California Ass’n of Rural Health Clinica; Avenal Community Health Center v. Douglas et al.
United States Court of Appeals for the Ninth Circuit, July 5, 2013
California recently enacted legislation that eliminates coverage for certain healthcare services in under-served rural areas to help curb the State’s budgetary woes. Specifically, the legislation cut coverage for adult dental, podiatry, optometry and chiropractic services in rural areas. The court ruled that eliminating coverage for such programs would be in conflict with the Medicaid Act and that the legislation is therefore invalid.
The Medicaid Act is a federal-state cooperative program through which the federal government provides financial assistance to states to furnish medical care to low income individuals. Medicaid is funded by state and federal governments. While states are not required to participate in Medicaid, those who do participate must comply with the statues and regulations promulgated by the federal Secretary of Health and Human Services. One of those regulations requires that states have rural health clinics—health centers that provide services in rural areas with insufficient numbers of healthcare practitioners.
In this case the court set out to determine whether cutting coverage for adult dental, podiatry, optometry and chiropractic services in rural areas would be in violation of federal Medicaid laws. The panel of judges found that the services being cut were covered under the Medicaid Act and therefore the law was invalid. The court first determined that the Medicaid Act imports the definition of health care services from the Medicare Act. It then found that the Medicare Act unambiguously defines healthcare services to include services performed by dentists, podiatrists, optometrists and chiropractors, in addition to services provided by doctors of medicine and osteopathy. Accordingly, the court struck down the law as invalid.