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Pallay v. Nationwide Insurance Co.10/31/2005
iens be deducted automatically from the "amounts available for payment" calculation required by R.C. ยง3937.18(A)(2), but rather, that it should merely be considered. In some cases, that consideration might lead to the conclusion that the Medicare lien should reduce the "amounts available for payment" calculation. In other cases, a different conclusion might be reached. In this respect, Appellee's interpretation of Littrell is in error.
{ } This Court has recently interpreted Littrell to mean that a Medicaid lien (similar to a Medicare lien) would not reduce the "amounts available for payment" calculation if the insurance policy in question is the decedent's own insurance policy. Mid-American Fire & Cas. Co. v. Broughton, 154 Ohio App.3d 728, 2003-Ohio-5305, 798 N.E.2d 1109, ; appeal not accepted for review, 101 Ohio St.3d 1468, 804 N.E.2d 41, 2004-Ohio-819. On the other hand, a Medicaid lien would reduce the "amounts available for payment" calculation if the insured is a statutory wrongful death beneficiary attempting to make a claim on his or her own auto insurance policy. Id. It should be kept in mind, though, that Broughton did not actually involve a Medicaid lien. The issue actually under review was whether funeral and headstone expenses could be deducted from the "amounts available for payment" calculation. This Court discussed the Medicaid lien only by way of comparison to headstone and funeral expenses.
{ } Appellee argues that this Court's Broughton decision was based on the specific facts of the case, and that the facts of the instant case are quite different. In Broughton, the victim was considered to be an insured under his mother's auto insurance policy. The tortfeasor had $20,000 in liability coverage, while the UIM provisions of the victim's policy provided $300,000 of coverage per accident. The insurance company filed a declaratory judgment action, claiming that their maximum exposure for UIM coverage was $280,000. The mother, and the victim's sister, argued that there was more than $280,000 in coverage because funeral and headstone expenses should have been deducted from the $20,000 "amounts available for payment" calculation. They argued that funeral and headstone expenses were similar to the Medicare lien discussed in Littrell. In a split decision, this Court disagreed with the mother and sister and held:
{ } "The parties base their dispute on the distinction Littrell drew between attorney fees and the statutory subrogation lien, arguing that funeral and headstone expenses are either more or less like statutory liens or attorney fees. For instance, appellants argue that the funeral and headstone expenses are more like a statutory subrogation lien because a court ordered that they be paid from the settlement, and appellees contend that those expenses are more like attorney fees because they are incurred after death. But what the parties fail to realize is that there is no real distinction between attorney fees, a statutory lien, or the funeral and headstone expenses when these expenses are considered in the abstract. Each is an expense of an insured. The salient question is which insured? For instance, if the decedent's estate seeks underinsured motorist benefits, then both a Medicaid lien and the funeral and headstone expenses would be expenses of that particular insured. On the other hand, if the insured is a statutory wrongful death beneficiary insured under a distinct insurance policy, then the expenses of the estate noted above would not be an expense of the separately insured beneficiary. This second situation was the fact pattern in Littrell."
{ } Appellee argues that in Broughton we only reached our conclusion because the insurance policy's U
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