Battle Creek Health System v. Robert F. Kennedy, Jr., Secretary of the United States, Department of Health

FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 22, 2024 Decided August 22, 2025
No. 23-5310
BATTLE CREEK HEALTH SYSTEM, ET AL.,
APPELLEES
v.
ROBERT F. KENNEDY, JR., SECRETARY OF THE UNITED STATES,
DEPARTMENT OF HEALTH AND HUMAN SERVICES,
APPELLANT
Appeal from the United States District Court
for the District of Columbia
(No. 1:17-cv-00545)
Kevin J. Kennedy, Attorney, U.S. Department of Justice,
argued the cause for appellant. With him on the briefs were
Brian M. Boynton, Principal Deputy Assistant Attorney
General, Matthew M. Graves, U.S. Attorney, Abby C. Wright,
Attorney, Samuel R. Bagenstos, General Counsel, U.S.
Department of Health and Human Services, Janice L. Hoffman,
Associate General Counsel, Susan Maxson Lyons, Deputy
Associate General Counsel, and James F. Segroves, Attorney.
Andrew B. Howk argued the cause for appellees. With him
on the brief was Heather D. Mogden.

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Jonathan C. Bond and Robert A. Batista were on the brief
for amici curiae American Hospital Association, et al. in
support of appellees.
Mark D. Polston, Christopher P. Kenny, and Nikesh Jindal
were on the brief for amici curiae Florida Hospital Association,
et al. in support of appellees.
Before: SRINIVASAN, Chief Judge, WALKER, Circuit
Judge, and EDWARDS, Senior Circuit Judge.
Opinion for the Court filed by Chief Judge SRINIVASAN.
SRINIVASAN, Chief Judge: The Medicare program
reimburses hospitals for providing services to covered patients.
Hospitals that treat a disproportionate number of low-income
patients are eligible to receive an upward adjustment to offset
the increased treatment costs. That adjustment is known as the
disproportionate share hospital (or DSH) adjustment.
In this case, a group of hospitals seeks to contest the way
in which one component of the DSH adjustment was
determined for fiscal year 2007. We have no occasion to
engage with the merits of their challenge. The administrative
body that hears such challenges, the Provider Reimbursement
Review Board, dismissed the hospitals’ claim in this case on
the ground that it was brought too early. According to the
Board, the hospitals needed to wait until they knew the final
amount of their DSH adjustment rather than just the
determination of one component of it. The district court
disagreed and concluded that the hospitals’ challenge could go
forward. Because we agree with the Board, we reverse the
district court.

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I.
A.
Medicare “provides health insurance to Americans who
are 65 or older, as well as to disabled Americans.” Allina
Health Servs. v. Price, 863 F.3d 937, 938 (D.C. Cir. 2017)
(Allina II); 42 U.S.C. § 1395 et seq. The program is
administered by the Centers for Medicare and Medicaid
Services (CMS) within the Department of Health and Human
Services.
1. Medicare Part A provides eligible individuals with
“government-administered health insurance.” Allina II, 863
F.3d at 938. Under Part A, the government pays hospitals
directly for services rendered to covered patients. See Azar v.
Allina Health Servs., 587 U.S. 566, 570 (2019) (Allina III).
Part C, meanwhile, covers individuals who enroll in private
rather than government-administered health insurance plans,
and the government pays the insurance premiums rather than
the hospitals directly for care. See id.; 42 U.S.C. §§ 1395w-
21–29; Northeast Hosp. Corp. v. Sebelius, 657 F.3d 1, 2–3
(D.C. Cir. 2011).
Before 1983, Medicare reimbursed hospitals for the
“reasonable costs” they incurred to furnish care to covered
patients. See Methodist Hosp. of Sacramento v. Shalala, 38
F.3d 1225, 1226–27 (D.C. Cir. 1994). Because
reimbursements depended on a hospital’s actual costs (subject
to reasonableness limitations), the final determination of the
reimbursement amount owed to a hospital was made after the
end of the fiscal year, based on the hospital’s year-end cost
report. See Washington Hosp. Ctr. v. Bowen, 795 F.2d 139,
141 (D.C. Cir. 1986). A document called the “Notice of
Program Reimbursement” (or NPR), produced after the end of

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the fiscal year, contained the final determination of the total
reimbursement owed to a provider. See id. NPRs continue to
serve that function today.
In 1983, Congress “completely revised” the method for
determining the reimbursement amounts. Methodist Hosp., 38
F.3d at 1227; Social Security Amendments of 1983, Pub. L.
No. 98-21, § 1886(d)(1)–(4) (codified as amended at 42 U.S.C.
§ 1395ww(d)(1)–(4)). Congress instituted the Prospective
Payment System (PPS), under which reimbursements are based
on prospectively determined standard rates for a given type of
diagnosis rather than on a retrospective determination of a
hospital’s actual treatment costs. See Washington Hosp. Ctr.,
795 F.2d at 141–42. Under the PPS, that is, hospitals are
generally reimbursed at “a fixed rate for treating each Medicare
patient . . . based on the patient’s diagnosis and regardless of
the hospital’s actual costs.” Becerra v. Empire Health Found.
for Valley Hosp. Med. Ctr., 597 U.S. 424, 429 (2022). The
standard reimbursement rates are generally known as the
“federal rates.” See 42 C.F.R. § 412.64. And because the
federal rates are fixed prospectively, hospitals know in advance
the reimbursement rates they will receive for services they will
render in any year.
2. The Medicare statute also provides for certain
adjustments to a hospital’s reimbursement rates. This case
involves one such adjustment: the “disproportionate share
hospital” (or DSH) adjustment. 42 U.S.C. § 1395ww(d)(5)(F).
The DSH adjustment compensates hospitals that “serve[] a
significantly disproportionate number of low-income patients,”
id. § 1395ww(d)(5)(F)(i)(I), who “are often more expensive to
treat than higher income ones, even for the same medical
conditions,” Empire Health, 597 U.S. at 429.

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The amount of a hospital’s DSH adjustment depends on
the level of its “disproportionate patient percentage,” a proxy
for the extent to which the hospital serves low-income patients.
42 U.S.C. § 1395ww(d)(5)(F)(v). To be eligible for a DSH
adjustment, a hospital must have a disproportionate patient
percentage that exceeds 15%. Id. “The higher the
disproportionate-patient percentage goes, the greater the rate
mark-up that the hospital will receive.” Empire Health, 597
U.S. at 432.
A hospital’s disproportionate-patient percentage is the
sum of two fractions, both defined by statute. See Allina
Health Servs. v. Sebelius, 746 F.3d 1102, 1105 (D.C. Cir. 2014)
(Allina I). The first is the “Medicare fraction” and the second
is the “Medicaid fraction.” Id. “[A]t a high level of generality,
the Medicare fraction is a measure of a hospital’s senior (or
disabled) low-income population, while the Medicaid fraction
is a measure of a hospital’s non-senior (except for disabled)
low-income population.” Empire Health, 597 U.S. at 430.
For the Medicare fraction, the “denominator is the time the
hospital spent caring for patients who were ‘entitled to benefits
under’ Medicare Part A” (calculated in patient days) and the
“numerator is the time the hospital spent caring for Part-A-
entitled patients who were also entitled to income support
payments under the Social Security Act.” Allina III, 587 U.S.
at 571 (quoting 42 U.S.C. § 1395ww(d)(5)(F)(vi)(I)). Those
income support payments are Social Security Income (SSI),
which is paid to “financially needy individuals” who are over
65 or disabled. Bowen v. Galbreath, 485 U.S. 74, 75 (1988).
The Medicaid fraction, meanwhile, “accounts for the
number of Medicaid patients—who, by definition, are low
income—not entitled to Medicare.” Allina I, 746 F.3d at 1105.
The numerator is the number of patient days attributable to

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individuals eligible for Medicaid and not entitled to Medicare
Part A, and the denominator is “the total number of the
hospital’s patient days.” 42 U.S.C. § 1395ww(d)(5)(F)(vi)(II).
To calculate a hospital’s disproportionate-patient
percentage, CMS works with intermediaries known as
Medicare Administrative Contractors—often insurance
companies—who calculate a hospital’s reimbursement
amounts based on the hospital’s year-end cost reports. Those
reports contain the kind of patient-day data that feeds into the
Medicare and Medicaid fractions. See Northeast Hosp., 657
F.3d at 3. But the Medicare contractors and hospitals do not
have all the information needed to determine a hospital’s
Medicare fraction because they lack access to SSI data. CMS
obtains that data, considers it together with patient information
from the Medicare contractors, and calculates and publishes
hospitals’ Medicare fractions. See 42 C.F.R. § 412.106(b)(2).
After CMS publishes the Medicare fraction, the Medicare
contractors compute the Medicaid fraction based on hospitals’
year-end cost reports, sum up the fractions, and determine a
hospital’s entitlement to a DSH adjustment for the relevant
year and the amount of any adjustment. Id. § 412.106(b)(5).
Hospitals ultimately learn their final reimbursement
amounts—including the final DSH adjustment amount—when
they receive their NPRs.
3. Hospitals dissatisfied with their Medicare
reimbursements can seek review before the Provider
Reimbursement Review Board. The Board has jurisdiction in
two situations of relevance here. First, the Board can address
claims concerning a “final determination . . . as to the amount
of total program reimbursement due the provider” as set out in
the NPR. 42 U.S.C. § 1395oo(a)(1)(A)(i). Second, the Board
can also resolve challenges to a “final determination” “as to the
amount of the payment” due to a provider under the PPS. Id. §

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1395oo(a)(1)(A)(ii). See Washington Hosp. Ctr., 795 F.2d at
144–48. If the Board concludes it lacks jurisdiction, it issues a
jurisdictional dismissal. 42 C.F.R. § 405.1840(c)(2). A
hospital that receives a final decision from the Board, including
a jurisdictional dismissal, may seek judicial review of the
Board’s decision. 42 U.S.C. § 1395oo(f)(1).
B.
In June 2009, CMS published the Medicare fractions for
fiscal year 2007. In December 2009, a group of hospitals
appealed the determination of their 2007 Medicare fractions to
the Board. The hospitals disputed CMS’s inclusion of
Medicare Part C beneficiaries in the Medicare fraction instead
of the Medicaid fraction. “The question is important as a
practical matter because Part C enrollees . . . tend to be
wealthier than patients who opt for traditional Part A
coverage,” such that “counting them” in the Medicare fraction
“makes the fraction smaller and reduces hospitals’ payments
considerably.” Allina III, 587 U.S. at 571.
The hospitals’ appeal went unaddressed before the Board
for more than seven years. Then, in 2017, the Board on its own
motion dismissed the hospitals’ challenge for lack of
jurisdiction. The Board concluded that “publication of the
[Medicare fractions] on the CMS website is not a final
determination as contemplated by the Board’s jurisdictional
statute.” J.A. 12 (citing 42 U.S.C. § 1395oo(a)). In relevant
part, the Board reasoned that it lacked authority to review the
Medicare fractions until the final determination of the
hospitals’ DSH adjustments for the relevant year, which had
not happened at the time the appeals were brought. Until the
final settled cost report for a given year, there is no
determination whether a hospital is even “eligible for DSH
payment at all, [or] the amount of any such final payment.”

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J.A. 15. As a result, “a provider may not appeal DSH-related
issues” like the Medicare fractions until they are “incorporated
into settled cost reports (and associated NPRs),” at which point
there will be “a final determination.” Id.; see 42 U.S.C. §
1395oo(a)(1)(A)(i)-(ii). The Board thus dismissed the appeal,
leaving the hospitals to wait to bring their challenge until the
NPRs issue.
The hospitals then brought this action in the district court,
contending that the Board had erred in dismissing their appeal
on jurisdictional grounds. The district court agreed with the
hospitals. The court understood our precedent—in particular,
our decision in Washington Hospital Center, 795 F.2d 139—to
support treating publication of the Medicare fraction as a “final
determination” for purposes of the Board’s jurisdiction, even if
there has been no final settlement of a hospital’s eligibility
for—or the amount of—any DSH adjustments in an NPR.
II.
The government defends the Board’s conclusion that it
lacked jurisdiction over the hospital’s challenge because
CMS’s publication of the 2007 Medicare fractions was not a
“final determination of the Secretary as to the amount of the
payment” due to a hospital. 42 U.S.C. § 1395oo(a)(1)(A)(ii).
We agree with the government.
A.
At the outset, we reject the hospitals’ submission that we
cannot consider the government’s argument for sustaining the
Board’s decision because it diverges from the Board’s own
rationale. A court of course must judge agency action based on
“the grounds invoked by the agency.” SEC v. Chenery Corp.,
332 U.S. 194, 196 (1947). But the Chenery principle is

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satisfied “[a]s long as the agency’s path may reasonably be
discerned, . . . even if it is of less than ideal clarity.” Press
Commc’ns LLC v. FCC, 875 F.3d 1117, 1122 (D.C. Cir. 2017)
(internal quotation marks omitted). That standard is readily
satisfied here.
The Board held that a challenge to the determination of the
Medicare fraction can be brought only after the final
determination of the DSH adjustment amount in an NPR—the
same understanding urged by the government before us. To
be sure, the Board did not specifically quote the words “as to
the amount of the payment” in 42 U.S.C. § 1395oo(a)(1)(A)(ii),
which the government now emphasizes in its argument. But
the full statutory phrase is “final determination of the Secretary
as to the amount of the payment,” and the Board invoked the
lead-in words of that clause—“final determination”—in
explaining that the hospitals needed to wait to bring their
challenge until the final settlement of the DSH adjustment
amount in an NPR. See J.A. 12, 15. And at any rate, an
“agency in this court [can] invoke[] reasoning ‘not specifically
discussed in the order under review’” without running afoul of
the Chenery principle, so long as “[w]e can reasonably discern
the [agency’s] path in its decision.” Press Commc’ns, 875 F.3d
at 1122 (quoting Chiquita Brands Int’l v. SEC, 805 F.3d 289,
299 (D.C. Cir. 2015)). We can here.
B.
The issue we face is whether CMS’s publication of the
Medicare fractions qualified as a “final determination . . . as to
the amount of the payment” owed to hospitals under the PPS
within the meaning of 42 U.S.C. § 1395oo(a)(1)(A)(ii). There
is no dispute that, in the context of this case, “the amount of the
payment” is the per-patient reimbursement amount due to a
hospital under the PPS. See Washington Hosp. Ctr., 795 F.2d

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at 147. That per-patient rate, as explained, is grounded in the
PPS’s standard “federal rate” for the type of diagnosis. And for
hospitals eligible for a DSH adjustment, the per-patient federal
rate is augmented by a hospital’s DSH adjustment.
1. Importantly, the federal rate is prospectively fixed,
whereas the DSH adjustment is retrospectively determined.
For the federal rate, hospitals know in advance the per-patient
reimbursement amount they will receive by diagnosis category:
the purpose of instituting the PPS was to standardize
reimbursement rates and set those rates prospectively. But the
DSH adjustment to the federal rate depends on year-end
information about the number of low-income patients a
hospital treats in a given year. See pp. 5–6, supra. For the DSH
adjustment, then, hospitals do not know the amount they will
receive (if any) until they receive their NPR after the relevant
year. By that time, the hospitals will have submitted their year-
end cost reports and CMS will have obtained SSI information
for the patients treated during the year. And based on that
information, the hospitals’ Medicare and Medicaid fractions
will have been determined and the hospitals’ eligibility for and
amount of any DSH adjustments will have been settled.
The prospectivity of the federal rate, as compared with the
retrospectivity of the DSH adjustment, has implications for
when a hospital can properly bring an appeal to the Board. For
the federal rate, once it is prospectively set, there has been “a
final determination of the Secretary as to the amount of the
payment” to be made to hospitals. 42 U.S.C. §
1395oo(a)(1)(A)(ii). A hospital wanting to challenge the
federal rate can bring its appeal to the Board at that time. It
need not wait for application of the federal rate to patients
during the year or for final settlement of its total amount of
reimbursements under the federal rate in the post-year-end
NPR. Insofar as the hospital wishes to challenge the per-

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patient federal rate itself, the “amount of [that] payment” is
known once the rate is set, and nothing that happens between
then and the issuance of the NPR will affect that amount. See
Washington Hosp. Ctr., 795 F.2d at 142 n.2 (“Under PPS the
amount of payment per discharge is fixed in advance, is not
based on a hospital’s actual costs, and is not subject to
retroactive adjustment.”).
With the DSH adjustment, by contrast, a hospital’s
eligibility for the adjustment and the amount of the adjustment
(if any), is not set until a hospital receives its NPR after the end
of the year. Then, and only then, is there a “final determination
of the Secretary as to the amount of the payment” to be made
to the hospital. 42 U.S.C. § 1395oo(a)(1)(A)(ii).
2. Our decision in Washington Hospital Center is
instructive in explaining when a hospital’s challenge to “the
amount of the payment under” the PPS can be brought to the
Board. 42 U.S.C. § 1395oo(a)(1)(A)(ii). The case arose in a
phase-in period before full implementation of the PPS’s
prospectively set, standardized rates. During that transitional
period, a hospital’s reimbursement amount was based on a
blend of two components, one of which would become the
PPS’s federal rate (i.e., uniform reimbursement amounts set in
advance for diagnosis categories), and other of which was a
“hospital-specific rate” predicated on a given hospital’s actual
costs in a fixed prior year. See Washington Hosp. Ctr., 795
F.2d at 142. While the hospital-specific rate was based on a
hospital’s actual costs, it was prospective in that it depended
solely on already-incurred costs in a previous year. In other
words, it, no less than the other component, was “independent

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of current costs and . . . determined with finality prior to the
beginning of the cost year.” Id. at 146.
The hospitals in Washington Hospital Center sought to
appeal the calculation of the hospital-specific rate to the Board.
They brought their challenge after obtaining notice of their
hospital-specific rate, but before incurring the costs to which
the rate would be applied and thus before receiving a post-year-
end NPR. See id. at 143. We considered whether there had
been “a final determination . . . as to the amount of the payment
under” the PPS so as to give the Board jurisdiction, 42 U.S.C.
§ 1395oo(a)(1)(A)(ii), or whether the hospitals instead would
need to wait until they received their post-year-end NPR. We
held that the Board had jurisdiction.
We explained that Congress enacted § 1395oo(a)(1)(A)(ii)
in conjunction with instituting the PPS. Id. at 145–46. With
that change, there are now two avenues of appeal to the Board.
The first was already in existence when reimbursements were
set retroactively based on a hospital’s actually incurred costs.
It enables challenges “to the amount of total program
reimbursement due the provider for the items and services
furnished to [covered] individuals . . . for the period covered by
[the hospital’s annual cost] report.” 42 U.S.C. §
1395oo(a)(1)(A)(i). That preexisting avenue, because it
addresses the “total program reimbursement due” for the period
covered in an annual cost report, necessarily comes after
settlement of that “total” in a post-year-end NPR. Washington
Hosp. Ctr., 795 F.2d at 146–47. The new avenue, §
1395oo(a)(1)(A)(ii), enables challenges to “per-patient”
payment rates under the PPS—the rates a hospital will be paid
for treating a patient by diagnosis category—which can be set
before the end of a cost year. Id. That “provision applicable to
PPS recipients” thus “cannot be read to require hospitals to file

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costs reports and await NPRs prior to filing a [Board] appeal.”
Id. at 146.
On that understanding, the challenge in Washington
Hospital Center was within the Board’s jurisdiction. The
hospitals, as noted, contested the calculation of the hospital-
specific component of the blended transitional payment rate.
The other component, the precursor to the standardized federal
rate, was “final once the Secretary has published” it, “as he
ha[d].” Id. at 148. There had also been “a final determination
as to the hospital-specific amount.” Id. And because both
components of the “per-patient amount” under the PPS had
been finalized, “there [was] a final determination as to the
amount of payment as required by § 1395oo(a)(1)(A)(ii).” Id.;
see Monmouth Med. Ctr. v. Thompson, 257 F.3d 807, 811 (D.C.
Cir. 2001) (“[P]re-NPR challenge could be brought where the
Secretary had firmly established ‘the only variable factor in the
final determination as to the amount of payment.’” (quoting
Washington Hosp. Ctr., 795 F.2d at 147)).
3. Our rationale in Washington Hospital Center compels
the opposite result in this case. Washington Hospital Center,
unlike this case, did not involve a post-end-of-year adjustment
to the baseline reimbursement rate. Rather, all relevant
components of the per-patient PPS rate had been finalized, and
there was thus no need for the hospitals to wait for an NPR to
bring their challenge to the hospital-specific component
pursuant to § 1395oo(a)(1)(A)(ii).
This case is different. Here, the Medicare fraction had
been published and the hospitals sought to challenge its
calculation. But other components of the DSH adjustment (and
thus of the per-patient payment amount) had yet to be finalized.
Indeed, the hospitals could not know that they would be
eligible for a DSH adjustment based on the Medicare fraction

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alone. The Medicaid fraction remained outstanding, and so
too, therefore, did the disproportionate-patient percentage, and
ultimately the hospitals’ eligibility for, and amount of, any
DSH adjustment. See pp. 5–6, 8, supra. Those are finally
settled upon issuance of an NPR. Unlike in Washington
Hospital Center, then, in this case there had been no “final
determination of the Secretary as to the amount of the
payment” under the PPS. 42 U.S.C. § 1395oo(a)(1)(A)(ii).
To be sure, Washington Hospital Center establishes that
some challenges “to per-patient amounts” under the PPS can be
brought pursuant to § 1395oo(a)(1)(A)(ii) before issuance of
an NPR. 795 F.2d at 147. It did not establish, though, that
every such challenge is necessarily ripe for consideration in
advance of an NPR. Some hospital-specific adjustments under
the PPS may be finalized prospectively and can be appealed to
the Board at that time—before an NPR. An example is the
“outlier adjustment” for a hospital whose “charges, adjusted to
cost, exceed” an outlier threshold fixed by CMS. 42 U.S.C. §
1395ww(d)(5)(A)(ii). The per-patient amount of a hospital’s
outlier adjustment, like the baseline federal rate, is generally
set ahead of the cost year. See Gov’t Reply Br. 18. But for a
retrospective adjustment like the DSH adjustment, a challenge
must await final settlement of the per-patient amount following
the cost year—i.e., after the “final determination . . . as to the
amount of the payment.” 42 U.S.C. § 1395oo(a)(1)(A)(ii). For
both the outlier and DSH adjustments (and any other
component of a hospital’s per-patient reimbursement rate
under the PPS), then, the issue is not whether the amount can
be challenged—it can—but when.
In this regard, the fact that DSH adjustments are settled
retrospectively does not make them any less a part of the PPS
for purposes of falling within the Board’s review under
§ 1395oo(a)(1)(A)(ii). That provision pertains specifically to

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payments under the PPS, meaning that DSH payments must be
part of that “prospective” payment system to be subject to the
provision’s coverage. See 42 U.S.C. § 1395oo(a)(1)(A)(ii)
(referring to “the amount of the payment under subsection (b)
or (d) of section 1395ww of this title”—i.e., the provisions
applying the PPS); Washington Hosp. Ctr., 795 F.2d at 144–
45. DSH payments, although settled after a cost year, are part
of the PPS in that they adjust the amount of the reimbursements
pursuant to the prospectively set rates. That is why they (along
with the federal rate) are established in a provision entitled
“Inpatient hospital service payments on basis of prospective
rates.” 42 U.S.C. § 1395ww(d) (emphasis added); see id. §
1395ww(d)(5)(F)(i)(I) (providing for DSH adjustments).
The hospitals in this case argue that even if settling the
amount of a DSH adjustment requires year-end cost
information, that information is available by the time of
publication of the Medicare fraction, and there was thus no
need for them to await issuance of an NPR before bringing an
appeal. Here, the hospitals observe, CMS published their
Medicare fractions for fiscal year 2007 after receiving their
year-end cost reports and obtaining SSI information about the
patients they served. At that point, the hospitals contend, they
could have easily: calculated the Medicaid fraction based on
the same year-end cost reports; summed the two fractions to
determine their disproportionate-share percentage and whether
it exceeds the DSH eligibility threshold; and then multiplied
that percentage by the federal rate to obtain a close estimate of
their DSH adjustment amount. In that light, the hospitals urge,
they could “do the math themselves” (Hospitals Br. 42) to
obtain a “final determination . . . as to the amount of the

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payment” before receiving their NPRs. 42 U.S.C. §
1395oo(a)(1)(A)(ii).
That argument cannot carry the day. The terms of
§ 1395oo(a)(1)(A)(ii) give the Secretary of Health and Human
Services (or the Secretary’s delegee)—not affected hospitals—
responsibility for making the “final determination”: the
provision speaks in terms of the “final determination of the
Secretary as to the amount of the payment under” the PPS. Id.
(emphasis added). That does not happen until issuance of an
NPR. And the Secretary’s final determination can ultimately
turn on interpretive issues lying within the Secretary’s—not the
hospitals’—purview. As the government points out (Gov’t
Reply Br. 12), for instance, calculating the Medicaid fraction
requires the Secretary to determine which patients count as
“eligible for medical assistance under a State plan.” 42 U.S.C.
§ 1395ww(d)(5)(F)(vi)(II); see Monmouth Med. Ctr., 257 F.3d
at 809–10 (reviewing developments in Secretary’s
interpretation). Additionally, the Secretary takes into account
audit adjustments to the hospitals’ year-end cost reports, which
can affect the final settlement of payment amounts under the
PPS in ways yet to surface when Medicare fractions are
published.
At that time, in short, there had not been a “final
determination of the Secretary as to the amount of the
payment” under the PPS. 42 U.S.C. § 1395oo(a)(1)(A)(ii).
The Board thus lacked jurisdiction over the hospitals’ appeal,
as it correctly determined.
* * * * *

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For the foregoing reasons, we reverse the judgment of the
district court.
So ordered.

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