A section of the Social Security Amendments of 1972, which requires the Secretary to establish limits on overall direct or indirect costs which will be recognized as reasonable under Medicare for comparable services in comparable facilities in an area. The Secretary is also permitted to establish maximum acceptable costs in such facilities with respect to items or groups of services (for example, food or standby costs). The beneficiary is liable (except in the case of emergency care) for any amounts determined as excessive (except that he may not be charged for excessive amounts in a facility in which his admitting physician has a direct or indirect ownership interest). Under rules issued for this section, reimbursement for hospital inpatient routine service costs is limited, effective July 1, 1975, to a figure derived from the 80th percentile (plus 10 percent of the median) for each class of hospitals. Classification of hospitals is based on whether the hospital is located in a Standard Metropolitan Statistical Area (SMSA) or not, per capita income in the area, and hospital bed capacity. The total number of hospital classes is 32.