18 Fla. L. Weekly Supp. 1159a
Online Reference: FLWSUPP 1811ROSSInsurance — Health — Equitable distribution of net settlement proceeds between insured and health insurer that asserts subrogation lien for benefits paid on behalf of insured
JAMES ROSS, Individually, Plaintiff, vs. HERITAGE ON THE RIVER, LLC, a Florida company, Defendant. Circuit Court, 4th Judicial Circuit in and for Duval County. Case No. 16-2007-CA-6615-XXXX, Division CV-H. October 12, 2010. Waddell A. Wallace, III, Judge.
ORDER ON MOTION FOR EQUITABLE DISTRIBUTION OF SETTLEMENT PROCEEDS
This case is before the Court for consideration of the Motion for Equitable Distribution filed on behalf of Plaintiff, James Ross. Plaintiff’s motion is brought pursuant to Section 768.76, Florida Statutes, and seeks an equitable distribution of net settlement proceeds between himself and Aetna Health, Inc., who asserts a subrogation lien on the proceeds by reason of benefits paid on behalf of the Plaintiff pursuant to a health insurance policy issued by Aetna and insuring Plaintiff.
The funds at issue arise from a settlement Plaintiff reached with Defendant, Heritage on the River, LLC (“Heritage”). In the settlement, Heritage paid Plaintiff $75,000 in settlement of all claims arising out of a fall sustained by Plaintiff on stairs at an apartment complex owned or maintained by Heritage. From the $75,000 in gross proceeds, attorneys’ fees of $30,000 (40 percent) and costs in the amount of $3,640.40 (5 percent) were reduced before a determination of Plaintiff’s net recovery. These attorneys’ fees and costs equal $33,640.40, which amount to 44.85 percent of the $75,000 gross settlement. Under Section 768.76(4), Florida Statutes, any amount of the settlement proceeds payable to Aetna must first be reduced by 44.85 percent, in order to determine Aetna’s pro rata share of the costs and attorneys’ fees incurred by Plaintiff in securing the settlement.
The next consideration is whether Plaintiff’s settlement represents a recovery of all of the benefits paid by Aetna on Plaintiff’s behalf. Aetna paid $24,327.78 for Plaintiff’s hip replacement surgery and recovery. The key issue in the resolution of Plaintiff’s claims against Heritage was whether Plaintiff’s hip replacement was due to a pre-existing chronic, degenerative condition, or, instead, was cause-related to the slip and fall. There was significant evidence that Plaintiff’s preexisting condition would have necessitated a hip replacement even without the fall. On the other hand, the fall apparently aggravated the hip condition and arguably contributed to the need for the hip replacement surgery. The settlement was achieved at mediation and represented a compromise of a disputed claim. The Court finds that, in reaching the settlement, Plaintiff compromised his claim to recover the costs of the hip replacement surgery and that the settlement represents a recovery to Plaintiff of approximately 40 percent of the costs of that surgery.
The amount paid by Aetna equals $24,327.78. Reducing that amount by 44.85 percent to reflect Aetna’s pro rata share of attorneys’ fees and costs, yields a reduced amount of $14,596.67. Forty percent of this amount equals $5,838.67. The Court finds this to be the proper amount equitably distributed to Aetna in satisfaction of its subrogation lien asserted against the proceeds of Plaintiff’s settlement with Heritage.
Accordingly, for the reasons stated, it is ORDERED:
1. Aetna Health, Inc. has a subrogation lien in the amount of $5,838.67 on the proceeds of the settlement Plaintiff reached with Defendant, Heritage on the River, LLC.
2. Upon payment to Aetna of its total lien amount, Aetna’s lien is satisfied and Plaintiff is entitled to the disbursement of the balance of the settlement proceeds.