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Out-of-State Hospitals Want $2 Billion from CA

SAN FRANCISCO (CN) - California owes $2 billion to hospitals in Oregon, Arizona and Nevada that treated California Medi-Cal patients, 20 such hospitals say. The federal claim could punch another giant hole in California's already tattered budget.

The hospitals say California unconstitutionally withheld the supplemental federal money, to which they are entitled for treating Medi-Cal patients, many of whom were "travelers who appear on an emergency basis because of a traumatic injury or sudden illness which require immediate treatment."

The hospitals say their inability to collect payment stems from AB 1383, which Gov. Arnold Schwarzenegger signed into law in October 2009.

The bill prevents hospitals outside of California from receiving supplemental Medi-Cal payments when they treat California Medi-Cal patients.

"This is a classic case of 'economic protectionism,'" according to the complaint.

"If no money is distributed to out-of-state hospitals, then more money gets distributed to California hospitals."

The hospitals want AB 1383 enjoined as unconstitutional. And they want the $2 billion. They are represented by Michael Sorgen.

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