Supreme Court Considers If Provider Organizations Can Sue States For Higher Medicaid Pay

On January 20, 2015, the U.S. Supreme Court heard oral argument in a lawsuit challenging the standing of Medicaid provider organizations to sue states to prevent reimbursement cuts. The issue is whether the Supremacy Clause gives Medicaid provider organizations a private right of action. The case is the State of Idaho’s appeal to Exceptional Child Center, et al. v. Armstrong, et al., which was filed in December 2009 by five residential habilitation provider organizations in Idaho.

The provider organizations sued alleging that the state should have raised its Medicaid reimbursement rates after independent reviews indicated that costs had . . .