A state judge has ordered Montana health officials to temporarily reinstate last year's Medicaid reimbursement rates after a group of nursing homes and assisted-living facilities challenged state rate cuts.

District Judge James Reynolds says the Department of Public Health and Human Services must not apply the reduced rates for reimbursements to nursing homes and assisted-living facilities that provide services to Medicaid patients.

The judge wrote that the Montana Health Care Association and other companies that own nursing facilities in the our state showed good cause that the health department is violating its constitutional rights.

A court hearing on the matter will stand until July 11. The health department cut Medicaid provider reimbursement rates by 2.99 percent in January, citing spending reductions across state government aimed at closing a budget shortfall.

That 2.99 percent reduction can mean a loss of more than $100,000 a year for larger nursing homes.

The health care association claims the cuts have cost the plaintiffs a combined $3 million this year, forcing many to turn away new Medicaid patients or cut staff hours, programs or equipment.

(The Associated Press Contributed To This Story)