In theory, Medicaid is supposed to raise what it pays to providers when there aren't enough providers to make sure people have real access. In practice, this rule is gamed and ignored. This decision supports stronger standards....
The U.S. Court of Appeals for the Ninth Circuit Court raised the bar last week for what states must prove to establish that their Medicaid provider reimbursement rates are sufficient to ensure a robust network of providers for Medicaid beneficiaries. In Hoag Memorial Hosp. Presbyterian et al. v. Price, __ F.3d __, No. 15-56547 (Aug. 7, 2017), the court held that, under 42 U.S.C. § 1396a(a)(30)(A)’s so-called “equal-access requirement” ("Section 30(A)"), the U.S. Secretary of Health and Human Services may not simply consider data about Medicaid beneficiaries’ access to care and services, but must compare their level of access to that of the general population. As a result, states will need to produce comparative access data showing a rate change will not adversely affect access for the Medicaid population relative to the general population to have the proposed rate change certified by the Secretary.
The Ninth Circuit ruled that U.S. Congress had provided clear and unambiguous guidance in the equal-access requirement—guidance that the Secretary’s interpretation contradicted. As a result, his interpretation was entitled to no deference. Further, the Ninth Circuit ruled that because the Secretary failed to even consider how Medi-Cal beneficiaries’ access to care and services compared to that of the general public, his approval of the SPA was arbitrary and capricious under the Administrative Procedures Act.