Mercy Hospital of Laredo v. Heckler

GARWOOD, Circuit Judge:

Appellants, Medicare provider hospitals, brought this suit challenging the disallowance by the Secretary of Health and Human Services of their claims for reimbursement of certain claimed costs of contract physical therapy services. The district court denied relief.. It determined that the derivation and the application of cost guidelines by the Secretary was neither arbitrary, capricious or an abuse of discretion, nor in excess of her statutory authority to establish and implement a Medicare cost reimbursement program; that the guidelines as applied did not create an…