Managed Pharmacy Care, et al v. Sebelius, et al, No. 12-55067 (9th Cir. 2012)Annotate this Case
In the four cases giving rise to these eleven consolidated appeals, the Secretary of the Department of Health and Human Services (HHS) and the Director of the California Department of Health Care Services (DHCS), appealed the district court's grant of preliminary injunctions to plaintiffs, various providers and beneficiaries of California's Medicaid program (Medi-Cal). At issue was the implementation of Medi-Cal reimbursement rate reductions. The court held that Orthopaedic Hospital v. Belshe did not control the outcome in these cases because it did not consider the key issue here - the Secretary's interpretation of 42 U.S.C. 1396a(a)(30)(A); the Secretary's approval of California's requested reimbursement rates were entitled to Chevron deference; and the Secretary's approval complied with the Administrative Procedures Act, 5 U.S.C. 500 et seq. The court further held that plaintiffs were unlikely to succeed on the merits on their Supremacy Clause claims against the Director because the Secretary had reasonably determined that the State's reimbursement rates complied with section 30(A). The court finally held that none of the plaintiffs had a viable takings claim because Medicaid, as a voluntary program, did not create property rights.
The court issued a subsequent related opinion or order on May 24, 2013.