California Appeal for Medi-Cal Rx fee cuts

The Ninth US Circuit Court of Appeals in San Francisco has overruled its previous decision to block the State of California from imposing cuts on fees to pharmacists, which are paid on behalf of the local Medicaid program, Medi-Cal, for dispensing prescription drugs. Lawyers acting for pharmacy owners had argued that the new rates are lower in some cases than the cost to pharmacists of obtaining the medicines, and that many would opt out of the Medi-Cal scheme altogether.

However, the Appeals Court accepted the argument of state authorities that, to stop the cuts from taking effect pending a legal verdict, would cost taxpayers about $12.0 million per month. The California HealthCare Foundation (CHCF) noted that the situation is likely to become even more complicated when a separate law suit is brought to the courts, this time on wider implications of budget cuts to Medi-Cal. One concern would be contradictory court decisions from the two cases affecting prescription drug supply for Medicaid beneficiaries.