Santa Rosa Mem'l Hosp., Inc. v. Kent

236 Cal. Rptr. 3d 199, 25 Cal. App. 5th 811
CourtCalifornia Court of Appeal, 5th District
DecidedJuly 31, 2018
DocketA151588
StatusPublished
Cited by16 cases

This text of 236 Cal. Rptr. 3d 199 (Santa Rosa Mem'l Hosp., Inc. v. Kent) is published on Counsel Stack Legal Research, covering California Court of Appeal, 5th District primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Santa Rosa Mem'l Hosp., Inc. v. Kent, 236 Cal. Rptr. 3d 199, 25 Cal. App. 5th 811 (Cal. Ct. App. 2018).

Opinion

Pollak, J.

*201*814The California Legislature reduced Medicaid hospital payments 10 percent between 2008 and 2011 and the federal agency administering the Medicaid program approved the rate reductions. A group of hospitals allege the rate reductions violate sections 13(A) and 30(A) of the Medicaid Act ( 42 U.S.C. § 1396 et seq. (Medicaid Act) ), which set out, respectively, procedural and substantive requirements the state must follow when establishing reimbursement rates. ( 42 U.S.C. § 1396a(a).) Plaintiffs appeal from the denial of their petitions for a writ of mandate seeking to declare the rates void and to obtain an award of almost $100 million in recalculated rates.

We shall affirm the trial court's denial of a writ but, as to plaintiffs' principal contention, on a ground rejected by the trial court. We conclude that health care providers alleging a violation of 42 United States Code section 1396a(a)(30)(A) (section 30(A) ) may not obtain a writ of mandate against state officials to contest Medicaid rates approved by the federal agency that administers the program. Their recourse is an administrative action against the federal agency that approved the rates. While plaintiffs may obtain a writ of mandate for violations of the procedural requirements of 42 United States Code section 1396a(a)(13)(A) (section 13(A) ), we agree with the trial court that no such violation occurred here.

*815Background

Medicaid statutory framework

Medicaid is a cooperative federal-state program that provides medical care to individuals "whose income and resources are insufficient to meet the costs of necessary medical services." ( 42 U.S.C. § 1396-1 ; Douglas v. Independent Living Center of Southern Cal. (2012) 565 U.S. 606, 610, 132 S.Ct. 1204, 182 L.Ed.2d 101 ( Douglas ).) The program is jointly funded by the federal government and participating states. ( 42 U.S.C. § 1396a(a)(2).) "State participation in Medicaid is voluntary but if a state participates, it must comply with the federal statutes and regulations governing the programs." ( Conlan v. Bonta (2002) 102 Cal.App.4th 745, 753, 125 Cal.Rptr.2d 788.)

To qualify for federal funds, participating states submit a "state plan" to the federal government. ( Douglas, supra, 565 U.S. at p. 610, 132 S.Ct. 1204.) "The State plan is a comprehensive written statement submitted by the [state] agency describing the nature and scope of its Medicaid program and giving assurance that it will be administered in conformity" with federal law. ( 42 C.F.R. § 430.10.) State plans and amendments are submitted for review and necessary approval to the federal agency that administers the program, the Centers for Medicare & Medicaid Services, a division of the Department of Health and Human Services (CMS). ( Douglas, supra, at p. 610, 132 S.Ct. 1204.)1

The Medicaid Act contains 83 separate requirements with which a state plan must comply. ( 42 U.S.C. § 1396a(1)-(83).) When state plans are submitted to CMS for approval, "the agency reviews the State's *202plan and amendments to determine whether they comply with the statutory and regulatory requirements governing the Medicaid program." ( Douglas, supra, 565 U.S. at p. 610, 132 S.Ct. 1204.) Medicaid providers and recipients may challenge CMS approval of a state plan under the Administrative Procedure Act (APA), 5 United States Code section 701 et seq. ( Douglas, supra , at p. 614, 132 S.Ct. 1204.) The APA "requires a reviewing court to set aside agency action found to be 'arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.' " ( Ibid. , quoting 5 U.S.C. § 706(2)(A).)

California's Medi-Cal program implements the federal Medicaid Act. ( Welf. & Inst. Code, § 14000 et seq. ; Cal. Code Regs., tit. 22, § 50000 et seq. ) The California Department of Health Care Services (department) is charged with administering Medi-Cal in accordance with the state plan, applicable Welfare *816and Institutions Code provisions, and Medi-Cal regulations. ( Cal. Code Regs., tit. 22, § 50004(b).) Defendant Jennifer Kent is the department's current director.

Federal standards for Medicaid provider payments

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Cite This Page — Counsel Stack

Bluebook (online)
236 Cal. Rptr. 3d 199, 25 Cal. App. 5th 811, Counsel Stack Legal Research, https://law.counselstack.com/opinion/santa-rosa-meml-hosp-inc-v-kent-calctapp5d-2018.