Thompson

I. Overview

Appellant, Tommy Thompson, Secretary of the Department of Health and Human Services (“the Secretary”), challenges the district court’s grant of summary judgment to the plaintiff hospitals (“the Providers”). At issue is the Secretary’s obligation to reimburse the Providers for bad debts arising from the failure of Medicare Part B participants to make coinsurance and deductible payments under circumstances in which Medi-Cal, California’s state Medicaid program, may be responsible for such payments.

Section 1395g(a) of Title 42 of the United States Code provides in part that “no [reimbursement] payments shall be made to any provider unless it has furnished such information as the Secretary may request in order to determine the amounts due such provider-” 42 U.S.C. § 1395g(a) (2002). Exercising this authority, the Secretary, throughout the relevant period, consistently required the Providers to submit evidence that they had billed Medi-Cal for coinsurance and deductible obligations and received a refusal to pay, known as a Remittance Advice or “R.A.” The Providers found this “must bill” policy onerous for a number of reasons and undertook to develop a…