COURT FROM WHICH APPEALED: JASPER COUNTY CHANCERY COURT. DATE OF JUDGMENT: 05/20/2014. TRIAL JUDGE: HON. H. DAVID CLARK II. TRIAL COURT DISPOSITION: DENIED MEDICAID'S SUBROGATION CLAIM.
REVERSED AND REMANDED.
FOR APPELLANT: J. NICHOLAS CRAWFORD; FRANCIS DRAPER INGRAM.
FOR APPELLEE: EUGENE COURSEY TULLOS; JOHN RAYMOND TULLOS.
BEFORE IRVING, P.J., ROBERTS AND MAXWELL, JJ. LEE, C.J., IRVING AND GRIFFIS, P.JJ., BARNES, ISHEE, ROBERTS, CARLTON AND FAIR, JJ., CONCUR. JAMES, J., CONCURS IN PART AND IN THE RESULT WITHOUT SEPARATE WRITTEN OPINION.
[¶1] When approving a minor's settlement, the chancellor here denied the subrogation rights of the Mississippi Division of Medicaid (Medicaid), citing the " made whole" rule. But the made-whole rule only applies to an insurer's contractual right to subrogation. Medicaid's right to subrogation is not contractual. It is statutory. And the made-whole rule does not apply to statutory subrogation rights.
[¶2] The chancellor, despite his equitable powers, could not disregard the clear statutory directive that Medicaid recover its $10,308.40 interest from the $25,000 third-party payment to the minor. Thus, we reverse the chancellor's order denying Medicaid's statutory subrogation right as a condition of the settlement approval. We remand this case back to the chancery court for further proceedings consistent with this opinion.
Facts and Procedural History
[¶3] Javas Pittman, a minor, was riding on the hood of a car when it crashed. Javas was seriously injured. He was airlifted to University of Mississippi Medical Center, where he underwent surgery. Months later, he had another surgery. By the time he reached maximum medical recovery, Javas's medical bills totaled more than $170,000. Javas's providers billed Medicaid for $66,699.19 of those expenses. And Medicaid reimbursed the providers $10,308.04.
[¶4] The driver of car was not insured. So Javas's mother, Melissa Pittman, made a claim under her automotive policy, which included $25,000 in uninsured-motorist coverage. Melissa's carrier, Progressive Gulf Insurance Company (Progressive), agreed to settle for full policy limits. So Melissa initiated a guardianship proceeding, requesting the Jasper County Chancery Court authorize her to accept Javas's settlement. See Miss. Code Ann. § 93-13-59 (Rev. 2013).
[¶5] Medicaid appeared in the guardianship and asserted a $10,308.04 lien against the settlement proceeds. The chancellor required Melissa to also notify two other potential lien holders: American Medical Response (AMR), which had billed Javas $1,225 for air transport, and Mississippi Children's Health Insurance Program (CHIPS), which had covered $42,228.18 of Javas's medical expenses. Neither AMR nor CHIPS ever appeared in the matter and were deemed to have waived any lien or right to subrogation they may otherwise have held. But Medicaid was vigilant to put forth its statutory right to recover $10,308.04 from the $25,000 settlement with Progressive. See Miss. Code Ann. § 43-13-125 (Rev. 2009).
[¶6] Progressive also appeared in the matter, informing the chancellor that Medicaid's statutory subrogation rights authorized Medicaid to go after Progressive directly. See Miss. Code Ann. § 43-13-125(4). Progressive voiced its concern that, were the court to deny Medicaid its $10,308.40 portion of the ...