Document ID: ./input/supremecourt_opinions/opinions/boundvolumes/529bv.pdf
Page Number: 759

529US3

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684

FISCHER v. UNITED STATES

Thomas, J., dissenting

ices.”
42 U. S. C. § 1395x(v)(1)(A). The Social Security Act
that created Medicare instructed the Secretary of Health and
Human Services to promulgate regulations establishing the
methods of determining “reasonable costs” and speciﬁcally
directed the Secretary to consider, among other things, reim-
Ibid. See
bursement methods used by private insurers.
also Shalala v. Guernsey Memorial Hospital, 514 U. S. 87,
91–92 (1995).

Under these regulations, the Federal Government reim-
burses medical providers based upon the lower of the provid-
er’s reasonable cost of furnishing these services to beneﬁci-
aries or the provider’s customary charges for the services.
42 CFR § 413.1(b) (1999). The regulations are designed
to provide reimbursement for the actual cost of providing
care to elderly and disabled Medicare beneﬁciaries. See
§ 413.5(a) (“Thus, the application of this approach, with ap-
propriate accounting support, will result in meeting actual
costs of services to beneﬁciaries”). The regulations make
clear that the Federal Government will reimburse hospitals
only for the costs of providing medical care to Medicare
patients, as opposed to nonbeneﬁciary patients. § 413.80(d)
(“Under Medicare . . . costs of services provided for other
than beneﬁciaries are not to be borne by the Medicare pro-
gram”); § 413.9(a) (“All payments to providers of services
must be based on the reasonable cost of services covered
under Medicare and related to the care of beneﬁciaries”);
§ 413.9(c)(3) (“The determination of reasonable cost of serv-
ices must be based on cost related to the care of Medicare
beneﬁciaries”).

Although these reimbursement provisions permit hospi-
tals to recover capital costs, such as the cost of maintaining
building facilities, § 413.9(c), the allowable reimbursement for
these expenditures is only the amount reasonably attribut-
able to Medicare patients as opposed to general maintenance
of the facilities. See § 413.9(b) (“The objective is that under
the methods of determining costs, the costs with respect to