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Gray v. Agency for Health Care Administration

Florida Court of Appeals, First District

September 3, 2019

John Gray, Appellant,
v.
Agency for Health Care Administration, Appellee.

         Not final until disposition of any timely and authorized motion under Fla. R. App. P. 9.330 or 9.331.

          On appeal from the Division of Administrative Hearings. J. Bruce Culpepper, Judge.

          Brandon G. Cathey and Brent G. Steinberg of Swope, Rodante P.A., Tampa, for Appellant.

          Ashley Moody, Attorney General; Jonathan A. Glogau, Special Counsel, and Elizabeth Teegen, Assistant Attorney General, Tallahassee; and Tracy George, Chief Appellate Counsel, Agency for Health Care Administration, Tallahassee, for Appellee.

          PER CURIAM.

         After John Gray settled a lawsuit arising from a car accident in which he suffered a spinal cord injury, the State of Florida obtained a lien against the proceeds of the settlement to satisfy payments made by the Medicaid program for Gray's medical care. Gray filed an administrative petition seeking to reduce the lien amount. The administrative law judge determined that Gray did not establish entitlement to a reduction of the lien. Because the ALJ's factual findings are supported by competent, substantial evidence, and because the ALJ correctly applied the operative statute when determining the lien amount, we affirm.

         Medicaid Third-Party Liability Act

         Medicaid is intended to be the payor of last resort. Under Florida law, Medicaid must be repaid from any third-party benefits obtained by the Medicaid recipient, such as a settlement in a lawsuit, "regardless of whether a recipient is made whole or other creditors paid." § 409.910(1), Fla. Stat. (2016). Repayment to Medicaid is accomplished through an automatic lien for the full amount of medical assistance provided by Medicaid. § 409.910(6)(c), Fla. Stat. (2016).

         The Medicaid Act allows AHCA to recover from a recipient provided medical care through the Medicaid program:

Except as otherwise provided in this section, notwithstanding any other provision of law, the entire amount of any settlement of the recipient's action or claim involving third-party benefits, with or without suit, is subject to the agency's claims for reimbursement of the amount of medical assistance provided and any lien pursuant thereto.

§ 409.910(11)(e), Fla. Stat. (2016) (emphasis added). However, the Florida Supreme Court has determined that the lien that may be placed on a Medicaid recipient's tort recovery is limited to reimbursement for medical expenses already paid to the recipient. Giraldo v. Agency for Health Care Admin, 248 So.3d 53, 56 (Fla. 2018). The Court reasoned that allowing AHCA to obtain recovery for payments not yet made by the program would conflict with the anti-lien provisions of the federal Medicaid laws. Id. at 55. Thus, the Court held that AHCA may not obtain a lien against any portion of a Medicaid recipient's settlement that is allocated for future medical expenses. Id. at 56.

         However, settlement agreements do not always neatly identify and allocate amounts recovered for past or future medical expenses. When there is a judicial finding or approval of an allocation between medical and non-medical damages or between past and future medical damages "in the form of either a jury verdict, court decree, or stipulation binding on all parties-that is the end of the matter." Wos v. E.M.A., 568 U.S. 627, 638 (2013). But without an agreement about the allocation, the parties may resolve the dispute in an administrative proceeding. Id.

         When there has been no judicial finding or approval of an allocation in a settlement agreement, Florida's Medicaid Third-Party Liability Act provides a default formula to calculate Medicaid's share of a settlement received from a third-party:

After attorney's fees and taxable costs . . . one-half of the remaining recovery shall be paid to the agency up to the total amount of ...

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