Belshe
Palomar Pomerado Health System v. Belshe
Opinion
Lead Opinion
Pregerson, J.
Opinion by Judge PREGERSON; Concurrence by Judge HAWKINS.
This action arises out of a California Department of Health Services (“DHS”) audit of Plaintiff Palomar . Pomerado Health System’s billing practices.
DHS asks us to decide whether a health care district created by the State of California has standing to sue the state in a federal court to challenge-the validity of state regulations on federal constitutional grounds. We answer in the negative.
*1106 I.
Palomar Pomerado is a health care district formed under California law. It provides long-term health care services at two “distinct part nursing facilities” 3 in San Diego County, California. Palomar Pom-erado provides services to privately ’ insured patients, Medi-Cal patients, and uninsured patients who paj^ on their own.
In April 1994, Palomar Pomerado switched from a billing system based on the level of care the patient required to a “flat rate” system based on the type of room the patient occupied. At the same time, Palomar Pomerado introduced a “prompt pay discount” for patients who paid privately or who were privately insured. Palomar Pomerado does not offer the discount to Medi-Cal. Under the prompt pay discount…
Concurring Opinion
Hawkins, J.
concurring:
The majority is undoubtedly correct in applying current circuit law, especially the way in which City of South Lake Tahoe v. *1109 California Tahoe Reg’l Planning Agency, 625 F.2d 231 (9th Cir.1980), has been subsequently interpreted. See Burbank-Glendale-Pasadena Airport Auth. v. City of Burbank, 136 F.3d 1360 (9th Cir.1998). Because the current law in this circuit calls for a ban on any constitutional challenge by a political subdivision against its “parent state” — an interpretation at odds with at least three other circuits — I believe omen banc court should take another look at South Lake Tahoe and its progeny.
South Lake Tahoe cited a long list of cases to support the statement that “[a] City may not challenge [a state agency’s] plans and ordinances on constitutional grounds.” However, none of the cited cases involved a Supremacy Clause challenge (at issue in South Lake Tahoe); rather, they addressed Fourteenth Amendment or Contract Clause challenges. Burbank-Glendale-Pasadena Airport Authority v. City of Burbank, 136 F.3d 1360 (9th Cir.1998), simply relied on South Lake Tahoe. We have thus never satisfactorily stated our rationale for including all…