United States Court of Appeals,

Eleventh Circuit.

No. 95-6781.

NATIONAL COAL ASSOCIATION, Alabama Land and Mineral Corporation,

Allied Signal, Inc., Berwind Corporation, Bethlehem Steel

Corporation, Costain Coal, Inc., LTV Steel Company, Mountain Laurel

Resources Company, The Pittston Company, Plaintiffs-Appellees,

v.

Shirley S. CHATER, Commissioner of Social Security, DefendantAppellant.

April 26, 1996.

Appeal from the United States District Court for the Northern

District of Alabama. (No. CV 94-H-0780-S), James Hughes Hancock,

Judge.

Before TJOFLAT, Chief Judge, COX, Circuit Judge, and CLARK, Senior

Circuit Judge.

PER CURIAM:

The Commissioner of Social Security appeals from a grant of

summary judgment for the plaintiffs, requiring her to recompute

premiums paid by coal operators under a federal statute that

creates a benefits plan for mine workers. The sole issue in this

appeal is the meaning of the word "reimbursements" as used in the

statutory formula for calculating health benefit premiums. We

affirm the district court.

I. Background

The financial instability of health and retirement benefit

plans for mine workers and retirees historically has been a

significant factor precipitating disputes between mine workers and

coal operators. From 1946 to 1992, health benefits for miners were

provided through a series of multiemployer plans created under

agreements between the United Mineworkers of America (UMWA) and the
 1

The Secretary of Labor's Advisory Commission on United Mine

Workers of America Retiree Health Benefits, A Report to the

Secretary of Labor and the American People (Nov. 1990), reprinted

in Coal Commission Report on Health Benefits of Retired Coal

Miners: Hearing Before the Subcomm. on Medicare and Long-Term

Care of the Senate Finance Comm., 102d Cong., 1st Sess. 142, 167-

81 (1991). 

National Bituminous Coal Operators' Association. By 1989, the two

multiemployer plans that provided health benefits to retirees, the

1950 UMWA Benefit Plan and Trust, and the 1974 UMWA Benefit Plan

and Trust, were operating at a deficit. The financial instability

of the plans led to a breakdown in labor relations: the Pittston

Company ceased making contributions to the plans in 1990, and an

eleven-month strike ensued. In re Chateaugay Corp., 53 F.3d 478,

484 (2d Cir.), cert. denied, --- U.S. ----, 116 S.Ct. 298, 133

L.Ed.2d 204 (1995).

 Congress recognized the potential for continued disruption in

the coal industry without an adequately funded source for the

continued provision of benefits. With the aid of a study on the

issue by a Department of Labor commission,1

 Congress passed the

Coal Industry Retiree Health Benefit Act ("the Act"), Pub.L. No.

102-46, 106 Stat. 3036 (1992), codified at 26 U.S.C. §§ 9701-9722

(1994). The purpose of the Act was to remedy the problems in

funding health care benefits for the beneficiaries of the former

UMWA plans while retaining a benefits program that was privately

financed. § 19142, 106 Stat. at 3037.

To accomplish this purpose, the Act basically consolidated the

1950 and 1974 UMWA Benefit Plans into one plan for the provision of

health and retirement benefits called the UMWA Combined Benefit

Fund ("Combined Fund"). 26 U.S.C. § 9702(a)(2). The Act directed
 2

The amount calculated under § 9704(b)(2)(A) is adjusted

according to any increase in the medical component of the

Consumer Price Index during the plan year. 26 U.S.C. §

9704(b)(2)(B). 

the Secretary of Health and Human Services ("Secretary of HHS") to

assign eligible beneficiaries of the Combined Fund to coal

operators according to certain criteria; a 1994 amendment to the

Act replaced the Secretary with the Commissioner of Social Security

("Commissioner"). 26 U.S.C. § 9706; Social Security Independence

and Program Improvements Act, Pub.L. No. 103-296, § 108(h)(9)(A),

108 Stat. 1464, 1487. Assigned coal operators finance the Combined

Fund by paying annual per-beneficiary premiums as directed by the

Act. 26 U.S.C. § 9704(a). The portion of the annual premium for

health benefits is calculated by the Commissioner using a formula

in § 9704(b)(2), which reads in part:

The Commissioner ... shall calculate a per beneficiary

premium for each plan year beginning on or after February 1,

1993, which is equal to the sum of—

(A) the amount determined by dividing—

(i) the aggregate amount of payments from the 1950 UMWA

Benefit Plan and the 1974 UMWA Benefit Plan for health

benefits (less reimbursements but including administrative

costs) for the plan year beginning July 1, 1991, for all

individuals covered under such plans for such plan year, by

(ii) the number of such individuals ...2

26 U.S.C. § 9704(b)(2) (emphasis added). The meaning of the word

"reimbursement" in this section is the sole issue disputed by the

parties to this appeal.

In order to understand the controversy in this case, it is

important to understand how the 1950 and 1974 UMWA Benefit Plans

acted in combination with government benefits programs, like
 3

The Medicare program is divided into two parts. Part A

covers services by institutional providers, like hospitals, and

Part B covers services by non-institutional providers, like

physicians. Only Part B is involved in this case. 

Medicare, to provide health care services for beneficiaries.

Health care coverage under the former UMWA plans was limited to

services that were not covered by Medicare or other government

benefit programs. But to promote efficiency for the payors and

convenience for the beneficiaries, the UMWA plans entered into a

series of agreements with the Health Care Financing Administration

("HCFA"), the governmental agency that administers Medicare, under

which the UMWA plans would pay providers all the covered costs of

the beneficiaries' health care. Medicare would then reimburse the

UMWA plans for services covered by Medicare Part B 3

 and related

administrative costs.

Prior to June of 1990, the payments made by HCFA pursuant to

its agreement with the UMWA plans were calculated on a traditional

cost basis. The UMWA plans submitted reports of Medicare services

actually received by their beneficiaries, and HCFA used Medicare

cost principles to calculate the appropriate payment to the benefit

plans. The process of calculating cost-based reimbursement for

benefit plans of this size was complicated, and disputes frequently

arose over the amount that HCFA would pay the UMWA plans.

In 1990, the UMWA plans and HCFA signed a new contract that

employed a risk-capitation method for calculating the payments from

HCFA to the benefit plans. (R. 2-28 Defs.' Ex. 5.) Under the new

method, HCFA paid a predetermined amount per plan member per month,

without regard to the amount of money that the UMWA plans actually
 4

The contract that was in effect from July 1, 1990, to June

30, 1993, reads in part:

I. Reimbursement

Pursuant to waivers ... [T]he [UMWA plan(s) ] will be

reimbursed on a risk-based capitated payment basis for

a period of 3 years, beginning July 1, 1990 and ending

June 30, 1993. The [UMWA plan(s) ] will furnish

medical and other health services to its enrollees who

are entitled to benefits under Part B of the Medicare

program.

The capitation payment for the period beginning July 1,

1990 and ending June 30, 1991, will be $141.87 per

member per month....

No reimbursement will be made to the [Combined Fund]

for covered Part A and Part B services furnished by a

provider of services....

(R. 2-28 Defs.' Ex. 5.) 

spent on Medicare-covered services. The risk-capitation method was

considered desirable by both parties. The UMWA plans hoped that

using this method would prevent the protracted disputes that had

occurred over the amount of the HCFA payments. HCFA favored the

risk-capitation method because it gave the UMWA plans the incentive

to provide Medicare-covered services more efficiently, and because

the amount of its payment to the plans would be more certain.

The contract between HCFA and the UMWA plans using the

risk-capitation method has been renewed every year since its

inception; the Combined Fund has been substituted for the UMWA

plans. The 1990 contract, as well as each of the renewal contracts

in the record, characterize the payment made by HCFA to the UMWA

plans under the contract alternatively as a "payment" or

"capitation payment", and as "reimbursement." (R. 2-28 Defs.' Exs.

5, 6, 7.)4
The Act requires the trustees of the Combined Fund to submit

to the Commissioner "information as to the benefits and covered

beneficiaries under the fund, and such other information as the

[Commissioner] may require to compute any premium under this

section." 26 U.S.C. § 9704(h). In September of 1993, the trustees

submitted a financial report for the 1992 plan year ("base year")

to the Secretary of HHS, the Commissioner's predecessor under the

Act. The report showed that in the base year, the UMWA plans spent

$156.8 million on Medicare Part B services and related

administrative expenses. The report also showed that, pursuant to

their contract with HCFA, the plans received $182.3 million in

risk-capitation payments for Medicare Part B services and related

administrative costs, an amount that exceeded actual costs by about

$25.5 million.

Under the formula in 26 U.S.C. § 9704 for the calculation of

the per beneficiary health benefit premiums, one factor is the

amount of "reimbursements" received by the plans during the base

year. 26 U.S.C. § 9704(b)(2). In calculating this premium, the

Secretary used the amount actually paid by the UMWA plans during

the base year for Medicare Part B and related administrative costs,

or $156.8 million, as "reimbursements" to arrive at an annual per

beneficiary premium of $2,245.33 for assigned coal operators. If

the Secretary had used the amount received by the UMWA plans from

HCFA under the risk-capitation contract, or $182.3 million, as

"reimbursements," the per beneficiary premium would have been about

$2,013.83.

II. Proceedings Below
 5

Many member companies of the plaintiff National Coal

Association are assigned premium payment obligations under the

Act. We will refer to the plaintiffs collectively as NCA. 

In April of 1994, the National Coal Association ("NCA") and

eight companies who are assigned premium payment obligations under

the Act filed suit in federal district court, 5

 alleging that the

Secretary violated the Act by miscalculating the health benefit

premium. Finding that there were no disputed issues of fact

between the parties, the district court addressed the contentions

of the parties on cross motions for summary judgment. The court

held that the word "reimbursements" in the Act clearly and

unambiguously referred to the entire amount of payments made by

HCFA to the UMWA plans pursuant to the contract. Because the court

held that Congress had precisely addressed the issue before it, the

court rejected the Secretary's argument that her interpretation of

"reimbursement" was entitled to deference under Chevron, U.S.A.,

Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104

S.Ct. 2778, 81 L.Ed.2d 694 (1984). The court granted the

plaintiffs' motion, and ordered the Commissioner to recalculate the

health benefit premium using the amount of the risk-capitation

payments as "reimbursements." The Commissioner appeals.

III. Issue on Appeal and Standard of Review

 The parties to this appeal do not disagree on any issue of

fact. The sole issue in this appeal is the meaning of the word

"reimbursement" in 26 U.S.C. § 9704(b)(2). This question is one of

statutory interpretation, which we review de novo. United States

v. Hansley, 54 F.3d 709, 717 (11th Cir.), cert. denied, --- U.S. --

--, 116 S.Ct. 540, 133 L.Ed.2d 444 (1995).
IV. Discussion

The Commissioner contends that her reading of § 9704(b)(2) is

compelled by the Act's plain meaning, legislative history, and

purpose. According to the Commissioner, the plain meaning of

"reimburse" is to indemnify, or pay back, only the amount that will

make a party whole. In other words, she argues that reimbursements

are necessarily cost-based, and that risk-based capitation payments

are only reimbursement to the extent that they do not exceed actual

costs. The legislative history supports her reading, she argues,

because one of the sponsors of the Act stated that the health

benefit premium would be based on "the aggregate amount of payments

made and to be made from the 1950 UMWA Benefit Plan and the 1974

UMWA benefit plan for health benefits-less payments by the plans

for Federal program benefits but including administrative costs—for

the [base year]." 138 Cong.Rec. S17634 (daily ed. Oct. 8, 1992)

(statement of Sen. Rockefeller) (emphasis added). The Commissioner

argues that her reading is more consistent with the Act's purpose

of creating a privately financed plan, because it does not allow

surplus payments by HCFA to subsidize the operators' contribution

to the Combined Fund. Finally, the Commissioner contends that the

above arguments demonstrate that hers is a reasonable reading of

the statute that is entitled to deference under Chevron.

NCA argues that the district court did not err in holding that

the plain meaning of "reimbursement" refers to the entire amount of

the capitation payments made by HCFA to the UMWA plans during the

base year. NCA contends that the Commissioner's reading of the

word "reimburse," which excludes an arrangement where a party is
repaid on a capitated basis, is impermissibly restrictive. NCA

argues that the agency reading of the statute is not entitled to

deference because Congress has spoken to the precise issue in the

plain language of the Act.

 Any exercise of statutory interpretation begins first with

the language of the act. Bailey v. United States, --- U.S. ----,

----, 116 S.Ct. 501, 506, 133 L.Ed.2d 472 (1995); Chevron, 467

U.S. at 842, 104 S.Ct. at 2781. Where the intent of Congress is

expressed in the text of a statute in reasonably plain terms, we

must give effect to that intent. Griffin v. Oceanic Contractors,

Inc., 458 U.S. 564, 570, 102 S.Ct. 3245, 3250, 73 L.Ed.2d 973

(1982). Terms that are not defined in the statute, like the word

"reimbursement" in this Act, are given their ordinary or natural

meaning. Federal Deposit Ins. Corp. v. Meyer, --- U.S. ----, ----,

114 S.Ct. 996, 1001, 127 L.Ed.2d 308 (1994).

 We hold that the plain meaning of "reimbursement" in §

9704(b)(2) refers to the entire amount of the capitation payments

that were made to the UMWA plans as reasonable compensation for

Medicare-related expenditures during the base year. "Reimburse" is

defined as "to pay back (an equivalent for something taken, lost,

or expended) to someone: repay." Webster's Third New

International Dictionary 1914 (1986). The ordinary meaning of the

term "reimbursement" is not restricted by any requirement that such

payments be dollar-for-dollar what the reimbursed party paid out.

 The district court was correct in reasoning that the

legislative history and general purpose of the Act do not overcome

its plain statutory language. Although we consider the legislative
history of a statute relevant in the process of interpretation, "we

do not resort to legislative history to cloud a statutory text that

is clear." Ratzlaf v. United States, --- U.S. ----, ----, 114

S.Ct. 655, 662, 126 L.Ed.2d 615 (1994). Nor can a general appeal

to statutory purpose overcome the specific language of the Act,

because the text of a statute is the most persuasive evidence of

Congress's intent. Griffin, 458 U.S. at 571, 102 S.Ct. at 3250.

Because the statutory text is clear, there is no need to address

whether the Commissioner's reading of the statute is entitled to

deference under Chevron. 467 U.S. at 842-43, 104 S.Ct. at 2781.

 The district court correctly held that the Secretary should

have included the entire $182.3 million paid to the UMWA plans as

"reimbursements."

AFFIRMED.

CLARK, Senior Circuit Judge, Concurring Dubitante:

While I disagree with the holding of the majority, I

nevertheless join for reasons which I shall explain. In a

nutshell, it would be a disservice in 1996 to reverse a financial

arrangement between the parties that has existed since 1993 and the

parties have acted thereon. No one gets hurt in the short run if

the Combined Fund for which the plaintiffs are partially

responsible becomes overpaid.

The majority is correct in adopting from Webster the

definition of "reimbursement" to mean "pay back" or "repay," but in

my view the opinion tends to err in saying: "The ordinary meaning

of the term "reimbursement" is not restricted by any requirement

that such payments be dollar-for-dollar what the reimbursed party
 1

Staff of House Comm. on Ways and Means, 104th Cong.Sess.,

Development and Implementation of the Coal Industry Retiree

Health Benefit Act of 1992. (Comm. Print 1992). 

 2Id. at 21-22. 

paid out." While I would agree such would be the case if the

excess reimbursement were penny ante, here we are talking about a

reimbursement that exceeds twenty-five million dollars.

A report prepared by the majority staff of the House Committee

on Ways and Means during the 1994 Term of Congress1 convinces me

that it would be an injustice to go back and try to recalculate the

payments from 1993 to present. Although the report shows during

the first six months of fiscal year 1995 the Combined Fund operated

with a deficit of ten million dollars, the Fund had a surplus of

ninety-six million dollars at the end of fiscal year 1994.

Further, the report has this statement: "The existence of a

surplus in the Combined Benefit Fund of over $100 million has

generated considerable interest among the parties responsible for

financing the retired miners' health benefits."2

From my view, this is a legislative problem, not a judicial

one. I have confidence, pursuant to the legislation on the books,

that the health benefits of the coal miners are protected. I have

just as much confidence that the plaintiff coal mine operators will

continue to be treated justly. I hope the taxpayers are equally

protected.

This is a case in which to let sleeping dogs lie, and

therefore I concur.