The U.S. Supreme Court case Donna E. Shalala, Secretary of Health and Human Services, et al. v. Illinois Council on Long Term Care, Inc., 1999 revolved around the question of whether healthcare providers could challenge Medicare regulations in court before exhausting all administrative remedies provided by the Department of Health and Human Services (HHS). The Illinois Council on Long Term Care had sued HHS over certain Medicare provisions without first going through HHS's appeals process. The Supreme Court ruled against the council, stating that under Section 405(h) of the Social Security Act - made applicable to Medicare via Section 1395ii - a claim arising under the Medicare Act cannot be brought in federal court unless all "administrative remedies" have been exhausted within HHS itself or unless doing so would amount to no review at all.

In the dissenting opinion for Shalala v. Illinois Council on Long Term Care, Inc., Justice Breyer argued that the majority's decision to require providers of Medicare services to go through a lengthy administrative process before seeking judicial review could potentially deny them access to court entirely. He pointed out that this interpretation was inconsistent with Congress' intent when it enacted the statute in question and also violated basic principles of administrative law. Furthermore, he noted that there were other ways for courts to avoid premature interference with agency processes without completely barring providers from accessing judicial review. For instance, they could stay proceedings until after an administrative record has been developed or dismiss cases where plaintiffs have not yet exhausted their administrative remedies. In his view, these alternatives would better balance the need for efficient administration against providers' rights than outright preclusion.