Cite as: 529 U. S. 667 (2000)
Opinion of the Court
compliance include dismissal from the program. 42 U. S. C. § 1320c-5(b)(1).
Medicare attains its objectives through an elaborate funding structure. Participating health care organizations, in exchange for rendering services, receive federal funds on a periodic basis. §§ 1395g, 1395l. The amounts received reflect the "reasonable cost" of services rendered, defined as "the costs necessary in the efficient delivery of needed health services to individuals covered [by the program]." § 1395x(v)(1)(A). Necessary costs are not limited to the immediate costs of an individual treatment procedure. Instead they are defined in broader terms: "Necessary and proper costs are costs that are appropriate and helpful in developing and maintaining the operation of patient care facilities and activities." 42 CFR § 413.9(b)(2) (1999). Allowable costs include amounts which enhance the organization's capacity to provide ongoing, quality services not only to eligible patients but also to the community at large. By way of example, amounts incurred for "certain educational programs for interns and residents, known as [graduate medical education] programs, are 'allowable cost[s]' for which a hospital (a provider) may receive reimbursement." Regions Hospital v. Shalala, 522 U. S. 448, 452 (1998) (citing 42 CFR § 413.85(a) (1996)); see also § 413.85(b) (1999); Thomas Jefferson Univ. v. Shalala, 512 U. S. 504, 507-508 (1994) (describing regulation of education programs). "These programs," the Medicare regulations explain, "contribute to the quality of patient care within an institution and are necessary to meet the community's needs for medical and paramedical personnel. . . . [M]any communities have not assumed responsibility for financing these programs and it is necessary that support be provided by those purchasing healthcare. Until communities undertake to bear these costs, the program will participate appropriately in the support of these activities." 42 CFR § 413.85(c) (1999). Medicare also permits, indeed encourages, these providers to deposit the amounts of reim-
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