Supreme Court rules providers can't sue states over Medicaid payments
April 02, 2015
A landmark Supreme Court ruling Tuesday made it clear that private medical providers cannot sue individual states in an attempt to raise Medicaid reimbursement rates.
In the case, Armstrong v. Exceptional Child Center, justices ruled 5-4 in favor of the state of Idaho, which a group of residential care service providers alleged had unfairly kept Medicaid reimbursement rates at 2006 levels despite studies showing that the cost of care had gone up. Lower courts had sided with the plaintiffs and required Idaho to increase reimbursements by $12 million in 2013.
But the highest court disagreed with the plaintiffs' argument that the Constitution's Supremacy Clause allows federal law to supersede contradictory state laws. The clause "instructs courts what to do when state and federal law clash, but is silent regarding who may enforce federal laws in court, and in what circumstances they may do so," Justice Antonin Scalia wrote in the majority opinion.