Last year, a group of patients, doctors, and hospitals in California filed a lawsuit against the state of California over cuts to Medicaid funding. The case has made its way to the Supreme Court. Now, the Supreme Court has officially declined to hear the case.
In 2008 and 2009, the legislature of the state of California cut the reimbursement fees that it paid to hospitals, doctors, and other health care providers who treated patients who were covered by Medicaid. Some of those cuts were as high as 10%. The state of California went ahead and put these changes into affect without waiting for approval from the federal Medicaid agency. There is a law that requires the state to get approval for this sort of thing before it does it.
The federal Medicaid agency did not approve of the cuts that the state of California had, by that point, already put into effect. The state of California decided to continue with those cuts to its Medicaid program, anyway, despite the fact that the federal Medicaid agency did not approve of them.
Next, a group of doctors, hospitals, and patients sued the state of California. The purpose of the lawsuit was to put a stop to the cuts to the state Medicaid program. A federal appeals court ruled that the Medicaid cuts were illegal, and halted them. The state of California then filed an appeal, which meant that the case was heading to the Supreme Court.
Now, the Supreme Court has officially declined to hear this case. A majority of five of the Justices of the Supreme Court, led by Justice Stephen Breyer, sent the case right back to the Ninth Circuit Court of Appeals in California.
The Justices want the Ninth Circuit Court to decide if changes in circumstances would warrant a different process. They also wonder if the case would be better with a different defendant. In short, the Supreme Court does not want to make a decision about the constitutionality of what the state of California has decided to do regarding cuts to their Medicaid program.
The changes in circumstances that the Supreme Court is referring to happened between the time when this case was sent to the Supreme Court, and when the Supreme Court was ready to discuss whether or not they would decide this case. In October of 2011, the federal Medicaid agency changed its mind. It decided to allow many of the cuts to go through. This happened after the Supreme Court heard oral arguments for this case.
The Justices want an appeals court in California to determine whether or not doctors, hospitals, and patients can still sue in light of the changed circumstances. The state of California, and the Obama administration, have argued that only the United States government can enforce federal law, and that private citizens do not have the right to sue.
Image by Mark Fischer on Flickr