17-004557MTR Julio Cesar Cabrera, As Personal Representative Of The Estate Of Yisell Cabrera Rodriguez, Deceased vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Tuesday, January 23, 2018.

Summary: Respondent is entitled to recover the amount calculated pursuant to the formula in section 409.910(11)(f) because the process in section 409.910(17)(b) is not applicable where the recipient is deceased before third-party benefits are recovered.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

JULIO CESAR CABRERA, as Personal

Representative of the Estate of

YISELL CABRERA RODRIGUEZ,

deceased,

Petitioner,

vs. Case No. 17 - 4557MTR

AGENCY FOR HEALTH CARE

ADMINISTRATION,

Respondent.

_______________________________/

FINAL ORDER

Pursuant to notice, a hearing was conducted in this case

pursuant to sections 120.569 and 120.57(1), Florida Statutes

(2017), 1/ before Cathy M. Sellers, an Administrative Law Judge

( " ALJ " ) of the Division of Administrative Hearings ( " DOAH " ), on

October 16, 2017, by video teleconference at sites in Miami and

Tallahassee, Florida.

APPEARANCES

For Petitioner: Steven G. Jugo , Esquire

Law Office s of Jugo & Murphy

Offices at Pinecrest, Suite 200

7695 Southwest 104 th Street

Miami , Florida 3 3156

For Respondent: Alexander R. Boler, Esquire

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

STATEMENT OF THE ISSUE

The issue to be determined is the amount to be reimbursed

to Respondent, Agency for Health Care Administration ( " AHCA " ) ,

for medical expenses paid on behalf of Yisell Cabrera Rodriquez

pursuant to section 409.910, Florida Statutes , from settlement

proceeds received by Petitioner from third parties.

PRELIMINARY STATEMENT

On August 15, 2017, Petitioner filed his Petition to

Determine Medicaid Lien, challenging Respondent ' s lien to

recover the amount of $86,491.86 in medical expenses paid by

Respondent on behalf of Yisell Cabrera Rodriquez. The basis

for the challenge is the assertion that the application of

section 409.910(1 7)(b) warrants reimbursement of a lesser

portion of the total third - party settlement proceeds than the

amount calculated by Respondent pursuant to the formula codified

in section 409.910(11)(f).

The final hearing was scheduled for, and held on,

October 16, 2017. Petitioner presented the testimony of Maria

Rodriquez, 2/ Julio Cesar Cabrera, and Orlando Ruiz. Petitioner ' s

exhibits 1 through 4 were admitted into evidence without

objection. Respondent did not present any witnesses or tender

any exhibits fo r admission into evidence.

The one - volume Transcript was filed on November 7, 2017,

and the parties were given until November 16, 2017, to file

their proposed final orders. Pursuant to joint motion of the

parties, the deadline for filing proposed final orders was

extended to December 1, 2017. Both parties timely filed their

proposed final orders, 3/ which were duly considered in preparing

this Final Order.

FINDINGS OF FACT

The Parties

1. Petitioner , Julio Cesar Cabrera, is the duly - appointed

Personal Representative of the Estate of Yisell Cabrera

Rodriquez, his deceased daughter.

2. Respondent is the state agency charged with

administering the Florida Medicaid program, pursuant to

chapter 409.

The Events Giving Rise to this Proceeding

3. On August 30, 2015, Petitioner ' s 23 - year old daughter,

Yisell, was sever e ly injured in an automobile accident. She was

a passenger in an automobile that was struck by another

automobile that failed to yield the right - of - way at an

intersection.

4 . The automobile in which Yisell was a passenger

previously had been in an accident and had been determined a

total loss. It subsequently was rebuilt by Unique Body Works in

Miami . A sister company, Unique Auto motive , sold the vehicle to

the driver of t he car in which Yisell was a passenger on

August 30, 2015 . When Unique Body Works rebuilt the automobile ,

it did not replace the passenger side airbag s . W hen the

automobile was struck in the accident, airbags on the passenger

side were not available to deploy. As a result, Yisell was

sever e ly injured.

5 . She was transported to Jackson Memorial Hospital, where

she received medical treatment in intensive careagically,

on August 31, 2015, Yisell died from the injuries she sustained

in the accident.

6 . Petitioner instituted a wrongful death action against

the at - fault driver ( " Carlos Espinoza " ) and the owner of the

automobile ( " Ana Ramirez " ) that struck the automobile in which

Yisell was a passenger , Unique Body Works , and Unique

Automotive , to recover damages to Yisell ' s parents and to her

estate.

7 . Espinoza/Ramirez were insured by Infinity Auto

Insurance Company under a policy having a bodily injury limit of

$10,000.

8 . Unique Body Works was insured by Grenada Insurance

Company under a policy having a liability limit of $100,000.

9 . Unique Automotive was insured by Western Heritage

Insurance Company under a policy having a liability limit of

$30,000.

1 0 . All of the insurers tendered their respective policy

limits for a total of $140,000.

1 1 . On July 14, 2017, Petitioner, on behalf of the Estate

of Yisell Cabrera Rodriquez, entered into settlement agreements

with Espinoza/Ramirez, Unique Body Works, and Unique Auto motive,

fo r a total of $140,000, which constitutes the total amount of

the third - party benefits received. 4/

1 2 . Yisell ' s medical care related to her injury was paid

by Medicaid. 5/ The medical expenses paid by Medicaid total ed

$86,491.86 . Pursuant to section 409.910 (6)(c)1., AHCA has a

Medicaid lien for that amount.

Petitioner ' s Challenge to the Repayment Amount

1 3 . Section 409.910(11)(f) establishes a formula for

distributing the benefits that are recovered by a recipient or

his or her legal representative in a tort action against a third

party that results in a judgment, settlement, o r award from that

third party. Applying this formula to the $140,000 that

Petitioner received in third - party benefits results in a lien

repayment amount of $51, 838.61. 6 / In this proceeding, AHCA

asserts that it is owed this amount.

14 . As noted above, Petitioner disputes that $51,838.61 is

the amount of recovered medical expenses payable to Respondent ,

and instead asserts that $4,039.17 in medical expenses are

payable to Respondent.

15 . In support of his position, Petitioner presented the

testimony of Mrs. Maria Rodriquez, Yisell ' s mother. She

testified, persuasively, that theirs was a v ery close - knit

family who did everything together, and that the loss of Y isell

has destroyed their family life . She also testified that as a

result of the emotional trauma of losing Yisell, her health has

suffered, and she has difficulty sleeping and has gastric reflux

for which she is being treated.

16 . Petitioner also testified, persuasively, that the loss

of Yisell changed his life and the lives of his family members.

As he described it, " [her loss] has changed our life. It ' s all

the sadness. It ' s all the pain, everything. Everything ' s

changed. . . . We were happy. We were so happy. We were so

close. "

17 . Petitioner also presented the expert testimony of

Oscar Ruiz 7 / regarding the valuation of Petitioner ' s wrongful

death claim.

18 . Mr. Ruiz testified that in his opinion, $3 million

constituted a very conservative valuation of t he damages

suffered by Yisell ' s parents in this case . He based this

opinion on having interviewed Yisell ' s parents regarding the

impact of her loss on their family, and on his knowledge of jury

verdicts and settlements in recent Florida cases involving

awards of damages to parents for the loss of their children in

automobile accidents or due to medical malpractice . He

emphasized that his valuation was far more conservative than

many comparable cases that yielded substantially higher verdicts

or settlements.

19 . Petitioner asserts that Respondent is only entitled to

recover $4,039.17 in medical expenses on the basis of the

calculation method used in Arkansas Department of Health and

Human Services v. Ahlborn , 547 U.S. 268 (2006). Specifically,

Petitioner proposes to apply the same ratio that the settlement

of $140,000 bore to the total monetary value of all damages

($3 million, according to Petitioner ' s expert) to determine the

amount Respondent is owed f or medical expenses. Petitioner

contends that although Ahlborn did not establish a uniform

calculation method applicable in all cases, it nonetheless has

been accepted and applied by ALJs in other Medicaid third - pa rty

recovery cases to determine the amount of reimbursable medical

expenses under section 409.910(17 ) (b) , without challenge from

AHCA regarding the accuracy of th at method .

20 . Respondent did not present any evidence regarding the

value of Petitioner ' s claim or propose a differing valuation of

the damages.

21 . As more fully discussed below, Respondent contends

that the opportunity to rebut the medical expense allocation

provided under section 409.910(17)(b) is not available in cases

such as this, w here the Medicaid recipient dies before third -

party benefits are recovered through settlement or other means.

CONCLUSIONS OF LAW

22 . DOAH has jurisdiction over the parties and the subject

matter of this proceeding pursuant to sections 120.569 and

120.57(1), Florida Statutes.

2 3 . Petitioner has brought this proceeding pursuant to

section 409.910(17)(b), which states:

If federal law limits the agency to

reimbursement from the recovered medical

expense damages, a recipient, or his or her

legal representative, may contest the amount

designated as recovered medical expense

damages payable to the agency pursuant to

the form ula 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 a gency pursuant to

paragraph (a). The petition shall be filed

with the Division of Administrative

Hearings. For purposes of chapter 120, the

payment of funds to the agency or the

placement of the full amount of the third -

party benefits in the trust account for the

benefit of the agency constitutes final

agency action and notice thereof. Final

order authority fo r 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 amou nt designated

as recovered medical expenses, the recipient

must prove, by clear and convincing

evidence, [ 8/ ] that the portion of the total

recovery which should be allocated as past

and future medical expenses is less than the

amount calculated by the agen cy pursuant to

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

Alternatively, the recipient must prove by

clear and convincing evidence that Medicaid

provided a lesser amount of medical

assistance than that asserted by the agency.

The Medicaid Program and Th ird - Party Lien Statute

24 . The Medicaid program " provide[s] federal financial

assistance to s tates that chose to reimburse certain costs of

medical treatment for needy persons. " Harris v. McRae , 448 U.S.

297, 301 (1980).

25 . The Medicaid program is a cooperative one. The

federal government pays between 50 percent and 80 percent of the

costs a state incurs for patient care. In return, the state

pays its portion of the costs and complies with certain

statutory requirements for making eligibility determinations,

collecting and maintaining information, and administering the

program. Estate of Hernandez v. Ag. for Health Care Admin. ,

190 So. 3d 139, 141 - 42 (Fla. 3 d DCA 2016)(internal citations

omitted).

26 . Alt hough state participation in the Medicaid program

is optional, once a state elects to participate, it must comply

with federal Medicaid law . Harris , 448 U.S. at 301.

27 . One condition for receipt of federal Medicaid funds is

that states must seek reimbursement for m edical expenses

incurred on behalf of Medicaid recipients 9 / who subsequently

recover benefits fr om legally liable third parties. 10 /

See Ahlborn , 547 U.S. at 276 ; Hernandez , 190 So. 3d at 142

( federal law require s each participating state to implement a

third - party liability statute which requires the state to seek

r eimbursement for Medicaid expenditures from third parties who

are liable for medical assistance provided to a Medicaid

recipient).

28 . To comply with this requirement, the Florida

Legislature enacted the Medicaid Third - Party Liability Act,

section 409.910. This statute authorizes and requires the State

of Florida , through Respondent, to be reimbursed for Medicaid

funds paid for a recipient ' s medical assistance when that

recipient subsequently receives a personal injury judgment,

award, or settlement from a third party. Smith v. Ag. for

Health Care Admin. , 24 So. 3d 590 (Fla. 5 th DCA 2009). See also

Davis v. Roberts , 130 So. 3d 264, 266 (Fla. 5 th DCA

2013 )(recognizing that to comply with fede ral law , the Florida

Legislature enacted section 409.910, which authorizes the S tate

to recover , from a tort settlement , Medicaid money that the

S tate paid for medical expenses for a recipient ).

29 . Section 409.910(1) expresses the Florida Legislature ' s

clear intent that Medicaid be repaid in full for medical

assistance furnished to Medicaid recipients. The statute

states:

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 available

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 - party

benefits, regardless of whether a recipient

is made whole or other creditors paid.

Principles of common law and equity as to

assignment, lien, and subrogation are

abrogated to the extent necessary to ensure

full recovery by Medicaid from third - party

resources. It is intended that if the

resources of a liable third party become

available at any time, the public treasury

should not bear the burden of medical

assistance to the extent of such resources.

30 . To that end, Respondent is required to recover , from

third - party benefits, the full amount of medical assistance

provided by Medicaid on behalf of the recipient. Section

409.910(7) states:

The agency shall recover the full amount of

all medical assistance provided by Medicaid

on behalf of the recipient to the full

extent of third - party benefits.

(a) Recovery of such benefits shall be

collected directly from:

1. Any third party;

2. The recipient or legal representative,

if he or she has received third - party

benefits;

3. The provider of a recipient ' s medical

services if third - party benefits have been

recovered by the provider; notwithstanding

any provision of this section, to the

contrary, however, no provider shall be

required t o refund or pay to the agency any

amount in excess of the actual third - party

benefits received by the provider from a

third - party payor for medical services

provided to the recipient; or

4. Any person who has received the third -

party benefits.

31 . To enable Respondent to execute this mandate,

section 409.910(6) creates, in favor of Respondent, a lien on

any recovered third - party benefits for the full amount of the

medical assistance provided by Medicaid. The statute states , in

pertinent part :

(6) Wh en the agency provides, pays for, or

becomes liable for medical care under the

Medicaid program, it has the following

rights, as to which the agency may assert

independent principles of law, which shall

nevertheless be construed together to

provide the gre atest recovery from third -

party benefits:

(a) The agency is automatically subrogated

to any rights that an applicant, recipient,

or legal representative has to any third -

party benefit for the full amount of medical

assistance provided by Medicaid. Recov ery

pursuant to the subrogation rights created

hereby shall not be reduced, prorated, or

applied to only a portion of a judgment,

award, or settlement, but is to provide full

recovery by the agency from any and all

third - party benefits. Equities of a

reci pient, his or her legal representative,

a recipient ' s creditors, or health care

providers shall not defeat, reduce, or

prorate recovery by the agency as to its

subrogation rights granted under this

paragraph.

(b) By applying for or accepting medical

assi stance, an applicant, recipient, or

legal representative automatically assigns

to the agency any right, title, and interest

such person has to any third - party benefit,

excluding any Medicare benefit to the extent

required to be excluded by federal law.

1. The assignment granted under this

paragraph is absolute, and vests legal and

equitable title to any such right in the

agency, but not in excess of the amount of

medical assistance provided by the agency.

2. The agency is a bona fide assignee for

value in the assigned right, title, or

interest, and takes vested legal and

equitable title free and clear of latent

equities in a third person. Equities of a

recipient, the recipient ' s legal

representative, his or h er creditors, or

health care providers shall not defeat or

reduce recovery by the agency as to the

assignment granted under this paragraph.

3. By accepting medical assistance, the

recipient grants to the agency the limited

power of attorney to act in his or her name,

place, and stead to perform specific acts

with regard to third - party benefits, the

recipient ' s assent being deemed to have been

given, including:

a. Endorsing any draft, check, money order,

or other negotiable instrument representing

third - party benefits that are received on

behalf of the recipient as a third - party

benefit.

b. Compromising claims to the extent of the

rights assigned, provided that th e recipient

is not otherwise represented by an attorney

as to the claim.

(c) The agency is entitled to, and has, an

automatic lien for the full amount of

medical assistance provided by Medicaid to

or on behalf of the recipient for medical

care furnished as a result of any covered

injury or illness for which a third party is

or may be liable, upon the collateral, as

defined in s. 409.901.

32 . This automatic lien cannot be impaired by settlements

entered into on behalf of the recipient. To this point, t he

statute states:

No action of the recipient shall prejudice

the rights of the agency under this section.

No settlement, agreement, consent decree,

trust agreement, annuity contract, pledge,

security arrangement, or any other device,

hereafter collectiv ely referred to in this

subsection as a " settlement agreement, "

entered into or consented to by the

recipient or his or her legal representative

shall impair the agency ' s rights. However,

in a structured settlement, no settlement

agreement by the parties shall be effective

or binding against the agency for benefits

accrued without the express written consent

of the agency or an appropriate order of a

court having personal jurisdiction over the

agency.

§ 409.910(13), Fla. Stat.

33 . Also in furtherance o f the mandate that Respondent

seek reimbursement from third - party benefits to the limit of

legal liability, the Legislature has afforded Respondent the

right to " institute, intervene in, or join any legal or

administrative proceeding in its own name . . . as lienholder. "

§ 409.910(11) , Fla. Stat .

34 . S ection 409.910(11)(f) establishes a formula governing

the distribution of third - party benefits recovered in tort.

This provision states:

N otwithstanding any provision in this

section to the contrary, in the event of an

action in tort against a third party in

which the recipient or his or her legal

representative is a party which results in a

judgment, award, or settlement from a third

party, the amount recovered shall be

distributed as follows:

1. After attorney ' s fees and taxable costs

as defined by the Florida Rules of Civil

Procedure, one - half of the remaining

recovery shall be paid to the agency up to

the total amount of medical assistance

provided by Medicaid.

2. The remaining amount of the recove ry

shall be paid to the recipient.

3. For purposes of calculating the agency ' s

recovery of medical assistance benefits

paid, the fee for services of an attorney

retained by the recipient or his or her

legal representative shall be calculated at

25 percent of the judgment, award, or

settlement.

4. Notwithstanding any provision of this

section to the contrary, the agency shall be

entitled to all medical coverage benefits up

to the total amount of medical assistance

provided by Medicaid. For purpose s of this

paragraph, " medical coverage " means any

benefits under health insurance, a health

maintenance organization, a preferred

provider arrangement, or a prepaid health

clinic, and the portion of benefits

designated for medical payments under

coverage f or workers ' compensation, personal

injury protection, and casualty.

As noted above, Respondent asserts that pursuant to this

formula, it is entitled in this case to recover $51,838.61 of

its full lien of $86,491. 86 .

35 . Federal law imposes some limits on a state ' s authority

to recover medical expenses paid by Medicaid. One such limit is

imposed by t he federal Medicaid " anti - lien " statute, 42 U.S.C.

§ 1396 p(a)(1), which provides , in pertinent part , that : " [n]o

lien may be imposed against the property of any individual prior

to his death on account of medical assistance paid or to be paid

on his behalf under the State plan , " except under specified

circumstances. 42 U.S.C. § 1 396p( a )( 1 )(emphasis added).

Florida Case Law on Federal Anti - lien Statute Applicability

36 . Florida case law addressing the interplay between th is

federal anti - lien statute and section 409.910 consistently has

held that in cases where the recipient dies before a settlement

of an action in tort for third - party benefits is reached, the

federal anti - lien statut e does not operate to preempt or negate

the applicability of section 409.910(11)(f), so that the formula

governs the distribution of third - party benefits in such cases.

37 . Goheagan v. Perkins , 197 So. 3d 112 (Fla. 4th DCA

2016), involved circumstances similar to those present in this

case. In that case , Medicaid paid $95, 476.60 in medical

expenses for a recipient who ultimately died of injuries

sustained in an automobile accident. After the recipient ' s

death, the estate brought a wrongful death action against the

at - fault driver, resulting in a multi - million dollar judgment.

Thereafter, her estate recovered $1,000,000 from the at - fault

driver ' s insurer in a bad faith action. AHCA asserted a lien

for $95,476.60, the full amount it had paid for medical expenses

for the recipient. The estate moved to reduce the lien

commensurate with the percentage of the multi - million dollar

judgment that the lien amount cons tituted. The trial court

ordered the estate to repay the entire amount of the Medicaid

lien. On appeal, the Fourth District Court of Appeal affirmed

the trial court ' s order, concluding that the plain language of

the federal anti - lien statute clearly reflected Congress ' intent

that the statute only apply to recipients who are living when

the settlement or judgment against the third party is obtained ,

and not to recoveries made by an estate or beneficiary in a

wrongful death action . See Goheagan , 197 S o. 3d at 120.

38 . Hernandez v. Agency for Health Care Administration ,

190 So. 3d 139 (Fla. 3d DCA 2016) , yielded similar results. In

Hernandez , Medicaid paid $409,676.36 in medical expenses for

Hernandez, who ultimately died as a result of a hospital

physician ' s misdiagnosis and improper treatment of her medical

condition. T he hospital paid $700,000 in settlement of any

wrongful death claims Hernandez ' s estate may have brought

against the hospital. Thereafter, the estate filed an action in

court, seeking to apportion $200,000 as medical expenses to

satisfy AHCA ' s Medicaid lien. AHCA argued that pursuant to the

formula in 409.910(11)(f), it was owed $262,500 in medical

expenses from the recovered third - party benefits . The Third

District Court of Appeal held that the express terms of the

federal anti - lien statute mandated that it does not apply to a

Medicaid lien that vests a gainst the property of a Medicaid

recipient after his or her death. The court stated: " [i]f the

language of the statute is clear and unequivocal, then the

legislative intent must be derived from the words used without

involving incidental rules of construction or engaging in

speculation as to what the judges might think that the

legislators intended or should have intended. " Id. at 143

( citing Hess v. Philip Morris USA, Inc. , 175 So. 3d 687, 692

(Fla. 2015) ) . The court h e ld that the federal Medicaid Act ' s

anti - lien provision does not preempt Florida ' s Medicaid Third -

Party Liability Act where a Medicaid lien is imposed on a

wrongful death settlement. Id.

39 . Pursuant to the holdings in Goheagan and Hernandez , it

is concluded that in this case, the formula in section

409.910(11)(f) governs the distribution of the third - party

benefits recovered by Petitioner. 11 /

40 . As discussed above, applying that formula to the

$140,000 in third - party benefits Petitioner received , results in

$51,838.61 being owed to Respondent as reimbursement for its

Medicaid lien.

The 2017 Amendments to Section 409.910(17)(b)

41 . The 2017 a mendments to section 409.910(17 ) (b) do not

change this result.

42 . In the 2017 Legislative Session , the following

language, underlined, was added to the first sentence of

section 409.910(17)(b) 12 / :

If federal law limits the agency to

reimbursement from the recovered medical

expense damages , a recipient, or his or her

legal representative , may contest the amount

designated as recovered medical expense

damages payable to the agency pursuant to

the formula specified in paragraph (11)(f)

by filing a petition under chapter 120

within 21 days after the date of payment of

funds to the agency or after the date of

placing the full amount of the third - party

benefits in the trust account for the

benefit of the agency pursuant to

paragraph (a).

43 . The Florida Senate 2017 Summary of Legislation Passed

for Senate Bill 2514, 13 / discussing the amend ments to

section 409.910, generally explains the amendments ' purpose as

follows:

Section 19 amends s. 409.910, F.S., relating

to responsibility for payments on behalf of

Medicaid - eligible persons when other parties

are liable, and addresses federal compliance

issues in the current statute. Specifically

addressed are applicable federal law limits

on recoveries, evidentiary standards,

applicability to third party payers, and

payment response requirements. Outdated

provisions are deleted from the statute.

44 . Consistent with this explanation, t he addition of the

first clause to section 409.910(1 7)(b) appears to clarify that

the opportunity to challenge the amount of medical expenses

allocated under the formula in section 409.910(11)(f) is limited

to circumstances where the federal anti - lien statute applies ÏÏ

that is, to situations where the recipient is living at the time

AHCA ' s right to recover third - party benefits vests. This is

consistent with the plain language of the federal anti - lien

statute and with the holdings in Goheagan and Hernandez .

45 . As discussed a bove, because this proceeding involves

the recovery of third - party benefits after the death of the

Medicaid recipient, section 409.910(17)(b) does not afford

Petitioner the right to challenge Respondent ' s recovery pursuant

to the formula in section 409.910(11)(f), and the addition of

the first clause to the first sentence of section 409.910(17)(b)

does not change that result.

4 6 . The second amendment to the first sentence adds the

clause " or his or her legal representative. " This appears to

clari fy that a recipient who is otherwise entitled to bring a

challenge to AHCA ' s asserted recovery under section

409.910 (17)(b) may be represented in that proceeding by a legal

representative. This amendment does not create entitlement to

bring such a challen ge, but only clarifies who may bring that

challenge.

Conclusion

47 . There is absolutely no question in the mind of the

undersigned that Petitioner and his famil y have suffered, and

continue to suffer, a grievous loss due to the tragic death of

Yisell.

48 . However, while this outcome may seem inequitable,

the Florida Legislature has clearly stated that equity cannot

serve as the basis for reducing the Medicaid lien. See

§ 409.910(6) (a) & (b)2. , Fla. Stat.

49 . As compelling as the circumstances in this proceeding

are, the undersigned is nonetheless required to follow the

applicable law. Here, the applicable law, discusse d in detail

above, dictates that pursuant to section 409.910(11)(f),

R espondent is entitled to recover $51, 8 38.61 in third - party

benefits paid to Petitioner through settlement of his actions in

tort.

ORDER

Consistent with the above Findings of Fact and Conclusions

of Law, it is hereby ORDERED that :

T he Petition to Determine Medicaid Lien filed by Julio

Cesar Cabrera, as Personal Representative of the Estate of

Yisell Cabrera Rodriquez, deceased, is dismissed.

DONE AND ORDERED this 23rd of January, 2018, in

Tallahassee, Leon County, Florida .

S

Cathy M. Sellers

Administrative Law Judge

Division 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 23rd day of January, 2018 .

ENDNOTES

1/ The 2017 version of Florida Statutes is applicable to this

case. In Suarez v. Port Charlotte HMA, LLC , 171 So. 3d 740

(Fla. 2d DCA 2015), the co urt determined that AHCA ' s right under

section 409.910 to be reimbursed from third - party benefits

recovered by the Medicaid recipient vests at the time of the

recipient ' s recovery of those benefits , not when the lien itself

attaches , so the version of section 409.910 in effect at the

time of the recovery of third - party benefits applies to

challenges brought under section 409.910(17)(b). As noted in

paragraph 1 1 , Petitioner ' s settlement agreements with the third

parties in this case were executed on July 14, 2017.

2/ Richard Cotton, a Spanish l anguage interpreter, translated

the examination of Maria Rodriquez.

3/ In addition to Petitioner ' s Proposed Final Order, Petitioner

also filed Petitioner ' s Memorandum of Law in Support of Proposed

Final Order, and Petitioner ' s Notice of Supplemental Authority.

These documents have been treated as part of Petitioner ' s

P roposed F inal O rder.

4/ " Third - party benefit " is defined by section 409.901(28) as:

any benefit that is or may be avai lable at

any time through contract, court award,

judgment, settlement, agreement, or any

arrangement between a third party and any

person or entity, including, without

limitation, a Medicaid recipient, a

provider, another third party, an insurer,

or the ag ency, for any Medicaid - covered

injury, illness, goods, or services,

including costs of medical services related

thereto, for personal injury or for death of

the recipient, but specifically excluding

policies of life insurance on the recipient,

unless avail able under terms of the policy

to pay medical expenses prior to death. The

term includes, without limitation,

collateral, as defined in this section,

health insurance, any benefit under a health

maintenance organization, a preferred

provider arrangement, a prepaid health

clinic, liability insurance, uninsured

motorist insurance or personal injury

protection coverage, medical benefits under

workers ' compensation, and any obligation

under law or equity to provide medical

support.

5/ Section 409.910(6)(b) p rovides that by applying for or

accepting medical assistance, an applicant, recipient, or legal

representative automatically assigns to AHCA any right, title,

and interest such person has to any third - party benefit,

excluding any Medicare benefit to the ex tent required to be

excluded by federal law. Pursuant to this provision, Yisell

assigned her right to recover, from third parties, the medical

expenses paid by Medicaid.

6 / This amount is calculated as follows: 25% of $140,000 =

$35,000. $140,000 Î ($3 5,000 in attorney ' s fees $1,322.79 in

costs) = $103,677.21. $103.677.21 ÷ 2 = $51,838.61.

7 / Mr. Ruiz has been a practicing attorney for 37 years. He

started his career with the U.S. Department of Justice in the

Torts Branch of the Civil Division, where he represented the

United States in civil litigation, medical malpractice, and

national secu rity cases. Thereafter, he joined a large Florida

law firm, where he served as head of the firm ' s medical

malpractice defense section. In that capacity, he represented

Jackson Memorial Hospital and the University of Miami Medical

School in malpractice ca ses. For the last 30 years, he has

practiced in his own law firm, specializing in plaintiff

representation in medical malpractice cases.

8 / In Gallardo v. Senior , 2017 U.S. Dist. LEXIS 112448, *21 - *23

(N.D. Fla. July 18, 2017), the court determined t hat the " clear

and convincing " standard in section 409.910(17)(b) is preempted

by the federal Medicaid Act. Accordingly, if the merits of

Petitioner ' s challenge in this proceeding were reached, he would

be required to demonstrate, by a preponderance of th e evidence,

that Respondent is entitled to a lesser amount of medical

expenses than it would recover pursuant to application of the

formula in section 409.910(11)(f). However, as discussed below ,

because the federal anti - lien statute does not apply in thi s

case because the recipient died before the settlement agreements

with liable third parties were executed, as a matter of law,

Petitioner is not entitled to a reduction of the recovery amount

determined pursuant to the formula in section 409.910(11)(f).

9 / Section 409.901(19) defines a " Medicaid recipient, " in

pertinent part, as an individual whom the Department of Children

and Families determines is eligible, pursuant to federal and

state law, to receive medical assistance and related services

for whi ch the agency may make payments under the Medicaid

program. For purposes of determining third - party liability, the

term includes an individual formerly determined to be eligible

for Medicaid, an individual who has received medical assistance,

or an indivi dual on whose behalf Medicaid has become obligated.

1 0 / Title 42 U.S.C. § 1396a(a) sets forth the requirements that

a state Medicaid plan must address to be consistent with federal

law. One of those requirements is that the state must enact

laws under which a Medicaid recipient is considered to have

assigned to the state his or her right to recover from, liable

third parties, medical expenses paid by Medicaid. Title

42 U.S.C. § 1396a(a)(25)(H), which imposes this specific

requirement, states:

that to the extent that payment has been

made under the State plan for m edical

assistance in any case where a third party

has a legal liability to make payment for

such assistance, the State has in effect

laws under which, to the extent that payment

has been made under the State plan for

medical assistance for health care item s or

services furnished to an individual, the

State is considered to have acquired the

rights of such individual to any payments by

such third party.

11 / Petitioner urges the undersigned to reject the application

of Goheagan and Hernandez to this proceed ing on two grounds.

First, Petitioner contends that these cases are not pertinent

because they addressed the ability of a trial court to reduce a

Medicaid lien , rather than addressing the ability of an

administrative forum to do so pursuant to section

409.910(17 ) (b). Second, he urges that these cases should be

disregarded because they " misconstrue " federal Medicaid law and

provide only a " shallow, confused review of federal Medicaid law

and reach the wrong result. " Neither of these arguments is

well - t aken. Petitioner ' s first argument disregards that at the

time of th e trial court proceedings in tho se cases, section

409.910(17)(b) had not yet been enacted , so trial courts were

the only forum available in which to seek a reduction of the

lien and reimbursement amounts. To comply with the holding in

Wos v. E.M.A. , 568 U.S. 627 (2013) , requiring states to provide

an administrative opportunity and forum in which t o rebut the

application of a medical expenses recove ry allocation pursuant

to formula , the Florida Legislature enacted section

409.910(17)(b) in 2013 . See Harrell v. State , 143 So. 3d 478,

480 n.1 (Fla. 1st DCA 2014) ; Villa v. Ag. for Health Care

Admin. , Case No. 15 - 4423MTR ( Fla. DOAH Dec. 30, 2015 ) aff ' d sub.

nom. Giraldo v. Ag. for Health Care Admin. , 208 So. 3d 244

(Fla. 1st DCA 2016). However, t he rational e for the holdings in

Goheagan and Hernan dez is equally applicable in judicial and

administrative proceedings. Th ose cases address ed the interplay

between the federal anti - lien statute and the Medicaid Third -

Party Liability Act, and determined that the federal anti - lien

statute only applies to situations where the Medicaid recipient

is living when the third party benefits are recovered by

settlement or other means. This substantive law is not affected

or changed according to the forum ÏÏ judicial or administrative ÏÏ

in which the reimbursement reduction proceeding is brought.

Petitioner ' s second argument invites the undersigned to

disregard binding Florida appel late case law in this proceeding ,

which the undersigned cannot do .

12 / In addition to the language added to the first sentence, the

Legislature clarified that the amount designated as recovered

medical expenses under t he formula can be challenged, and also

imposed on the challenger a " clear and convincing evidence "

standard to show that Medicaid provided a lesser amount of

medical assistance than that asserted by the agency. These

changes affect provisions in the statute that are not at issue

in this proceeding.

13 / The undersigned takes official recognition of this document

pursuant to section 90.202(6), which authorizes judicial notice

of records of any state, territory, or jurisdiction of the

United States. The 2017 amendments to section 409.910, which

included the amendments to section 409.910(17)(b), constituted

section 19 of Senate Bill 2514, the comprehensive health care

bill that passed during the 2017 Legislative Session.

COPIES FURNISHED:

Alexander R. Boler, Esquire

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

(eServed)

Kim Annette Kellum, Esquire

Agency for Health Care Administration

2727 Mahan Drive , Mail Stop 3

Tallahassee, Florida 32308

(eServed)

Steven G. Jugo, Esquire

Law Offices of Jugo & Murphy

Offices at Pinecrest, Suite 2 00

7695 Southwest 104th Street

Miami, Florida 33156

(eServed)

Kathleen T. Murphy, Esquire

Law Offices of Jugo & Murphy

Offices at Pinecrest, Suite 200

7695 Southwest 104th Street

Miami, Florida 33156

(eServed)

J ustin Senior, Secretary

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 1

Tallahassee, Florida 32308

(eServed)

Stefan Grow, General Counsel

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

(eServed)

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

(eServed)

Thomas M. Hoeler, Esquire

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

(eServed)

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

Statutes. 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 prescrib ed 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 resides or as otherwise provided by law.