21-002087MTR Jareth Foster vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Wednesday, November 10, 2021.

Summary: Petitioner established evidentiary grounds for a proportional reduction of the portion of the settlement to which the Medicaid lien may attach, thereby limiting Respondent's recovery to 4.44% of the medical assistance provided.

S TATE OF F LORIDA

D IVISION OF A DMINISTRATIVE H EARINGS

J ARETH F OSTER ,

Petitioner ,

vs. Case No. 2 1 - 2087 MTR

A GENCY F OR H EALTH C ARE

A DMINISTRATION ,

Respondent .

/

F INAL O RDER

This case came before Administrative Law Judge (ÑALJÒ) John G.

Van Laningham, Division of Administrative Hearings (ÑDOAHÒ), for final

hearing on September 14 , 2021 , in Tallahassee, Florida.

A PPEARANCES

For Petitioner: Floyd B. Faglie , Esquire

Staunton & Faglie, PL

189 East Walnut Street

Monticello , Florida 3 2344

For Respondent: Alexander R. Boler, Esquire

2073 Summit Lake Drive, Suite 300

Tallahassee, Florida 32317

S TATEMENT OF T HE I SSUES

The i ssues for determination are whether a lesser portion of Petitioner Ô s

total recovery from a third - party tortfeasor should be designated as recovered

medical expenses than the share presumed by statute; and, if so, what is the

amount of Petitioner Ô s recovery to which Respondent Ô s Medicaid lien may

attach ?

P RELIMINARY S TATEMENT

Petitioner Jareth Foster ( Ñ Foster Ò ) settled a personal injury action for

$ 8 8 8 ,000.00 . Respondent Agency for Health Care Administration (the

Ñ Agency Ò or Ñ AHCA Ò ) asserted i t s intent to enforce a Medicaid lien in the

amount of $ 324,425.61 against this recovery . The Agency relies, as is its

right, on the formula set forth in section 409.910(11)(f), Florida Statutes, to

determine that portion of the settlement which should be allocated as past

medical expense damages.

Foster objected to this presumptive allocation of the recovery , and, on

June 30 , 2021 , he timely filed a petition wit h DOAH to contest the default

amount designated by statute as recovered medical expense damages payable

to the Agency .

On September 7 , 202 1 , the parties filed a Joint Pre - h earing Stipulation,

which contains a statement of facts that Ñ are admitted and wil l require no

proof at hearing. Ò As a result, many of the material historical facts of this

case are undisputed.

At the final hearing, which took place as scheduled on September 14 ,

20 2 1 , with both parties present, Foster called trial attorneys Richard Per lini

and Karen Gievers as witness es . Petitioner Ô s Exhibits 1 through 6 were

received in evidence without objection . The Agency rested without offering

any evidence.

The final hearing transcript was filed on October 11 , 2021 . The parties

timely filed proposed final orders on October 25, 2021 , which have been

considered .

Unless otherwise indicated, citations to the official statute law of the state

of Florida refer to Florida Statutes 202 1 .

F INDINGS OF F ACT

1. On May 23 , 20 20 , Foster , who was then 1 7 years old, was a passenger

in a car that struck a tree and burst into flames . He was pulled from the

burning wreck by a heroic bystander but suffered catastrophic and

permanent injuries . These includ ed fractures to both legs , which requir ed

orthopedic surgery, and severe burns over 60 percent of his body, which led ,

in turn , to multiple surgeries, finger amputations, and disfiguring scarring .

Foster is permanently disabled . He cannot eat without having his mother cut

his food into small bite s, and he must drink through a straw . Even friends

avoid him due to his appearance . Foster will suffer from these terrible

injuries for the rest of his life .

2. FosterÔs injury - related medical care was paid for by Medicaid. A s the

state Medicaid agency, A HCA paid medical bills totaling $ 934,002.58 . It is

undisputed that t h is sum constitutes FosterÔs entire damages claim for past

medical expenses.

3. Foster pursed a personal injury claim against the parties (the

ÑDefendantsÒ) allegedly liable for his damages . The DefendantsÔ liability

insurance was limited to $250,000.00 in coverage, which would be woefully

inadequate to compensate Foster for his losses, assuming Foster prevailed .

The parties eventually settled FosterÔs personal injury lawsuit through a

series of confidential settlements, pursuant to which Foster received an

unallocated lump - sum payment of $ 888 ,000.00 . This figure exceed ed the

limits of available insurance but is a mere fraction of FosterÔs monetary

damages .

4. AHCA elected not to pres ent evidence at hearing bearing on the relative

strength of FosterÔs tort case on the question of liability . Based on the limited

record on this point, the undersigned finds that Foster likely would have

prevailed had his personal injury suit been tried to conclusion . In view of the

extremely high value of his total damages (ÑTotal ValueÒ) , which will be

discussed below, it is likely (based, again, on the limited record ) that Foster

accepted a settlement of $ 888 ,000.00, not because he had a weak case, but

b ecause the Defendants simply did not have the wherewithal to satisfy a

multi - million dollar judgment, much less an award likely to be in the tens of

millions of dollars.

5. AHCA was timely notified of FosterÔs personal injury action. AHCA did

not Ñinstitute, intervene in, or join inÒ the personal injury action to enforce its

rights as provided in section 409.910(11), or participate in any aspect of the

personal injury action against the Defendant s . I nstead, AHC A asserted a

Medicaid lien against FosterÔs cause of action and settlement of that action .

By letter, AHCA was notified of the settlement. AHCA has not filed a motion

to set - aside, have declared void , or otherwise dispute d FosterÔs settlement.

6. As mentio ned, t he Medicaid program, through AHCA, spent

$934,002.58 on behalf of Foster , all of which represents expenditures paid

towards FosterÔs past medical care and treatment. FosterÔs taxable costs

incurred in securing the $ 888 ,000.00 settlement totaled $ 17, 1 48.78 .

Application of the section 409.910(11)(f) formula to FosterÔs $ 888 ,000.00

recovery produces a statutory default allocation of $ 324,425.61 in settlement

funds to past medical expenses .

7. There is no dispute that, under the anti - lien provisions in th e federal

Medicaid statute, the Medicaid lien attaches only to the portion of FosterÔs

recovery attributable to past medical expenses. FosterÔs recovery, however,

was an undifferentiated lump - sum payment, meaning that the parties did not

negotiate an appor tionment of the settlement proceeds as between the

several categories of damages comprising the Total Value of FosterÔs loss.

8. The ultimate question presented is whether the AgencyÔs default

distribution, in the amount of $324,425.61, reflects Ñthe porti on of the total

recovery which should be allocated Ò to FosterÔs recovery of past medical

damages, or whether a lesser sum, from the total settlement, Ñshould be

allocatedÒ to the recovery of past medical damages. It is FosterÔs burden to

prove that the statutory allocation is greater than the amount which Ñshould

beÒ distributed to the Agency, and that the default Medicaid lien amount

Ñshould beÒ adjusted to better reflect the portion of the p laintiffÔs total

recovery attributab le to past medical expenses.

9. To meet his burden, Foster presented evidence at hearing, as is now

typically done in cases such as this, with the goal of establishing the Ñtrue

valueÒ of the p laintiffÔs damages. Usually, and again as here, this evidence

c omes in the form of opinion testimony, from a trial attorney or attorneys

who specialize in personal injury law and represent plaintiffs in negligence

actions.

10. Foster called two experienced plaintiffÔs personal injury lawyers, one

of whom represented h im in the underlying personal injury lawsuit, to give

opinions on the valuation of his damages. The undersigned finds the opinions

of these attorneys on valuation of damages to be credible and persuasive.

Moreover, the Agency did not offer any evidence to challenge FosterÔs proof of

the full value of the p laintiffÔs damages. Having no evidential basis for

discounting or disregarding the opinions of FosterÔs expert witnesses, the

undersigned bases the findings on valuation that follow upon their

unchallenged testimony.

11 . Foster is requesting Ð and his expert witnesses opined Ð that the

Medicaid lien should be adjusted according to a method that will be referred

to herein as a Ñproportional reduction.Ò A proportional reduction adjusts the

lien so that the Agenc yÔs recovery is discounted in the same measure as the

plaintiffÔs recovery. In other words, if the plaintiff recovered 25% of the Ñtrue

valueÒ of his damages, then, under a proportional reduction, the Medicaid

lien is adjusted so that the Agency recovers 2 5% of the plaintiffÔs past medical

damages.

12. The mathematical operation behind a proportional reduction is simple

and requires no expertise. Using ÑrÒ to signify the plaintiffÔs recovery; ÑvÒ to

represent the ÑvalueÒ of his damages; ÑmÒ for past medi cal expenses; and ÑxÒ

as the variable for the adjusted lien amount, the equation is: (r ÷ v) × m = x.

In these cases, the only unknown number (usually) is v, i.e., the ÑvalueÒ of the

plaintiffÔs total damages.

1 3 . ÑTrue value,Ò sometimes also called Ñfull valueÒ or Ñtotal value,Ò is an

elusive concept, given that the actual, true value of damages which have not

been liquidated by a judgment is not, and cannot be, known in a case that

settles before the entry of a judgment.

1 4 . The uncontested and unimpeach ed expert testimony in this case

establishes, by any standard of proof, that the Ñtrue valueÒ of FosterÔs

damages lies somewhere between $ 20 million and $ 6 0 million, and is no less

than $ 20 million, which is the most conservative figure presented by Foster Ôs

witnesses, Richard Perlini , Esquire , and Karen Gievers, Esquire . Thus, the

undersigned finds as a matter of ultimate fact that the Total Value is

$2 0 million.

1 5 . It is true that, except for past medical damages, FosterÔs expert

witnesses did not have discrete numbers for FosterÔs economic damages such

as lost wages and future medical expenses . Their opinions focused on the

likely gross jury award without differentiating the components of such a

verdict . Such opinions are sufficiently precise , however, for the purposes of

this case . This is bec ause FosterÔs noneconomic damages for past and future

pain and suffering, mental anguish, loss of capacity for the enjoyment of life,

etc., which are compensable but cannot be objectively quantified, so eclipse

the quantifiable economic damages as to make the latter almost a rounding

error. As a practical matter, setting the Total Value at $2 0 million (instead

of, say, $5 0 million, which the evidence would also support) eliminates any

issue regarding the value of Fo sterÔs economic losses. There is no getting

around the fact that the settlement is pa ltr y in relation to FosterÔs total

damages, at most reflecting only a small percentage thereof.

1 6 . M s. Gievers testified that because Foster recovered only 4.44 percen t

of the Total Value of his damages, conservatively appraised, it stands to

reason that he recovered only 4.44 percent of his total past medical damages

( $934,002.58 ), a sum equal to $41,469.71 . Ms. Gievers testified that it would

be reasonable to allocate $41,469.71 of the settlement to past medical

expenses and thereby limit the Medicaid lien to that amount . Mr. Perlini, the

other expert on allocation methodology, concurred . 1

1 7 . An allocation of $ 41,469.71 from the settlement to past medical

expenses, pursuant to the proportional reduction methodology, would be

consistent with the expert testimony presented in this case (and other

Medicaid lien adjustment cases) and supported by the case law.

1 8 . Once Fost er made a prima facie showing of Total Value by adducing

competent substantial evidence thereof, and offered expert testimony

regarding the proportional reduction methodology, the Agency might have

introduced some evidence that would have given the fact - fi nder an

evidentiary basis for discounting or rejecting the $2 0 million Total Value

figure, or for rejecting the pro - rata allocation method. 2 The Agency, however,

1 AHCA argues that Mr. Perlini neither underst ood the proportional reduction formula,

n or comprehend ed the mathematical operation behind it . The undersigned rejects this

characterization . To be sure, when asked on cross - examination to explain the math,

Mr. Perlini seemed slightly confused and came across as somewhat inarticulate relative to

the rest of his testimony; it is fair to say that he was unprepared to Ñrun the numbersÒ while

testifying . But the undersigned puts little weight on this . Performing the mathematical

operation (especially while testify ing) is much less important than grasping the rationale

behind the proportional reduction approach . Mr. Perlini clearly understood the concept , i.e.,

that a settlement - to - value ratio is used to discount all of the damages, including total past

medical expe nses , so that AHCAÔs percentage of recovery matches the plaintiffÔs .

2 To be clear, the undersigned is not shifting the burden of proof to the Agency . T he Agency is

not required to put on any such evidence . The Agency is free to present no evidence, rely

solely on cross - examination of the petitioner Ô s witnesses to undermine the testimony elicited

by the petitioner on direct, and then argue that the petitioner has failed to meet his burden

of proof Ð as the Agency has done in this case . If the Agency takes t his approach, however, it

loses the opportunity affirmatively to prove that the Total Value is too high, and it risks a

elected not to present evidence, preferring instead to argue that Foster has

failed to prove t hat the particular medical - expense allocation he advocates

should be made, and that, as a result, the default, statutory allocation should

be made. As far as the evidence goes, therefore, the undersigned has no

reasonable basis for rejecting the full value figure of $2 0 million, which

FosterÔs witnesses established, via credible and compelling expert opinion,

was a conservative appraisal of FosterÔs total damages, or for declining to use

the proportional reduction approach.

19 . The opinion testimony elicit ed at hearing, in addition to being

unchallenged and unimpeached, is otherwise persuasive to the fact - finder

and convincingly establishes that the probable Ñfull valueÒ of FosterÔs

damages, i.e., v in the proportional reduction formula, is $2 0 million. The

unchallenged expert testimony convincingly shows, as well, that a

proportional reduction methodology appropriately identifies the Ñportion of

the total recovery which should be allocatedÒ in this case as past medical

expense damages.

20 . Accordingly, the undersigned determines as a matter of ultimate fact

that the portion of FosterÔs $ 888 ,000.00 recovery that Ñshould be allocatedÒ to

past medical expenditures is $41,469.71, or 4.44 percent of FosterÔs total past

medical expenses.

finding that the unrebutted evidence of Total Value is a fair reflection of the full value of the

petitionerÔs damages. If, however , the Agency presents evidence of full value, or settlement

value, or some alternative value, then the petitioner must rebut the evidence and try to

overcome it, for the petitioner bears the ultimate burden of persuasion with regard to

establishing the valu e of the petitioner Ô s damages .

C ONCLU SIONS OF L AW

2 1 . DOAH has personal and subject matter jurisdiction in this proceeding,

as well as final order authority, pursuant to section 409.910(17)(b).

2 2 . Section 409.910(1) provides as follows:

It is the intent of the Legislature that Medicaid be

th e 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.

2 3 . Section 409.910(6)(c) provides , in relev ant part , as follows:

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 [, which

includes Ñ [a] ny and all causes of action, suits, claims,

counterclaims, and demands that accrue to the

recipient or to the recipient Ô s legal representative,

related to a ny covered injury, illness, or necessary

medical care, goods, or services that necessitated

that Medicaid provide medical assistance Ò ] .

24 . Section 409.910(11)(f) provides , in pertinent part , as follows:

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

judgment, award, or settlement from a third party,

the amount recovered shall be distributed as fo llows:

1. After attorney Ô 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 amoun t of the recovery shall be

paid to the recipient .

3. For purposes of calculating the agency Ô 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 calculate d

at 25 percent of the judgment, award, or settlement.

25 . Section 409.910(17)(b) provides as follows:

If federal law limits the agency to reimbursement

from the recovered medical expense damages, a

recipient, or his or her legal representative, may

conte st 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

d ate of placing the full amount of the third - party

benefits in the trust account for the benefit of the

agency pursuant to paragraph (a). The petition shall

be filed with the Division of Administrative

Hearings. For purposes of chapter 120, the payment

of f unds 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 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 designated as recovered

medical expenses, th e recipient must prove, by clear

and convincing evidence, 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 agency 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 .

26 . Section 409.910 provides no guidance , instructions, or criteria that the

AL J is required to consider in determining the portion of a recipient Ô s total

recovery which Ñ should be allocated Ò as medical expenses , nor does it prohibit

the ALJ from considering any specific criteria or from using any particular

methodology . This lack of specific statutory standards limiting the decision -

maker Ô s discretion extends to the recipient , as well, who must prove that

some amount less than the default allocation Ñ should be allocated Ò to medical

expense damages , without any clear statu tory direction as to what must be

prove d to make the required showing.

27 . T he U.S. Supreme Court has interpreted the anti - lien provision in

federal Medicaid law as imposing a bar which, pursuant to the Supremacy

Clause, precludes Ñ a state from asserting a lien on the portions of a

settlement not allocated to medical expenses. Ò See, e.g. , Mobley v. State ,

181 So. 3d 1233, 1235 (Fla. 1st DCA 2015) .

28 . In Gallardo v. Dudek , 963 F.3d 1167 , 1181 - 82 (11 th Cir. 2020) , the

U.S. Eleventh Circuit Court of A ppeals held that Florida Ô s statutory formula

is not preempted by federal law . U nder Dudek , the Medicaid lien may attach

to all medical expenses recovered, including damages for future care and

treatment, and the standard of proof by which the recipient must rebut the

formulaic allocation is clear and convincing evidence . Id. at 1178 - 79 , 1182 .

29 . In Giraldo v. Agency for Health Care Administration , 248 So. 3d 53, 54

(Fla. 2018), however, the Florida Supreme Court ruled that , under

preemptive federal law, the state Ô s Medicaid lien may attach only to that

portion of a recipient Ô s settlement recovery attributable to past medical

expense damages . Thus, the Florida Supreme C ourt held that section

409.910(17)(b) is invalid and unenforceable to the extent it would allow the

Agency to recover from future medical expense damages . As an authoritative

decision of the state Ô s highest court , Giraldo is binding precedent on all lower

courts, which a state ALJ , applying state law, must follow . See Du dek ,

963 F.3d at 1192 - 93 ( Ñ Florida Medicaid recipients will now head to state

administrative court to benefit from the Florida Supreme Court Ô s holding in

Giraldo . Ò ) (Wilson, J., concurring in part and dissenting in part).

3 0 . Florida state courts have not held that the clear and convincing

standard of proof as prescribed in section 409.910(17)(b) is preempted or

otherwise unenforceable . Foster has proved his case by clear and convincing

evidence , as required by statute .

3 1 . Regarding the methodology for determin ing that portion of the total

recovery w hich should be allocated to past medical expense damages, recent

appellate decisions have moved towards acceptance of the proportional

reduction as a valid , albeit nonexclusive, basis for making the required

distribution . Indeed, it is probably accurate to say that, under the present

state of the law, an ALJ is practically required to accept the use of a

proportional reduction, provided certain conditions are met, e.g., where

unrebutted expert testimony is rec eived both as to the value of the recipientÔs

damages and as to the use of the pro - rata methodology . As the First District

Court of Appeal explained:

[ W ]hile no t established as the only method, the pro

rata [or proportional reduction] approac h has been

acc epted in other Florida cases where the Medicaid

recipient presents competent, substantial evidence

to support the allocation of a smaller portion of a

settlement for past medical expenses than the

portion claimed by AHCA. See Giraldo v. Agency for

Health C are Admin. , 248 So. 3d 53 (Fla. 2018);

Mojica v. Agency for Health Care Admin. , 285 So. 3d

393 (Fla. 1st DCA 2019); Eady v. State , 279 So. 3d

1249 (Fla. 1st DCA 2019). But see Willoughby v.

Agency for Health Care Administration , 212 So. 3d

516 (Fla. 2d DCA 2017) (quoting Smith v. Agency for

Health Care Administration , 24 So. 3d 590, 591

(Fla. 5th DCA 2009)) (explaining that the pro rata

formula is not the Ñ required or sanctioned method to

determine the medical expense portion of an overall

settlement amount Ò ).

Ag. for Health Care Admin. v. Rodriguez , 294 So. 3d 441 , 444 ( Fla. 1st DCA

2020) .

3 2 . To the cases cited by the court in Rodriguez may be added another

decision, Bryan v. Agency for Health Care Administration , 291 So. 3d 1 033

(Fla. 1st DCA 2020) . In Bryan , the recipient settled a medical malpractice

action arising out of a catastro phic brain injury for $3,000,000 , and then

initiated an administrative proceeding to adjust the Medicaid lien , which the

Agency asserted should be payable in the full amount of approximately

$380 ,000 . Bryan , 291 So. 3d at 1034 . A t hearing, the recipient Ñ offered the

testimony of two trial attorneys who were both admitted as experts in the

valuation of damages. Ò I d . The se witnesses relied upon a life care plan and an

economist Ô s report, wh ich were filed as exhibits, as well as jury verdicts in

similar cases , to support their opinion that Ñ the value of [the recipient Ô s]

damages exceeded $30 million. Ò Id .

33 . The Ñ experts both testified that, using the conserv ative figure

$30 million, the $3 million settlement only represented a 10% recovery, Ò and

that, Ñ based on that figure, it would be reasonable to allocate 10% of [the

recipient Ô s approximately $38 0 ,000 ] claim fo r past medical expenses Ð [ or,

approximately $38 ,000 ] Ð from the settlement to settle [the Agency Ô s] lien. Ò

Id . The recipient also Ñ submitted an affidavit of a former judge, Ò who

affirmed that the proportional allocation was a reasonable, rational, and

logical Ñ method of calculating the proposed allocation. Ò Id .

34 . Regarding the Agency Ô s case, t he court wrote:

In turn, AHCA did not: (1) call any witnesses,

(2) present any evidence as to the value of

Ms. Bryan Ô s damages, (3) propose a differing

valuation of the damages, or (4) present evidence

contesting the methodology used to calculate the

$38,106.28 allocation to past medical expenses.

Id . at 1035.

35 . The ALJ rejected the recipient Ô s proposed proportional reduction

methodology as a ÑÓ one size fits all Ô a pproach which place[s] each element of

[the recipient Ô s] damages at an equal value. Ò Id . The ALJ determined that it

was the recipient Ô s burden to Ñ prove that it was more probable than not Ò

that the parties in the personal injury action had intended to allo cate only

10 percent of the settlement recovery as past medical expenses , and that the

recipient had failed to do that . Id . Accordingly, the ALJ ordered the recipient

to pay the Medicaid lien in full . Id .

36 . The court reversed the ALJ Ô s order, explaining :

[I]n this case, [the recipient] presented unrebutted

competent substantial evidence to support that the

value of her case was at least $30 million. She also

presented unrebutted competent substantial

evidence that her pro rata methodology did indeed

supp ort her conclusion that $38,106.28 was a proper

allocation to her past medical expenses. Such

methodology was similar to the methodology

employed in Giraldo , Eady , and Mojica . [The

Agency] did not present any evidence to challenge

[the recipient Ô s] valuati on, nor did it present any

alternative theories or methodologies that would

support the calculation of a different allocation

amount for past medical expenses. Without

any evidence to contradict the pro rata methodology

proposed by [the recipient] , the ALJ Ô s rejection of

that methodology was not warranted.

Id .

37 . The re are many similarities between this case and Bryan . Here, as in

Bryan , two trial attorneys (one of whom, Ms. Gievers, is a retired circuit

judge) gave unrebutted testimony that , using a conservative ( and

uncontested ) appraisal of the recipient Ô s case ($ 2 0 million ) , the settlement

( $ 888 ,000 . 00 ) represented only a small fraction ( 4.44 percent ) of the

recipient Ô s total damages . They expressed the opinion, as in Bryan , that a

proportional red uction was the proper method of determining the portion of

the recipient Ô s recovery which should be allocated as past medical expe n ses .

As in Bryan , the Agency did not present testimony or other evidence as to :

(i) the value of the rec ip ient Ô s case ; (ii) an alternative appraisal of the

recipient Ô s damages ; or (iii) the weaknesses, if any, in the proportional

reduction methodology as applied to the particular facts .

38 . The undersigned concludes that Bryan is applicable and controlling .

F ollow ing th at cour t Ô s lead , the undersigned accept s the premise that the

proportional reduction method ology, when established , as here, by

unrebutted, competent substantial evidence , provides a valid formula for

determining the portion of the recipient Ô s recovery which should be allocated

as past medical expense damages .

39 . Accordingly, a s found above, Foster carried his burden, as a matter of

fact, by proving that the portion of his total recovery which should be

designated as compensation for past medical expenses i s $ 41,469.71 .

D ISPOSITION

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

O RDERED that the amount payable to the Agency for Health Care

Administration in satisfaction of the Medicaid lien for medical assistance

provided to Foster is $ 41,469.71 .

D ONE A ND O RDERED this 10th day of November , 202 1 , in Tallahassee,

Leon County, Florida.

S

J OHN G. V AN L ANINGHAM

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 Administrative Hearings

this 10th day of November , 2021 .

C OPIES F URNISHED :

Floyd B. Faglie, Esquire Richard J. Shoop, Agency Clerk

Staunton & Faglie, PL Agency for Health Care Administration

189 East Walnut Street 2727 Mahan Drive, Mail Stop 3

Monticello, Florida 32344 Tallahassee, Florida 32308

Alexander R. Boler, Esquire Thomas M. Hoeler, Esquire

2073 Summit Lake Drive, Suite 300 Agency for Health Care Administration

Tallahassee, Florida 32317 2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

Simone Marstiller , Secretary

Agency for Health Care Administration Shena L. Grantham, Esquire

2727 Mahan Drive, Mail Stop 1 Agency for Health Care Administration

Tallahassee, Florida 32308 Building 3, Room 3407B

2727 Mahan Drive

William H. Roberts , Acting General Counsel Tallahassee, Florida 32308

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

N OTICE OF R IGHT TO J UDICIAL R EVIEW

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 appeal wi th the Clerk of the

Division of Administrative Hearings and a copy, accompanied by filing fees

prescribed by law, with the First District Court of Appeal in Leon County, or

with the District Court of Appeal in the Appellate District where the party

resides . The notice of appeal must be filed within 30 days of rendition of the

order to be reviewed.