SAN FRANCISCO – Moody’s Investors Service said a court ruling that allows California to cut its Medi-Cal program is a negative for the credit ratings of hospitals, and positive for the state’s fiscal flexibility.

On May 24, the Ninth U.S. Circuit Court of Appeals upheld the right of California to implement a 10% cut to its Medicaid program proposed in 2011, which totals $600 million annually, according to Moody’s.

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