Ariz. hospitals file suit to stop cuts in Medicaid reimbursements

Dec 1 2011

The state plans to reduce payments by 5 percent and that follows a similar 5 percent cut earlier in the year.

Arizona Republic: Arizona Hospitals' Lawsuit Aims To Block Medicaid Cut
Arizona hospitals on Tuesday filed suit to block a 5 percent reduction in the rates they're paid to care for Medicaid patients. The suit, filed in U.S. District Court in Phoenix, argues that the rate cut will reduce patient access to health-care providers, in violation of federal law. The rate reduction, approved this month by federal health officials and retroactive to Oct. 1, follows another 5 percent rate cut in April and a 2007 freeze in reimbursement rates paid to Medicaid providers (Reinhart, 11/29).

East Valley (Tempe, Ariz.) Tribune: Arizona Hospitals Sue To Stop Medicaid Cuts To Health Care Providers
In legal papers filed in federal court here, attorneys for the hospitals contend the latest 5 percent cut, on top of an identical reduction in April and a three-year freeze in reimbursements "results in rates that are so low that they violate the mandate of federal law." That law, the lawyers said, requires that rates for Medicaid services "be consistent with quality and assure that Medicaid beneficiaries have equal access to services" (Fischer, 11/29).

In California, concerns are also being raised about cuts in Medicaid payments.

Sacramento Bee: Rural Medical Providers Say Medi-Cal Cuts Will Slash Skilled-Nursing Care
Hospital officials in California's rural counties say the latest round of cuts to Medi-Cal could leave thousands of the state's neediest people without access to medical care. At particular risk, they say, are elderly and long-term patients who need skilled-nursing care. … The cuts are intended to save the budget-strapped state up to $623 million. Reimbursement rates will be trimmed as much as 10 percent, but earlier cuts blocked by legal action could also take effect, making the effective reductions 20 percent or more (Smith, 11/30).

Meanwhile, Georgia officials announce what they will be receiving from a recent national settlement with a major drug company.

The Atlanta Journal-Constitution: Merck Paying Georgia Medicaid $15.6 M to Settle Vioxx Drug Claims
The drug manufacturer Merck Sharp & Dohme Corp. will pay millions of dollars to the state of Georgia for illegally marketing the now-shelved drug Vioxx for treatment of rheumatoid arthritis before it was approved for such use. Merck removed the drug from pharmacy shelves in 2004 because of the increased risk of heart attack, stroke and other cardiovascular problems (Seward, 11/29).