Medicare Plan Finder
July 19, 2015
One Major Health Expense Which Americans are Uninsured
July 19, 2015

Physicians Mount a Legal Challenge

The US Supreme Court hears oral arguments from California’s physicians…
California’s physicians mount a legal challenge to California’s proposed Medicaid reimbursement cuts.  The California Pharmacists Association, Santa Rosa Memorial Hospital and the Independent Living Center of Southern California all challenged the state’s reimbursement cuts.

The US Supreme Court heard the initial oral arguments today.  Judge’s questions suggested that physicians might have a hard time prevailing in their efforts to stop the California reductions through legal action. The Supreme Court won’t decide on the reductions themselves, but whether the medical professionals have a right to sue under the Constitution.

The medical professionals argue that they have the power to sue under the supremacy clause of the Constitution, which declares that congressional acts are the “supreme law of the land” and take precedence over state laws. Under this reasoning, the California laws imposing reimbursement cuts violated the 1965 Medicaid law’s requirement that state payments remain “consistent with efficiency, economy and quality of care” and be “sufficient” for medical professionals.

California spends more than $41 billion a year on the Medicaid program, which the state operates under the name MediCal. It is the single largest budget item consuming about 13 percent of the state’s budget.

In 2008, faced with what the state’s attorneys described as a “devastating, ongoing and deepening financial crisis,” the California Legislature approved reimbursement cuts in 2008 and 2009 of between 1 and 10 percent. Hospitals sued, joined by unions and organizations that include the Gray Panthers of Sacramento. The 9th U.S. Circuit Court of Appeals blocked the reductions from taking effect. Customarily, private parties can sue to enforce a federal law only if Congress has explicitly authorized them to. The Medicaid law doesn’t include such authority.

This time may be different, however, because of the huge $20 billion California budget deficit. A Supreme Court decision is expected before the new term expires in June 2012.   As the first case heard, it’s likely to be decided well before then.

The US Supreme Court hears oral arguments from California’s physicians…
California’s physicians mount a legal challenge to California’s proposed Medicaid reimbursement cuts.  The California Pharmacists Association, Santa Rosa Memorial Hospital and the Independent Living Center of Southern California all challenged the state’s reimbursement cuts.

The US Supreme Court heard the initial oral arguments today.  Judge’s questions suggested that physicians might have a hard time prevailing in their efforts to stop the California reductions through legal action. The Supreme Court won’t decide on the reductions themselves, but whether the medical professionals have a right to sue under the Constitution.

The medical professionals argue that they have the power to sue under the supremacy clause of the Constitution, which declares that congressional acts are the “supreme law of the land” and take precedence over state laws. Under this reasoning, the California laws imposing reimbursement cuts violated the 1965 Medicaid law’s requirement that state payments remain “consistent with efficiency, economy and quality of care” and be “sufficient” for medical professionals.

California spends more than $41 billion a year on the Medicaid program, which the state operates under the name MediCal. It is the single largest budget item consuming about 13 percent of the state’s budget.

In 2008, faced with what the state’s attorneys described as a “devastating, ongoing and deepening financial crisis,” the California Legislature approved reimbursement cuts in 2008 and 2009 of between 1 and 10 percent. Hospitals sued, joined by unions and organizations that include the Gray Panthers of Sacramento. The 9th U.S. Circuit Court of Appeals blocked the reductions from taking effect. Customarily, private parties can sue to enforce a federal law only if Congress has explicitly authorized them to. The Medicaid law doesn’t include such authority.

This time may be different, however, because of the huge $20 billion California budget deficit. A Supreme Court decision is expected before the new term expires in June 2012.   As the first case heard, it’s likely to be decided well before then.

Brian Schroeder
Brian Schroeder
Brian J Schroeder – Independent Broker - (925) 513-7778