CDA and coalition partners file lawsuit to block Medi-Cal reimbursement cuts

CDA joined the California Medical Association, the California Pharmacists Association and the National Association of Chain Drug Stores to file a lawsuit against the California Department of Health Care Services and the U.S. Department of Health and Human Services. The suit, filed with the California Central Federal District Court on Nov. 21, is in response to the Centers for Medicare and Medicaid Services’ recent approval of a 10 percent reimbursement rate cut in California’s Medicaid program, known as Medi-Cal.

According to the California Medical Association, the Centers for Medicare and Medicaid Services asked the Department of Health Care Services for more information that would substantiate its state plan amendments for cuts in the Medi-Cal program. By approving the cuts without receiving that information, CMS did not follow protocol and applied the wrong legal standard, CMA says.

Earlier this year, in a budget-cutting move, the California Legislature passed and Governor Brown signed AB 97, which included a 10 percent reimbursement rate cut for physicians, dentists and pharmacists. The federal government approved the rate cuts on Oct. 27. Federal approval was required before the state can implement its proposed cuts.  By law, the state is required to submit underlying documents to the Centers for Medicare and Medicaid Services clearly documenting that access to care for Medi-Cal patients would not be impacted by the state plan amendments.  The lawsuit challenges the adequacy of the information provided by the state to support the cuts. 

CDA believes this latest attack on the already inadequate Medi-Cal network of dental care will result in further hindrance of dentists’ ability to provide appropriate care and is taking a stand against the state’s willingness to obstruct access to care.

The information that CMS relied on to approve the State's cuts does not measure whether and how patients' access to care would be impacted or otherwise take into consideration, as required by law, the costs to provide the care. In fact, a recent poll and independent studies show that access to care is already unequal, making the recent cuts illegal by federal standards.

The California Hospital Association recently filed a suit on behalf of the Subacute Distinct Part Nursing Facilities that is set to be heard on Dec. 19.

CDA, CMA and CPhA successfully sued in the past to enjoin prior Medi-Cal cuts and expect to demonstrate once again that federal law, which ensures that Medi-Cal patients have equal access to health care, was not followed.