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Hospital group sues over cuts to Medi-Cal program

November 2, 2011 |  1:59 pm

  PICTURE DOCTOR 11-2-11
The trade group for California’s hospitals has sued state and federal officials to block a 10% cut in government reimbursements for healthcare providers who treat low-income patients.

The California Hospital Assn. said in its suit, filed in federal district court in Los Angeles, that cuts to the Medi-Cal insurance program will threaten the ability of many hospitals to continue operating skilled nursing facilities.

Patients, particularly those in rural communities and other medically underserved areas, will likely face delays or gaps in healthcare services, the lawsuit contends.

Other medical providers also have warned that cuts to the program, which is funded by state and federal governments, would deprive low-income patients of access to care. Among those targeted for the cuts are physicians, pharmacists and optometrists.

“The filing of this lawsuit is a regrettable but necessary step to protect access to care for California’s most vulnerable patients,” hospital association President C. Duane Dauner said in a statement. “California’s hospitals cannot stand by and allow these cuts to take effect.”

The 10% cuts, part of the 2011-2012 budget deal signed by Gov. Jerry Brown, are retroactive to June 1. They required federal approval, which the Obama administration gave last week.

Officials in Sacramento and Washington said they could not comment on the lawsuit but added that they would closely monitor the effect of the reduced payments to ensure that patient care is not jeopardized.

Norman Williams, a spokesman for the California Department of Health Care Services, said reductions can be “applied while still maintaining sufficient access for Medi-Cal beneficiaries.”

Williams’ boss, department director Toby Douglas, is named in the lawsuit, as is federal Health and Human Services Secretary Kathleen Sebelius.

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-- Duke Helfand

Photo credit: Andre Panneton / iStockphoto.com  

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