Medicaid lawsuit that includes Ariz. heard by U.S. Supreme Court

(Shutterstock)By Chris Kardish | Governing

The U.S. Supreme Court heard from both sides Tuesday in a case that could upend the ability of doctors and patient advocacy groups to sue state Medicaid agencies for higher payment rates to health care providers.

At issue in Armstrong v. Exceptional Child Center is the ability of private individuals and groups to challenge state Medicaid laws under the Constitution’s Supremacy Clause, which holds federal law above state law. If the court decides the constitution doesn’t give that right, then a method doctors and patient advocates have used for decades to change benefit and reimbursement laws will no longer be available.

Doctors and many groups that advocate for low-income people argue they’d effectively lose their best tool for addressing Medicaid reimbursement, which is lower than private insurance and is commonly blamed for issues of patient access. State officials, on the other hand, argue a decision upholding the right to sue will only encourage more suits and make it harder to apply cuts that are sometimes necessary to avoid more harmful reductions to patient care.

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