Document: 467 U.S. 51 104 S.Ct. 2218 81 L.Ed.2d 42 Margaret M. HECKLER, Secretary of Health and Human Services, Petitionerv.COMMUNITY HEALTH SERVICES OF CRAWFORD COUNTY, INC., et al. No. 83-56. Supreme Court the United States Argued Feb. 27, 1984. Decided May 21, Syllabus Under Medicare program, providers health care services are reimbursed for reasonable cost rendered to beneficiaries required submit annual reports which audited determine actual costs. The Services (Secretary) may reopen any reimbursement determination within a 3-year period make appropriate adjustments. Respondent non-profit corporation (hereafter respondent), pursuant its contract provide home under received through fiscal intermediary, Travelers Insurance Cos. (Travelers). also federal grant Comprehensive Employment Training Act (CETA), authorized use funds training job opportunities economically disadvantaged persons. This made it possible respondent take on additional personnel expand services. A regulation prevent double providers' costs indicated that grants by provider pay special operating must be subtracted from program. asked whether salaries CETA-funded employees who provided patients were reimbursable as Medicare, was orally advised Travelers' manager CETA "seed money" defined in Provider Reimbursement Manual mean "[g]rants designated development new agencies or expansion established agencies," therefore, even though employees' constituted specific paid grant, they Relying this advice, included receiving years 1975, 1976, 1977, those sums. Eventually, however, Travelers, should have done previously, referred respondent's inquiry Department formally not thus had reimbursement. then reopened question recomputed costs, determining been overpaid $71,480. When demanded repayment amount, filed suit Federal District Court, but, after obtained temporary injunctive relief, parties stipulated would stayed pending administrative review. Thereafter, while rejecting position money," Review Board found Secretary's right recoup 1975 overpayment barred because given written notice reopening limitation period, accordingly reduced amount dispute. another seeking review determination. Consolidating two suits, court ruled favor, claim ought estopped deny representations agent, Travelers. Appeals reversed, holding Government "affirmative misconduct" agents erroneous coupled with failure refer Secretary, such misconduct. Held: is recovering respondent, since has demonstrated traditional elements an estoppel present respect either change reliance advice. Pp. 59-66. (a) consequences Government's misconduct entirely adverse, did receive immediate benefit result Its detriment inability retain money never first place. Thus, case lost legal suffered adverse status. cannot levels greater than error occurred. Curtailment operation does justify when achieved unlawful access funds. raise without proving significantly worse off if question. 61-63. (b) regulations governing provisions put ample prepared, taken them relevant period. Yet prepared basis oral policy judgment official who, known, business making policy. That kind give rise against private party therefore estop Government. 63-66. 698 F.2d 615 (3rd Cir.1983), reversed remanded. Kenneth S. Geller, Washington, D.C., petitioner. Raymond G. Hasley, respondents. Justice STEVENS delivered opinion Court. 1 what recognized purposes incorrect interpretation rather complex regulations, during 1977 expended $71,480 entitled. presented relied express authorization responsible agent expenditures. 2 * Title XVIII Social Security Act, 79 Stat. 291, amended, U.S.C. §§ 1395-1395vv, determined (Secretary). § 1395x(v)(1)(A). Providers interim payments at least monthly covering rendered. 1395g(a). Congress recognized, these always correctly reflect instructed develop mechanisms retroactive adjustments inadequate excessive. 1395x(v)(1)(A)(ii).1 Pursuant statutory mandate, requires CFR 405.454, 405.1803 (1982). 405.1885. 3 permits elect "fiscal intermediary." 1395h; 421.103 If intermediary nominated meets requirements, enters into agreement perform responsibilities she assigns it. 421.5, 421.110. These duties include receipt, disbursement, accounting used payments, auditing records order ensure proper, resolving disputes over reimbursement, reviewing reconsidering providers, overpayments providers. 421.100(b), (c), (e), (f), 421.120(e). "serve center for, communicate information instructions furnished serve channel communication Secretary." 1395h(a)(2)(A). 4 Community Crawford County, Inc. nonprofit corporation. In 1966 entered petitioner's predecessor, Health, Education, Welfare, individuals eligible benefits Part 1395c 1395i-2. contract, 5 1973 enacted 87 839, codified, 29 801 seq. (1976 ed. Supp. V), repealed, Pub.L. 97-300, 96 1357, authorizing began participating fringe certain employees. 6 To effect one concerning program indicates reimbursement.2 After obtaining administrator contacted ask Medicare. meaning 612.2 Manual, agencies,"3 7 reports, sums amounting $7,694, $32,460, $31,326 respectively.4 On several occasions requested verification propriety treatment.5 With funds, expanded number visits approximately 4,000 1974 81,000 next three years. budget increased about $200,000 $900,000. 8 It undisputed correct practice definitive answer. However, do until August 7, request finally submitted Philadelphia office Department's Bureau Insurance. October notified preceding total 9 1978 formal demand disputed amount. relief Travelers; November 1979, stipulation providing postpone attempts recoupment civil action outcome 10 (PRRB) conducted hearing issued money." PRRB found, limitations period;6 thus, dispute $63,800. April 10, 1980, complaint consolidated equitable earlier. cross-motions summary judgment, favor accepting PRRB's view her held unreasonable believe could twice expense.7 11 reaching only v. Califano, (CA3 1983). advice rejected "clearly erroneous" Court's finding rely concluding instead acted reasonably no clear source other turn II 12 Estoppel doctrine invoked avoid injustice particular cases. While hallmark flexible application, principles tolerably clear: 13 "If person makes definite misrepresentation fact having reason will upon act . entitled 14 15 "(b) regain property value acquired act, before discovery truth so changed his unjust deprive him he acquired." Restatement (Second) Torts 894(1) (1979).8 16 claiming adversary's conduct "in manner worse."9 know nor known misleading.10 See Wilber National Bank States, 294 120, 124-125, 55 362, 364, L.Ed. 798 (1935). unable enforce law estoppel, interest citizenry whole obedience rule undermined. well settled same terms litigant.11 Petitioner urges us principle flat circumstances run We left issue open past,12 again today. Though arguments advances substantial, we hesitant, unnecessary decide case, say there cases public ensuring can free might outweighed countervailing citizens some minimum standard decency, honor, reliability their dealings Government.13 But however heavy burden asserted Government, surely prevail demonstrating present. unpersuaded III 17 analyze nature party's detrimental position, identify caused citizen worse. adverse. right, vested contingent, status.14 deprived something position. Here rights but merely induced corrected later time.15 18 There doubt adversely affected already spent. curtail operations forced seek debts bankruptcy. extent likely curtailment volume much less reduce activities below level proper. need extended modifications process continue operate, questions method enforcing collection us. forfeited money. 19 for-profit hardly base wrongfully allowed interest-free taxpayers' years, enabling operation.16 No more when—by own account—the governmental And reduction service prior receipt record foreclose possibility aggregate advantages community stemming offset hardship associated now being restore IV 20 Holmes wrote: "Men square corners deal Government." Rock Island, A. & L.R. Co. 254 141, 143, 41 55, 56, 65 188 (1920). observation greatest force seeks spend Protection fisc scrupulous regard requirements law; expect most demanding standards quest consistent general expected contrary law.17 As participant duty familiarize itself Since elected acquainted role intermediary. arose consulting demonstrates necessity applicable regulations; indisputably knew doubtful clearly covered existing statements. is, itself, insufficient estoppel,18 petitioner anticipated problem resolution available respondent.19 simply requirement anticipate every arise administration Medicare; neither bit informal course sufficiently reliable expenditure substantial spent respondent.20 Nor reliance. recipient conduit; resolve questions. statute, acquainted, perfectly clear.21 attempt resolved Secretary; satisfied mere conduit.22 21 appropriateness further undermined oral. fraud undermines our confidence confirmed evidenced instrument. Written like judicial opinion, author citizen, subjects review, criticism, reexamination. stay lawful scope authority, exactitude, argues strongly conclusion erected underlay reports. especially true involved, manifest. 22 sum, party. 23 assuming ever appropriately applied said faces severe imposed unfair way case. Accordingly, remanded proceedings opinion. 24 ordered. 25 REHNQUIST, whom THE CHIEF JUSTICE joins, concurring judgment. 26 I agree estopped. write separately think treatment decided area gives inaccurate misleading impression circumstances, any, laws. 27 Sixty-seven ago, Utah Power Light 243 389, 37 387, 61 791 (1917), argued lands, law, acquiesced exercise rights. laid down claims behalf Government: "As rule, laches neglect part officers defense protect interest. Citations omitted. And, assumed subject exceptions, find nothing hand fairly out heretofore understood court. maintain respecting lands holds trust all people stands different plane respects ordinary title real remove cloud [Citation omitted.]" Id., 409, S.Ct., 391. 28 where agency coverage crop insurance policy, agreed carrier. Crop Corp. Merrill, 332 380, 383-386, 68 1, 2-4, 92 (1947). employee eligibility, resulted applicant's losing months benefits. Schweiker Hansen, 450 785, 101 1468, 67 685 (1981) (per curiam). connection enforcement immigration laws denial citizenship officials. INS Miranda, 459 14, 103 281, 74 (1982) curiam); Hibi, 414 5, 94 19, 38 (1973) Montana Kennedy, 366 308, 314-315, 1336, 1340-1341, 313 (1961). none agents. supra, U.S., 8, noted still whether, future grounds estoppel. 1340-1341. estopped, question, ante, 60-61, hospitality towards warrant. footnote 12, 60, intimates decisions estopped: Pennsylvania Industrial Chemical Corp., 411 655, 93 1804, 36 567 (1973), Moser 341 41, 71 553, 95 729 (1951). criminal prosecution, "to [Government regulations] [the defendant] fair warning intended criminal, notions fairness inherent system justice proceeding prosecution." 674, 1816. cryptic Moser, alien declined Armed Forces expressly rested absence knowing intentional waiver citizenship. 47, 556. 30 clean slate field, narrow range circumstances. Because efforts phrase statements casts cases, concur adjust account previous underpayments. "(a) Principle. Unrestricted grants, gifts, income endowments deducted computing cost. Grants, endowment donor paying group Definitions—(1) endowment. cash otherwise, restriction use. "(2) Designated restricted endowments. purpose donor. unrestricted provider. "(c) Application. (1) generally management deems inequitable require care. means otherwise recoverable. Donor-restricted hospital expenses apply donation. reduced, secure expense twice; donor-restricted contributions third-party payers including program." 405.423 (emphasis supplied). "Seed Money Grants.—Grants 'seed money' grants. 'Seed allowable usually cover group[s] stated time. During time, sufficient patient caseloads enable continued self-sustaining payers." HIM-15, Pt. I, (Aug. 1968), reproduced CCH, Medicaid Guide ¶ 5461 (1983). Presumably participants benefits, reimbursements substantially larger portion claimed. $16,555, $53,952, $81,118 respectively. From concluded consulted qualified five separate occasions. times received. 1976 served time comply year. timely thereafter respondent. independently liable Agency 8B (1958). J. Pomeroy, Equity Jurisprudence 805, p. 192 (S. Symons 1941); see id., 812. "The material facts unknown amounts representation concealment, him. If, acted, knowledge truth, diligence acquire negligence remain ignorant using means, misled relying concealment." 810, 219 (footnote omitted). See, e.g., 383, 2, 284, 788, 1470, 315, 1341, fact, seem rest premise acts ways, harm deception. 670-675, 1814-1817, (criminal defendant assert led legal); (1951) (applicant deemed waive form signed signing rights). Kaiser Aetna 444 164, 178-180, 100 392-393, 62 (1979); Santobello New York, 404 257, 495, 427 (1971); Branson Wirth, Wall. 32, 42, 566 (1873). underlies retroactively unduly intrude interests. NLRB Bell Aerospace Co., 416 267, 295, 1757, 1772, 40 134 (1974); Atchison, T. S.F.R. Wichita Bd. Trade, 412 800, 807-808, 2367, 2374-2375, 350 (plurality opinion); SEC Chenery 194, 203, 1575, 1580, 91 1995 St. Regis Paper 368 208, 229, 82 289, 301, 240 (1961) (Black, J., dissenting) ("Our picayunish haggling promise, permit arms which, construction, word arm do. good morals dealing government"); 387-388, 4-5 (Jackson, ("It very corners. why constitute one-way street"); Brandt Hickel, 53, 57 (CA9 1970) ("To appellants, 'The joke you. You shouldn't trusted us,' worthy great Menges Dentler, 33 Pa. 500 (1859) ("Men naturally government, so, suffer it"). Giglio 405 150, 154-155, 763, 766, 31 (1972). plainly distinguishable (1951), "was thereby lose citizenship." 46, 789, 1471 Stewart, 311 70, 102, 108, 85 (1940); Sutton 256 575, 563, 1099 (1921); Pine River Logging 186 279, 920, 925, 46 1164 (1902); Hart 316, 479 (1877). Automobile Club Commissioner, 353 180, 77 707, 746 (1957). "Whatever functions, anyone entering arrangement takes risk accurately ascertained purports stays bounds authority. authority explicitly limited delegated legislation, properly exercised rule-making power. though, here, himself unaware authority." 384, 3. California, 39-40, 1658, 1668-1669, 1889 (1947); 108; San Francisco, 310 16, 31-32, 60 757; 123-124, 363-364, (1935); 284 534, 545-546, 52 232, 235, 76 469 (1932); Jeems Bayou Fishing Hunting 260 561, 564, 43 205, 206, 402 (1923); 579, 391, (1917); 925; 318-319, 479; Gibbons 269, 274, 453 (1869); Lee Munroe, Cranch 366, 373 (1813). 789-790, 1471-1472 supra. agency, principal bound apparent 145, 159 Comment b (principal lack negligently leads third exists). believed directly. belief, accurate, reasonable. Moreover, conduit information, far specifically pass Department, so. Even duty, indicate unwilling honor request.

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