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California Association of Rural Health Clinics v. Douglas

United States Court of Appeals, Ninth Circuit

July 5, 2013

California Association of Rural Health Clinics; Avenal Community Health Center, Plaintiffs-Appellants,
v.
Toby Douglas, [*] Director of the California Department of Health Care Services, Mari Cantwell, [**] Chief Deputy Director for Health Care Programs of the California Department of Health Care Services; California Department of Health Care Services, Defendants-Appellees. California Association of Rural Health Clinics; Avenal Community Health Center, Plaintiffs-Appellees,
v.
Toby Douglas, Director of the California Department of Health Care Services, Mari Cantwell, Chief Deputy Director for Health Care Programs of the California Department of Health Care Services; California Department of Health Care Services, Defendants-Appellants.

Argued and Submitted December 6, 2012—San Francisco, California

Appeal from the United States District Court for the Eastern District of California D.C. No. 2:10-CV-00759-FCD-EFB Frank C. Damrell, Senior District Judge, Presiding

COUNSEL

Kathryn Ellen Doi (argued), Murphy Austin Adams Schoenfeld LLP, Sacramento, California, for Plaintiffs-Appellants–Cross-Appellees.

Susan M. Carson (argued) and Kara Read-Spangler, Deputy Attorneys General, Office of the California Attorney General, Sacramento, California, for Defendants-Appellees–Cross-Appellants.

Matthew Sidney Freedus, Feldesman Tucker Leifer Fidell LLP, Washington, D.C., for Amicus Curiae National Association of Community Health Centers.

Elizabeth Charisse Saviano, Law Offices of Elizabeth C. Saviano, Oakland, California, for Amici Curiae California Primary Care Association, San Francisco Community Clinic Consortium, California Consortium for Urban Indian Health, Center for Oral Health and Alameda Health Consortium.

Before: Dorothy W. Nelson, A. Wallace Tashima, and Mary H. Murguia, Circuit Judges.

SUMMARY [***]

Medicaid Act

The panel filed an order amending its opinion filed on July 5, 2013, and denying a petition for panel rehearing and rehearing en banc in a case challenging the validity under the Medicaid Act of California legislation that eliminated coverage for certain healthcare services, including adult dental, podiatry, optometry, and chiropractic services, provided by rural health clinics and federally qualified health centers.

In the amended opinion, the panel reversed the district court's summary judgment in favor of the defendants. The panel affirmed the district court's holding that the California Association of Rural Health Clinics and a federally qualified health center had a private right of action to bring a claim pursuant to 42 U.S.C. § 1983 challenging the validity of California Welfare and Institutions Code § 14131.10. Following other circuits, the panel held that a private right of action exists to enforce rights created by 42 U.S.C. § 1396a(bb). The panel reversed the district court's interpretation of the Medicaid Act and held that § 14131.10 impermissibly eliminated mandatory services from coverage. The panel held that it did not owe Chevron deference to the approval granted by the Centers for Medicare and Medicaid Services after the district court entered judgment. The panel concluded that the California Department of Health Services' cross-appeal from the grant of injunctive and declaratory relief was moot.

ORDER

The opinion filed on July 5, 2013 is amended as follows:

On page 8 of the slip opinion, the second sentence of the third paragraph, which reads, "We reverse the district court's holding that the Clinics have a private right of action to challenge the Department's implementation of the SPA prior to obtaining approval, " is stricken.

An amended opinion is filed concurrently with this order.

With this amendment, the panel unanimously votes to deny the petition for panel rehearing. Judge Murguia votes to deny the petition for rehearing en banc, and Judges Nelson and Tashima so recommend. The full court has been advised of the petition for rehearing and rehearing en banc, and no judge has requested a vote on whether to rehear the matter en banc. Fed. R. App. P. 35.

The petition for panel rehearing and rehearing en banc is DENIED. No further petitions for en banc or panel rehearing shall be entertained.

IT IS SO ORDERED.

OPINION

D.W. NELSON, Senior Circuit Judge:

This case concerns a clash of competing interests: the mission of publicly-funded health clinics to provide a panoply of medical services to under-served communities on the one hand, and California's persistent budget woes on the other. We must decide whether California legislation that eliminates coverage for certain healthcare services, including adult dental, podiatry, optometry and chiropractic services, conflicts with the Medicaid Act, 42 U.S.C. §§ 1396, et seq., and is therefore ...


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