In Brief: Appeals Court Reinstates Medi-Cal Benefits; Lifting of MICRA Cap May Make Ballot
Federal Court Orders Reinstatement of Medi-Cal Benefits
A round in the ongoing battle over Medi-Cal benefits has been awarded to rural healthcare providers in federal court.
A three-judge panel of the U.S. 9th Circuit Court of Appeals ruled earlier this month that cuts to Medi-Cal providers in rural areas was illegal. It cited federal law that made any cuts to the federal Medicaid program illegal. Medi-Cal is California's version of the Medicaid program, but still operates under federal regulations and guidelines.
The cuts were originally passed by the state Legislature as part of the 2009 budget, and included reductions in dental, podiatry and chiropractic services. However, the first round of litigation over the issue led to reinstatement of the benefits in 2010. Payments briefly resumed until the Centers for Medicare and Medicaid Services approved the reductions in 2011.
The California Department of Health Care Services, which administers the Medi-Cal program, can ask for a hearing in front of the entire 9th Circuit, or appeal to the U.S. Supreme Court.
Lifting Of MICRA Cap May Wind Up On Ballot
The Santa Monica-based advocacy group Consumer Watchdog will try and get an initiative on the November 2014 ballot that would lift the cap on non-economic damages awarded in medical malpractice lawsuits.
The Medical Injury Compensation Reform Act was signed into law in 1975, and capped non-economic damages at $250,000. That amount has not changed during the intervening 38 years, causing the purchasing power of the maximum award to shrink to a fraction of what it once was. The cap has also made it difficult for potential plaintiffs to find attorneys willing to represent them, industry observers and published reports say.
Should Consumer Watchdog – which is working in tandem with trial attorneys to qualify the initiative – get it to voters, it would likely have an uphill battle to passage. A recent poll of likely California voters indicated 55% thought the MICRA cap was “too high or about right,” and only one-third believe it is too low.
Anti-Trust Suit Against Health Plans Dismissed
A federal judge has dismissed an anti-trust lawsuit filed against Aetna, Blue Shield of California and Quest Diagnostics by several California-based laboratories last year. The action had been filed in U.S. District Court in San Francisco.
Rheumatology Diagnostics Laboratory, Pacific Breast Pathology Medical Corp., Hunter Laboratories and Surgical Pathology Associates had argued the health plans had accepted Quest's lower charges for laboratory services in exchange for barring the smaller labs from their provider networks.
In his decision, District Judge John Tigar ruled that the labs had not been able to show that Quest and the health plans had acted in a coordinated enough manner to suggest they were engaged in deliberate activity to stifle competition.
Tigar did permit an amended complaint. Chris Riedel, chief executive officer of Campbell-based Hunter Laboratories, said the plaintiffs would submit one later this summer.
