Hospital joins lawsuit vs. state |

Hospital joins lawsuit vs. state

Grass Valley’s Sierra Nevada Memorial Hospital and 29 other hospitals have sued the state Department of Health Services, saying the agency has illegally frozen reimbursement rates paid to hospitals for treating low-income patients.

The lawsuit filed in U.S. District Court in Sacramento charged the state with illegally trying to fix its budget problems on the backs of the state’s hospitals by freezing reimbursement rates to hospitals that are required by law to accept Medi-Cal patients.

Sierra Nevada Memorial officials couldn’t be reached for comment late Thursday. But in January, hospital leaders cited declining Medi-Cal payments and other factors for a $1.5 million deficit.

The hospital cut the equivalent of six full-time employees in January, its second round of layoffs in less than a month. Officials have said the hospital is in no danger of closing.

The hospitals that filed the suit traced the freeze to a vote last August by the state Legislature to retain 2003 reimbursements for hospitals that have no Medi-Cal contracts with the state. An estimated 20 percent of the state’s hospitals fall into that category.

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