Medi-Cal Cut to California Hospitals Was Illegal, U.S. Appeals Court Rules

A U.S. appeals court decided Monday that the federal government wrongly approved California’s request to temporarily cut Medi-Cal reimbursement by 10 percent during the recession for hospital outpatient care.

Protestors demonstrate against another round of budget cuts to Medi-Cal on September 21, 2011, in San Francisco. (Credit: Justin Sullivan/Getty Images)

Protestors demonstrate against past budget cuts to Medi-Cal on September 21, 2011, in San Francisco. (Credit: Justin Sullivan/Getty Images)

The ruling by a three-judge panel of the U.S. 9th Circuit Court of Appeals said the federal government can approve such cuts only if evidence shows that the recipients of aid will have access to the same services as the general population.

California, struggling with a budget crisis, imposed the cutback for eight months, from July 2008 through February 2009.

If the ruling stands, the state and the federal government will have to pay back California hospitals hundreds of millions of dollars, said Robert Leventhal, who represented more than 50 California hospitals in the challenge.

See the full story on LATimes.com.