In a dissenting opinion joined by Justices Ruth Bader Ginsburg, Elena Kagan and Anthony Kennedy, Justice Sonia Sotomayor wrote that the majority's decision means that only HHS may go after state Medicaid agencies that underpay providers, and then only “through the drastic and often counterproductive measure of withholding the funds that pay for such services.”
Some legal experts say it's unlikely HHS would withhold federal Medicaid dollars from a state in such situations because that would hurt Medicaid beneficiaries. Perkins said she is not aware of HHS ever previously withholding Medicaid money on a large scale. “That is the nuclear option, double down,” she said. “It's nonsensical (HHS) would ever do that.”
But Matt Salo, executive director of the National Association of Medicaid Directors, who applauded last week's ruling, said withholding the funds is an option. He said HHS would do it if the stakes were high enough, but that it's not in anyone's best interest to get to that point.
Salo said frequent lawsuits over Medicaid rates were a problem for states in the past.
The narrowed ability to go to court to seek a remedy for low Medicaid payment rates may force primary-care doctors into making some uncomfortable choices.
“Physicians will have a hard decision in terms of whether or not to take a Medicaid patient,” said Dr. Robert Wergin, president of the American Academy of Family Physicians. “If the reimbursement is too low, they will not take them.”
With the loss of legal recourse, providers will continue to push to reinstate an ACA provision that temporarily increased Medicaid reimbursement for primary-care services to match Medicare rates, Wergin said. And they will press the CMS and state officials about rate adequacy during each state's Medicaid rate-setting process.