ready to hear the case  hospital plaintiffs including the california hospital association and i would like to reserve whatever time i don't use on my opening argumentative for rebuttal and i do not anticipate using a full twenty minutes off like at the outset those to thank you all for all for having this or learning all the attention you've given these medical rape cases i think all of the parties are very appreciative of that but the issues that we have today is  relatively narrow issue in the scheme of these cases but very important in the hospitals and presumably to the state as well and this is a judgement by apologize for cutting you off so quickly here but i think it might be helpful for the judges concerned protecting perhaps for judge fletcher who is new on this to understand which cases which case you are telling as in your motion that you want us to in effect the words eighty five to what we've previously had in our order as a v eleven eighty three and yes we heard that is the panel of judges reinhard and the district court granted an injunction which was later amended enjoying the enforcement of welfare and institutions code section fourteen one hundred five point nineteen v one which hospitals on the basis that no irreparable injury was shelved now i know we don't want that issue in the eleven eighty three case but the reality is unless you can straighten me out on you your honor you are correct in your recitation of the history i don't know i would agree with your characterization of what we are trying to do through this motion for clarify for a moment put aside i just to make certain we have an understanding that the district court heard on our remit and the issue of the injunction eighty five was dealt with in so far as the district court  there were two appeals that were made from the district courts fata vacation of the order one was on the face of that a v five was in fact properly enacted and not a violation of a thirty day of the medicare act and secondly there was a question of whether or not the starting date of august eighteenth which the district court on the basis that she had no choice but to do that based upon the eleventh amendment i say here that is an appeal that i say we heard in san francisco and judge wright judge foster and i are are just citing that issue with respect to a b five but it seems to me unless i'm unaware of something in terms of a motion somewhere or some other ruling the portion of a b five that you're talking about was left on the table at the district court level and was not appealed to this court is that right that is what you just said is absolutely correct ok and your analysis i hope you will deal with the fact that when we were asked  to issue the order in which all the monthly was issued on april sixth we dealt only with eleven eighty three nobody ever even mentioned to us that i can recall and i don't remember seeing anything in the that specifically ask us to do anything different lenders look at eighty eleven eighty three so if you'll keep that in mind i'd be grateful i will your honor and thank you for the yes we the independent living center was few by way of background the hospitals do have a state court case that they're involved with challenging the a v five limitation and the california hospitals the situation a variety of other hospitals are have their case pending then the state mentioned that in its response to your request for clarification so apart for our purposes you're asking us to in effect then this is my terminology to piggyback the eighty five issue onto the eleven eighty three issue but the reality is that the district court deny what you originally or not you but the independent living ask for with respect to your particular plaintiffs you now have a separate action pending in the state court on the same issue it will decide and effect a third of bite at the apple if you're trying for here  we don't think so your honor we wouldn't be here if in making this motion if we did what we the the key question i think is whether a v eleven eighty three and the hospitals eighty three the eleven eighty three rate reductions in a b eleven eighty three itself included not just what we've called in the papers the c max minus five percent reduction for invasion services but it also included the ten percent reduction so we understood that maybe eleven eighty four eighty at least as of october one of two thousand and one of two thousand and eight when it went into effect included the ten percent reduction as eighty five that impose a ten percent reduction and affected some of the hospital services that didn't affect the inpatient services that we're talking about today eighty five also an active one for one six six position that are taking that introductory language is just part of the statute you know part of the enactment part of eleven eighty three not part of the codified statute recites that existing law reduces by ten percent payments for invasion of full services this bill until january two thousand and thirteen then this bill of eleven eighty three would revive this provision via flying this reduction to all hospitals or receive medical reimbursement from the department in the are not under selective contract with the department this bill came in and so are our view is that the legislature when it enacted a v eleven eighty thirty took a brand new look at the ten percent reduction  and said ok we are in effect we are keeping the ten percent reduction in effect reenacting the ten percent reduction as part of a v eleven eighty three and that slate is very importantly into how the courts are to look at a challenge to a feel of an eighty three under section thirty a where under the orthopedic case the court is being asked to decide whether the stay considered various factors efficiency economy quality of care or how the hospital costs and showed a reasonable relationship between the rates but but but what are we not mr bork but in a a three does not follow orthopedic hospital correct and that's why the district court concluded there was a likelihood of success on the merits fest right in deciding that it did not follow orthopedic hospital the question retained by the state legislature in any of the eleven eighty three as well as the other reductions that were made and feel of it but you aren't you simply saying that the legislature not only didn't get it right in the terms of  thirty day it really didn't get it right that we are being set in our thanks to order they didn't get it right the fact that it may or may not have included some of the language or some of the same cuts is a v five you still have the same issue in that the district court found there was a likelihood of success on the merits because the legislature did not consider the requirements of the laws interpreted by orthopedic hospital before then acted the  eleven eighty three but having said that we're back to the same issue you we still have to look at what eleven eighty three says that the law that's what forty one four one six six point two four five says now we don't have to look back at eighty five to understand that it says what it says in that section that's correct your honor and what it says in that section is the rates will be reduced by the lower ten percent for the other construct this is a kind of the c max minus five percent negotiate a contract rate construct and so that's what the law currently says and what we're saying is by challenging a v eleven eighty three and what the state legislature did in september two thousand and one and then acted a b eleven eighty three we are challenging the entirety of one four one rate reduction as well so what what is it in one four one six six point two four five watch in one specific language i've got it in front of me what specific the language is the director and not following according to your construction of this statute what's the director not of the director is ok the director is following i've got it it is a subdivision fee it's what we're challenging is that in effect the entirety of subdivision of reimbursement after the years over but they do parallel things and be the one that says we're reducing rates on an after july one two thousand and eight by ten percent in the two says we're go after one two thousand and eight we're going to save those rates that have already been reduced by ten percent and now we're going to compare them to another rate reduction a contract for a group contract average contract rates minus five percent so what what we perceive that we are challenging is the one and the two as well as on the next is the next subdivision c one which an x a ten percent rate reduction next on final reimbursement this c max minus five percent rate reductions so so you're so you're so you're saying and again you i know you have you to be i mean you you two in the state live with this stuff every day we have the pleasure of doing it all a periodical and it is complex but my understanding is say that your real complaint is we enjoined the enforcement of eleven eighty three and a director is saying we're not going to partial an eighty three vote we're going to pretend like eleven eighty three was never an act that we're going to go ahead and we're going to apply the rate as applied in eighty five correct that that is correct and the reason we're saying that that is part and parcel of eleven a friday is the way we review what the legislature did in eleven eighty three based in part on that introductory language i referred to was to take another look at the ten percent and say you know we're going to keep that we're not just challenging the amendment with challenging the facts that were originally taken twenty years ago it seems to me at least i'm unlikely that that would be your position i mean you can reckon argument that they reenacted the whole thing but if they had had a system that has originated with cuts twenty years ago and then they added another five today it would be very difficult to make the argument eighty five was enacted in february of two thousand and eight at a time where we were having budgetary problems in the states which of course continued to this day and the legislature decided at that time that it needed to save enough money that would result from this ten percent kind of did in eighty five by the time that the state was looking at its fiscal year beginning july one two thousand and eight budget states said you know what we can balance the budget by giving them providers back some of what we took in eighty five the so they enacted effective july one two thousand and eight a b eleven eighty three which for most  clients and no hospitals in fact were parties to the independent living center case so it is true that independent live in independent living center the district court declined to as you know an injunction as to the hospital rights with respect to eighty five but our clients the hospitals were not a part of that case were parties to this case and they were as i indicated at the outset of the parties and are in any way to intervene in the independent living action before the district court a few yes we came in and in two attempts to intervene on behalf of select hospitals on behalf of the hospital association the first time in the middle of you we we came in on behalf of what were district hospital and then there's some esoteric ninth circuit law that does not allow hospital districts  raise supremacy clause claims against the state then we came back to to the trial court with several other hospitals again individual hospitals and the judge at that time said you know i think it's a little effect a little too late and once you folks issue a ruling on the the end of in a livings in a case of this pending before you i would expect we could revitalize that case and move forward but apart from the state court case yes this is the only train leaving the station and again we're we're challenging as part of a levin eighty three not as a separate challenge to a five and looking at what the legislature did or didn't do enough a t f and eighty eleven eighty three five case independent living came out in a particular way that were your clients a party would take care of this matter but you're not parties to that how are you going to benefit if that if it were to come out that way if eighty five were to come out favorably on the on the substantive merits of those we think it would be influential to the state superior court and then we would have to eighth in federal court and a b five state court that's correct so that is where we're at right now with a five because a five aside from this ten percent reduction that we're talking about again just to argue when if if if the filing date was already established for your state court action on a b five and the eleventh amendment issue we're satisfied presumably you think it really is there in state court yes that's true we will certainly be making that effort so then as that's the case why do you need why do you need in just the relief of the nature you're seeking here and i've got a column to piggyback but i know you don't appreciate that terminology but you know what i mean the reason we're here and trying to include the ten percent cut is part of an eighty three a first we think it is properly part of eleven eighty three and when we challenge what the legislature did in light of work the p tick we're challenging what they did when they enacted eleven eighty three and we're saying that that was  improper and therefore everything that's part of eleven eighty three which we perceive to include the ten percent cut isn't proper so that this is the right place for us to bring this challenge as far as eleven eighty in our view it's part of the eleven eighty three even though it originated with the eighty five why didn't you i mean you you folks are obviously very capable lawyers why why did you not mention i know you had something in your pleadings about this earlier by the way and it was a relief you actually asked for in this case there was no mention of a b five why was that because we because we perceived and appropriate to be in two places at one time challenging the same thing let me ask you this this is a judge fletcher and i'm vested with respect to the state court action and the possible retroactive relief on that action with respect to independent living case comes out the way you want i'm saying that hypothetically and then you go back to the state court influenced by the decision in an independent living goes your way what happens with respect to monetary relief the very this case has been pending but during which you no one junction deal get that money out of the state or not we fight about that with the state of our facility and is that we are entitled to file is a process that affected as is by which the state has voluntarily obligated its sovereign immunity and allowed parties to sue the state to comply nice ok if i get the argument  here you understand the often case but you're saying that there's been a state waiver of sovereign immunity in state court with respect to this yet that's argument you have the argument you will make whether successful or not of course we don't know that i got it that's right so that's why why we think we have  reason reasonable opportunity for relief in state court although it's obviously not a certainty which is what i hope another reason for us to be here arguing other than we think we're probably arguing that the ten percent got as far as eleven eighty three and asking you to and clarify your order to to to so state we don't think we're asking you to say the navy five is invalid as part of this proceeding we're just asking you to say that there's a probability of success that i have eleven eighty three is invalid i wouldn't want to say and this will not be as eloquent as i could say it but i would want to say that the four days reimbursement forth in welfare and institutions code section one four one six six point two four five and then there are the others are one four one one zero five point one nine one normally what we would do if we were if we were doing what you want it is we would go to the conclusion of what is in effect the prayer and what you say here is if you want the court to amend its april sixth or specify that applied to the ten percent rate reduction for non contract hospitals that was originally mandated by eighty five as well as to outpatient skilled nursing and suffocated services is that what you're looking for  the argument of the five to ten percent reduction that was originally included as well as out of phase is mandated by eighty five as well as outpatient skilled nursing and so if you services i just want to emphasize the need to also include a good afternoon your honor judge smith i first want to clarify a very important point that i think mr bookman didn't accurately portray to you in terms of the involvement of their clients in the independent living center case and are standing that they in fact filed a motion to intervene and were granted intervener status and did in fact in pier and argue in that case so i think your assessment that this is the third bite of the apple is entirely correct it's our understanding that they fully briefed those issues and appeared and argued before this panel and it was actually a member of their firm by the name of that actually argued in front of that panel so i don't think it's entirely correct for mr bush been to claim that they had a limited role in that case so from your perspective you know where this where we sent this back to the district court i would say so your honor i mean i think it's again if that issue went down to the district court the district court ruled on that exact issue in terms of a b five and the non contact hospital services and what the plane has are attempting to do through this motion and i will use your term is to piggyback in this argument to motion to clarify when that issue has already been decided by remand what about the what about the state court and what role if any do you believe that has what what what how should we view that as an appellate court in this matter is it something where we  comedy does a state or because we're dealing with the medicare statute we don't have such an obligation well what i would say to you today in terms of this notion of clarify is that plaintiffs chose to challenge  in state court they in this particular action did not challenge a b five you stated earlier in the in the argument that mr benson put forward there was no statement in their  pleadings or in the argument that took place on march twenty seventh two thousand and nine that they wanted a b five in joint in addition to a b eleven eighty three so what i would say to you is in terms of the issues that you're deciding with t day they simply did not ask for any injunction of eighty five and the fact that they're pursuing that in state court just simply shows that that's the form that they decided to challenge that particular statute in i ask you  eleven eighty three is the state's position that it is simply proceeding with a v five that portion of a v five which has not been included in the language of a essentially what a b eleven eighty three did is it did not repeal the law that was already in effect and already being implemented which was the ten percent rate cut exacted by eighty five that did not change at all when doesn't that is still valid to the degree that it was not amended by eleven eighty three that remains law and that's what the state is implementing that's correct your  correct your honor that it is our position that they had knowledge that they knew the department's position that essentially any injunction that would happen or may happen of a b eleven eighty three that essentially what the department would do would stop those rate reductions that were now active by a b eleven eighty three and would essentially return the reimbursement rates to what they were prior to a b eleven eighty three which was the temperature that reduction of eighty five that's consistent we would argue that's consistent with the order that was issued on april sixth two thousand and nine and that's exactly what the department is doing  i would say trying to work it out as centrally they were sent several emails to me personally inquiring as to when the order was going to be implemented i had communications with mr carville and mr book notifying them essentially when the department was going to be implementing the order and would be by the term implementing the order i mean the seeing the rate reductions of eighty eleven eighty three not ceasing the rate reductions of eighty five do we have those e mails in front of us so we know precisely where you were saying was going to happen and what they thought was going to happen or is it possible that they didn't know for sure until we got the final orders coming up you guys what they're going to do well your honor what i would say is i it's i mean certainly not relevant i would say because the fact of the matter is they contacted us after the fourteen days had already expired then essential to our position is we're dealing with a b eleven eighty three so any any injunction we're going to simply stop anything that was put forth in a b eleven eighty three so i understand your question but i'm trying to figure out at what point does they understand that that your position your honor plus my understanding is what mr can feel has alleged is that it wasn't until we published a bulletin on our website that they actually understood that that's how we were going to interpret the order but and what day was that both bulletin folks on the website i believe it was april twenty second two thousand and nine and i do believe that was in the pleadings that were submitted by the pla understand the stakes position of the state would not be applying the stay to this ten percent reduction that we're talking about today until an e mail we received from ms chambers unable to twenty thirty thousand i which is in the material we submitted to the court and after in response to e mail that we have reveals a minute she said ok here's what we're going to do able to twenty two she's absolutely correct on april twenty two the department advised on their website it both in explaining what they would do and at that point in time they said we would not we're only going to stop the c max minus five percent reduction we're not going to stop the ten percent reduction we then  mr chambers confirmed all of that on april twenty third we then wrote her a letter a few dated april twenty seven which is in the materials that we submitted saying gee we think you guys have it wrong would you please reconsider and do we think the  doesn't include the ten percent reduction she got back to us on april thirtieth and said no she sent us a letter no saying no we got it right that doesn't apply to the ten percent reduction that's the kind of the trigger we used to say you know we can either go back to the court on a can have motion which would require the court to construe its order and decide whether to include of the ten percent reduction or not but we don't want to do that the hospitals the station doesn't want to file it in time motion against the director of the department health care services but it's not something that we would do very lightly obviously so we thought of if out when it was appropriate to come in with a motion for clarification that's why the timing took so long again we could have come in with a contempt you know a motion for contempt and probably gotten in effect of the same place didn't want to do that as the only other point i'd like to make as an intervention  hospitals have not successfully intervened in the independent living center eighty five case we are firm does represent other providers who have intervened in the navy fought in the independent living center case court at the independent living center hearing but again it wasn't on behalf of the hospitals the hospitals have not and are not a party to the independent living center case either directly or as interveners that someone from your firm argue on behalf of any of the parties that were excluded by the district judge in her injunction the only part is that we're excluded i believe that we were concerned about our hospitals and no we did not argue on behalf of