Opinion
No. 1D21-2500.
04-12-2023
K.H., Appellant, v. AGENCY FOR HEALTH CARE ADMINISTRATION, Appellee.
Michael Bross of Bross Law Office, Melbourne, for Appellant. Alexander R. Boler , Tallahassee, for Appellee.
Michael Bross of Bross Law Office, Melbourne, for Appellant.
Alexander R. Boler , Tallahassee, for Appellee.
Osterhaus, J.
This appeal involves a Medicaid lien asserted by the Florida Agency for Health Care Administration under the Medicaid Third-Party Liability Act, § 409.910, Fla. Stat., after Appellant obtained a recovery from a civil lawsuit. An administrative law judge denied a petition filed by Appellant to reduce the amount of AHCA's lien under the Act. See § 409.910(17)(b), Fla. Stat. (2021). Appellant makes two arguments for reversing the ALJ's decision, but we affirm. Appellant settled a lawsuit for more than $350,000 after being seriously injured by a criminal act committed at a commercial property. By the time of the settlement, AHCA had paid over $120,000 for Appellant's medical care under the Medicaid program. See § 409.910(1), Fla. Stat. (establishing Medicaid as "the payor of last resort for medically necessary goods and services furnished to" recipients). A condition of Florida's participation in the federal Medicaid program is compliance with requirements to make reasonable efforts to recoup medical cost outlays. Gallardo By & Through Vassallo v. Marstiller, ___ U.S. ___, 142 S.Ct. 1751, 1755, 213 L.Ed.2d 1 (2022); see also 42 U.S.C. § 1396a(a)(25)(H) & § 409.910(4), Fla. Stat. (requiring reimbursement when the assets of a liable third party become available). In this case, AHCA asserted a statutory lien to recoup medical expenses incurred for Appellant's care from the funds she received from settling her civil lawsuit. See Gray v. Agency for Health Care Admin., 288 So.3d 95, 97 (Fla. 1st DCA 2019) (describing how repayments for covered medical care can be accomplished via a lien on a Medicaid recipient's tort recovery). Under circumstances like this one, AHCA's reimbursement is calculated under a statutory formula, see § 409.910(11)(f), Fla. Stat., unless the Medicaid recipient shows that "a lesser portion of the total recovery should be allocated as reimbursement for ... medical expenses than [the statutory amount]." § 409.910(17)(b), Fla. Stat.; see also Was v. E.M.A. ex rel. Johnson, 568 U.S. 627, 636, 133 S.Ct. 1391, 185 L.Ed.2d 471 (2013) (restricting states from claiming funds from tort recoveries that aren't designated as payments for medical care). In this case, Appellant responded to assertion of the lien by filing a petition with the Division of Administrative Hearings to reduce the amount of reimbursable expenses under § 409.910(17)(b)). But her petition was denied.
Appellant makes two arguments on appeal that the reimbursable medical expense amount should have been reduced by the ALJ. First, Appellant argues that a "Letter of Understanding" agreed by the parties to the lawsuit bound the ALJ to reduce the lien amount in accordance with the terms of the Letter. The Letter provided that 5% of settlement amounts would be allocated for Appellant's medical care and satisfaction of AHCA's lien, about $13,000. Appellant argues that the Letter's 5% allocation bound the ALJ to so limit AHCA's recovery. But Appellant is incorrect. While it is true that settlement agreements can dictate the amount of reimbursable medical expenses when a state agrees to the terms, see Gray, 288 So. 3d at 97, here AHCA lacked any involvement with the Letter or with the terms set forth in the Letter for reimbursing Appellant's medical expense costs. Absent AHCA's agreement with the reduced medical expense figure provided in the Letter, Appellant could not unilaterally impose it upon AHCA and foreclose recoupment of thousands of Medicaid dollars paid for Appellant's care. See Gallardo by & through Vassallo v. Dudek, 963 F.3d 1167, 1175-76 (11th Cir. 2020) (recognizing that parties to a lawsuit cannot unilaterally bind AHCA's Medicaid recovery). Indeed, courts have repeatedly recognized the risk of parties artificially allocating low medical expenses in Medicaid recipients' personal injury settlements. Id. at 1176; Wos, 568 U.S. at 638, 133 S.Ct. 1391; Eady v. State, 279 So.3d 1249, 1256 (Fla. 1st DCA 2019). We therefore see no error in the ALJ's treatment of the Letter of Understanding.
Appellant's second contention is that the ALJ erred by rejecting the pro rata method of proportioning medical expenses. The so-called pro rata method is a way of reducing the repayment amount of medical expenses from a lawsuit settlement by which an injured party establishes the overall value of the lawsuit compared to the settlement amount and applies that same proportion to the total medical expenses paid with Medicaid funds. Agency for Health Care Admin. v. Rodriguez, 294 So.3d 441, 443-44 (Fla. 1st DCA 2020). Here, however, the ALJ determined that Appellant did not pursue the pro rata method for reducing medical expenses at the hearing but relied only upon the Letter of Understanding argument addressed above. Appellant apparently didn't seek rehearing or clarification of this conclusion with the ALJ. Moreover, even if we assume that Appellant's pro rata argument was preserved, the record fails to show that Appellant proved what was needed to complete a pro rata calculation and reduction of the medical expenses. The situation here is different from Eady, for instance, where we credited expert testimony and reversed the denial of a petition to reduce the amount of reimbursable medical expenses. 279 So.3d 1249. A full record in Eady permitted us to assess the uncontested hearing testimony of an expert that established the appropriate share of lawsuit-settlement funds to be allocated to medical expenses, which supported a pro rata reduction of reimbursable medical expenses. Here, by contrast, Appellant did not order a transcript of the hearing (as noted in both the Final Order and Answer Brief), nor supply other evidence demonstrating that the medical expenses should be pro rata reduced. Particularly in the absence of knowing what Appellant's expert said at the hearing, we cannot evaluate the ALJ's conclusion that fact and data-based shortcomings undermined the expert's $10 million valuation of Appellant's case. See § 90.702(1), Fla. Stat. (requiring that expert testimony be "based upon sufficient facts or data"); cf. Eady, 279 So. 3d at 1259 (noting that "evidentiary infirmities" had doomed pro rata expense-reduction arguments in two earlier cases). Because Appellant has not demonstrated reversible error in the Final Order, we affirm.
AFFIRMED.
Ray and Nordby, JJ., concur.