Regents of the University of California v. Donna E. Shalala, Secretary, Health & Human Services Provider Reimbursement Review Board

OVERVIEW

Regents of the University of California (“Regents”) appeals the district court’s summary judgment in favor of the Secretary of Health and Human Services in Regents’ action under Title XVIII of the Social Security Act, 42 U.S.C. § 1395oo(f)(1), challenging the Secretary’s decision to deny Medicare reimbursement for patient expenses attributable to interest costs incurred on working loans from Regents to three University hospitals (“providers”).

We have jurisdiction under 28 U.S.C. § 1291 , and we affirm.

FACTS AND PROCEDURAL HISTORY

Regents owns and operates the three Medicare providers on whose behalf this appeal is taken, UCLA Medical Center, UC Irvine Medical Center, and UCSD Medical Center. The providers are not separate legal entities from the Regents and, as such, cannot sue, be sued, enter into contracts, or perform other legal functions in their own names, including borrowing monies from outside sources.

In 1982, 1983, 1984, and 1985, Regents made working capital loans to the providers. It is undisputed that the proceeds from the loans were used for necessary and proper purposes related to patient care. These loans were necessitated by a budget shortfall…