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Heckler v. Community Health Servs.

Supreme Court of the United States

February 27, 1984, Argued ; May 21, 1984, Decided

No. 83-56

Opinion

 [*53]  [***47]  [**2220]    JUSTICE STEVENS delivered the opinion of the Court.

 Under what is recognized for present purposes as an incorrect interpretation of rather complex federal regulations, during 1975, 1976, and 1977 respondent received and expended $ 71,480 in federal funds to provide health care services to Medicare beneficiaries to which it was not entitled. The question presented is whether the Government is estopped from recovering those funds  [***48]  because respondent relied on the express authorization of a responsible Government agent in making [****7]  the expenditures.

Under the Medicare program, Title XVIII of the Social Security Act, 79 Stat. 291, as amended, 42 U. S. C. §§ 1395-1395vv, providers of health care services are reimbursed for the reasonable cost of services rendered to Medicare beneficiaries as determined by the Secretary of Health and Human Services (Secretary). § 1395x(v)(1)(A). Providers receive interim payments at least monthly covering the cost of services  [*54]  they have rendered. § 1395g(a). Congress recognized, however, that these interim payments would not always correctly reflect the amount of reimbursable costs, and accordingly instructed the Secretary to develop mechanisms for making appropriate retroactive adjustments when reimbursement is found to be inadequate or  [**2221]  excessive. § 1395x(v)(1)(A)(ii). 2 Pursuant to this statutory mandate, the Secretary requires providers to submit annual cost reports which are then audited to determine actual costs. 42 CFR §§ 405.454, 405.1803 (1982). The Secretary may reopen any reimbursement determination within a 3-year period and make appropriate adjustments. § 405.1885.

 [****8]  The Act also permits a provider to elect to receive reimbursement through a "fiscal intermediary." 42 U. S. C. § 1395h; 42 CFR § 421.103 (1982). If the intermediary the provider has nominated meets the Secretary's requirements, the Secretary then enters into an agreement with the intermediary to have it perform those administrative responsibilities she assigns it. §§ 421.5, 421.110. These duties include receipt, disbursement, and accounting for funds used in making Medicare payments, auditing the records of providers in order to ensure payments have been proper, resolving disputes over cost reimbursement, reviewing and reconsidering payments to providers, and recovering overpayments to providers. §§ 421.100(b), (c), (e), (f), 421.120(e). The fiscal intermediary must also "serve as a center for, and communicate to providers, any information or instructions furnished to it by the Secretary, and serve as a channel of communication from providers to the Secretary." 42 U. S. C. § 1395h(a)(2)(A).

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467 U.S. 51 *; 104 S. Ct. 2218 **; 81 L. Ed. 2d 42 ***; 1984 U.S. LEXIS 87 ****; 52 U.S.L.W. 4621

HECKLER, SECRETARY OF HEALTH AND HUMAN SERVICES v. COMMUNITY HEALTH SERVICES OF CRAWFORD COUNTY, INC., ET AL.

Prior History:  [****1]  CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT.

Disposition:  698 F.2d 615, reversed and remanded.

CORE TERMS

reimbursement, funds, estoppel, provider, costs, advice, estopped, cases, per curiam, private party, regulations, seed, operating costs, circumstances, designated, endowments, gifts, misrepresentation, Unrestricted, fiscal intermediary, citizenship, misconduct, benefits, patients, corners, notice, rights, square, Crop

Civil Procedure, Preliminary Considerations, Equity, General Overview, Contracts Law, Estoppel, Equitable Estoppel, Governments, Federal Government, Claims By & Against