Appeals court again sides with healthcare providers over state cuts to Medicaid

The U.S. Court of Appeals for the Ninth Circuit again has ruled that California's lawmakers cannot cut reimbursements to the state's Medicaid program solely because it needs to reduce expenditures.

Legislators in California facing a multibillion-dollar budget deficit have cut a number of education and healthcare provisions in an attempt to overcome an enormous budget deficit. Nursing homes, assisted living facilities and other healthcare providers have won a string of lawsuits aimed at blocking some of these cuts. The Aug. 7 decision upheld a federal trial court's injunction against the state to prevent Medicaid cuts. It said that the proposed cuts to Medi-Cal—this time to non-emergency medical transportation and home-health services—violate Title 42, Chapter 7 of the U.S. Code. This regulation says that provider rates cannot be set without due consideration of the effect on access, quality of care, efficiency and economy, the Bureau of National Affairs reported.

In recent months, California healthcare providers won a victory over state legislators when the Supreme Court declined to hear an appeal by the state, allowing the providers to continue suing to block funding cuts. (McKnight's, 6/24/09)