WICS Live: Around the States

California: Federal Court of Appeals Ruling Blocks State from Implementing Medi-Cal Provider Cuts: The U.S. Court of Appeals July 8th upheld a lower court ruling, preventing the state from reducing Medicaid provider reimbursements by 10% that was to take effect in July 2008. The appeals court ruled that the state violated federal Medicaid law by failing to consider how the across-the-board provider rate cuts would affect quality and access to care. The court said a state budget crisis could not be used as a justification for illegal cuts in the Medicaid program. California can appeal the ruling or ask for an en banc ruling. However, the ruling could cost the state $56 million in retroactive payments; it could be more if providers are entitled to interest. This ruling now jeopardizes a second-round of rate cuts that took effect March 1st and are also before the 9th Circuit. As part of its budget compromise, the state is implmenting a rate freeze, beginning August 1st.