medicaidcuts Supreme Court hears California Medicaid case Can providers and patients sue a state under the Supremacy Clause? Douglas Independent Living Center of Southern California, in which health care providers, including pharmacies, and patients in California challenged the state of California over repeated cuts to Medicaid reimbursements, was argued October before the U.S. Supreme Court. The case was the heard in the new term. The justices will likely render a decision in spring 2012. For pharmacy, their ruling should shed light on how far state Medicaid programs can cut reimbursements. The ruling is sure to address whether pharmacies, other providers, and patients can sue states for actions that lead to inconsistency with federal law. Federal Medicaid law calls for states to ensure quality and access. California plaintiffs in the consolidated case, including the California Pharmacists Association, are maintaining that reimbursement cuts made during that budget crises would force pharmacies out of the Medicaid program, thereby harming patient access to quality care. Arguing for the state of California was Karin S. Schwartz, the Supervising Deputy Attorney General, and Deputy U.S. Solicitor General Edwin S. Kneedler, representing the United States. Arguing for the providers and patients in California was Carter G. Phillips, Managing Partner of the Washington, DC, of Sidley Austin LLP. Pharmacy groups brief In the consolidated case, APhA, the National Association of Chain Drug Stores, the National Alliance of State Pharmacy Associations, and the National Community Pharmacists Association an amicus brief on August supporting the pharmacies and patients. (See Court takes California Medicaid in Pharmacy Today for more information.) 60 PHARMACY TODAY NOVEMBER 2011 The question before the Supreme Court is whether private citizens such as health care providers and patients have the right to sue a state over reductions in Medicaid reimbursements that lead to inconsistency with federal Medicaid law. The U.S. District Court for the Central District of California and U.S. Court of Appeals for the Ninth Circuit have ruled on the case, issuing injunctions that halted the implementation of the cuts. In addition to the litigation, the proposed cuts are being addressed administratively through state plan amendments submitted to CMS. Outcome unclear It was unclear which way the Supreme Court would go during the hour of oral arguments on October 3. While Chief Justice John G. Roberts Jr. and Justice Antonin Scalia both said there was no cause of action (the right to sue), none of the justices said just as plainly that there was. Should the justices decide the plaintiffs lack the right to sue, the case would be over and California would be free to go as far as CMS will let it in making statebased changes in Medicaid policies. For the state of California, Schwartz argued for administrative enforcement. Given that only remedy for cuts in violation of Medicaid law is denying federal funding to the state, Justice Ruth Bader Ginsburg said, a very drastic remedy going to hurt the people that Medicaid was meant to But Schwartz said that a fund cutoff was not drastic and that the case cried out for administrative review. In his turn to argue for the providers and patients, Phillips said to look to the Supremacy Clause, the part of the U.S. Constitution that says to follow federal law when federal and state laws Analyzing the case for Today, Brian Gallagher, BSPharm, JD, APhA Senior Vice President of Government Affairs, said, of the issues that the justices seemed to be concerned about was that a ruling in favor of the providers and patients would open the for lawsuits whenever state law and federal law He added, could have implications as health care reform goes forward as well as in areas far beyond health During the hearing, Justice Stephen G. Breyer said, this a Later on, he added that if he adopted line of argument, any time a person says state law is contrary to a federal law, that person can right into which would stop the agency from doing its business. when Phillips resorted to an emotional plea, calling the case a He said, there were ever a situation where you would say, look to see whether or not there is relief this would be the process works there be of thousands of cases going Phillips added. Core question between state and federal laws are typically resolved by the appropriate federal in this not through the courts. have a Supremacy Clause cause of Scalia told Phillips. Phillips asked, do you do with someone who is suffering a lack of access to vital medical care in a way that is He asked if Congress had deprived the individual of the right to sue to enforce the federal Medicaid law, and said that was the core question. answer is Roberts replied. intended to deprive them of the right to sue under the Schwartz had the minutes for rebuttal. is not she concluded. have to have a www.pharmacytoday.org