Court Opinion

ID: 9750517
Source: CourtListenerOpinion
Date Created: 2023-08-28 15:04:03.233853+00
Date Added: 2024-06-11T07:26:11.568545
License: Public Domain

YEGAN, J.
I respectfully dissent.
Respondent was seriously injured when his car went over the side of a bridge owned and maintained by the State of California. The injuries left him totally disabled. Respondent incurred $200,000 medical expenses, some of which were paid by Medi-Cal.
*1614Respondent filed suit. At a court supervised settlement conference, the State of California, through its Department of Transportation, settled for $290,000 and stipulated that respondent’s comparative fault was 80 percent. The State Department of Health Services appeared at the settlement conference but refused to participate. A week later, it filed a Medi-Cal lien for $45,599.34. (Welf. & Inst. Code, § 14124.71.) On June 2, 1995, more than three months after the settlement conference, it moved to enforce the lien.1
The trial court reduced the lien to zero on the ground that Welfare and Institutions Code section 14124.71 did not authorize a lien recovery where the settling tortfeasor is the state. It found that the State of California may not “reduce its own liability for damages by dividing itself into two separate entities, and taking back through one entity the damages agreed to be paid by the other. The reality is that both are the State of California. . . . The Department of Transportation is not ‘another person’ with regard to a right of reimbursement to the Department of Health Services; they are the same ‘person’; the State of California.”
Applying a commonsense analysis, the trial court came to the correct result. The statutes governing the recovery of Medi-Cal liens are limited to third party claims against tortfeasors other than the State of California. (Welf. & Inst. Code § 14124.71 et seq.) “Under the Medi-Cal program, the state makes payments to health care providers who render medical care and treatment to Medi-Cal beneficiaries. (§ 14000 et seq.) When health care services are provided because of an injury for which another person or entity is civilly liable, the Director has the right to recover from such person or entity the reasonable value of the services provided. (§ 14124.71.) When an action is brought by the beneficiary alone, the Department is allowed a first lien, of not more than one-half, on the proceeds, after payment of reasonable litigation expenses and attorney’s fees. (§§ 14124.74, 14124.78.)” (Kizer v. Ortiz (1990) 219 Cal.App.3d 1055, 1058-1059 [268 Cal.Rptr. 666], italics added.)
The State of California’s right to recover on the lien is limited to third party liability cases. (Welf. & Inst. Code, § 14124.71 et seq.) But what is a third party? It is not expressly defined in the “definitions” section of article 3.5, entitled, “Third Party Liability.” (§ 14124.70.) In my view, the “third party” contemplated by section 14124.71 is any person or entity other than the State of California, who is at fault for the injury.
The majority recognize that the Department of Health Services and Department of Transportation are different departments of the same legal *1615entity. However, by the majority’s construction, the Department of Health Services could have sued the Department of Transportation and recovered the reasonable value of the medical services. (Welf. & Inst. Code, §§ 14124.71, 14124.72, 14124.73.) While these two departments may have separate budgets, they do not have separate treasurers. (Gov. Code, § 12320.) “The fact that. . . [separate] departments perform different functions for the State of California does not mean they are akin to separate business entities within a multiunit corporate enterprise. . . . [B]oth departments and their employees are agents of the state. [Citation.]” (Colombo v. State of California (1991) 3 Cal.App.4th 594, 598 [5 Cal.Rptr.2d 567].)
“It must be conceded that no person can sue himself. [Citation.]” (Rudnick v. Delfino (1956) 140 Cal.App.2d 260, 266 [294 P.2d 983], citing Byrne v. Byrne (1892) 94 Cal. 576, 576 [29 P. 1115].) The same principle controls here. The State of California may not sue itself to recover Medi-Cal payments. The Medi-Cal payments and the money to settle respondent’s personal injury claim came from the same public entity. (Gov. Code, §§ 900.6, 940.6.)2
Like other tortfeasors, the State of California may advance medical payments to the plaintiff and assert a setoff. (E.g., Scott v. County of Los Angeles (1994) 27 Cal.App.4th 125, 154 [32 Cal.Rptr.2d 643].) Here, the State of California waived the setoff when it settled for $290,000.
Until today, no court has held that the Department of Health Services may enforce a Medi-Cal lien against a settlement paid by the State of California as a tortfeasor. To compound the problem, the majority hold that the trial court had no discretionary power to reduce the Medi-Cal lien. This is at odds with Government Code section 985.
Medi-Cal liens, whether enforced pretrial or posttrial, are the same. Had respondent proceeded to trial and obtained a judgment against the State of California, the trial court could have reduced the lien “on terms as may be just” pursuant to Government Code section 985, subdivision (f)(1). In the alternative, the trial court could have invoked Government Code section 985, subdivision (f)(3) which provides in pertinent part: “In determining the amount to be reimbursed from the judgment to a provider of a collateral source payment, or the amount by which the judgment will be reduced to account for collateral source payments, the court shall make the following adjustments: [<]D (A) Where plaintiff has been found partially at fault, the *1616reimbursement or reduction shall be decreased by the same percentage as the entire judgment is reduced to take into account the plaintiff’s comparative fault.” (Italics added.) Assuming that the State of California was found to be 80 percent at fault, the Medi-Cal lien would be reduced to $5,107.13.
Today’s decision penalizes the plaintiff who settles and rewards the plaintiff who proceeds to trial and obtains a judgment against the State of California. This is contrary to the policy of California law to encourage settlements. It may well be that the Legislature wants full reimbursement of a Medi-Cal lien where the State of California is the settling “third party tortfeasor.” Until it expressly and unambiguously declares, reimbursement should be denied.
I would affirm the judgment.
Respondent’s petition for review by the Supreme Court was denied February 5, 1997.

The Medi-Cal lien was reduced to $31,116.58 to compensate respondent for his attorney’s fees and costs. (Welf. & Inst. Code, § 14124.72, subd. (d).)

 Government Code section 900.6 provides: “ ‘State’ means the State and any office, officer, department, division, bureau, board, commission or agency of the State claims against which are paid by warrants drawn by the Controller.”