CPhA supports Medi-Cal lawsuit against the California Department of Health Care Services

The California Pharmacists Association (CPhA) today announced its support for a lawsuit filed December 3, 2013 in San Francisco Superior Court against the California Department of Health Care Services (DHCS) over the Medi-Cal provider reimbursement cuts. California imposed the 10% across-the-board cut to the reimbursement rates for most Medi-Cal providers in 2011.

The latest lawsuit, brought by Professional Pharmacy Alliance and the California Korean American Pharmacists Association, builds on concerns raised by CPhA in letters to DHCS and the Centers for Medicare & Medicaid Services (CMS) in June and September 2013. The lawsuit contends in part that DHCS is in violation of state Welfare and Institutions Code Sec. 10000 and that implementation of the cuts will result in many rural and multi-cultural Medi-Cal patients being denied access to life saving medications.

CPhA raised similar concerns in its correspondence to DHCS and CMS earlier this year. In those letters, CPhA outlined multiple examples of DHCS admitting to CMS that implementation of the reimbursement cuts to pharmacy providers would violate federal Medicaid access to care laws. The lawsuit filed last week extends these arguments to include violations of state law as well.

Under the cuts, pharmacies will be reimbursed 10% less for medications dispensed to patients but the price that pharmacies pay to acquire those drugs will not change. This means that pharmacies will lose money every time they fill a prescription. As a result, many pharmacies will not be able to afford to continue serving Medi-Cal patients.

"We are pleased to see that other pharmacy organizations are as concerned as we are about the patients who will ultimately be denied access to their medications," stated Jon Roth, CEO of the CPhA. "We have attempted to work with the State for several years to bring long term solutions to these issues without disrupting the provider network, but DHCS has stayed the course toward implementing these devastating cuts on January 9, 2014. Unfortunately it appears that the only thing DHCS responds to these days is a lawsuit."