Court says groups can't sue states over Medicaid access

The decision also leaves legal challenges to state agencies over reimbursement rates in doubt, says a lawyer representing doctors.

By Mike Norbut, AMNews staff. Sept. 5, 2005.

Medicaid beneficiaries and the physicians who care for them do not have the right as a group to sue to enforce equal access standards under the federal Medicaid law, a federal appellate court ruled in August.

Advocates for Medicaid recipients say the ruling by a three-judge panel of the 9th U.S. Circuit Court of Appeals in San Francisco sets a dangerous precedent that will likely result in fewer care options for disabled, poor and senior patients.

They also say the decision will lead to lower reimbursement rates for physicians who care for those patients. The ruling, by saying the law did not clearly allow a group to enforce a federal law against a state, effectively gives state agencies the sole ability to set reimbursement levels.

"No one would have the authority to challenge the level of reimbursement rates," said Craig Cannizzo, a San Francisco attorney representing the California Medical Assn. and other medical societies in one of several cases challenging the reimbursement rates set by Medi-Cal, California's Medicaid program. "The consequence of that is it renders the equal access standard unenforceable."

The court ruled on three separate cases. The first, Sanchez et al. v. Johnson, involved a group of disabled residents who challenged wage levels Medi-Cal set for health care professionals. The court applied its decision in that case to California Medical Assn. et al. v. Bonta, which pitted a coalition of organized medicine groups against the state. A third case, Clayworth et al. v. Bonta, involved a California pharmacist and two Medicaid recipients who also challenged the state's compliance with federal law.