Supreme Ct. Denies CA Medicaid case

Article published February 22, 2012
Calif. Medicaid case heads back to lower court
By Gregg Blesch Posted: February 22, 2012 – 12:45 pm ET
The U.S. Supreme Court sent a widely watched California Medicaid case back to a lower court, declining to rule whether providers can sue states to enforce the federal statute.
California hospitals and other providers argued in five lawsuits that state amendments to the Medicaid program, including a 10% reimbursement cut, violated language in the federal law that payments are sufficient to sustain quality and access for beneficiaries. The 9th U.S. Court of Appeals agreed and issued injunctions
blocking the state from making the changes.
In the meantime, however, the CMS approved some of the plan amendments and the state withdrew most of the others.
“While the cases are not moot, they are now in a different posture,” Justice Stephen Breyer wrote in an opinion for a 5-4 majority. “The providers and beneficiaries continue to believe that the reductions violate the federal provision the agency’s view to the contrary notwithstanding.” The 9th Circuit’s injunctions remain in place.
Breyer noted, however, that the providers may now more appropriately seek review of the CMS’ decisions rather than basing their challenge on the supremacy of federal law over the state actions. Breyer noted that the administrative review requires deference to the agency’s decisions and “to permit a difference in result here would subject the states to conflicting interpretations of federal law by several different courts (and the agency), thereby threatening to defeat the uniformity that Congress intended.”
The Supreme Court remanded the case to the 9th Circuit.