Physicians, Justice Department Face Off in Lawsuit Over California Medicaid Cuts

The Justice Department and physicians are at odds over a pending U.S. Supreme Court case that challenges Medicaid cuts to California providers, according to an American Medical News report.

According to the report, Acting U.S. Solicitor General Neal Katyal said in a brief to the high court that private citizens and healthcare officials should not be permitted to sue states for cutting Medicaid payments. A former statement by Mr. Katyal suggested he agreed with earlier court decisions allowing legal challenges to Medicaid cuts, according to the report.

The case stems from several lawsuits fighting cuts to Medi-Cal, the state's Medicaid program. The cuts are intended to close the state's annual budget deficits of $20 billion or more in recent years. Physicians, hospitals and other providers filed a lawsuit in 2008 fighting a 10 percent cut scheduled for July 2008.

Gov. Jerry Brown proposed another 10 percent cut this year, decreasing a Medicaid payment rate that is already one of the lowest in the nation.

Read the American Medical News report on Medicaid cuts.

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