Entitlement Mentality? California Pharmacies Block 5% Medicaid Cut

I think that health-care providers who want to survive and thrive in the days to come need a new, self-imposed, guideline for their businesses:

"If government revenue is so important to you that a 5% cut drives you into court to recover it, you are too dependent on government revenue."

California pharmacies have succeeded in rolling back such a cut in the U.S. district court. (Although the state is commanding the rollback, the pharmacies allege that it violates federal law.)

OK, so Medicaid's incentives are so perverse that the state cannot even decide what Medi-Cal's dispensing fee should be. (Not that I think the state is economically competent to do so, but the idea that it is not legally competent to do so is pretty obnoxious to me, as a California taxpayer. It's not like the state has gone out of its way to protect me from out-of-control state spending otherwise.)

But what's more disturbing is that the state's pharmacies are so dependent on Medi-Cal that they went to court to block the cut. In today's economic climate, many buyers are demanding price reductions far greater than 5% of their suppliers. Unfortunately, they don't have the courts to fix prices for them.

This is a short-term victory for the pharmacies. As long as they are dependent on Medi-Cal their fiscal woes will mount.