Could Supreme Court Decision Jeopardize Medical Care for Accident Victims?

Under federal Medicaid laws, medical coverage is provided for eligible low-income individuals, including those in need of care after suffering personal injury in an accident, through a joint effort by the federal and state governments, explains an attorney. The federal government can pay anywhere from 50-75 percent of the costs of care, depending upon the state. However, in order to continue receiving state funding, the states must pay sufficient fees to health care providers to ensure fair access to medical care for Medicaid recipients, reported NPR. Recent events in California have jeopardized this medical care, and a Supreme Court decision may stop it altogether.

In 2008 and 2009, NPR reports that California cut the fees being paid to physicians without prior approval from Medicaid, which is required. In light of the California Medicaid cuts, the fees became so low that many physicians were unable to operate in the Medicaid system.

Because California acted without prior approval of the federal government and because the fees are so low as to deprive patients of care, hospitals and patients sought a temporary injunction to freeze Medicaid cuts. Unfortunately, federal Medicaid laws do not authorize patient or hospital suits of this nature, and the state appealed, with the support of President Obama.

The Supreme Court's Response

The case made its way to the Supreme Court, where Justice Ruth Bader Ginsberg indicated that the federal government that enforces Medicaid laws also does not have the authority to issue an injunction to stop California from cutting Medicaid rates. With neither the patients and doctors nor the federal government vested with the power to seek an injunction, the only option would be for the federal government to simply cut off their portion of the funding provided to California for the Medicaid program. This would be a drastic solution that would deprive medical care to the very patients that the law is designed to protect.

The attorney for the providers and plaintiffs argues that the patients are not seeking damages from California and that, while the law doesn't expressly give the patients a right to sue, the patients are simply taking action to prevent "irreparable harm" to the Medicaid system established by federal law. He argues that because the federal government established the Medicaid system in the first place, federal law should take precedence over state law under the Supremacy Clause and Supreme Court precedent.

The Justices, however, are fearful that if they permit the patients to take action in this case, it could lead to many other lawsuits in which anyone, regardless of whether they had any authority to do so, could challenge any state law that allegedly violates any federal law. It is long acknowledged that people must have standing to sue before a court can take a case, and allowing patients and doctors with no standing would be a departure from this rule and could potentially create a maelstrom of suits.

Accident Victims and Medicaid

If the Supreme Court doesn't step in, many Medicaid patients in California will be left without the medical care that they need and that Medicaid is supposed to provide. Among these patients are people who may need immediate and life saving care after suffering serious personal injury in an accident, which they may have no way to pay for without Medicaid assistance, explains an attorney.

Both Medicaid and Medicare currently have rules in place that allow for people to receive some degree of Medicaid or Medicare-provided care after an accident. While Medicare defines itself as a secondary payer in such situations under Sect. 1862, and while both Medicaid and Medicare can recover some of the monies paid out to accident victims from a portion of an accident settlement earmarked for medical costs, the access to Medicaid and Medicare funds after an accident still allows people to get care that they would otherwise be unable to afford while they wait for their settlements to arrive.

The decision made by the California Supreme court could have implications on accident victims and other Medicaid-dependent patients that reach beyond California to other states as well. Medicaid freezes always create controversy, such as the proposed Arizona freeze in summer of 2011, which set off a wave of litigation and hearings intended to stop the freeze even though Arizona did act in consultation with the federal government. With Medicaid freezes already such a hot button issue, creating standing to sue where none existed before is likely to increase the controversy and legal claims exponentially.

ABOUT THE AUTHOR: Jim Ballidis
For over 35 years, attorney James Ballidis and the staff at Allen, Flatt, Ballidis, and Leslie have been helping the victims of accidents. During this time, he has written extensively on the personal injury claims process.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.