Medicaid Lien Law in Florida Personal Injury Cases Appears to be Resolved

us supreme court.jpgMedicaid will sometimes pay the medical expenses incurred by a person injured in an accident, albeit at rates substantially below the medical provider’s usual and customary charges. When Medicaid does pay, beneficiaries must reimburse Medicaid from third party payments for medical care. See section 409.910(11)(f), Florida Statutes (2013). The goal of the statute is to protect tax dollars while preventing Medicaid beneficiaries from receiving a windfall. Tristani v. Richman, 652 F.3d 360, 370, at 372 (3d Cir. 2011).

In Arkansas Department of Health & Human Services v. Ahlborn, 547 U.S. 268 (2006), the U.S. Supreme Court confirmed that the Medicaid lien was limited to payments for medical care. Id. at 284. At issue in Ahlborn was a North Carolina Medicaid lien statute similar to Florida’s.

In spite of Ahlborn, AHCA, which administers Florida’s Medicaid system, insisted that its payments could be recovered from the entire settlement without regard to the various other damage elements typically constituting the basis of a settlement. (In addition to incurred medical expenses, personal injury cases usually also involve claims for lost wages, future medical expenses, mental anguish, and pain. According to Ahlborn, Medicaid’s lien only attaches to the payments made for medical care.) Moreover, ACHA refused to negotiate or even concede that any court had a say in the matter. AHCA’s brazenness was challenged.

In Roberts v. Albertson’s Inc., 37 Fla. L. Weekly D2515 (Fla. 4th DCA Oct. 24, 2012), reh’g and reh’g en banc denied, modified on reh’g, No. 4D10-2313 (Fla. 4th DCA June 26, 2013), the Fourth District Court of Appeal issued a decision authorizing the trial court to conduct a hearing to determine the Medicaid lien. The court could consider evidence of payments for such other damages as lost wages, pain, and mental anguish, as well as determine how much less the case settled for than its full value. (Cases are often settled for less than full actual damages due to a variety of factors including comparative fault and limited insurance coverage.)

In addition, while another Medicaid lien case, Agency for Health Care Administration v. Riley (Fla. 2nd DCA 8-14-13), was pending on appeal, the United States Supreme Court decided Wos v. E.M.A., 133 S. Ct. 1391 (2013), an opinion making it clear that the Medicaid lien is limited to medical payments. After the Wos decision came down, AHCA acknowledged in the Riley case that a Medicaid recipient should be afforded an opportunity to attempt to rebut the statutory presumption of 409.910(11)(f), which is consistent with the holding of the Fourth District in Roberts, which treats the statutory allocation as a “default allocation.” Roberts, 37 Fla. L. Weekly at D2519.

In response to the Wos decision, the 2013 Florida Legislature revised Fla. Stat. §409.910 relating to the settlement of Medicaid claims involving third parties. The new legislation, CS/CS/HB 939, passed on April 30 and took effect July 1. §409.910(17)(a) expressly divests circuit court judges from jurisdiction to perform equitable distributions of the Medicaid beneficiary’s tort settlement proceeds. Now, only a hearing officer in Leon County can hear these agency matters. Moreover, the burden is on the plaintiff to seek the administrative hearing during a narrow post-settlement window. The plaintiff must then prove, by clear and convincing evidence, that an amount less than the 50 percent provided for in §409.910(11)(f) should be allocated to the beneficiary’s medical expenses.

While cynical, it is not unrealistic to predict that this procedure, involving an administrative judge located in Tallahassee deciding issues involving another state and Tallahassee- based agency (AHCA), portends tough times for Plaintiffs. Let’s hope not. (Compare our pre-July 1, 2013 experience with resolving a Medicaid lien: Reducing Substantial Florida Personal Injury & Workers’ Compensation Medicaid Liens — Our Recent (June, 2013) Court Experience.)

IMPORTANT CONSIDERATION: With the new administrative procedure seemingly stacked against Plaintiffs, it is no time to hand AHCA ammunition. Section 409.910(6)(c)(7) provides that any tort settlement without Medicaid’s knowledge is considered prima facie evidence of an impairment of the agency’s lien. In cases where it is known in advance that the Medicaid lien could be problematic, it may be advisable to bring AHCA into the loop early on and to notify it in advance of a proposed settlement.

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