The U.S. Supreme Court kicked off its 2011 session earlier this week by hearing oral arguments on a case stemming from California's attempt to cut Medicaid reimbursement rates, report the New York Times and Washington Post. Its decision could ultimately strip hospitals and others in the provider community of redress regarding changes to the Medicaid program on the state level.
The case, Douglas v. Independent Living Centers of California, is being reviewed on the merits of whether private parties can actually sue to block changes to the Medicaid program on the state level.
Since 2008, California has tried to impose cuts to provider payments in its Medicaid program, known as Medi-Cal, that have totaled about 10 percent. Providers have balked, complaining that California already has one of the lowest reimbursement rates in the nation. However, both California and the Obama Administration claim that private parties have no right to sue to block cuts in the program.
"If Congress wants to provide for private-party litigation, it must do so clearly and unambiguously, and it has not done so in this case," said California Deputy Attorney General Karin S. Schwartz, who argued on behalf of the state.
Although the justices did not tip their views on the case, Associate Justice Elena Kagan did suggest that California engaged in an "end run" by imposing new rates without getting prior approval from the federal government.
A ruling in the case is expected by the spring of 2012.