Belshe

These two appeals raise a question of statutory construction on which reasonable minds can differ. Indeed, two distinguished district judges of this Circuit reached opposite results when faced with it. The issue is whether federal approval was required before a state agency could implement changes to its Medicaid plan in 1995.

Plaintiff Exeter Memorial Hospital Association operates a rural hospital and plaintiff California Healthcare Association is an association of healthcare providers. Each brought suit against the California Department of Health Services challenging the state’s implementation of amendments to MediCal, the state’s Medicaid plan, before the amendments were approved by the federal government. The plaintiffs maintained that such approval was required; the state maintained that it was not.

Resolution of the issue requires interpretation of the so-called “Boren Amendment” to the Medicaid statutes in 1980. See 42 U.S.C. § 1396a(a)(13)(E) (Supp. IV 1980); see also 42 U.S.C. § 1396a(a)(13) (Supp. V 1981). We view the issue against the backdrop of the earlier versions of the statutes, and the decisions of our own court in earlier cases raising related issues. See,…