Federal Judge To Rule on Motion To Block Medi-Cal Rate Freeze

On Friday, U.S. District Judge Frank Damrell said he will rule this week on the California Hospital Association's motion for an injunction that would block a planned freeze on Medi-Cal reimbursement rates for inpatient care, the Sacramento Bee reports. Medi-Cal is California’s Medicaid program.

Background

In October 2010, the state Legislature froze Medi-Cal reimbursement rates at the July 1, 2010 level for an indefinite period of time.

The rate freeze initially was scheduled to take effect on February 1, but a temporary restraining order has delayed its implementation.

Hospitals and state officials agree the freeze would reduce hospitals' Medi-Cal reimbursements by about $169 million annually, compared with the level the rates would have risen to without the freeze (Walsh, Sacramento Bee, 2/26).

In addition to cutting costs, state officials said the freeze would provide a fixed baseline for Medi-Cal reimbursements while the state develops and implements a new rate schedule.

CHA Response

Attorneys for CHA said the state could develop a new Medi-Cal rate schedule without freezing reimbursement levels.

The attorneys also argued that the state failed to obtain proper federal approval for the rate changes (Walsh, Sacramento Bee, 2/25).