An appeals court ruling allowing California to cut Medicaid payments to doctors, pharmacists, and others -- including dentists -- could open the door for other states to pursue similar reductions.
A panel of the 9th U.S. Circuit Court of Appeals ruled on December 13 that California may cut reimbursements by 10% to healthcare providers who serve low-income patients under Medi-Cal, the state's Medicaid program, according to an article on amednews.com.
The three-judge panel ruled that the U.S. Department of Health and Human Services (HHS) has the authority to determine whether states are justified in cutting Medicaid rates. California does not have to consider physicians' costs of providing the medical services in question before receiving government approval for the cuts, the story said.
The California Medical Association (CMA), a co-plaintiff in the case, will appeal the decision, according to the article.
In October 2011, the U.S. Centers for Medicare and Medicaid Services approved a state proposal to reduce Medi-Cal provider reimbursements by 10% in 2012, retroactive to June 2011. The reductions were approved by California lawmakers and Gov. Jerry Brown.
The California Dental Association, CMA, and other groups then sued the state, challenging the cuts. In January 2012, a federal court blocked California officials from moving forward with the reductions, and the federal government appealed. California has since rescinded the plan amendments that were in dispute in the case.
The appellate panel overturned several injunctions blocking the 2011 cuts from taking effect. The judges said deference must be given to the HHS secretary in determining whether a state pay-cut proposal meets the requirements of federal laws, including whether states first must take any specific steps to consider the costs to health professionals of providing care.
If the reductions remain, access to care would be negatively affected not only for current Medicaid enrollees, but for an estimated 900,000 children moving into Medi-Cal from another assistance program, said CMA President Paul Phinney, MD.
