In the case of Heckler, Secretary of Health and Human Services v. Community Health Services of Crawford County, Inc., et al., 1983, the U.S Supreme Court ruled that an agency must adhere to its own regulations until it has amended them through appropriate procedures. The dispute arose when the Department of Health and Human Services (HHS) retroactively adjusted Medicare payments made to a provider based on cost reports submitted by the provider. The HHS had previously given advice to this effect which was relied upon by Community Health Services in submitting their cost reports. However, after an audit revealed overpayments due to incorrect advice from HHS's fiscal intermediary, HHS sought repayment from Community Health Service who argued they were entitled to rely on prior representations made by government officials about how costs would be calculated under Medicare rules. In a unanimous decision authored by Justice Blackmun, the court held that equitable estoppel could apply against federal agencies where there is affirmative misconduct or misrepresentation leading another party into detrimental reliance.

In the dissenting opinion for Heckler v. Community Health Services of Crawford County, Inc., it was argued that the Court majority had erred in its decision to allow providers to rely on incorrect information given by government officials and then claim equitable estoppel against the government when asked to repay funds received based on this misinformation. The dissenters believed that such a ruling could potentially lead to abuse of public funds as well as create an unfair burden on taxpayers who would ultimately bear the cost of these mistakes made by individual government employees. They also expressed concern about setting a precedent where any misstatement from a federal employee could bind the entire U.S Government financially, which they viewed as impractical and unwise policy-making.