States fear that five words in Obama health law will open door to lawsuits

April 2, 2010 03:59

Was this payback for lawyer donations? -among the highest of any and at the top of the list for many lawmakers. “DHH cannot estimate the cost of this, but it is not even worth estimating. It will be substantial.”

By Jon WardThe Daily Caller

The addition to existing law of five words, and a comma, may cause a world of hurt to state governments.

Tucked away on page 466 of President Obama’s 2,704-page health-care bill is a provision that changes the definition of “medical assistance,” the term describing what states are required to provide to Medicaid recipients.

States have in the past been required to provide payment for services to physicians. Now, under the new definition, states will be liable for ensuring provision of “the care and services themselves.”

In other words, states are legally on the hook not only to ensure that Medicaid recipients are paid for, but that they’re seen by a doctor.

Medicaid recipients have found it increasingly difficult to be seen by doctors, as states in extreme economic duress have cut payment rates.

The new law seeks to solve the problem, but may cost states even more money at a time when most are in some of the worst economic straits since the Great Depression.

“With the expanded definition, it leaves every state vulnerable to a new wave of lawsuits any time someone cannot access a service, even if that service is limited by virtue of the rates we pay,” said Alan Levine, Louisiana’s secretary of health and hospitals, in a recent memo prepared for fellow state government officials.

Levine wrote: “DHH cannot estimate the cost of this, but it is not even worth estimating. It will be substantial.”

Ann Kohler, director of health policy at the nonpartisan American Public Human Services Association, said she was aware of the concern and was “looking at the legislative language,” but had not yet reached a determination.

“I have my lawyers looking at it right now,” she said.

Republicans on the House Energy and Commerce Committee said they agreed that the provision could open the floodgates to lawsuits.

“Section 2304 changes the definition of Medical Assistance, and potentially, wipes clean years of court precedent that has kept states from losing very expensive lawsuits,” a GOP staffer said. “The states and the Medicaid directors are very worried about this provision.”


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