Rule of Law

Justices limit lawsuits against state Medicaid programs

By Richard Wolf


WASHINGTON — A closely divided Supreme Court ruled Tuesday that private parties cannot sue states over low Medicaid reimbursement rates, a finding that critics said could leave poor patients without enough health care providers to serve them.


The justices ruled 5-4 that the federal law creating the joint federal-state program empowers only the secretary of Health and Human Services to withhold Medicaid funds if a state does not comply with the law’s funding requirements.


The law requires state Medicaid plans to “assure that payments … are 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 court’s majority said that section of the law was written too broadly to allow for private lawsuits, such as the one filed by home-care providers in Idaho claiming insufficient reimbursement rates.


Justice Antonin Scalia, writing for the majority, called it “judicially unadministrable,” adding, “It is difficult to imagine a requirement broader and less specific.”


Scalia was joined by three other conservatives and by liberal Justice Stephen Breyer, Justice Sonia Sotomayor wrote the dissent, joined by two other liberals and by Justice Anthony Kennedy, who most often is in the middle.


“The court’s error today has very real consequences,” Sotomayor said. “Previously, a state that set reimbursement rates so low that providers were unwilling to furnish a covered service for those who need it could be compelled by those affected to respect the obligation imposed by (the law).


“Now, it must suffice that a federal agency, with many programs to oversee, has authority to address such violations through the drastic and often counterproductive measure of withholding the funds that pay for such services.”


The case was brought by the Exceptional Child Center, which provides residential services to people with developmental disabilities or maladaptive behaviors. A number of health care groups filed friend-of-the-court briefs on their behalf, ranging from doctors and hospitals to employers and people with disabilities. Idaho was joined by the federal government and 28 states.


“The practical effects of this ruling are enormous for ordinary Americans,” said David Gans, civil rights director at the Constitutional Accountability Center. “The court today turned its back on the principle of access to our federal courts, leaving low income people seeking access to health care to the vagaries and limitations of the executive branch.”