The Supreme Court recently (March 31, 2015) ruled by a 5-4 margin that “ neither the Constitution nor federal law authorizes doctors and other health-care providers to go to court to enforce the law’s directive that the reimbursement rates set by states be ‘sufficient to enlist enough providers so that care and services are available’ to Medicaid recipients just as they are to the general population.” The case involved two home health care providers suing the State of Idaho, saying it set reimbursements unlawfully low. Chief Justice John Roberts was joined by Justices Antonin Scalia, Clarence Thomas, Stephen Breyer, and Samuel Alito in ruling against the providers.
The claim maintained that Idaho was unfairly keeping Medicaid reimbursement rates at 2006 levels, despite studies showing that the cost of providing care had gone up. Lower courts agreed and the increased reimbursements cost to the state an additional $12 million in 2013.
The Justices ruled that Federal law empowers only the Secretary of Health and Human Services to withhold Medicaid funds if a state does not comply with the law’s funding requirements. Justice Scalia, writing for the majority, said the section of the law that requires states to maintain “sufficient” Medicaid reimbursement levels was written too broadly too allow for private lawsuits, calling it “judicially unadministrable.”
Justices Sonia Sotomayor, Anthony Kennedy, Ruth Bader Ginsburg, and Elena Kagan dissented. Sotomayor wrote in the dissenting opinion, “Now it must suffice that a federal agency, with many programs to oversee, has authority to address such violations through the drastic and often counterproductive measure of withholding the funds that pay for such services.”
The aftermath of the Supreme Court’s decision is seen by some as a blow to hospitals who hold the position that Medicaid rates are not covering their costs. The American Medical Assn., the American Dental Assn. and the American Hospital Assn. all had urged the court to protect Medicaid from state cutbacks. Some alarms have been risen about the potential difficulty of Medicaid beneficiaries to find or retain doctors. Michael Gerardi, MD, president of the American College of Emergency Physicians supported that notion with his comment — “Providers have rent and mortgages to pay and unless there are adequate rates, patient access to care will get severely limited.”
Providers will now will have to take any objections to Medicaid rates to HHS.