B-142041, FEB. 26, 1960

B-142041: Feb 26, 1960

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BOARD OF COMMISSIONERS OF THE DISTRICT OF OLUMBIA: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15. IN YOUR LETTER IT IS STATED THAT WHEN THE CONTRACT WAS NEGOTIATED IT WAS THE INTENTION OF BOTH PARTIES THAT THE HOSPITAL WOULD BE REIMBURSED FOR THE ACTUAL PER DIEM COST OF INPATIENT CARE RENDERED DURING THE TERM OF THE CONTRACT (JULY 1. IT IS STATED FURTHER THAT THE COST WAS ESTIMATED TO BE $17.75 PER PATIENT DAY AND THAT THE CONTRACT PROVIDED FOR REFUND TO THE DISTRICT OF COLUMBIA OF AMOUNTS PAID BY IT IN EXCESS OF THE ESTIMATED COST BUT THAT. NO PROVISION WAS INCLUDED IN THE CONTRACT PROVIDING FOR PAYMENT OF AN ADDITIONAL AMOUNT BY THE DISTRICT OF COLUMBIA IF THE ACTUAL COST TO THE HOSPITAL SHOULD PROVE TO BE GREATER THAN THE ESTIMATED COST.

B-142041, FEB. 26, 1960

TO HONORABLE ROBERT E. MCLAUGHLIN, PRESIDENT, BOARD OF COMMISSIONERS OF THE DISTRICT OF OLUMBIA:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15, 1960, REQUESTING A DECISION AS TO WHETHER NEGOTIATED CONTRACT NO. DCFA 1348 BETWEEN THE DISTRICT OF COLUMBIA AND THE EASTERN DISPENSARY AND CASUALTY HOSPITAL MAY BE AMENDED SO AS TO PROVIDE FOR PAYMENT OF AN ADDITIONAL AMOUNT TO THE HOSPITAL TO COVER THAT PART OF THE ACTUAL COST OF INPATIENT CARE BEYOND THE AMOUNT PAYABLE UNDER THE TERMS OF THE ORIGINAL CONTRACT.

IN YOUR LETTER IT IS STATED THAT WHEN THE CONTRACT WAS NEGOTIATED IT WAS THE INTENTION OF BOTH PARTIES THAT THE HOSPITAL WOULD BE REIMBURSED FOR THE ACTUAL PER DIEM COST OF INPATIENT CARE RENDERED DURING THE TERM OF THE CONTRACT (JULY 1, 1958, THROUGH JUNE 30, 1959), NOT IN EXCESS OF THE LIMITATION OF $20 PER DAY INCLUDED IN THE DISTRICT OF COLUMBIA APPROPRIATION ACT FOR 1959. IT IS STATED FURTHER THAT THE COST WAS ESTIMATED TO BE $17.75 PER PATIENT DAY AND THAT THE CONTRACT PROVIDED FOR REFUND TO THE DISTRICT OF COLUMBIA OF AMOUNTS PAID BY IT IN EXCESS OF THE ESTIMATED COST BUT THAT, THROUGH INADVERTENCE, NO PROVISION WAS INCLUDED IN THE CONTRACT PROVIDING FOR PAYMENT OF AN ADDITIONAL AMOUNT BY THE DISTRICT OF COLUMBIA IF THE ACTUAL COST TO THE HOSPITAL SHOULD PROVE TO BE GREATER THAN THE ESTIMATED COST.

YOU STATE THAT THE ACTUAL COST TO THE HOSPITAL FOR THE FISCAL YEAR 1959 AS REPORTED TO YOU IN AN AUDITED STATEMENT PROVED TO BE $18.89 PER PATIENTDAY AND THAT THE HOSPITAL FURNISHED 13,990 PATIENT DAYS OF CARE TO TAX-ELIGIBLE PATIENTS, THEREBY ENTITLING THE HOSPITAL TO AN ADDITIONAL PAYMENT OF $15,948.60 IF THE CONTRACT CAN BE AMENDED AS PROPOSED SO AS TO INCREASE THE PAYMENT FOR INPATIENT CARE FROM $17.75 TO $18.89 PER PATIENT DAY. IT IS STATED FURTHER THAT THE HOSPITAL OWES THE DISTRICT OF COLUMBIA $25,126.98 AS REIMBURSEMENT FOR OVERPAYMENTS MADE FOR CLINIC VISITS, EMERGENCY ROOM TREATMENT AND AMBULANCE RUNS, LEAVING A BALANCE OF $9,178.38 DUE FROM THE HOSPITAL IF THE PROPOSED CONTRACT AMENDMENT IS MADE.

UNDER CERTAIN CIRCUMSTANCES, A WRITTEN AGREEMENT NOT CONFORMING TO THE ACTUAL INTENTION OF THE PARTIES MAY BE REFORMED TO ACCORD WITH SUCH INTENTION. WHERE, BY REASON OF MUTUAL MISTAKE, A CONTRACT AS REDUCED TO WRITING DOES NOT REFLECT THE ACTUAL AGREEMENT AND INTENTION OF THE PARTIES, THE WRITTEN INSTRUMENT MAY BE REFORMED IF IT CAN BE ESTABLISHED WHAT THE AGREEMENT ACTUALLY WAS. SEE 36 COMP. GEN. 507, 509; 30 ID. 220; 20 ID. 533 AND CASES THERE CITED. IN THE INSTANT MATTER, IT MAY BE REGARDED AS ESTABLISHED THAT BOTH PARTIES CONTEMPLATED AND INTENDED THAT THE HOSPITAL SHOULD BE PAID THE ACTUAL COST OF INPATIENT CARE, NOT IN EXCESS OF THE STATUTORY LIMITATION OF $20 PER DAY, AND THAT THE ULTIMATE PAYMENT OF THAT AMOUNT SHOULD BE EFFECTUATED BY REQUIRING THE HOSPITAL TO REIMBURSE THE AMOUNT OF ANY OVERPAYMENTS AND REQUIRING THE DISTRICT OF COLUMBIA TO PAY TO THE HOSPITAL THE AMOUNT OF ANY UNDERPAYMENTS.

FOR THE REASONS ABOVE SET FORTH, WE OFFER NO OBJECTION TO AMENDMENT OF THE CONTRACT AS PROPOSED.