18-001995MTR Kimikia Molina vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Monday, September 17, 2018.

Summary: Petitioner did not prove that the agency's Medicaid lien amount should be reduced. The agency is awarded the full amount of the undisputed lien amount it held for Medicaid payments made on behalf of Petitioner.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

KIMIKIA MOLINA,

Petitioner,

vs. Case No. 18 - 1995MTR

AGENCY FOR HEALTH CARE

ADMINISTRATION,

Respondent.

_______________________________/

FINAL ORDER

O n August 22, 2018, Administr ative Law Judge Hetal Desai

with the Division of Administrative Hearings (DOAH) conducted

t he final hearing by video conference wi th sites in Tallahassee

and Sarasota , Florida.

APPEARANCES

For Petitioner: Robert J . Healy , Esquire

Salter, Healy, LLC

Post Office Box 10807

St. Petersburg, Florida 33733 - 0807

For Respondent: Alexander R. Boler, Esquire

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

STATEM ENT OF THE ISSUE S

The issue for determination is the amount Petitioner,

Kimikia Molina , must pay to Respondent, Agency f or Health Care

Administration (the Agency or AHCA), out of h er settlement

proceeds as reimbursement for past Medicaid expenditures

pursu ant to section 409.910, Florida Statutes (2017 ). 1/ More

specifically, it must be determined whether Petitioner owes the

default amount , $41,250 , pursuant to section 409.910(11)(f) ; and ,

if not, what portion of her $ 110 ,000 settlement proceeds is due

to AH CA.

PRELIMINARY STATEMENT

On April 16, 2018 , Petitioner, a Medicaid recipient, filed

a ÐPetition to Determine Amount Payable to Agency for Health

Care Administration in S atisfaction of Medicaid l ienÑ (Petition)

with DOAH. Upon receiving the Petition, DOAH notified AHCA of

the Petition and assigned it to an Administrative Law Judge .

The Petition argues that the Medicaid l ien asserted by AHCA

against her settlement proceeds should be reduced because she

received less than the Ðsettlement valueÑ of her claim . The

Agency argues it must be reimbursed for its Medicaid lien in the

amount of $41,250, as calculated pursuant to section

409.910(11)(f).

The final hearing was held on August 22, 201 8 . 2/ Petitioner

offered the testimony of Frank Currie, Esq uire , and P etitioner Ós

Exhibits 1 through 9 were admitted into evidence without

objection. The Agency did not offer any witnesses, but offered

RespondentÓs Exhibit 1, which was admitted into evidence .

At the conclusion of the hearing, the parties indicated a

transcr ipt would not be filed. The parties were ordered to file

post - hearing submittals no later than 5:00 p.m. on September 4,

2018 . Both parties timely filed proposed final orders (PFOs),

and both PFOs have been considered.

FINDING S OF FACT

Underlying Acciden t and Injuries

1. Although there was no testimony regarding PetitionerÓs

accident or injuries, the following information can be gleaned

from her medical records. On February 3, 2017, Petitioner, then

age 22, was admitted to a medical facility after being involved

in a motor vehicle accident. Petitioner had been a passenger in

the car and was not wearing her seatbelt; the driver of the car

was declared Ðsignal 7Ñ (or deceased) by the emergency

responders at the scene of the accident.

2. Petitioner was treated for neuro logical and orthopedic

injuries , including surgical care to her left knee, right ankle

and fibula.

3. After numerous surgeries, on March 8, 2017, Petitioner

was released from the medical facility to return home. At the

time of her rele ase, she still had splints on her left arm and

right leg and dressings on her wounds, but was otherwise stable

and alert.

4. Upon discharge, Petitioner was placed on restrictions

that included the following :

• No driving.

• No tub baths .

• No heavy lifting (ove r 10 pounds).

• No lifting, pulling, pushing, or straining.

• No weight bearing on the lower right side.

These restrictions were to remain in effect until lifted by a

doctor. Petitioner was also given instructions to follow up

with physical and occupational therapy.

5. The parties stipulated that Medicaid provided

$55,042.63 toward Petitioner Ó s past medical expenses arising out

of the February 2017 car accident .

6. Additionally, Amerigroup Community Care has a lien

against the settlement amount for $3 ,199 .59 .

7. Petitioner submitted billing records establishing she

incurred $3,865 for services provided by Rehab Consultants of

Central Florida from March 16 to August 24, 2017. There was no

evidence if this amount remains unpaid, what kinds of services

were provided, or whether they were effective in PetitionerÓs

rehabilitation.

8 . There was no evidence as to whether Petitioner suffered

from any emotional injuries .

9 . There was no evidence as to whether the accident had a

permanent impact on her ph ysical abilities.

10 . There was also no evidence as to whether Petitioner,

who is relatively young, suffered from memory or other cognitive

injuries that would prevent her from working in the future.

1 1 . There was no evidence how the accident affected

Petition erÓs daily life functions, or her ability to maintain

normal family, social , and work relationships.

Petitioner Ó s Sources of Recovery

1 2 . The parties stipulated that i n total, Petitioner

received $ 110 ,000 in gross settlement proceeds . These proceeds

cam e from two sources. The bulk of the proceeds were provided

as a result of a unilateral ÐBodily Injury ReleaseÑ (Release)

with Progressive American Insurance Company (Progressive),

executed by Petitioner on March 22, 2018. The release indicates

Petitioner would receive $100,000 in exchange for forfeiting her

rights to pursue any claims arising out of the February 2017

accident against the estate of Loron Michael Turner (presumably

the driver and/or owner of the vehicle).

13 . The remaining $10,000 was pr ovided to Petitioner by

State Farm Insurance under a policy held by Jesmarie and Mirian

Perez. There was no evidence or testimony iden tifying the

relationship of the Perezes to Petitioner or the driver of the

vehicle.

Allocation of Past Medical Expend iture s

1 4 . The key factual issue in this case is how much of the

$110,000 settlement funds are available to ACHA for payment of

the Medicaid lien. One way to determine this amount is through

a default formula set forth in section 409.910(11)(f ) . The

parties stipulated that under th is default formula, P etitioner

is required to pay AHCA $ 4 1, 250 for its Medicaid lien from the

$110 ,000 total settlement proceeds. 3/

1 5 . Alternatively, Petitioner can show that a lesser

amount than the default amount Ðshou ld be allocated as

reimbursementÑ for past medical expenses. See § 409.910(17)(b) ,

Fla. Stat . Here, Petitioner urges the reduction of the Medicaid

lien by the ratio of the actual settlement recover y to the

Ðsettlement value Ñ amount. Using this formula, Petitioner

claims AHCA can only recover 5.5 percent of the past medical

expenses, or a total of $3,208.72 from the $110,000 settlement

proceeds. Peti tioner offered only the Release and the opinion

of Frank Currie in support of using this formula.

1 6 . The Release, signed only by Petitioner (not

Progressive or the Turner estate), states in relevant part:

The parties to this release agree that the

total value of Kimikia MolinaÓs claim is

$2,000,000.00 that of that $58,340.35 is

allocated for past medical bil ls, $41,659.70

is allocated to past lost wages, $720,000.00

is allocated to future loss of earning

capacity, $590,000.00 is allocated to past

pain and suffering and $590,000.00 is

allocated to future pain and suffering.

1 7 . There was no evidence as to how the parties arrived at

the monetary allocations in the Release. Petitioner provided no

evidence supporting the ReleaseÓs allocations of past lost wages,

future loss earnings, or non economic damages , such as pain and

suffering.

1 8 . AHCA was not a part y to the Release.

1 9 . There was no evidence as to how the $10,000 State Farm

proceeds were to be allocated among the damage categories.

2 0 . Regarding Mr. Cu r rieÓs testimony, although he may have

had litigation experience in personal injury lawsuits, h is

testimony did not establish why an alternative to the default

formula should be used in PetitionerÓs case.

21 . Mr. Currie testified PetitionerÓs Ðsettlement valueÑ

would have been $2 million, but it was not clear from his

testimony that the Ðsettleme nt valueÑ is equivalent to the

Ðtotal value of Kamikia MolinaÓs claim,Ñ as referenced in the

Release. See Smathers v. Ag . for Health Care Admin. , Case No.

16 - 3590MTR, 2017 Fla. Div. Adm. Hear. LEXIS 540, at *7 - 8 (Fla.

DOAH Sept. 13, 2017) (defining total provable damages as Ðall

components of a plaintiffÓ s recoverable damages, such as medical

expenses, lost wages, and noneconomic damages ( e.g. , pain and

suffering)Ñ ).

2 2 . Moreover, according to Mr. Currie , the terms

Ðsettlement valueÑ and Ðjury awardÑ ar e different from each

other and do not necessarily establish the total value of

PetitionerÓs claim or the amount of damages suffered by

Petitioner. He explained, the factors in determining a

Ðsettlement valueÑ include the best interest of the client, as

w ell as the cost and risk of going to trial.

2 3 . In contrast, a Ðjury awardÑ is the amount of damages

that can be proven at trial, and can be influenced by a juryÓs

emotions. In this case, Mr. Currie admitted a hypothetical jury

could have been influence d by a number of fact s , including : the

defendant was an estate (as opposed to an individual) ;

Petitioner fail ed to use her seat belt ; and alcohol contributed

to the accident.

2 4 . Regardless of whether the $2 million figure cited by

Mr. Currie was a Ðset tlement valueÑ or pote ntial Ðjury award,Ñ

there was insufficient evidence establishing this figure because

there was no evidence establishing the el ements other than past

medical expenses , such as an amount attributable to future

medical expenses, lost wag es, or pain and suffering. Thus ,

Mr. CurrieÓs opinion as to th e medical expenses portion of the

settlement is purely speculative and inconsistent with the

Release . For example, Mr. Currie testified Petitioner

previously made approximately $18,000 a year in salary. 4 / But

using this figu re, PetitionerÓ s past lost earnings from February

2017 (the date of the accident) to March 2018 (the date of the

settlement) would total approximately $20,000, not the $42,000

agreed to in the Release.

2 5 . Moreover, Mr. C urrieÓs opinion regarding the value of

PetitionerÓs case was not based on an established methodology or

verifiable facts. Although Mr. Currie testified he reviewed the

Release and PetitionerÓs medical records in reaching the

$2 million figure, there was no evidence at the hearing that he

was sufficiently familiar with the facts of PetitionerÓs current

economic situation, her work history, or current employability.

There was no evidence that he met with Petitioner or knew any

information other than what wa s in PetitionerÓs exhibits.

2 6 . E ven Mr. Currie noted the cases he relied upon to

establish his $2 million settlement valuation were procedurally

and factually distinguishable from PetitionerÓs situation . For

example, some of the cases involved recover y after a jury awa rd,

others involved settlements; some involved alcohol, some did

not; and u nlike one of the other claimants, Petitioner was not

known to have a pre - existing medical condition .

2 7 . The undersigned rejects Mr. CurrieÓ s testimony

because, although unrebutted , it was not based on a reliable

methodology or sufficiently established facts. Although he

relied on a number of verdict reports where the claimant had

injuries similar to Petitioner Ós , the underlying facts of

PetitionerÓs accident an d medical situation were never

sufficiently established at the hearing to meaningfully compare

them to the facts of these cases; there was no evidence

regarding PetitionerÓs pre - accident health, her occupation, or

her future ability to work.

2 8 . Neither the Release nor Mr. CurrieÓs testimony

establish that the Ðactual settlement Ñ - to - Ð settlement value Ñ

formula should be applied to Petitioner Ós Medicaid lien instead

of the default formula, nor did Petitioner establish the

Ðsettlement valueÑ of her claim wa s $2 million .

2 9 . Petitioner has not proven by a preponderance of the

evidence an alternative amount should be allocated for

reimbursement for past medical expenses.

CONCLUSIONS OF LAW

30 . The Division of Administrative Hearings has

jurisdiction over t he subject matter and parties in this case

pursuant to sections 120.569, 120.57, and 409.910 , Florida

Statutes (the Medicaid Third - Party Liability Act ). See Delgado

v. Ag. for Health Care Admin . , 4 3 Fla. L. Weekly D 245, 2018

Fla. App. LEXIS 1012, at *11 - 1 2 (Fla. 1st DCA 2018) .

31 . As most recently explained by the Florida Supreme Court

in Giraldo v. Ag. for Health Care Admin. , 43 Fla. L. Weekly S279 ,

2018 Fla. LEXIS 1376 , at * 5 (Fla. July 5, 2018) , Medicaid is a

joint federal Ï state program designed to h elp participating states

provide medical treatment for their residents who cannot afford

to pay for treatment . 5 /

32 . In order for the state of Florida to take advantage of

Medicaid funds for patient care costs, it must comply with the

federal regulation s requiring it to recover its expenditures for

the medical expenses from third - party sources such as settlement

agreements . 42 U.S.C. § 1396a(a)(25)(B); Ahlborn , 547 U.S. at

284 - 85. At the same time, the Medicaid statute limits a stateÓs

right to collec t reimbursement of expended funds to only those

third - party monies that can be allocated for medical care.

42 U.S.C. § 1396p(a)(1) ; Ahlborn , 547 U.S. at 285 - 86.

3 3 . As mentioned above, t he Legislature set forth a

Ðdefault formula Ñ to determine the amoun t AHCA may recover for

past Medicaid payments from a judgment, award, o r settlement from

a third - party. See § 409.910(11)(f), Fla. Stat. The statute,

however, provides Medicaid r ecipients with a method for

challenging this default amount by initiating an administrative

proceeding through DOAH. See § 409.910(17)(b) ( provid ing the

procedure by which a Medicaid recipient may contest the amount

designated as recovered medical expenses payable under section

409.910(11)(f) ) .

34. Recent federal and state cou rt decisions have struck

down portions of section 409.910(17)(b) , so that this section

currently is interpreted as follows:

This procedure is the exclusive method for

challenging the amount of third - party

benefits payable to the agency. In order to

succes sfully challenge the amount payable to

the agency, the recipient must prove, by

[ a preponderance of the evidence ] clear and

convincing evidence , that a lesser portion of

the total recovery should be allocated as

reimbursement for past and future medical

e xpenses than the amount calculated by the

agency pursuant to the formula set forth in

paragraph (11)(f) or that Medicaid provided a

lesser amount of medical assistance than that

asserted by the agency. ( strike - through and

underline added) .

See Giraldo , 2 018 Fla. Lexis 1376, at *8 ( hold ing Ð federal law

allows AHCA to lien only the past medical expenses portion of a

Medicaid beneficiary's third - party tort recovery to satisfy its

Medicaid lien .Ñ); Gallardo , 263 F. Supp. 3d at 1260 (holding

FloridaÓs Ðclear a nd convincingÑ burden in section

409.910(17)(b) is preempted by federal law). 6/

3 5 . Again, the burden wa s on Petitioner -- as the Medicaid

recipient -- to prove by a preponderance of the evidence that a

lesser portion of the total recovery should be allocated as

re imbursement for past medical expenses rather than the amount

calculated by AHCA . The Ð preponderance of the evidence Ñ standard

requires some convincing testimony or evidence to lead the fact

finder to choose one sideÓs argument versus the other.

See S. Fla. Water Mgmt. v. RLI Live Oak, LLC , 139 So. 3d 869, 872

n.1 (Fla. 2014) .

3 6 . As set forth in Giraldo , there must be a "reasonable

basis in the evidence" for the rejection of Ðuncontradicted

testimony.Ñ Giraldo , 2018 Fla. LEXIS 1376, at *7 - 8. Suc h

reasonable basis can include Ðconflicting . . . evidence,

evidence that impeaches the expert's testimony or calls it into

question, such as the failure of the plaintiff to give the . . .

expert an accurate or complete . . . history, conflicting lay

testi mony or evidence , . . . or the plaintiff's conflicting

testimony or self - contradictory statements.Ñ Wald v. Grainger ,

64 So. 3d 1201, 1206 (Fla. 2011).

37 . Here, there was no evidence that PetitionerÓs total

provable damages would be $2 million. Althoug h Petitioner relies

on the language in the Release, ACHA is not bound by the

allocations set forth in the settlement amount. See Domingo v.

Ag. for Health Care Admin . , Case No. 17 - 5471MTR, 2018 Fla. Div.

Adm. Hear. LEXIS 315, at *15 ( Fla . DOAH May 22, 201 8)(Ð It could

not be more clear that the Legislature intended all Medicaid

liens to be repaid, and that absent joinder in a settlement

agreement by the Agency, such agreements do not affect the amount

of the lien. Ñ). In fact, the Legislature explicitly pro hibits

the Release from being used to establish what portion of the

settlement proceeds can be allo cated for past medical expenses in

s ec t ion 409.9 1 0 (13) , which provides in relevant part :

No action of the recipient shall prejudice

the rights of the agency [AHCA] under this

section. No . . . Ðsettlement agreement,Ñ

entered into or consented to by the recipient

or his or her legal representative shall

impair the agencyÓs rights.

See also Deyam par t v. Ag. for Health Care Adm in . , Case No. 17 -

4560MTR, 2018 Fla . Div. Adm. Hear. LEXIS 2, at *16 - 17 ( Fla. DOAH

Jan. 3, 2018).

38 . Even if Petitioner had proven that an alternative to

the default formula should be used to determine the portion of

the settlement attributable to past medical expenses, she did not

establ ish she could have been awarded $2 million dollars in

damages. As explained above, the allocations of damages for the

remaining components of future medical expenses, future lost

wages, or past and future pain and suffering in the Release are

not corrobor ated by any evidence. Without such evidence of oth er

potential damage elements , it is impossible to determine the

total Ðsettlement valueÑ or what amount is attributable to past

medical expenses. See Mojica v. Ag. for Health Care Admin. , Case

No. 17 - 1966 MTR, 2018 Fla. Div. Adm. Hear LEXIS 273, at *15 (Fla.

DOAH May 3, 2018).

39 . Because Petitioner has not established that ACHA should

be reimbursed in an amount other than that set forth by the

default formula in section 409.910(11)(f) , Petitioner is liab le

for the default amount of $41,250.

ORDER

Based on the foregoing Findings of Fact and Conclusions of

Law, it is hereby :

ORDERED that the Agency for Health Care Administration may

recover $ 4 1, 250 from PetitionerÓs settlement proceeds at issue

in this matt er in satisfaction of its Medicaid lien.

DONE AND ORDERED this 17 th day of September , 2018 , in

Tallahassee, Leon County, Florida.

S

HETAL DESAI

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Build ing

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 17th day of September , 2018 .

ENDNOTE S

1/ Unless referenced o therwise, all citations to state and

federal statutes, rules and regulations are to the 2017

versions , which were in effect at the time of Petitioner Ós

settlement agreement . See Cabrera v. Ag. for Health Care

Admin. , DOAH Case No. 17 - 4557MTR, 2018 Fla. Di v. Adm. Hear.

LEXIS 43 n.1 (Fla. DOAH Jan. 23, 2018)(citing Suarez v. Port

Charlotte HMA , 171 So. 3d 740 (Fla. 2d DCA 2015)).

2/ A properly noticed telephonic pre - hearing conference w as

conducted on August 14, 2018, but because t he Agency failed to

appea r for the hearing , no significant issues were discussed.

3/ Section 409.910(11)(f) establishes the AgencyÓs default

recovery amount for a Medicaid lien : the default amount is

equal to one - half of the total award, 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.

4/ Other than Mr. CurrieÓs testimony, there was no evidence at

the hearing establishing P etitioner Ós past sal ary .

5/ Although participation in Medicaid is voluntary , all states

take advantage of this funding source for the medical needs of

its citizens. See Ark. DepÓ t of Health & Human Servs. v.

Ahlborn , 547 U.S. 268, 275 (2006 ) (Ð States are not required to

p articipate in Medicaid, but all of them do. The program is a

cooperative one; the Federal Government pays between 50% and 83%

of the costs the State incurs for patient care, and, 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.Ñ); see also Gallardo v. Dudek , 263 F.

Supp. 3d 1247, 1250 (N.D. Fla. 2017) , amended on rehearing , 2017

U.S. Dist. LEXIS 11 2448 (N.D. Fla. 2017) , rev . granted , Case

No. 17 - 13693 (11 th Cir. 2017).

6/ In Gallard o , Judge Mark Walker enjoined ACHA from a pplying

the clear and convincing standard in section 409.910(17)(b) .

Therefore, the Agency has stipulated to the preponderan ce of the

evidence default standard under section 120.57(1)(j). See also

Museguez v. Ag. for Health Care Admin . , Case No. 16 - 7379MTR, 2017

Fla. Div. Adm. Hear. LEXIS 561 , at *36 - 37 (Fla. DOAH Sept. 19,

2017) (explaining the default burden of proof after G allardo

pursuant to section 120.57(1)(j) is preponderance of the

evidence); Lamendola v. Ag. for Health Care Admin. , Case No.

17 - 3908MTR, 2018 Fla. Div. Adm. Hear. LEXIS 6, at *14 - 15 ( Fla.

DOAH Jan. 5, 2018) (ÐNotwithstanding the language of section

409.9 10(17)(b), because of rulings in Gallardo , . . .

PetitionerÓs burden in this case is a preponderance of the

evidence .Ñ)

COPIES FURNISHED:

Alexander R. Boler, Esquire

Suite 300

2073 Summit Lake Drive

Tallahassee, Florida 32317

(eServed)

Kim Annette Ke llum, Esquire

Agency for Health Care Administration

Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308

(eServed)

Robert J. Healy, Esquire

Salter, Healy, LLC

Post Office Box 10807

St. Petersburg, Florida 33733 - 0807

(eServed)

Justin Senior , Se c reta ry

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)

Shena Grantham, Esquire

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 re view 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 prescribed by law,

with the clerk of the District Court of Appeal in the appellate

district where the agency maintain s its headquarters or where a

party resides or as otherwise provided by law.