Medi-Cal Administrators, Pharmacists Charge Ahead in Pay Cut Suit
Attorneys for pharmacists and the state disputed the effects of Medi-Cal cuts to pharmacists in court filings submitted late Monday, the San Francisco Chronicle reports. Medi-Cal is California's Medicaid program (Egelko, San Francisco Chronicle, 7/23).
On July 11, the Ninth U.S. Circuit Court of Appeals in San Francisco issued a temporary injunction barring the state from cutting payments to pharmacists, but the court revoked the injunction on July 16 after attorneys for the Department of Health Care Services argued that the injunction would cost the state more than pharmacists would lose under the payment cuts.
DHCS administers Medi-Cal.
The Legislature and Gov. Arnold Schwarzenegger (R) approved a 10% cut in Medi-Cal provider payments in February to help address the state budget deficit (California Healthline, 7/21).
Attorneys for the pharmacists maintained that DHCS officials purposefully misinterpreted a study and manufactured data that indicates that the reimbursement cuts will not be detrimental to pharmacies.
The pharmacists argue that the payment cuts will push some pharmacies out of business and encourage others to stop participating in Medi-Cal.
State attorneys restated their arguments that pharmacies will remain profitable despite the pay cut.
Deputy Attorney General Jennifer Kim called statements about harm to pharmacies or Medi-Cal beneficiaries "blatantly speculative" and said that reinstating the cuts would exacerbate the state's budget deficit.
If the Medi-Cal provider payments are eliminated, Kim said the Legislature could scale back Medi-Cal eligibility guidelines or eliminate coverage of some services that are not required under federal law.
The court has not said whether it will revisit its order that reinstated the reduced reimbursement rates.
However, a federal judge in Los Angeles has scheduled a hearing for Aug. 1 in the pharmacists' original argument to block the cuts from taking effect (San Francisco Chronicle, 7/23).