The government's best offense is deference: the decision of the Supreme Court in Shalala v. Guernsey Memorial Hospital

The United States Supreme Court agreed with the Secretary of Health and Human Services that Guernsey Memorial Hospital's advance refunding transaction costs would be subject to a medicare reimbursement policy that is not based upon generally accepted accounting principles. According to the sharp dissent in this case, this policy, set forth in a manual provision, contradicts federal regulations.     

United States Supreme Court rules against Medicare providers in cost reimbursement case. Shalala v. Guernsey Memorial Hospital

In the long run, the impact of Guernsey will depend on the interpretation and application of the decision by HCFA, the Provider Reimbursement Review Board, and the courts. If HCFA interprets the decision as a signal that the Supreme Court is willing to grant federal agencies broad latitude to avoid the rulemaking requirements of the APA, providers may have fewer opportunities for formal input into payment policy issues under the Medicare program. The impact of the case may well go beyond cost-based reimbursement issues and affect all aspects of the Medicare program.     

City of Revere v. Massachusetts General Hospital: government responsibility for an arrestee's medical care

City of Revere v. Massachusetts General Hospital presented the United States Supreme Court with its first opportunity to consider whether a state or municipality has a constitutional duty to pay for medical treatment received by an individual in police custody. The Supreme Judicial Court of Massachusetts had held that the city had an eighth amendment duty to pay for an arrestee's treatment. The U.S. Supreme Court reversed, observing that eighth amendment rights and duties are not implicated prior to conviction and that fourteenth amendment due process concerns were met once the arrestee received adequate medical care. No obligation to pay arises, the Court held, absent a specific state law provision requiring such payment. Because arrestees are subject to physical restraints similar to those imposed on convicted prisoners, this Case Comment argues that courts undertaking to determine the scope of a state's duty to provide treatment to arrestees should apply a due process standard which draws upon eighth amendment analysis. The Comment concludes that under such an eighth amendment equivalence approach, no duty to pay arises because the state's failure to pay the health care provider does not reflect "deliberate indifference" towards the recipient of the treatment.