20-003573MTR Christopher Sciesinski vs. Agency For Health Care Administration, And Sunshine Health Plans, Inc. Status: Closed DOAH Final Order on Tuesday, March 16, 2021.

Summary: Petitioner proved by clear and convincing evidence that the total of the Medicaid liens should be reduced by the same ratio as the settlement is to the value of the claim.

S TATE OF F LORIDA

D IVISION OF A DMINISTRATIVE H EARINGS

C HRISTOPHER S CIESINSKI ,

Petitioner ,

vs. Case No. 20 - 3573MTR

A GENCY F OR H EALTH C ARE

A DMINISTRATION , A ND S UNSHINE

H EALTH P LANS , I NC . ,

Respondents .

/

F INAL O RDER

Pursuant to notice, a final hearing in this cause was held in Tallahassee,

Florida, via Zoom video conference on December 9, 2020, before Linzie F.

Bogan, Administrative Law Judge of the Division of Administrati ve

Hearings.

A PPEARANCES

For Petitioner Christopher Sciesinski :

Floyd B. Faglie, Esquire

Staunton & Faglie, PL

189 East Walnut Street

Monticello, Florida 32344

For Respondent Agency for Health Care Administration :

Alexand er R. Boler, Esquire

2073 Summit Lake Drive, Suite 330

Tallahassee, Florida 32317

For Respondent Sunshine Health Plans, Inc.:

Seann M. Frazier, Esquire

Parker, Hudson, Rainer & Dobbs, LLP

215 South Monroe Street, Suite 750

Tallahassee, Florida 32301

S TATEMENT OF T HE I SSUE

What amount from PetitionerÔs settlement proceeds should be paid to

satisfy RespondentsÔ Medicaid liens under section 409.910, Florida Statutes

(2020)? 1

P RELIMINARY S TATEMENT

On August 12, 2020, C hristopher Sciesinski (Petitioner or Mr. Sciesinski)

filed with the Division of Administrative Hearings (DOAH) a Petition to

Determine Amount Payable to Satisfy Medicaid Lien. At the final hearing,

Petitioner offered testimony from Scott Borders, Esquire, and Karen Gievers,

Esquire. Neither the Agency for Health Care Administration (AHCA) nor

Sunshine Health Plans, Inc. (Sunshine) , called witnesses to testify on its

behalf.

PetitionerÔs Exhibits 1 through 10 were admitted into evidence. Neither

AHCA nor S unshine offered exhibits into evidence. The parties filed a pre -

hearing stipulation that included 13 admitted and undisputed facts. Findings

of Fact 1 through 13 set forth those stipulations and agreements in near -

verbatim form.

A Transcript of the final hearing was filed with DOAH on January 21,

2021. On February 9, 2021, an Order was entered granting the partiesÔ Joint

Motion for Extension of Time to File Proposed Orders. On or about

1 All subsequent references to Florida Statutes are to the 2020 version, unless otherwise

indicated.

February 15, 2021, each party filed a proposed order, and the same have been

considered in the preparation of this Final Order.

F INDINGS OF F ACT

1. On January 28, 2018, Mr. Sciesinski[,] who was then 43 years old, was

admitted to the Hospital with an epidural abscess and a[n] oral abscess. He

was treated with antibiotics and had his oral abscess lysed and molars

removed. In February 2018 [,] he presented to the Hospital with shaking,

chills, fevers [,] and malaise. His antibiotics were changed and he was

discharged home. On May 30, 2018[,] Mr. Sciesinski again presented to the

[H] ospital with increasing neck pain. He was diagnosed with a

retropharyngeal abscess and underwent surgery. During surgery [,]

Mr. Sciesinski suffered a spinal cord injury permanently rendering

Mr. Sciesinski a quadriplegic. Mr. Sciesinski is now unable to stand, walk,

ambulate, eat, toilet, or care for himself in any manner.

2. Mr. SciesinskiÔs medical care related to the injury was paid by

Medicaid. AHCA through the Medicaid program provided $56,838.94 in

Medicaid benefits related to the injury and Sunshi ne through the Medicaid

program provided $78,957.18 in Medicaid benefits related to the injuries. The

sum of these benefits, $135,796.12, constituted Mr. SciesinskiÔs claim for past

medical expenses.

3. Mr. Sciesinski pursued a medical malpractice action a gainst the parties

allegedly liable for his injuries (Defendants) to rec over all his damages

associated with his injuries.

4. Mr. SciesinskiÔs medical malpractice action was settled through a series

of confidential settlements in a lump - sum unallocated amo unt of $1,725,000.

5. During the pendency of Mr. SciesinskiÔs medical malpractice action,

AHCA and Sunshine were notified of the action. AHCA asserted a $56,838.94

Medicaid lien and Sunshine asserted a $78,957.18 lien against

Mr. SciesinskiÔs cause of acti on and settlement of that action.

6. AHCA and Sunshine did not commence a civil action to enforce [their]

rights under [section] 409.910 or intervene or join in Mr. SciesinskiÔs action

against the Defendants.

7. By letter, AHCA and Sunshine were notified o f Mr. SciesinskiÔs

settlement.

8. AHCA and Sunshine have not filed a motion to set - aside, void[,] or

otherwise dispute Mr. SciesinskiÔs settlement.

9. The Medicaid program through AHCA and AHCAÔs contractor [,]

Sunshine [,] spent $135,796.12 on behalf of Mr. Sciesinski, all of which

represents expenditures paid for Mr. SciesinskiÔs past medical expenses.

10. Mr. SciesinskiÔs taxable costs incurred in securing the settlement

totaled $48,943.00.

11. Application of the formula at [section] 409.910(11)(f) to

Mr. SciesinskiÔs $1,725,000 settlement requires full payment of AHCAÔs

$56,838.94 Medicaid lien and SunshineÔs $78,957.18 Medicaid lien.

12. The Petitioner has deposited the Medicaid lien amount in an interest -

bearing account for the benefit of AHCA pending an administrative

determination of AHCAÔs rights, and this constitutes Ñfinal agency actionÒ for

purposes of chapter 120 [,] [Florida Statutes] , pursuant to [section]

409.910(17).

13. Sunshine is under contract with AHCA to provide Medicaid benefits to

Medicai d beneficiaries. Pursuant to AHCAÔs contract with Sunshine, AHCAÔs

Medicaid lien takes priority and must be paid first from the amount of the

settlement allocated to past medical expenses.

14. As previously noted, Petitioner presented testimony from Scott

Borders, Esquire, and Karen Gievers, Esquire. Mr. Borders represented

Petitioner in his personal injury claim against the tortfeasors, and

Ms. Gievers and Mr. Borders both offered opinion testimony regarding the

value of PetitionerÔs underlying personal in jury claim(s).

15. Mr. Borders has been a trial attorney for 32 years, and he practices

exclusively in the area of medical malpractice law. Mr. Borders has been

Florida Bar Board Certified in the area of Ñcivil trialÒ since 1997. Mr. Borders

credibly testi fied that based on his professional training and experience ,

PetitionerÔs claim(s) were valued at between $27 and $41 million.

16. Ms. Gievers has been a member of The Florida Bar since 1978, and

has been Florida Bar Board Certified in the area of Ñcivil trialÒ since 1985.

From 1978 until 2010, Ms. Gi e vers practiced in the area of personal injury

law. In 2010 she was elected Circuit Judge of the Second Judicial Circuit for

the State of Florida. As a Circuit Judge, Ms. Gievers presided over all

manner of ci vil matters, including personal injury lawsuits. Ms. Gi e vers

retired from the bench in April 2019, and has returned to the practice of law.

Ms. Gievers credibly testified that based on her professional training and

experience , PetitionerÔs claim(s) had a v alue of at least $25 million, and that

this amount is Ñvery conservative.Ò

17. Using the pro rata allocation methodology, Ms. Gi e vers and

Mr. Borders testified that $9,369.93 of the $1,725,000 settlement proceeds

should be allocated to past medical expens es because the personal injury

claims were settled for 6.9 percent of its conservative value. The testimony of

Ms. Gi e vers and Mr. Borders was credible, persuasive, and uncontradicted by

Respondents.

C ONCLUSIONS OF L AW

18. DOAH has jurisdiction over the subject matter and the parties

pursuant to sections 120.569, 120.57(1), and 409.910(17), Florida Statutes.

19. PetitionerÔs burden of proof in this case is the clear and convincing

evidence standard. § 409.910(17)(b), Fla. Stat.; Gallardo by & through

Vass allo v. Dudek , 963 F.3d 1167, 1182 (11th Cir. 2020) (finding no conflict

between the clear and convincing standard and federal law).

2 0 . AHCA is the agency authorized to administer FloridaÔs Medicaid

program. § 409.902, Fla. Stat.

2 1 . The Medicaid program Ñprovide[s] federal financial assistance to

States that choose to reimburse certain costs of medical treatment for needy

persons.Ò Harris v. McRae , 448 U.S. 297, 301 (1980). If a state participates in

the Medicaid program, it must comply with federal requi rements governing

the program. Id .

2 2 . Federal law requires states to seek reimbursement for medical

expenses incurred on behalf of Medicaid recipients who recover from third

parties. See Ark. DepÔt of Health & Human Servs. v. Ahlborn , 547 U.S. 268,

276 (2 006). FloridaÔs Legislature enacted section 409.910 to comply with that

requirement. Section 409.910(7) requires AHCA to recover for Medicaid funds

paid for a Medicaid recipientÔs medical care when the recipient later receives

a personal injury judgment or settlement from a third party. Smith v. Ag. for

Health Care Admin. , 24 So. 3d 590 (Fla. 5th DCA 2009). The statute imposes

an automatic lien on the proceeds of any judgment or settlement for the

medical services provided by Medicaid. § 409.910(6)(c), Fla. Stat.

2 3 . The formula in section 409.910(11)(f) determines the amount AHCA

may recover from a judgment, award, or settlement from a third party for

Medicaid medical expenses. Ag. for Health Care Admin. v. Riley , 119 So. 3d

514, 515 n.3 (Fla. 2d DCA 2013). Section 409.910(17)(b) establishes the right

to contest a Medicaid lien before DOAH, and provides that section

409.910(11) establishes the default allocation of damage amounts

attributable to medical costs. See Harrell v. State , 143 So. 3d 478, 480 (Fla.

1st DCA 2014) (adopting the holding in Riley that petitioner Ñshould be

afforded an opportunity to seek the reduction of a Medicaid lien amount

established by the statutory default allocation by demonstrating, with

evidence, that the lien amount exceeds th e amount recovered for medical

expenses , Ò quoting Roberts v. AlbertsonÔs, Inc. , 119 So. 3d 457, 465 - 66 (Fla.

4th DCA 2012), rehÔg and rehÔg en banc denied sub nom . Giorgione v.

AlbertsonÔs, Inc. , 2013 Fla. App. LEXIS 10067 (Fla. 4th DCA June 26, 2013)).

Th e Medicaid recipient may prove that a different allocation is the correct

allocation.

2 4 . PetitionerÔs persuasive, unrebutted, and unimpeached expert

testimony proves by clear and convincing evidence that the settlement

proceeds of $1,725,000 represents 6 .9 percent of PetitionerÔs claim valued

conservatively at $25,000,000 ($1,725,000/$25,000,000). The total Medicaid

lien amount of $135,796.12 should be reduced by the percentage that

PetitionerÔs recovery represents of the total value of PetitionerÔs claim .

Accordingly, $9,369.93 constitutes a fair, reasonable, and accurate share of

the total recovery for past medical expenses actually paid through the

Medicaid program. 2

2 5 . The First District Court of Appeal recently accepted the pro rata

method used fo r this determination as sufficient proof of a fair allocation of a

settlement amount. Soto v. Ag. for Health Care Admin. , Case No. 1D17 - 5387 ,

2020 WL 6777558 (Fla. 1st DCA Nov. 18, 2020)(reversing Soto v. Ag. for

Health Care Admin. , Case No. 17 - 4556MTR (Fl a. DOAH Nov. 28, 2017 ) for

rejecting a pro rata allocation like the one proven in this proceeding.). See

also Bryan v. State , 291 So. 3d 1033 (Fla. 1st DCA 2020); Larrigui - Negron v.

Ag. for Health Care Admin. , 280 So. 3d 550 (Fla. 1st DCA 2019).

O RDER

Bas ed on the foregoing Findings of Fact and Conclusions of Law, it is

ORDERED that Respondent, Agency for Health Care Administration, is

entitled to recover $ 9,369.93 in satisfaction of its Medicaid lien.

2 As previously noted, the parties stipulate that Sunshine is under contract with AHCA to

provide Medicaid benefits t o Medicaid beneficiaries, and that SunshineÔs lien interest herein

is subordinate to that of AHCA. Whether the contract provides for any recovery by Sunshine

from the amount owed by Petitioner to AHCA is not before the undersigned, and therefore

the recove ry amount of $9,369.93 is allocated only to AHCA.

D ONE A ND O RDERED this 16th day of March , 2021 , in Ta llahassee, Leon

County, Florida.

S

L INZIE F. B OGAN

Administrative Law Judge

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrat ive Hearings

this 16th day of March , 2021 .

C OPIES F URNISHED :

Alexander R. Boler, Esquire Floyd B. Faglie, Esquire

2073 Summit Lake Drive , Suite 330 Staunton & Faglie, PL

Tallahassee, Florida 32317 189 East Walnut Street

Monticello, Florida 32344

Shena L. Grantham, Esquire

Agency for Health C are Administration Rosie Heinrichs, Esquire

Building 3, Room 3407B The Rawlings & Associates, PLLC

2727 Mahan Dri ve Post Office Box 49

Tallahassee, Florida 32308 La Grange, Kentucky 40031

Seann M. Frazier, Esquire Richard J. Shoop, Agency Clerk

Parker, Hudson, Rainer & Dobbs, LLP Agency for Health Care Administration

215 South Monroe Street , Suite 750 2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32301 Tallahassee, Florida 32308

Simone Marstiller, Secretary Thomas M. Hoeler, Esquir e

Agency for Health Care Administration Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 1 2727 Mahan Drive, Mail Stop 3

T allahassee, Florida 32308 Tallahassee, Florida 32308

James D. Varnado, General Counsel

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

N OTICE O F R IGHT T O J UDICIAL R EVIEW

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

review pursuant to section 120.68, Florid a 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 o f

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 d istrict c ourt of

a ppeal in the appellate district where the agency maintains its headquarters

or where a party resid es or as otherwise provided by law.