U.S. Supreme Court Rules Against Medicaid Providers Seeking Higher Reimbursement Rates

 Written By Joanne Ceballos

In a 5-4 decision issued on March 31, 2015, the U.S. Supreme Court ruled that Medicaid providers cannot sue state Medicaid agencies pursuant to Section 30(A) of the Medicaid Act for failure to raise reimbursement rates.  A January 20, 2015 post on this blog describes the background of the case, Armstrong v. Exceptional Child Center, Inc.   Justice Scalia, writing for the majority, opined that the Supremacy Clause of the U.S. Constitution does not provide a basis to imply a private right of action to enjoin a state law or regulation that is inconsistent with federal law.  The majority further reasoned that because the Medicaid Act expressly authorizes the Secretary of the U.S. Department of Health and Human Services to withhold Medicaid funds if a state does not comply with the Act’s funding requirements, by providing this remedy Congress had signaled its intent to foreclose other remedies.  The full text of the Court’s opinion is available here.