Skip to content Skip to navigation

Supreme Court Rules that Providers Cannot Sue States Over Medicaid Payment

March 31, 2015
by Mark Hagland
| Reprints
The U.S. Supreme Court rules against providers in lawsuits over Medicaid reimbursement

On Tuesday morning, March 31, the U.S. Supreme Court ruled in Armstrong et al v. Exceptional Child Center, Inc., et al, that private healthcare providers cannot sue states over low Medicaid reimbursement rates, in a 5-4 ruling, reversing a lower court’s ruling. Providers had argued that suing over low rates is sometimes the only way to enforce federal payment requirements.  But their opponents asserted that a ruling in favor of providers could lead to unending litigation that would slow the system.

The Supreme Court took up the case after Idaho residential providers for disabled patients sued state officials over that state’s failure to implement higher reimbursement rates, after the Idaho Legislature failed to sufficiently fund such reimbursement. A federal district court ruled that Idaho’s rates did not align with requirements in federal law requiring adequate reimbursement, and the distrct court was upheld by the 9th U.S. Circuit Court of Appeals.

A report in the online news service NewsMax reported that  “State officials recommended increases in reimbursement rates in the late 2000s but they were never implemented because the Idaho legislature declined to appropriate funds, according to court papers.Writing on behalf of the majority,” the NewsMax report said, “Justice Antonin Scalia said that the providers have no right to sue the state under the so-called Supremacy Clause of the U.S. Constitution, which holds that federal law generally trumps state law. The clause ‘instructs courts what to do when state and federal law clash, but is silent regarding who may enforce federal laws in court,’ Scalia wrote.”

The report further said that “Scalia noted that the providers have another option: they can ask the federal government to intervene on their behalf. In a dissenting opinion, Justice Sonia Sotomayor said there was nothing in the Medicaid law to suggest that Congress intended to prevent private lawsuits.”





ONC National Coordinator Gets Live Look at Carequality Data Exchange

Officials from Carequality have stated that there are now more than 150,000 clinicians across 11,000 clinics and 500 hospitals live on its network. These participants are also able to share health data records with one another, regardless of technology vendor.

American Red Cross, Teladoc to Provide Telehealth Services to Disaster Victims

The American Red Cross announced a partnership with Teladoc to deliver remote medical care to communities in the United States that are significantly affected by disasters.

Report: The Business of Cybercrime in Healthcare is Growing

While stolen financial data still has a higher market value than stolen medical records, as financial data can be monetized faster, there are indications that there is ongoing development of a market for stolen medical data, according to an Intel Security McAfee Labs report.

Phishing Attack at Baystate Health Potentially Exposes Data of 13K Patients

A phishing scam at Baystate Health in Springfield, Mass. has potentially exposed the personal data of 13,000 patients, according to a privacy statement from the patient care organization and a report from MassLive.

New Use Cases Driving Growth in Health Data Exchange through Direct

In an update, DirectTrust reported significant growth in Direct exchange of health information and the number of trusted Direct addressed enabled to share personal health information (PHI) in the third quarter of 2016.

Insurers to CBO: Consider Private Insurers’ Data in Evaluations of Telemedicine

Eleven private insurers, including Aetna, Humana and Anthem, are urging the Congressional Budget Office (CBO) to consider the experience of commercial insurers when evaluating the impact of telemedicine coverage in Medicare.