Media Statement

CHA Pleased By Court Order Blocking Medi-Cal Payment Cuts for Hospital-Based Skilled Nursing Units

The California Hospital Association (CHA) is pleased by a federal court decision blocking state officials from implementing Medi-Cal rate cuts slated for distinct-part skilled nursing facilities within acute care hospitals. The decision, issued late Wednesday by U.S. District Judge Christina Snyder, should have put an end to California’s ongoing attempts to balance the state’s budget on the backs of patients and health care providers. However, the state has announced that it will appeal the decision to the 9th Circuit Court of Appeals.  According to Judge Snyder “…the State’s fiscal crisis does not outweigh the serious irreparable injury plaintiffs would suffer absent the issuance of an injunction.”

In issuing her opinion, Judge Snyder agreed with CHA’s contention that the federal Centers for Medicare and Medicaid Services (CMS) “failed to consider whether DHCS relied on responsible cost studies” before approving the state’s request to slash payments to hospitals and other health care providers.  Judge Snyder also concluded that the state’s plan to monitor access to care in light of the payment cuts would not prevent Medi-Cal patients from being harmed.

California’s Medi-Cal program has been chronically underfunded for more than two decades.  Medi-Cal already ranks last in the nation in payments to doctors and hospitals who care for the state’s most vulnerable patients.  Rates paid to doctors and hospitals in California are almost 25 percent less than the national average for Medicaid programs. In 2010, the Medi-Cal program underpaid California hospitals by more than $4.6 billion on the actual costs of delivering care.

Judge Snyder’s decision clearly affirms that the interests of patients must be placed ahead of the state’s budget decisions.