PRESS RELEASE: New Brief Explores the Evolution of Medicaid Lawsuits to Stop Scheduled Reductions in Medi-Cal Provider Payment Rates and Their Implications for Health Care Access, Quality, and Efficiency

WASHINGTON (Oct. 19, 2009) - In a one year period, beginning in April of 2008, five lawsuits were filed against the state of California, to stop scheduled reductions in provider payments in the state's Medicaid program, Medi-Cal. A cross-cutting theme of these lawsuits is the theory that Medi-Cal rate cuts violate the "equal access" statute, a federal law which requires payment to Medicaid providers to be "sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area." The theory is that low or reduced Medicaid provider payment rates may act as a disincentive to provider participation in Medicaid programs, hence compromising beneficiary access to health care. The Medi-Cal cases spotlight an important Medicaid policy dilemma -- low or reduced provider compensation rates intended to save money may actually serve to drive up healthcare costs by deterring provider participation and eroding beneficiary access to quality health care, ultimately forcing patients to seek care in more expensive settings, such as emergency rooms.

In "Medicaid Payment Rate Lawsuits: Evolving Court Views Mean Uncertain Future for Medi-Cal" Sara Rosenbaum, Hirsh Professor of Health Law and Policy and chair of The George Washington University School of Public Health and Health Service's Department of Health Policy, explores these cases and their implications for the future of Medi-Cal, as well as for health care access, quality, and efficiency for beneficiaries of public health insurance nationwide. The paper, prepared for the California HealthCare Foundation, is available at http://www.chcf.org/topics/medi-cal/index.cfm?itemID=134108
 
About the California HealthCare Foundation
The California HealthCare Foundation is an independent philanthropy committed to improving the way health care is delivered and financed in California. By promoting innovations in care and broader access to information, their goal is to ensure that all Californians can get the care they need, when they need it, at a price they can afford. For more information on CHCF, visit us online at www.chcf.org.
 
About The George Washington University Medical Center
The George Washington University Medical Center is an internationally recognized interdisciplinary academic health center that has consistently provided high-quality medical care in the Washington, DC metropolitan area, since 1824. The Medical Center comprises the School of Medicine and Health Sciences, the 11th oldest medical school in the country; the School of Public Health and Health Services, the only such school in the nation’s capital; GW Hospital, jointly owned and operated by a partnership between The George Washington University and a subsidiary of Universal Health Services, Inc.; and the GW Medical Faculty Associates, an independent faculty practice plan. For more information on GWUMC, visit www.gwumc.edu.