22 states join California suit to reduce Medi-Cal payments to health care providers

Former Gov. Arnold Schwarzenegger and the California State Legislature got the ball rolling in 2008 by cutting Medi-Cal payments to doctors, hospitals and other health care providers by billions of dollars.

The providers sued and a federal court blocked approximately $1 billion in cutbacks.

Newly elected California Gov. Jerry Brown has proposed the cuts again, hoping to reduce the state’s budget shortfall by that same $1 billion.

On Tuesday, Jan. 18, the U.S. Supreme Court agreed to hear the case.

If they decide in favor of California and the 22 other states that have joined in the suit, it will have a ripple effect across the county.

Elizabeth Ashford, a spokeswoman for Brown, said the federal court’s ruling has been a “roadblock” in allowing California to balance its budget, and the issue is a matter of “state sovereignty.”

"It's incredibly important. The fact that they (Supreme Court justices) are taking this up indicates that they understand how important this issue is to the state," Asford told the LA Times.

While states are desperate to save money and balance their budgets any way they can, medical care providers are insisting that such actions will drive hundreds of thousands of people out of the program as doctors will drop out, because they cannot afford to have their reimbursements reduced.