28 Dec

State to sue feds over Medicare

first_imgSACRAMENTO – California will sue the federal government over its new problem-riddled prescription drug plan, which has already cost the state $150 million in emergency prescription help, Attorney General Bill Lockyer said Wednesday. At least three other states – Kentucky, Missouri and Texas – likely will join the lawsuit against the Medicare funding program that took effect Jan. 1, California legislators were told this week. “There are a lot of states that are concerned about this provision and are weighing whether to join this legal challenge,” said Tom Dressler, a spokesman for the attorney general. Lockyer said the law is supposed to save California millions of dollars it used to spend on prescription drugs under its Medi-Cal program, but it could instead end up costing Californians more than $750 million over the next three years. AD Quality Auto 360p 720p 1080p Top articles1/5READ MORESanta Anita opens winter meet Saturday with loaded card A clause in the legislation requires states to reimburse the federal government for money they will save – something Lockyer will argue is unconstitutional. “We are going to challenge it to ensure the state does not have to pay the federal government for a program that has more flaws than prescriptions,” Lockyer said in a news release. Tens of thousands of elderly participants nationwide have been unable to receive medicines promised by the government since the drug benefit began, and more than 20 states have stepped in with temporary funding. Federal officials said last week that state will be reimbursed for those emergency costs. U.S. Justice Department spokesman Charles Miller declined to comment Wednesday on a possible legal challenge from California and other states. Gov. Arnold Schwarzenegger said he fully supports the pending challenge. “When Congress passed this federal drug program, states were promised we would save 10 percent of what we otherwise would have paid to provide prescription drugs to this population,” said Schwarzenegger in a statement. “I have worked in good faith with the federal government for more than a year to address this issue. Despite these efforts, California still stands to be charged $183 million more each year than Congress intended when they passed this legislation. Our state is poised to take action to ensure California does not pay more than its fair share.” Kentucky Attorney General Greg Stumbo has previously said his state would sue over the so-called “clawback,” which he estimated will cost Kentucky $88 million in 2006 alone. That state already had worked with drug companies to cut drug costs, and the federal plan will cost about $20 million more to administer, said Jennifer Hans, an assistant attorney general for Kentucky. Texas Gov. Rick Perry is still weighing whether to join a lawsuit, spokeswoman Kathy Walt said. Scott Holste, a spokesman for Missouri Attorney General Jay Nixon, said his office is seriously considering a lawsuit. In California, a group of 37 Assembly Democrats wrote to Lockyer on Jan. 18 asking him to challenge the federal program. Assembly Majority Leader Dario Frommer, D-Glendale, who co-authored the letter, said California paid $50 million to $70 million less each year for the program than the federal estimate. “Not only is it costing us more to have Washington administer this program than it did when California ran it, now that the program’s so seriously screwed up, we’ve had to spend an additional $150 million in one month,” he said Wednesday. The lawsuit will allege: The so-called “clawback” provision that will require California to pay the federal government about $500 million this fiscal year and around $1.3 billion in 2006-07 illegally forces states to pay for a federal program; States’ legislative process is being subverted; and The provision is an unlawful tax on states. 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!last_img read more