California Department of Health Care Services Wins Exemption from Dormant Commerce Clause
Court Finds California DHCS Not Subject to Dormant Commerce Clause Restrictions
19 hospitals in Arizona, Nevada and Oregon filed a lawsuit against the Department of Health Care Services (DHCS) and its director, Jennifer Kent. The hospitals claimed California violated the dormant Commerce Clause when it established new criteria for medical reimbursements to out-of-state hospitals. In the March 14th ruling, Ninth Circuit U.S. Appeals Court Judge Fernandez held that the department did not violate the dormant Commerce Clause. In his ruling, Fernandez noted that “the Department sets rates of reimbursement to hospitals for those who are essentially insured as beneficiaries under Medi-Cal in a manner much like that of a private insurer participating in the market.
