt.ÓÑ In re Graziano, 696

So. 2d 744, 753 (Fla. 1997). ÐAlthough [the clear and

convincing] standard of proof may b e met where the evidence is

in conflict, it seems to preclude evidence that is ambiguous.Ñ

Westinghouse Elec. Corp. v. Shuler Bros. , 590 So. 2d 986, 989

(Fla. 1st DCA 1991).

17. In this case, the administrative procedure created by

section 409.910(17)(b) is the means for determining whether a

lesser portion of a total recovery should be allocated as

reimbursement for medical expenses in lieu of the amount

calculated by application of the formula in section

409.910(11)(f).

18. Here , Griffis is not alleg ing that Medicaid provided a

lesser amount of medical assistance than asserted by the Agency.

He is saying that a lesser portion of the total recovery should

be allocated for past medical expenses. By clear and convincing

evidence, i.e., an Order from Ju dge Andrew J. Decker, III, in

the Circuit Court of the Third Judicial Circuit, in and for

Hamilton County, Florida, Case No. 13 - 229 - CA , Griffis

established that the amount of the settlement allocated for past

medical expenses is $24,901.50.

19. The apport ionment made by Judge Decker is reasonable,

reliable, and based upon competent and substantial evidence. It

is therefore appropriate for the Administrative Law Judge to

accept and approve that apportionment . See , e.g., the well -

reasoned decisi on by Admin istrative Law Judge Early in Holla nd

v. Ag. for Health Care Admin. , Case No. 14 - 2520MTR ( Fla. DOAH

Sept. 29, 2014) .

ORDER

Based on the foregoing Findings of Fact and Conclusions of

Law, it is hereby

ORDERED that Petitioner, Larry J. Griffis, pay to

Respo ndent, Agency for Health Care Administration, the sum of

$24,901.50.

DONE AND ENT ERED this 30th day of October , 201 5 in

Tallahassee, Leon County, Florida.

S

R. BRUCE MCKIBBEN

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Buil ding

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 30th day of October, 2015.

ENDNOTES

1/ This figure may not be mathematically correct, but it is the

figure the parties have agreed to use for purposes of this

proceeding.

2 / Had future medical expenses been added to GriffisÓ claim, the

medical expenses portion of the allocated settlement would have

been higher. There is no requirement, however, that future

medical expenses be included where none is projected.

COPIES FURNISHED :

Alexander R. Boler, Esquire

Xerox Recovery Services Group

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

(eServed)

Joe l F. Foreman, Esquire

Foreman, McInnis and Associates, P.A.

Post Office Box 550

Lake City, Florida 32056 - 0550

(eServed)

Stuart Fraser Williams, General Counsel

Agency for Health Care Administration

2727 Mahan Drive, M ail Stop 3

Tallahassee, Florida 32308

(eServed)

David N. Perry, Esquire

Xerox Recovery Services, Inc.

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

(eServed)

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Flori da 32308

(eServed)

Elizabeth Dudek, Secretary

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 1

Tallahassee, Florida 32308

(eServed)

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.