Court Rules that State Violated Public Records Act

This week, the court ruled that California Department of Health Care Services violated disclosure law in 2011 by refusing to provide background information on proposed Medi-Cal payment cuts with the California Medical Association (CMA).

The official signed judgment states that “documents exchanged between DHCS and the federal Centers for Medicare & Medicaid Services… are not subject to the deliberative process privilege claimed by DHCS.” The court also ruled that “the relationship between DHCS and CMS is fundamentally different from that involved in cases which have recognized a deliberative process privilege and any benefit derived from keeping discussions confidential is substantially diminished in this context.”

The court ordered DHCS to release the documents that it gave to federal officials.

The state has 20 days to appeal the decision or ask for additional time to explain why the documents should not be disclosed.

Background

In October 2011, CMS approved the state’s plan to reduce certain Medi-Cal payments by 10%. State officials said that the cuts would save $623 million.

In February, U.S. District Court Judge Christina Snyder granted a preliminary injunction to block the rate cuts on the basis that they could cause irreparable harm.

Last year, CMA, California Hospital Association, and California Pharmacists Association filed a Public Records Act request to gain access to the state’s supporting evidence that the Medi-Cal cuts would not harm beneficiaries’ access to care.

DHCS denied the request, saying that such documentation needed to remain private so the agency could “engage in candid policy discussions” with federal officials.

Supreme Court Sends Medicaid Case Back to Court of Appeals

Today, in a majority decision, the United States Supreme Court refused to reverse the Ninth Circuit Court of Appeals decision in Douglas v. Independent Living Center of Southern California (“Independent Living Center”). That court has previously sided with physicians and other providers, agreeing that interested parties should have the ability to sue in order to block cuts to California’s Medicaid program, Medi-Cal.  The case will now return to the Ninth Circuit Court of Appeals.

The federal Medicaid Act requires that government insured and privately insured patients have equal access to medical care. If the state and federal government continue to cut funding to these programs, physicians will be forced to stop taking new patients, meaning that access to care will be greatly impacted.

“This is a win for physicians and their patients in California,” said James T. Hay, M.D., President of the California Medical Association (CMA). “The lower court has previously ruled that interested parties indeed have the right to sue the state and federal government if the federal Medicaid Act is being violated. They will have the opportunity to decide that once again.”

The Supreme Court’s decision will have huge implications for the more than 10 million patients who are currently enrolled in California’s Medicaid program.

“The state cannot continue to propose sweeping cuts to programs for California’s poorest and most vulnerable patients,” Dr. Hay added. “Our hope is that they get the message loud and clear with the U.S. Supreme Court’s decision today.”

Through Medi-Cal, physicians, dentists, pharmacists, adult day health care providers, clinics and hospitals provide health care services to low-income seniors, families, children and people with disabilities. By providing these primary and preventive care services, the state ensures these Californians have access to health care, while at the same time saving money by lowering the chances they will be forced to seek more costly health care, such as emergency rooms or hospital admissions.

CMA is a party in the case.

California announces short-term payment delays for Medi-Cal institutional providers

The state of California announced that it will institute short-term payment delays to Medi-Cal institutional providers due to a severe cash flow shortage. Implementation of the delays is effective March 1, 2012 (the first check release date of March).

Reimbursement to Medi-Cal institutional providers, except for clinics, designated public hospitals and local educational agencies, will be held per the schedule below:

• Payments scheduled for March 1 [electronic funds transfer (EFT) date of March 5] will be held until March 15 (EFT date of March 19), and will be paid along with all services normally scheduled for payment that week.

• Payments scheduled for March 8 (EFT date of March 12) will be held until March 22 (EFT date of March 26), and will be paid along with all services normally scheduled for payment that week.

• Payments to Medi-Cal non-institutional providers will not be held. Please note that the list below is limited to providers whose claims are processed by the ACS, the Medi-Cal fiscal intermediary.

To ensure implementation of this proposal, the Department of Health Care Services (DHCS) will hold reimbursement to the following Medi-Cal institutional providers:

• Adult Day Health Care Centers
• Assistive Device and Sick Room Supply Dealers
• Blood Banks
• Clinical Laboratories
• Fabricating Optical Laboratory/Prison Industry Authority
• Home Health Agencies
• Community Hospital Outpatient Departments
• Community Hospital Inpatient (with the exception of designated public hospitals)
• Long-Term Care (LTC) facilities
• Pediatric Subacute Care – LTC
• Ground Medical Transportation
• Genetic Disease Testing
• Air Ambulance Transportation Services
• Certified Hospice Service per Assembly Bill 4249
• Home and Community Based Services Nursing Facilities
• Mental Health Inpatient
• County Hospital Inpatient (with the exception of designated public hospitals)
• County Hospital Outpatient
• Multipurpose Senior Services Program
• Residential Care Facilities for the Elderly

The following institutional providers are exempt from the temporary payment withhold:

• Indian Health Clinics
• Rural Health Clinics
• Federally Qualified Health Centers
• Free Clinics
• Community Clinics
• Chronic Dialysis Clinics
• Multi-Specialty Clinics
• Surgical Clinics
• Exempt from Licensure Clinics
• Rehabilitation Clinics
• County Clinics Not Associated with a Hospital
• Birthing Centers – Primary Care Clinics
• Clinic Otherwise Undesignated
• Alternate Birthing Centers – Specialty Clinics
• Expanded Access to Primary Care Clinics
• Designated Public Hospitals
• Local Education Agencies

DHCS acknowledges that this difficult decision is painful for providers. SFMS/CMA is working with DHCS to mitigate the impact of this action on physicians.

Obama Administration Rejects California’s Request to Impose Mandatory Co-Pays

The Centers for Medicare & Medicaid Services (CMS) rejected California’s request to impose mandatory co-payments for Medi-Cal patients. The co-pays, which would have included physician office and clinic visits ($5), ER visits ($50), and inpatient hospital stays ($100 per day up to a $200 maximum), was another attempt by the state to balance to budget by slashing Medi-Cal.

Medi-Cal payment rates are grossly inequitable for emergency care as is, and the proposed co-payments exceeded the limits allowed by federal law for Medicaid cost sharing. The co-payments would have exceeded federal maximums, particularly for non-emergency use of the Emergency Department.

Often, co-payments discourage low-income families from filling prescriptions for themselves or their children because they can’t afford it. When patients fail to take their prescription medications correctly, or stop taking their medications altogether, this seriously undermines their quality of life, quality of care, health care outcomes and the value of health care dollars spent.

Providers, such as physicians and dentists, and advocates for low-income Californians warned that a co-pay plan would hurt low-income patients by cutting access to health care. Providers felt it was a back-door cut in reimbursement rates, because the state put the burden on them to collect the copays or make the decision to refuse patients for nonpayment.

The rejection comes just days after Federal Judge Christina Snyder issued her final ruling in CMA et al v. Douglas. Her decision blocked the state from imposing a 10 percent reimbursement rate reduction to Medi-Cal physicians.

Judge Issues Final Ruling to Blocks 10% Medi-Cal Rate Cuts to Providers

Today, because of the efforts of a coalition led by the California Medical Association, a final ruling was issued by Judge Christina Snyder of the California Central Federal District Court, which blocks a 10 percent Medi-Cal reimbursement rate reduction. Her decision is a huge win for physicians in California and for the patients they treat.

California faces a budget deficit every year, and to close that widening gap, programs are cut and services are slashed. Medi-Cal is a program that is constantly targeted, and proposals always seem to include reducing reimbursement rates for physicians as a short-term solution. CMA has repeatedly informed the state, the federal government and the courts about the unacceptable impact of those cuts.

Year after year, we’re obliged to tell the same story: if Medi-Cal rates are cut, physicians will be forced to stop accepting the patients that need care the most. Thanks to the hard work of CMA’s legal and legislative staff, our voices have been heard, yet again. As we argued, Judge Snyder’s ruling stated that “fiscal crisis does not outweigh the serious irreparable injury plaintiffs would suffer absent the issuance of an injunction.”

It is more important than ever that we fight these fights and that we set a precedent for other states to follow. As the nation faces a changing health care landscape over the coming years, it is also critical that we physicians stand together. We thank our members for helping us accomplish this important outcome, preventing deterioration of access to care. Our hope is that this achievement will serve as a reminder to those who are not yet members, and encourage them to join CMA today. To have continued success winning these battles for all California physicians and patients, it is crucial that we gain the support of those that benefit most.

To read the full statement issued by the coalition of plaintiffs in CMA et al. v. Douglas, please visit here.