Martinez v. Department of Health Care Services (Dec. 13, 2017, B2728117) __ Cal.App.5th __ [2017 WL 6939086], ordered published and modified Jan. 12, 2018.
The California Department of Health Care Services (DHCS) asked the trial court to determine the amount of a Medi-Cal lien on plaintiff Solomon Martinez’s $150,000 settlement of a medical malpractice action. Although Martinez had received $86,676.46 in Medi-Cal payments, the court determined the value of the lien to be $39,004.41. The court determined the value by first adding the $250,000 maximum recovery of noneconomic damages permitted under the Medical Injury Compensation Reform Act (MICRA) to the $86,676.76 in medical costs. Then the court calculated the $150,000 settlement amount to be 45 percent of the total case value, and awarded the DHCS 45 percent of the medical costs. Martinez appealed, arguing that the court erred by failing to value his noneconomic damages at $2.5 million, by failing to consider his $300,000 lost wage claim, and by failing to utilize the full $171,000 amount of the hospital bill, rather than the $86,676.46 actually paid for medical services.
The Court of Appeal affirmed in part. Following Arkansas Department of Health and Human Services v. Ahlborn (2006) 547 U.S. 268, the court held it would have been irrational for the trial court to credit Martinez with (1) $2.5 million in noneconomic damages, when $250,000 is the maximum award allowed under MICRA, (2) the full $171,000 hospital bill, instead of the $86,676.46 amount actually paid, since the lien was based on the lower amount paid, or (3) $300,000 in lost wages, because Martinez failed to identify any evidence supporting his lost earnings claim. However, the court did reduce the lien amount by 25 percent to account for statutory attorney fees, as required by Welfare and Institutions Code section 14124.72, subdivision (d).
Thomas Watson
htwatson@horvitzlevy.com
Horvitz & Levy LLP
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