A coalition of California Medicaid beneficiaries and health care providers have filed a lawsuit in U.S. District Court in Sacramento seeking a preliminary injunction to stop $237 million in state Medicaid reimbursement cuts scheduled to take effect Jan. 1. The coalition alleges that the 5% across-the-board cut in reimbursement rates, passed as part of the state budget this fall, violates the Social Security Act by ignoring how those reductions would affect access to care for the more than 6 million poor, disabled, elderly and children whose health care is provided by the state Medi-Cal program. The suit also alleges the state failed to get prior approval for the cut from the Centers for Medicare & Medicaid Services as required by federal regulations. The 5% cut reduces provider payments from the state general fund by $115 million, but because the federal government matches every $100 with $106, the total loss in Medi-Cal spending would be $237 million. The plaintiffs include 11 physician, dentist and pharmacist organizations, including the California Medical Association. Sherreta Lane, vice president of reimbursement and economic analysis for the California Healthcare Association, said CHA supports the lawsuit, but could not participate in the suit because of a settlement it reached with Medi-Cal in 2000 regarding outpatient reimbursement rates that precluded future legal action.