Court Returns California Medicaid Case To Lower Court

WASHINGTON (AP) — The Supreme Court has thrown out a federal appeals court ruling allowing patients and health care providers to sue over California's cuts in Medicaid payment rates.

The narrow ruling Wednesday is not a total loss for the parties challenging the Medicaid cuts. By a 5-4 vote, the court sent the case back to the federal appeals court in San Francisco to consider whether private parties or only the federal government can object to Medicaid reductions.

The facts of the case have changed significantly since it first came to the Supreme Court. California originally put cuts in place without federal approval. In recent months, however, the U.S. Health and Human Services Department endorsed the reductions.

The four dissenting justices said they would have ended the lawsuit Wednesday.