21-002902MTR Iquan Steadman vs. Agency For Health Care Administration Status: Closed DOAH Final Order on Tuesday, February 8, 2022.

Summary: Petitioner proved, by a preponderance of the evidence, that a lesser portion of his total recovery should be allocated as reimbursement for medical expenses instead of the amount AHCA calculated pursuant to the section 409.910(11)(f) formula.

S TATE OF F LORIDA

D IVISION OF A DMINISTRATIVE H EARINGS

I QUAN S TEADMAN ,

Petitioner ,

vs. Case No. 21 - 2902MTR

A GENCY F OR H EALTH C ARE

A DMINISTRATION ,

Respondent .

/

F INAL O RD ER

The final hearing in this matter was conducted before Brittany O.

Finkbeiner, Administrative Law Judge of the Division of Administrative

Hearings (ÑDOAHÒ) , on November 17, 2021, in Tallahassee and by Zoom

conference.

A PPEARANCES

For Petitioner: Floyd B. Faglie, Esquire

Staunton & Faglie, PL

189 East Walnut Street

Monticello, Florida 32344

For Respondent: Alexander R. Boler, Esquire

2073 Summit Lake Drive , Suite 300

Tallahassee, Florida 32317

S TATEMENT O F T HE I SSUE

Th e issue to be determin ed in this case is the amount of money to be

reimbursed to Respondent, the Agency for Health Care Administration

(ÑAHCAÒ) , for medical expenses paid on behalf of Petitioner, Iquan Steadman

(ÑMr. SteadmanÒ), a Medicaid recipient, following a tort settlement recovered

from a third party.

P RELIMINARY S TATEMENT

On September 22, 2021, Mr. Steadman filed a Petition to Determine

Amount Payable to Agency for Health Care Administration in Satisfaction of

Medicaid Lien (ÑPetitionÒ). On the same date, DOAH notified A H CA of

Mr. SteadmanÔs Petition for an administrative proceeding to determine the

amount payable to A HCA to satisfy the Medicaid lien. Through his Petition,

Mr. Steadman challenged AHCAÔs lien for medical expenses following his

recovery from a third party.

AHCA seeks reimbursement from Mr. Steadman for medical expenses

covered by Medicaid on his behalf. AHCA calculated the amount it believes it

is owed using the default formula set forth in section 409.910(11)(f), Florida

Statutes . Mr. Steadman asserts that reimbursement of a lesser portion of his

recovery is warranted pursuant to section 409.910(17)(b).

Prior to the final hearing, Mr. Steadman and AHCA filed a Joint Pre -

hearing Stipulation , agreeing to several facts upon which the undersigned

relied. At t he hearing, PetitionerÔs Exhibits 1 through 10 were admitted into

evidence. AHCA raised hearsay objections to PetitionerÔs Exhibits 6 and 7,

which the undersigned noted and analyzed in weighing the evidence. 1

Mr. Steadman presented the testimony of Dougla s J. McCarron, Esquire, as a

fact and expert witness; and R. Vinson Barrett, Esquire, as an expert

witness. AHCA did not present any witnesses or offer exhibits into evidence.

1 In considering the evidence in this case, the undersigned is bound by the limitations on the

use of hearsay in administrati ve proceedings, as set forth in section 120.57(1)(c), Florida

Statutes, which states, Ñ[h]earsay evidence may be used for the purpose of supplementing or

explaining other evidence, but it shall not be sufficient in itself to support a finding unless it

wou ld be admissible over objection in civil actions.Ò PetitionerÔs Exhibits 6 and 7, although

hearsay, were used to supplement other nonhearsay evidence Ð witness testimony that was

based on personal knowledge and professional experience. Accordingly, the under signed

considered the exhibits over AHCAÔs objection.

The one - volume Transcript of the final hearing was filed with DOAH on

December 16, 2021. Following two extensions of time requested by the

parties, both parties submitted proposed final orders, which were duly

considered in the preparation of this Final Order.

F INDINGS O F F ACT

Stipulated Facts

1. On October 12, 2017, Mr. Steadman was shot in his left knee at a gas

station. He was 20 years old at the time. Mr. Steadman underwent numerous

surgeries to repair his left knee, but ultimately his left knee had to be fused.

Mr. Steadman is now permanently disabled and unable to bend his le ft leg.

He requires assistance in ambulating.

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

Medicaid. Medicaid , through AHCA , provided $102,660.17 in benefits .

Medicaid , through a Medicaid m anaged c are o rganization known as Molina

Health care of Florida , provided $5,729.52 in benefits . Medicaid , through a

Medicaid m anaged c are o rganization known as Simply Healthcare Plans ,

provided $28,993.97 in benefits. The sum of these benefits, $137,383.66 ,

constituted Mr. SteadmanÔs entire claim for p ast medical expenses.

3. Mr. Steadman pursued a personal injury action against the owners and

operators of the premises (ÑDefendantsÒ) where the shooting occurred to

recover all of his damages.

4. Mr. SteadmanÔs personal injury action was settled through a series of

confidential settlements in a lump - sum unallocated amount of $1,400,000 .

5 . During the pendency of Mr. SteadmanÔs personal injury action, AHCA

was notified of the action and asserted a $102,660.17 Medicaid lien against

Mr. SteadmanÔs cause of ac tion and the attendant settlement.

6. AHCA did not commence a civil action to enforce its rights under

section 409.910 or intervene or join in Mr. SteadmanÔs action against the

Defendants.

7. AHCA was notified of Mr. SteadmanÔs settlement by letter.

8. AH CA has not filed a motion to set aside, void, or otherwise dispute

Mr. SteadmanÔs settlement .

9. The Medicaid program, through AHCA, spent $102,660.17 on behalf of

Mr. Steadman, all of which represents expenditures for Mr. SteadmanÔs past

medical expenses .

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

totaled $60,839.95.

11. Application of the default formula in section 409.910(11)(f) to

Mr. SteadmanÔs $1,400,000 settlement requires payment to AHCA of the full

Medicaid lien in the a mount of $102,660.17.

12. Mr. Steadman has deposited the full Medicaid lien amount in an

interest - bearing account for the benefit of AHCA pending an administrative

determination of AHCAÔs rights, and this constitutes final agency action

within the meaning of chapter 120, pursuant to section 409.910(17).

Testimony of Douglas J. McCar r on

13. Mr. McCarron has been a trial attorney in Florida since 1996. He has

handled jury trials throughout his entire career. The primary focus of his

current practice is repres enting plaintiffs in wrongful death or catastrophic

injury cases. Within that specialty, Mr. McCarron handles a lot of cases

involving negligent security with respect to crime victims.

14. In order to provide representation to his clients, Mr. McCarron st ays

abreast of jury verdicts and continuously educates himself on the changes

over time in the value of damages, costs of long - term care, and proper charges

for medical care. He collaborates with his law partners on a regular basis in a

round - table setting , where they discuss cases together and strategize on

representing their clients.

15. As a routine part of his daily practice, Mr. McCarron makes

assessments concerning the full value of damages suffered by injured parties

to maximize his representation o f clients. This includes the process of

allocating settlements in the context of health insurance liens.

16. Mr. McCarron represented Mr. Steadman in the personal injury

lawsuit underlying the present case. Over the course of that representation,

Mr. McCar ron has extensively reviewed all of Mr. SteadmanÔs medical

records, met with his last treating surgeon, reviewed surveillance video from

the injury - causing event, and ordered a life care plan to be prepared.

17 . Mr. McCarron explained that in Mr. Steadman Ôs case, a life care

planner prepared a report projecting Mr. SteadmanÔs future medical needs

and an economist calculated the present value of those needs, as well as the

present value of his lost future wages.

18. Mr. Steadman was injured while he was pat ronizing a gas station with

friends in North Miami. As Mr. Steadman was exiting the convenience store

area of the gas station, several masked individuals came onto the property

and began shooting. Mr. Steadman ran back towards the convenience store

amid th e gunshots and was struck by a bullet behind his left knee. He was

able to hop back into the convenience store, where he collapsed. Fire rescue

and police were called, and Mr. Steadman was transported to Jackson

Memorial Hospital, which is the Level I Trau ma Center in Miami - Dade

County. Police were never able to determine the identities of the assailants or

any reason for the shooting.

19. At the hospital, Mr. Steadman was rushed into surgery, which

included orthopedic surgery with an external fixator and a vascular bypass of

the lower extremity. He was initially in the hospital for about two months

before he was discharged to a rehab center, where he remained for over a

year, going back and forth to the hospital for multiple surgeries. Ultimately,

Mr. Stea dman was given the option to have his leg amputated above the knee

or have his knee fused to make it immobile. He chose to have his knee fused.

The initial surgery to fuse his knee was not successful and Mr. Steadman

required a second surgery. He also had numerous surgeries to restore feeling

to his foot. As a result of his injuries, Mr. Steadman has no flexion in his left

knee, which prevents him from bending or squatting and causes him to walk

with a noticeable limp. He continually suffers from physical a nd neuropathic

pain. In addition to physical pain, Mr. Steadman also struggles with self -

consciousness and depression.

20. Mr. Steadman has a high school education. Prior to being injured, he

was working two jobs Ð one in the fast food industry and one as a carpenter.

He is unable to perform the manual tasks required for these jobs as a result

of his injury. Further, he is unable to participate in physical activities that he

used to enjoy. Mr. Steadman will continue to suffer the effects of the injury

for th e remainder of his life. His doctors expect that he will need joint

replacements to address wear and tear associated with his irregular gait. He

is also likely to need a total knee or hip replacement and a subsequent

revision.

21. Mr. McCarron testified t hat, based on his professional training and

experience, Mr. SteadmanÔs damages have a value between $10,000,000 and

$12,000,000. Mr. McCarron calculated this estimate to include the value of

Mr. SteadmanÔs past and future medical costs; past and future los t wages;

and pain and suffering.

22. Mr. McCarron explained that , in Mr. SteadmanÔs case , a life care

planner prepared a report projecting Mr. SteadmanÔs future medical needs ;

and an economist calculated the present value of those needs, as well as the

pre sent value of his lost future wages. Mr. McCarron testified that , in his

career , he has reviewed around 250 similar life care plans and economist

reports ; and Mr. SteadmanÔs was typical of others he had seen . Mr. McCarron

used the information in the life c are plan and economist report to help inform

his calculation of economic damages.

23. Mr. McCarron estimated that Mr. SteadmanÔs economic damages,

which include s future healthcare and lost wages, in addition to the sum of

$137,383.66 for past medical expe nses, would total $4,479,872.

24 . In order to determine the full estimated amount of Mr. SteadmanÔs

damages, Mr. McCarron also calculated noneconomic damages, which

involves assigning a monetary amount to pain and suffering. Mr. McCarron

testified that, b ased on the complexity of Mr. SteadmanÔs medical condition

and the extent of his pain and suffering, a Miami - Dade jury would likely

award around $5,300,000. To arrive at that number, Mr. McCarron estimated

$100,000 per year for the remaining 53 years of Mr . SteadmanÔs remaining

life expectancy.

25. Mr. McCarron testified that a personal injury action was pursued

against the operator of the gas station and the property owner based on the

theory of negligent security. The parties eventually settled for $1,40 0,000 .

26. Mr. McCarron testified that the $1,400,000 settlement did not fully

compensate Mr. Steadman for the full value of his damages. He further

explained that, based on a value of $10,000,000, which he believed was a

conservative estimate of all damag es, Mr. Steadman Ôs recovery of $1,400,000

constituted only 14 percent of the value of his damages. He testified that ,

because Mr. Steadman recovered only 14 percent of his damages in the

settlement , concomitantly, he also recovered only 14 percent of his

$ 137,383.66 claim for past medical expenses, or $19,233.71. Accordingly, he

concluded that it would be reasonable and fair to allocate $19,233.71 of the

settlement to past medical expenses.

27. Mr. McCarron was accepted as an expert. His testimony was credi ble.

Further, Mr. McCarronÔs testimony was not countered by AHCA with any

evidence that his proposed methodology was inaccurate or that another

method would be more appropriate to apply.

Testimony of R. Vinson Barrett

28. Mr. Barrett has been a trial atto rney since 1977. In his current

practice, he handles jury trials representing clients who have been

catastrophically injured. As a routine part of his practice, Mr. Barrett reviews

medical records, life care plans, and economist reports . Mr. Barrett testif ied

that, as part of his practice, he maintain s familiarity with settlement

allocation in the context of health insurance liens. He also reviews jury

verdict reports and keeps up with valuation trends in personal injury

settlements. Making assessments conc erning the full value of damages is an

aspect of every case he has.

29 . Mr. Barret is familiar with Mr. SteadmanÔs injuries and his case. In

analyzing the value of Mr. SteadmanÔs case, Mr. Barrett studied jury verdicts

in similar cases. He explained that, in Mr. SteadmanÔs case, the life care plan

and economist report detailed that Mr. SteadmanÔs economic damages were

$4,479 , 87 2, consisting of $137,383.66 in past medical expenses, $152,552 in

past lost earnings, $117,399 in future lost wages, and $4,072,53 8 in future

medical expenses . Mr. Barrett testified that he had reviewed numerous life

care plans and economist reports in the past and Mr. SteadmanÔs reports

were typical and similar to others he had seen. Based on his research, along

with his training an d experience, Mr. Barrett testified that a conservative

value of his overall damages would be $10,000,000 .

30 . Mr. Barrett explained that he was aware that Mr. SteadmanÔs case

settled for $1,400,000. He testified that the settlement amount did not fully

co mpensate Mr. Steadman for the value of the damages he suffered.

Mr. Barrett further testified that, using the value of $10,000,000 for all

damages, the $1,400,000 settlement represents a 14 percent recovery of the

full value. Therefore, he concluded that it would be reasonable to

proportionally allocate 14 percent of the $137,383.66 Medicaid expended in

past medical expenses, which equals $19,233.71.

31. Mr. Barrett was accepted as an expert. His testimony was credible.

Further, Mr. BarrettÔs testimony was not countered by AHCA with any

evidence that his proposed methodology was inaccurate or that another

method would be more appropriate to apply.

Ultimate Facts

32. Based on the testimony from Mr. McCarron and Mr. Barrett that the

$ 1,400 ,000 settlement d oe s not fully compensate Mr. Steadman for his

damages, Mr. Steadman argues that a lesser portion of the medical costs

should be calculated to reimburse Medicaid, instead of the full amount of the

lien. Mr. Steadman proposes that a ratio be applied based on t he true value

of his damages ($ 10,000,000 ) compared to the amount that he actually

recovered ($ 1,400,000) . Using these numbers, Mr. SteadmanÔs settlement

represents approximately a 14 percent recovery of the full value of his

damages. In similar fashion , t he Medicaid lien should be reduced to

14 percent , or approximately $ 19,233.71 ($ 137,383.66 x . 14 ). Therefore,

Mr. Steadman asserts that $ 19,233.71 is the portion of his third - party

settlement that represents the equitable, fair, and reasonable amount the

Florida Medicaid program should recoup for its payments toward his medical

care.

33. All of the expenditures Medicaid spent on Mr. SteadmanÔs behalf are

attributed to past medical expenses. No portion of the $ 137,383.66 Medicaid

lien represents future medi cal expenses.

34. The undersigned finds that the unrebutted testimony at the final

hearing demonstrates that the full value of Mr. SteadmanÔs damages equals

$ 10,000,000 . Further, based on the evidence in the record, Mr. Steadman met

his burden of prov ing, by clear and convincing evidence, that a lesser portion

of his settlement should be allocated as reimbursement for medical expenses

than the amount AHCA calculated using the rebuttable formula set forth in

section 409.910(11)(f). Accordingly, the undersign ed finds that the competent

substantial evidence adduced at the final hearing establishes that AHCA

should be reimbursed in the amount of $ 19,233.71 from Mr. SteadmanÔs

recovery of $ 1,400 ,000 from a third party to satisfy the Medicaid lien.

C ONCLUSIONS O F L AW

3 5 . DOAH has jurisdiction over the subject matter and parties in this

proceeding pursuant to sections 120.569, 120.57(1), and 409.910(17)(b).

DOAH has final order authority . § 409.910(17)(b), Fla. Stat.

36. AHCA is the Medicaid agency for the State of Florida, as provided

under federal law, and administers FloridaÔs Medicaid program. See

§ 409.901(2), Fla. Stat.

37. The federal Medicaid program Ñprovide[s] federal financial assistance

to States that choose to reimburse certain costs of medical trea tment for

needy persons .Ò Harris v. McRae , 448 U.S. 297, 301 (1980). While a stateÔs

participation is optional, once a state elects to participate in the federal

Medicaid program, it must comply with federal requirements governing the

program. Id. ; and 42 U.S.C. § 1396, et seq.

38 . As a condition for receipt of federal Medicaid funds, states are

required to seek reimbursement for medical expenses from Medicaid

recipients who later recover from liable third parties . See Ark. DepÔt of Health

& Hum. Servs. v. Ahlborn , 547 U.S. 268, 276 (2006) ; and 42 U.S.C. § 1396a.

To comply with this federal requirement, the Florida Legislature enacted

section 409.910, FloridaÔs ÑMedicaid Third - Party Liability Act,Ò which

requires AHCA to seek reimburse ment for Medicaid funds paid for a

recipientÔs medical care when that recipient later receives a personal injury

judgment or settlement from a third party. See Smith v. Ag. for Health Care

Admin. , 24 So. 3d 590 (Fla. 5th DCA 2009). The Legislature expressly set

forth in section 409.910(1):

It is the intent of the Legislature that Medicaid be

the payor of last resort for medically necessary

goods and services furnished to Medicaid

recipients. All other sources of payment for medical

care are primary to medical assistance provided by

Medicaid. If benefits of a liable third party are

discovered or become 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

entit y. 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 exte nt of such resources.

39. Accordingly, by accepting Medicaid benefits, Medicaid recipients

automatically subrogate their rights to any third - party benefits for the full

amount of medical assistance provided by Medicaid and automatically assign

to the Agen cy the right, title, and interest to those benefits, other than those

excluded by federal law . See § 409.910(6)(a) and (b), Fla. Stat.; see also

42 U.S.C. § 1396k(a)(1) (requiring states participating in the federal Medicaid

program to provide, as a condit ion of Medicaid eligibility, assignment to the

state of the right to payment for medical care from any third party).

Section 409.910 creates an automatic lien on any such judgment or

settlement with a third party for the full amount of medical expenses

Me dicaid paid on behalf of the Medicaid recipient. See § 409.910(6)(c), Fla.

Stat.

40. However, the obligation to reimburse AHCA (and Medicaid) following

recovery from a third party is not unb ridled . Pursuant to 42 U.S.C.

§§ 1396a(a)(25)(A), (B), and (H), 1 396k(a) , and 1396p(a), AHCA may only

assert a Medicaid lien against that portion of a p etitionerÔs award from a

third party that represents the costs of the medical assistance made available

for the individual. See Ahlborn , 547 U.S. at 278; Wos v. E.M.A. , 568 U.S. 627,

633, 133 S. Ct. 1391, 1396 (2013 ); and Harrell v. State , 143 So. 3d 478, 480

(Fla. 1st DCA 2014) . The federal Medicaid statuteÔs anti - lien provision,

42 U.S.C. § 1396p(a)(1), prohibits a state from attaching a lien for medical

assistance on a Medicaid recipientÔs property other than that portion of a

Medicaid recipientÔs recovery designated as payment for medical care. See

also §§ 409.910(4), (6)(b)1., and (11)(f)4., which provides that the Agency may

not recover more than it paid for the Medi caid recipientÔs medical treatment.

41 . As Ahlborn explains, the anti - lien provision of the federal Medicaid

Act circumscribes these obligations by authorizing payment to a state only

from those portions of a Medicaid recipientÔs third - party settlement rec overy

allocated for payment of medical care . Ahlborn , 547 U.S. at 285; s ee also

E.M.A. ex rel. Plyler v. Cansler , 674 F.3d 290, 312 (4th Cir. 2012)(Ñ As the

unanimous Ahlborn CourtÔs decision makes clear, federal Medicaid law limits

a stateÔs recovery to se ttlement proceeds that are shown to be properly

allocable to past medical expenses.Ò) .

42. The Florida Supreme Court interprets federal law to limit AHCAÔs lien

authority to the portion of a third - party tort recovery representing past

medical expenses . Gi raldo v. Ag . for Health Care Admin ., 248 So. 3d 53, 54

(Fla. 2018). The C ourt held that the section 409.910(17)(b) procedure must be

read to comply with the federal law, and thus effectively excised the portions

that would allow the Agency to impose a lien on recovered future medical

expense damages. Giraldo , 248 So. 3d at 56. 2

43 . Section 409.910(11) establishes a formula to determine the amount

A HCA may recover for medical assistance benefits paid from a judgment,

award, or settlement from a third party. Section 409.910(11)(f) states, in

pertinent part:

2 In Gallardo v. Dudek , 963 F.3d 1167 (11th Cir. 2020), cert. granted , 141 S. Ct. 2884 (Jul. 2,

2021) (No. 21 - 1263), the Eleventh Circuit Court of Appeals determined that amounts in a

settlement agreem ent fairly allocable to both past and future medical expenses are subject to

AHCAÔs lien. However, this is contrary to the Florida Supreme Court's holding in Giraldo .

State courts, however, are not required to follow the decisions of intermediate federal

a ppellate courts on questions of federal law. See Carnival Corp. v. Carlisle , 953 So. 2d 461,

465 (Fla. 2007). Neither party to the present case argues that future medical expenses

should be included in the relevant calculation.

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

follows:

1. After attorneyÔs fees and taxable costs as defined

by the Florida Rules of Civil Procedure, one - half of

the remaining recovery shall be paid to t he agency

up to the total amount of medical assistance

provided by Medicaid.

2. The remaining amount of the recovery shall be

paid to the recipient.

3. For purposes of calculating the agencyÔs recovery

of medical assistance benefits paid, the fee for

ser vices 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 al l

medical coverage benefits up to the total amount of

medical assistance provided by Medicaid. For

purposes of this paragraph, Ñmedical coverageÒ

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 for workersÔ

compensation, personal injury protection, and

casualty.

44. In summary, section 409.910(11)(f) establishes that AHCAÔs recovery

for a Med icaid lien is limited to the lesser of: (1) its full lien; or (2) one - half of

the total award, after deducting attorneyÔs 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 recipientÔs behalf. See Ag . for Health Care Admin. v. Riley ,

119 So. 3d 514, 515 n.3 (Fla. 2d DCA 2013). In th e present case , using the

section 409.910(11)(f) formula, Mr. SteadmanÔs recovery ($1,400,000) is

sufficient to fully satisfy the medical assistan ce provided by Florida Medicaid.

Therefore, the Agency is authorized to seek recovery of the full amount of its

lien ($137,383.66).

4 5 . However, section 409.910(17)(b) provides a method by which a

Medicaid recipient may contest the amount designated as rec overed medical

expenses payable under section 409.910(11)(f). Following the U.S. Supreme

Court decision in Wos , the Florida Legislature created an administrative

process to determine the portion of the judgment, award, or settlement in a

tort action that i s properly allocable to medical expenses; and, thus, the

portion of the recovery that may be used to reimburse the Medicaid lien.

Section 409.910(17)(b) 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 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).

The petition shall be filed with the Division of

Administrati ve 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 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 challen ge the amount designated as

recovered medical expenses, the 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 t he 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. (emphasis supplied ).

46. Section 409.910(17)(b) establishes that the section 409.910(11)(f)

formula constitutes a default allocation of the amount of a settlement that is

attributable to medical costs, and sets forth an administrative procedure for

an adversarial challenge of that allocation. See Harrell , 143 So. 3d at 480

(Ñ [A] plaintiff must be given the opportunity to seek reduction of the

amount of a Medicaid lien established by the statutory formula outlined in

section 409.910(11)(f), by demonstrating, with evidence, that the lien amount

exceeds the amount recovered for medical expenses . Ò).

47. In order to successfully challenge the amount payable to A HCA , the

burden is on the Medicaid recipient to prove, by clear and convincing

evidence, that a lesser portion of the total recovery should be allocated as

reimbursement for past medical expenses than the amount AHCA calculated.

§ 409.910(17)(b), Fla. Stat. In other words, in this matter, if Mr. Steadman

can demonstrate that the portion of the settlement attributed to past medi cal

expense s is less than the amount AHCA calculated using the

section 409.910(11)(f) formula, the amount he must reimburse AHCA may be

reduced below $ 137,383.66 .

48. With respect to Mr. SteadmanÔs $ 1, 40 0 ,000 settlement, the

undersigned finds that Mr. Ste adman persuasively demonstrated that a

lesser portion of his third - party recovery should be allocated to satisfy

AHCAÔs Medicaid lien, instead of the default amount calculated under

section 409.910(11)(f).

49. Regarding the specific amount of a petition erÔs settlement that should

be allotted to reimburse AHCA , the Florida Legislature, despite establishing

a procedure for a Medicaid recipient to challenge the amount of a Medicaid

lien, provided little guidance as to the standard DOAH should use to

determi ne what portion of the third - party recovery should represent past

medical expenses.

50. Mr. Steadman contends that the Medicaid lien should be reduced

using a ratio that factors in the full value of his damages. Mr. Steadman

specifically asserts that onl y $ 19,233.71 of the total settlement amount

should be attributed to past medical expenses ($ 137,383.66 x .14 ).

Mr. Steadman maintains that his calculation apportions a more reasonable

share of the settlement to him in light of his significant injuries.

5 1. AHCA, on the other hand, opposes Mr. SteadmanÔs pro rata

calculation. However, AHCA did not elicit testimony or present other

evidence to contradict the expert testimony on Mr. SteadmanÔs behalf . When,

as in the present case, a petitioner presents subst antially detailed and

uncontradicted evidence to support the reduction of a Medicaid lien using the

pro rata method, and AHCA fails to present evidence that the proposed

methodology is Ñinaccurate or that another method would be more

appropriate to apply,Ò the petitioner has met his burden. Soto v. Ag . for

Health Care Admin . , 313 So. 3d 143 (Fla. 1st DCA 2020); See also Eady v.

State , Ag. for Health Care Admin. , 279 So. 3d 1249, 1259 (Fla. 1st DCA 2019).

52. Mr. Steadman proved, by clear and convincing evid ence, that

$ 19,233.71 is the portion of his settlement Ñwhich should be allocated as past

È medical expenses,Ò pursuant to section 409.910(17)(b). Accordingly, AHCA

is entitled to be reimbursed in the amount of $ 19,233.71 from Mr. Steadman Ôs

$ 1, 40 0 ,000 set tlement.

O RDER

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

O RDERED that Petitioner, Iquan Steadman, shall pay Respondent, Agency for

Health Care Administration, the amount of $19,233.71 in satisfaction of its

Medicaid lien.

D ON E A ND O RDERED this 8th day of February , 2022 , in Tallahassee, Leon

County, Florida.

S

B RITTANY O. F INKBEINER

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 8th day of February , 2022 .

C OPIES F URNISHED :

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

2073 Summit Lake Drive , Suite 300 Staunton & Faglie, PL

Tallahassee, Florida 32317 189 East Walnut Street

Monticello, Florida 32344

Shena L. Grantham, Esquire

Agency for Heal th Care Administration Simone Marstiller, Secretary

Building 3, Room 3407B Agency for Health Care Administratio n

2727 Mahan Drive 2727 Mahan Drive, Mail Stop 1

Tallahassee, Florida 32308 Tallahassee, Florida 32308 - 5407

Josefina M. Tamayo, General Counsel Richard J. Shoop, Agency Clerk

Agency for Health Care Administration Agency for Health Care Administration

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

Tallahassee, Florida 32308 Tallahassee, Florida 32308

Thomas M. Hoeler, Esquire

Age ncy 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 a ffected 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 administra tive 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 d istrict c ourt of

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

or where a party resides or as otherwise provided by law.