[Senate Hearing 108-127]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 108-127

                       NOMINATION OF CHARLES GRIM

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON INDIAN AFFAIRS
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                                   ON

  NOMINATION OF CHARLES W. GRIM, TO BE DIRECTOR OF THE INDIAN HEALTH 
         SERVICE AT THE DEPARTMENT OF HEALTH AND HUMAN SERVICES

                               __________

                             JUNE 11, 2003
                             WASHINGTON, DC



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                      COMMITTEE ON INDIAN AFFAIRS

              BEN NIGHTHORSE CAMPBELL, Colorado, Chairman

                DANIEL K. INOUYE, Hawaii, Vice Chairman

JOHN McCAIN, Arizona,                KENT CONRAD, North Dakota
PETE V. DOMENICI, New Mexico         HARRY REID, Nevada
CRAIG THOMAS, Wyoming                DANIEL K. AKAKA, Hawaii
ORRIN G. HATCH, Utah                 BYRON L. DORGAN, North Dakota
JAMES M. INHOFE, Oklahoma            TIM JOHNSON, South Dakota
GORDON SMITH, Oregon                 MARIA CANTWELL, Washington
LISA MURKOWSKI, Alaska

         Paul Moorehead, Majority Staff Director/Chief Counsel

        Patricia M. Zell, Minority Staff Director/Chief Counsel

                                  (ii)

  
                            C O N T E N T S

                              ----------                              
                                                                   Page
Statements:
    Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, 
      chairman, Committee on Indian Affairs......................     1
    Conrad, Hon. Kent, U.S. Senator from South Dakota............    11
    Dorgan, Hon. Byron, U.S. Senator from North Dakota...........    15
    Grim, Charles, DDS, nominee for Director of Indian Health 
      Service, Department of Health and Human Services, 
      Washington, DC.............................................     3
    Inhofe, Hon. James M., U.S. Senator from Oklahoma............     2
    Murkowski, Hon. Lisa, U.S. Senator from Alaska...............    14
    Nickles, Hon. Don, U.S. Senator from Oklahoma................     2

                                Appendix

Prepared statements:
    Grim, Charles................................................    17

 
                     NOMINATION OF CHARLES W. GRIM

                              ----------                              


                        WEDNESDAY, JUNE 11, 2003


                                       U.S. Senate,
                               Committee on Indian Affairs,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:01 a.m. in 
room 485, Senate Russell Building, Hon. Ben Nighthorse Campbell 
(chairman of the committee) presiding.
    Present: Senators Campbell, Murkowski, Conrad, and Dorgan.

 STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM 
        COLORADO, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

    The Chairman. Good morning, and welcome to the committee's 
hearing on the nomination of Dr. Charles Grim to be the 
Director of the Indian Health Service.
    Since August 2002 Dr. Grim has been serving as the Interim 
Director of the Indian Health Service. In March 2003, President 
Bush submitted his nomination to the U.S. Senate.
    Dr. Grim is an enrolled member of the Cherokee Nation of 
Oklahoma, and, despite his relative youth, has already had 
quite a distinguished career with the Indian Health Service. In 
fact, I was reading about some of your latest accolades and 
awards, Dr. Grim. A dentist, Dr. Grim has been twice awarded 
the U.S. Public Health Service Commendation Medal and the 
Achievement Medal. He is the recipient of the Jack D. Robertson 
Award, which is given to senior dental officers in the U.S. 
Public Health Service who demonstrate outstanding leadership 
and commitment. He also currently holds the rank of Rear 
Admiral as part of the Commissioned Corps of the U.S. Public 
Health Service.
    We have, by the way, received numerous letters regarding 
this nominee, and every single one of them is very positive. I 
was very pleased to see that Dr. Grim. These and other letters 
will be included in the record, and during the next 2 weeks, I 
imagine we will be getting a few more.
    I will also tell the Members that it is not my intention to 
vote on this nomination at the conclusion of this hearing 
because we will be doing another hearing right afterwards. But 
we will schedule a vote on it before the end of the month.
    Senator Inouye may not be attending this morning, so we 
will go ahead. Senator Inhofe, if you would like to introduce 
Dr. Grim.

 STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM OKLAHOMA

    Senator Inhofe. Thank you, Mr. Chairman. It is my honor to 
be here. I know that Senator Nickles is planning to be here 
because I talked to him, so I will stall a little bit while he 
comes. I would like to say that it is kind of unique that our 
honoree this morning is from Oklahoma. You can say he is from 
two cities, Tulsa and Ponca City. As it happens, Tulsa is my 
home town and Ponca City is Don Nickles' home town. So that is 
a little bit of a coincidence.
    It is very meaningful to me, with the background that 
Charles has, that he has taken the position. I do not think 
that you could have a more qualified person to confirm for any 
position than our nominee today. I think probably the best way 
for me to introduce him is to read to you a proclamation that 
makes today a very special day in the State of Oklahoma, and it 
is actually proclaimed by our Governor who is a Democrat, not a 
Republican. So, if you would allow me to read this proclamation 
into the record, I would appreciate it.
    The Chairman. Please do.
    Senator Inhofe. Here is Don. I will tell you what I will 
do. I will go ahead and read this proclamation, and then I will 
turn it over to Don.
    The Chairman. All right.
    Senator Inhofe.

    Whereas, Charles W. Grim, DDS, is a native Oklahoman and a 
member of the Cherokee Nation of Oklahoma; and
    Whereas, Dr. Grim, a 1983 graduate of the University of 
Oklahoma College of Dentistry, has served in the IHS for nearly 
20 years and has held several positions, most recently serving 
as Director of the Oklahoma City Area Office; and
    Whereas, in August 2002, President George W. Bush appointed 
Dr. Grim as the Interim Director of the Indian Health Service, 
an agency of the Department of Health and Human Services; and
    Whereas, on June 11, 2003, the Senate Committee on Indian 
Affairs will officially confirm President George W. Bush's 
appointment of Dr. Grim to serve as the Director of the Indian 
Health Service; and
    Whereas, as Director, Dr. Grim will administer a nationwide 
multi-billion dollar health care delivery program providing 
preventive, curative, and community health care for 
approximately 1.6 million of the Nation's 2.6 million American 
Indians and Alaska Natives.

    And as the IHS is the principal Federal health care 
provider and health advocate for Indian people, I will be 
working very closely with you, Doctor, as we discussed in my 
office yesterday, on a pet project I have had for quite some 
time, and that is Indian diabetes and some of the unique 
problems that we are facing there.
    So it is a great deal of honor for me to second the 
nomination for Dr. Grim. And I turn it over to my senior 
Senator, Don Nickles.
    The Chairman. Thank you. Senator Nickles.

   STATEMENT OF HON. DON NICKLES, U.S. SENATOR FROM OKLAHOMA

    Senator Nickles. Mr. Chairman, thank you very much. I want 
to join my colleague, Jim Inhofe, in urging the committee 
toward a rapid confirmation of Dr. Grim to be the Director of 
Indian Health Service.
    We are very honored, to have an Oklahoman and a member of 
the Cherokee Nation who has 20 years of experience in Indian 
Health Service, a lot of that experience in Oklahoma as well as 
New Mexico. He graduated from the University of Oklahoma School 
of Dentistry. He also has a Masters degree in Health Services 
Administration from the University of Michigan. He now holds 
the rank of Rear Admiral in the Commissioned Corps of the U.S. 
Public Health Service. Dr. Grim has 20 years of experience in a 
lot of different capacities. He has served as Area Director of 
the Oklahoma City Area Indian Health Service--with a 
jurisdiction that includes Oklahoma, Kansas, and portions of 
Texas. He oversaw health services for the largest IHS 
population in the Nation. He has done an outstanding job. 
Everyone has told us that, both within the Indian Health 
Service and others that have had the pleasure of working with 
him.
    I am excited about his nomination. I am excited about his 
eventual confirmation. And I look forward to working with Dr. 
Grim and others in this committee to see if we can make 
positive improvements in Indian health throughout the country. 
I appreciate the Chairman's commitment for doing that as well. 
I think we have an outstanding nominee who will do a great job 
in service to our country and to our Nation's Indian 
population.
    Mr. Chairman, thank you very much.
    The Chairman. I thank you, Senator Nickles and Senator 
Inhofe, for making that very fine introduction. If you have a 
busy schedule and need to leave, that is fine. But you are 
certainly invited to stay as long as you can.
    Senator Nickles. We will leave it in your very capable 
hands, Mr. Chairman. Thank you.
    The Chairman. Dr. Grim, we will now take your statement. I 
need to tell you that every letter that we have gotten, as I 
mentioned before, is in support of your candidacy. You have a 
very outstanding background. There does not seem to be any 
opposition at all. We will take your complete statement. But I 
should tell you that around this place sometimes the longer you 
talk the more questions arise. [Laughter.]
    The Chairman. So you are welcome to submit your complete 
written statement that will be included in the record, and if 
you would like to abbreviate or depart from it, that is fine. 
Please proceed.

STATEMENT OF CHARLES GRIM, DDS, NOMINEE FOR DIRECTOR OF INDIAN 
   HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN SERVICES, 
                        WASHINGTON, DC.

    Mr. Grim. Thank you, Mr. Chairman, Mr. Vice Chairman, other 
distinguished members of the Committee on Indian Affairs. It is 
a pleasure and an honor for me to be sitting here before you 
today as the nominee by President George W. Bush, and supported 
by tribal governments across the Nation, also endorsed by 
Secretary Tommy Thompson, and for this committee to consider me 
as the seventh Director of the Indian Health Service.
    For those on the committee and those attending this 
hearing, I would like to introduce myself. My name is Charles 
W. Grim. I am a member of the Cherokee Nation of Oklahoma, and 
I am descended from those who walked the Trail of Tears. I come 
from the town of Cushing, OK. I am the father of two children, 
Kristen and Steven, who are sitting behind me and are here 
today. My sister, Denise Grim, is also here with me to 
celebrate this honor. My mother, Ruth Kannady Grim, has also 
travelled to be with me today and understands how important an 
occasion this is for me.
    The Chairman. Where is your family, Dr. Grim?
    Mr. Grim. They are right here behind me.
    The Chairman. Very good. Thank you.
    Mr. Grim. We got here early so they could have a front row 
seat.
    The Chairman. Good. Do not worry, in this committee your 
mom will always have a front row seat.
    Mr. Grim. I also wanted to mention my father, Charles Grim, 
who has passed away but whose confidence in me gave me the 
strength to face moments in life such as this.
    As a child, both my parents and also my aunt and uncle, 
Larry and Dorothy Snake, instilled in me a sense of heritage 
and culture. With their encouragement and guidance, I grew up 
knowing my Indian heritage while living in a non-Indian world. 
As an adolescent, I wanted to work for the Indian Health 
Service as a way to help Indian people. And after I decided on 
dentistry as my career field and graduated from dental school, 
my aunt also encouraged me to work for the IHS as part of my 
National Health Service Corps educational scholarship pay back 
requirement.
    My first assignment was with IHS at the Indian health 
center in Okmulgee, OK. Working there was like coming home and 
fulfilling the dream I had as a teenager to help Indian people. 
I knew then, and I know now just as strongly, that working for 
the IHS is part of my life. I cannot imagine being as satisfied 
or having a sense of reward working anywhere else. To be 
nominated to lead the Indian Health Service, and to be in a 
position to do so much for so many Indian people is an 
unexpected and humbling opportunity, as well as a great honor.
    The opportunity to set before you today is the culmination 
of events put into motion in 1784 with the signing of the first 
treaty between the Federal Government and an Indian Nation. My 
ancestors and yours helped build this great Nation and have 
brought us to this moment and the opportunities before us. I 
pledge both to the Federal and tribal governments that I will 
do my best to take full advantage of this opportunity and to 
work with this committee who has done so much for Indian 
affairs, the Administration, Secretary Thompson, and tribal 
governments toward our shared goals and objectives.
    I am pleased to serve as the Director of the IHS during 
this time in our Nation's history and also to be a part of the 
Department's management team under the leadership of Secretary 
Thompson as this Department undergoes change to respond to the 
health needs of all Americans. Through Secretary Thompson's 
leadership as a key policymaker, I am confident that tribal 
governments and the position of the Director of the IHS will 
enjoy new opportunities to be involved in the evolution of 
their health programs. I will also benefit from the Secretary's 
policy guidance as I lead the IHS to a position of greater 
influence within the Department that has been envisioned by the 
Secretary.
    I believe one of the overriding questions of my tenure with 
IHS would be: How will I meet the challenges of eliminating the 
disparity between the health status of American Indians and 
Alaska Natives and the rest of the Nation? I intend to focus 
heavily on health promotion and disease prevention. The rates 
of some health disparities within our population are 
decreasing, but the rates of most leading causes of death for 
Indian people remain more than double the rates for the rest of 
America.
    In the early history of the Indian Health Service, the 
greatest achievements in reducing health disparities were 
through increased medical care and public health efforts that 
included massive vaccination programs and bringing safe water 
and sanitation facilities to reservation homes and communities. 
I believe future reductions in disparities of any significance 
will be made through health promotion and disease prevention 
efforts and programs rather than through treatment. I believe 
the more we invest in promoting good health the less will be 
needed for treating the consequences of poor health.
    The Indian Health Service has a proud history of 
dramatically improving the health of Indian people. Indian life 
expectancy has increased by 7.1 years since 1973, although 
still 6 years below the general U.S. population. And while 
significant disparities still exist, mortality rates have 
decreased for many health indicators, and the greater 
involvement since the passage of the Indian Self-Determination 
and Education Assistance Act of 1975 of Indian tribes and 
Indian people in the decisions affecting their health has also 
produced significant health improvements for Indian people. I 
will continue to support the decision of tribes to contract, 
compact, or retain the Indian Health Service as their provider 
of choice.
    The Indian Self-Determination Act gives tribes the right to 
manage their own health programs. And the continual increase in 
the number of tribes electing to contract and compact for IHS 
programs, and the increased political influence of Indian 
tribes and organizations at the State and national level are 
also having positive impacts on health indicators. In addition, 
this Administration and the Secretary have put their words into 
action and have increased the involvement of tribal and urban 
Indian representation in advising and participating in the 
decisionmaking process of the Department.
    Increased tribal involvement has also resulted in the 
development of an American Indian and Alaska Native workforce. 
The significance of this is twofold: It is a demonstration of 
self-determination, but it also improves the health status of 
Indian people, because it is well known that there is a 
positive co-relation between employment and health status. For 
example, 69 percent of the 15,000 employees within the Indian 
Health Service workforce are American Indian or Alaska Native. 
And because of the location of many of the IHS and tribal 
facilities, many are the major employers in the area. So, in 
addition to salaries, most of the operating funds are spent or 
invested back into the local and surrounding economies, and in 
many cases through tribal and Indian community businesses and 
operations.
    I feel we should invest wisely in our communities and in 
promoting good health. We cannot increase our health promotion 
and disease prevention programs at the expense of our treatment 
programs. And without improvements in other areas that affect 
health, improvement in health status cannot be sustained. 
Health status is a result of an interwoven tapestry of factors 
such as socioeconomic status, educational status, community and 
spiritual wellness, cultural and family support systems, and 
employment opportunities, just to name a few. The connection 
between poverty and poor health cannot be broken just by access 
to health services or treatment alone.
    Based on identified trends in Indian health care, I believe 
that we must begin to lay the groundwork now for the health 
environment that we want to have 5, 10, or 20 years down the 
road. I believe we must focus on identifying the emerging 
infectious and chronic disease patterns, and the related 
dramatically increasing cost of pharmaceuticals to treat these 
illnesses and disease. These issues can best be addressed I 
believe through health promotion and disease prevention 
activities so that our people improve their health, which will 
decrease the demand for both health services and 
pharmaceuticals.
    I have mentioned that my health emphasis will be on health 
promotion and disease prevention. My business emphasis will be 
to focus on strengthening the infrastructure of the Indian 
health system, which consists of the Indian Health Service 
programs, the tribal, and the urban health programs. Just as 
the health challenge has changed since 1955 when the IHS was 
transferred to the Department of Health, Education, and 
Welfare, so too has the infrastructure needed to meet those new 
demands. In 1955, our 2,500 employees and annual appropriation 
of approximately $18 million provided health services for a 
population of 350,000 people with a life expectancy of 58 
years. We have since increased to a staff of approximately 
15,000 and an appropriation of $3 billion, supplemented by 
almost half a billion dollars from our third party collections, 
which provide limited comprehensive health services for now 1.6 
million American Indians and Alaska Natives with an average 
life expectancy of 71 years.
    Our collections have become critical to the solvency of our 
programs because these funds return to the service unit to pay 
for additional staff, equipment, or other infrastructure 
elements to address the health needs of the community. It is 
among my priorities to implement a market-based business plan 
that actively promotes innovation. The plan is expected to 
enhance the level of patient care through increased revenue, 
reduced costs, and improved business processes. The plan will 
be implemented as part of the reorganization of the 
headquarters function that I have also initiated.
    Our workforce is another infrastructure element that is in 
crisis. Our annual average vacancy rate for critical health 
professions such as doctors, dentists, nurses, pharmacists, 
sanitarians, and engineers is approximately 12 percent, ranging 
from 5 percent for sanitarians to a high of 23 percent for 
dentists. I have initiated a review of the various recruitment 
and retention tools available to the agency in order to 
establish a more rigorous recruitment and retention effort. 
Scholarships, recruitment and retention grants, and health 
career specific collegiate programs are some of the funded 
tools that will create a greater pool of potential IHS and 
tribal employees. Currently, the agency is spending 
approximately $33 million of our budget on those efforts.
    However, nationwide the demand for health care 
professionals and support staff outpaces the supply available. 
So to augment our health workforce, particularly for remote and 
isolated locations that are difficult to staff or do not have 
sufficient workload to justify an on-site or local facility, 
the agency will need to continue its efforts to maximize the 
use of telemedicine and export the use of an electronic health 
record from the few test sites today to across the IHS network 
as early as next year.
    Another infrastructure issue is the age of the IHS 
buildings. Excluding housing, the IHS has 701 buildings 
comparable to private sector health facilities. The average age 
of our health facility buildings is 36 years, ranging from 
newly opened facilities this past year to the 103 year old 
Pawnee Health Center. In the private sector, according to the 
Almanac of Hospital Financial and Operating Indicators, the 
average age of a health facility is nine years. Only 20 percent 
of the IHS facilities fall within this range. To strengthen our 
efforts to modernize or replace facilities, I have emphasized 
additional consideration of collaborative projects between the 
IHS and tribes whenever feasible, and I intend to implement a 
proactive approach to assist tribes in developing project 
proposals and expedite the review and approval process.
    The Indian Health Service and the tribes and the urban 
Indian health programs are also not alone in trying to meet the 
health needs of Indian people. The Department of Health and 
Human Services is a vast resource as well. As the Secretary has 
stated numerous times at meetings with the tribes, during 
visits to Indian country, and to all of the operating divisions 
of the Department, the programs of the Department must do more 
to make them work better for American Indians and Alaska 
Natives and increase consultation with tribes in order to 
improve the HHS policies and services to Indian communities.
    To enact that philosophy, the Secretary revitalized the 
Intradepartmental Council on Native American Affairs, a council 
on which the Director of the Indian Health Service serves as 
the vice chair, by relocating it into the Office of the 
Secretary from an organizational location two levels down 
within another HHS component agency. The Secretary has also 
incorporated consideration of Indian programs into his ``One 
Department'' initiative as benefits are derived from that 
initiative throughout the Department. In previous hearings and 
in my written statement, I have provided numerous examples of 
those benefits.
    The Secretary's One Department initiative also includes 
consolidating similar functions within agencies to increase 
mission effectiveness and economies of scale. I have been asked 
by this committee in previous hearings whether One Department 
initiatives would be good for the Indian Health Service and 
Indian people. I fully support the One Department concept and 
assure you that IHS and Indian people will benefit. As we gain 
efficiencies in administrative management areas through 
consolidations and better use of technology, we will be able to 
redirect resources to our health care programs. And I can 
assure you that the Department is working closely with the IHS 
to assess the impact of consolidation on the programs of the 
agency and the effect it will have on employees, services, and 
the economic consequences to our communities.
    The discussions we have been holding have been positive. 
For example, since my last appearance before this committee, 
the Department has finalized their decision that all IHS human 
resource employees can remain at their current work sites and 
continue providing personnel services to our staff, even though 
the human resource positions convert to HHS positions on 
October 1, 2003. Our staff can remain in place unless they 
choose to apply for a position within HHS elsewhere.
    We have also been informed by the Department that due to 
concerns of this committee, due to concerns of tribal leaders, 
and due to concerns that have been laid out to them about the 
impact on Indian preference, they are working with us to ensure 
that for the positions in our field locations Indian preference 
will still apply to our employees there. I also anticipate that 
future functional consolidations will also benefit from the 
close working relationship between the Department and IHS and 
the considerations of any special needs of their particular 
programs.
    I have heard and share the concerns that Indian programs 
stand a great risk of being lost or forgotten if they are 
absorbed into a larger organization and program. So to avoid 
that, we must be vigilant and provide to others the information 
they need in order to make wise decisions rather than make 
decisions based on assumptions. Our financial, personnel, and 
construction needs and requirements are nothing like any other 
``inside the beltway'' agency. Laws governing self-
determination, child protection, Buy-Indian, and Indian 
preference in hiring, for example, are unique to the Indian 
Health Service.
    The IHS is the only Federal program delivering hands-on 
care to Indian people based on government-to-government 
treaties. I have found this Administration and particularly 
this Secretary and his staff to be receptive to receiving 
factual information as well as an Indian perspective on the 
interpretation of laws and regulations. I agree with this 
committee and the tribes of the Nation that influence within 
the Department is necessary, and I believe this Secretary has 
strengthened the position of Director of IHS to increase the 
degree of influence over the decisions of the Department that 
impact Indian country.
    I also believe now that there is an across-the-board 
understanding by all the operating divisions that the 
Department is responsible for the health of all the people of 
the Nation; that the health of American Indians and Alaska 
Natives is not the exclusive responsibility of the Indian 
Health Service, and that the Department's resources and funds 
need to be directed to this population group.
    Today we are facing many challenges. Change and challenge 
is nothing new to the history of the Nation or to our Indian 
nations. Our history as a people attests to our ability to 
respond to challenges, to overcome adversities that we 
sometimes face, and to maximize our opportunities.
    I have a great passion about this organization and our 
mission to raise the health of our people to the highest level 
possible. My actions will always reflect the honor of being 
entrusted to provide health services to American Indian and 
Alaska Native people. And I think I am ready to lead the Indian 
Health Service, with honor and respect for our ancestors, and 
to work with this committee who, again, has done so much for 
Indian people, and this Administration and Secretary Thompson 
for the benefit of American Indian and Alaska Native people.
    Thank you, Mr. Chairman. I would be pleased to respond to 
any questions you might have concerning this nomination.
    [Prepared statement of Dr. Grim appears in appendix.]
    The Chairman. Thank you, Dr. Grim. Well you hit just about 
all of the high points of the health of American Indians. You 
mentioned in one part some small increases in health status 
with Indians. But you know as well as I do, it might not be 
quite as bad as it was years ago, I might say it went from 
terrible to just awful, but it is still bad. I know those who 
have spent a lot of time on reservations, as I do, in fact all 
our colleagues here today, and it is not an uncommon sight to 
see people without legs, you mentioned the terrible, terrible 
tragedy of diabetes, and that has always been one of my big 
concerns as it is with many of us.
    I was particularly encouraged that you are really trying to 
get young Indian people involved in the health profession. I 
think that is just terrific.
    You also mentioned the interaction between modern medicine 
and I think you said ``cultural,'' I sometimes use the word 
``traditional.'' I think that is extremely important that we 
try and learn from the past and recognize that some Indian 
people, particularly elder Indian people, still have a little 
concern about modern medicine unless there is some healer or 
somebody there that they really trust from their own standpoint 
and their own traditional way of healing.
    You also mentioned both tribal and urban programs. I think 
that is extremely important as more and more people leave the 
reservation and find themselves in big cities where they are 
not sure where they are supposed to go and are sometimes turned 
away from normal urban health centers because people will tell 
them, ``well, you are Indian, you need to go back to your 
reservation,'' which may be thousands of miles away and they 
cannot do it.
    You also mentioned the shared reviews with tribes when you 
are going to make some decisions; sometimes we call that 
negotiated rule-making. I try to encourage everybody to do more 
of that because it is a lot easier doing that before than 
having tribes come in here before the committee afterwards and 
complain that nobody asked them before they put things in 
place. So, good luck with that too.
    You also mentioned the One HHS proposal. What kind of a 
reaction are you getting from tribes? I do not think I heard 
you say that.
    Mr. Grim. The reaction to the One HHS efforts, in general, 
have been positive. The one that has generated the greatest 
concern among tribes has been the human resource consolidation 
effort, as this committee is aware. And as I said, since the 
last committee hearing I was at, the Department has recognized 
the issues unique to Indian Health Services and has made a 
couple of decisions that were not available last time. They are 
going to be allowing all of our human resource employees to 
stay where they are in the locations in the field. They also 
have been working with us since that decision was made to see 
if there is a way that we can still allow Indian preference in 
hiring, and we have got that worked out just this week that all 
of our HR employees in the field, when we need to rehire them, 
we will be able to use Indian preference in hiring those 
positions and then transfer them to the Department at the 
appropriate time.
    The Chairman. Okay. That is good. Have you had a chance to 
look at S. 556, the Indian Health Care Improvement 
Reauthorization Act that I introduced again this year along 
with Senator Inouye?
    Mr. Grim. Yes, sir.
    The Chairman. What is your initial feeling about that?
    Mr. Grim. I think the overall bill is an outstanding bill, 
a very voluminous bill.
    The Chairman. I am ready to vote for your nomination right 
now. [Laughter.]
    Mr. Grim. Maybe I should just stop. [Laughter.]
    There are three primary concerns the Administration had. 
One of them was on the qualified Indian Health program and the 
ability to be able to effectively manage that from a payment 
perspective; Medicare and Medicaid issues. Another one was on 
what appeared to be a broad use of negotiated rulemaking for a 
lot of the regulations within the act and both the cost and the 
time factors involved with that. And the third issue was the 
extension of 100 percent F-map payments to providers other than 
non-Indian health providers, like to the States and the S-chip 
programs.
    The Chairman. Well you will be before the committee 
probably dealing with us on that bill. So I would appreciate 
any insight you would have to try to make a bill that I think 
is very, very important a better bill that will be acceptable 
to tribes and to the Administration. So I look forward to 
working with you on that.
    Mr. Grim. Yes, sir.
    The Chairman. You mentioned diabetes. I had one particular 
problem, I think I shared it with you once before, all tribes 
have problems with it too, as you know, but I get involved in 
it pretty regularly, frankly, because I go home pretty 
regularly, and that deals with the Northern Cheyenne diabetes. 
As you know, they were able to secure dialysis machines 
sometime ago. Now they tell me the IHS will not or cannot or 
whatever provide trained medical personnel to operate the 
machine. And to compound their frustration, in the last round 
of diabetes funding they received such a small amount that it 
basically did not help at all. You are aware of that I am sure.
    Mr. Grim. Yes, sir; Mr. Chairman.
    The Chairman. I talked to you a little bit about that. I 
want to do whatever I can to help you make whatever decisions 
we need to get machines. They have had a new health clinic 
building up there now I guess for about 4 or 5 years and people 
still have to drive all the way to I think Crow or to Billings. 
They go about 100 and something miles about three times a week 
back and forth. They spend one-half their time in an automobile 
just to stay alive and that is not right, people should not 
have to do that. So I would appreciate you looking into that 
and trying to help there.
    Mr. Grim. I will, Mr. Chairman.
    The Chairman. Let me now go to the Ranking Member today, 
Senator Conrad. Do you have an opening statement or any 
questions?

 STATEMENT OF HON. KENT CONRAD, U.S. SENATOR FROM NORTH DAKOTA

    Senator Conrad. Thank you very much, Mr. Chairman. Thank 
you, Dr. Grim, for being here. We welcome your family, I assume 
this is your family behind you.
    Mr. Grim. Thank you.
    Senator Conrad. I enjoyed very much our opportunity to 
visit the other day. You are going into a circumstance that is 
I think one of the most challenging in Government. If we look 
at the gap between what is being done and what needs to be 
done, I do not think there is a bigger gap anywhere in the 
Federal Government. When I go home and visit with people in 
Indian country talking about health care, housing, the long 
list of needs, health care is right at the top of the list of 
concerns. The budget for Indian Health Service that has been 
proposed is I think $3 billion; is that correct?
    Mr. Grim. Right at $3 billion.
    Senator Conrad. What do you think it would take to really 
meet the needs across the country to improve Indian health 
care? And I say that looking at my own State, seeing in the 
Aberdeen area the life expectancy is 64.3 years, 71.1 for all 
Indians in the country, average age nationwide for all parts of 
our population is almost 77 years. So, 13 years less life 
expectancy in the Aberdeen area for Native Americans. When we 
look at disease states, 50 percent more likely to have 
experienced congestive heart failure--these are Native American 
elders--44 percent more likely to report asthma, 173 percent 
more likely to be affected by diabetes. The need is not being 
met. Would you agree with that?
    Mr. Grim. I think we have prioritized as well as we have 
been able to, Senator, within the resources we have to focus on 
some of the highest priority needs, and they are many of the 
ones you mentioned today--diabetes, unintentional injuries, and 
on down the line. But we do not have all the resources 
necessary to treat all of the conditions out there.
    Senator Conrad. In your judgement, how much money would be 
needed to really meet the need?
    Mr. Grim. There are several studies, well actually one 
study on personal health care expenditures that was 
accomplished with tribal leadership and with Indian Health 
Service, it was done with an outside actuarial firm that 
provided for personal health care expenditures and compared it 
to a Blue Cross-Blue Shield Federal employees health benefit 
package. That particular study showed that for the personal 
health care expenditures we were a little over $1 billion short 
of what was necessary. The tribes have also done a needs-based 
budget and worked closely with the Indian Health Service and 
with the Department, and including our infrastructure needs 
which include facilities, and I made some statements earlier 
and in my written statement about our facilities program, they 
have come up with a number of $15 billion, $7 billion of that 
is facilities sorts of needs.
    Senator Conrad. And $8 billion would be for?
    Mr. Grim. The number I cited earlier did not address a lot 
of the needs around the public health infrastructure--
sanitation facilities, safe water and sewer systems, things 
like that.
    Senator Conrad. Okay. Thank you for that. Let me turn to a 
specific that I have just learned about that concerns me a 
great deal. I have been told on the Fort Berthold Reservation 
the service unit there is prohibited by IHS from ever denying a 
patient authorization for a procedure that qualifies as a 
contract health care priority one procedure--that would be life 
or limb threatening--even if the service unit knows it has or 
will soon run out of contract health care dollars for the year. 
Additionally, I have been told that the service unit may not 
carry over contract health care bills from one fiscal year to 
the next.
    So if a tribal member needs a priority one procedure, the 
service unit approves it, but when the bill is received after 
the contract health care funds have been exhausted the IHS 
simply declares that it is now not a priority one procedure. As 
a result, IHS no longer has a legal obligation to pay the bill. 
Responsibility for the bill now falls on the tribal member. 
Oftentimes, tribal members will not learn until weeks later 
that they are responsible for the bill. If the tribal member 
cannot pay the bill, which is unanticipated, their credit 
rating is damaged.
    To your knowledge, is this a IHS policy to reclassify 
procedures if a service unit has exhausted its contract health 
care funds?
    Mr. Grim. No, sir; I am not aware that is a national policy 
at all. There are two types of referrals that I would just 
raise the issue. We have medical referrals that our medical 
staff make for any patient that they feel needs a type of 
service that we are not able to provide. So sometimes medical 
referrals will be made whether the Indian Health Service has 
sufficient funds to pay for them or not. Then there are those 
medical referrals that the Indian Health Service will pay for 
with contract health service funds and they make every attempt 
to pay for all of the priority one cases that there are out 
there.
    Senator Conrad. Do they pay for all the priority one cases?
    Mr. Grim. No; the problem that usually arises is that in 
some service units across the Nation there are so many needs 
out there that some of the things that fall into our priority 
one classification system, there is a letter classification 
within priority one, A, B, C, D, E, and sometimes even though 
it falls in priority one, if the moneys are expended, they will 
have to deny payment for priority one level cases.
    Senator Conrad. Let me ask you the fundamental question. Do 
you believe it is wrong to, first of all, grant that a priority 
one case be funded, and then after the fact change it?
    Mr. Grim. If a patient was told upon leaving the facility 
that their case was going to be paid for, then, yes, I would 
agree with you.
    Senator Conrad. I would ask you to investigate this matter 
and report back to us on what you find.
    Mr. Grim. Okay. I will do that.
    Senator Conrad. I take this to be a very serious matter.
    Mr. Grim. I agree.
    Senator Conrad. People are told that they are priority one, 
that their case is to be funded, and then when they run out of 
contract health care they as a regular practice reclassify, 
leaving that Native American hit with a bill that they had no 
idea they were going to be faced with.
    The second question I would have on a specific relates to 
contract health care, and this relates to something I mentioned 
to you when we had a chance to meet. Mercy Hospital, Devils 
Lake, North Dakota, which contracts to provide health care, a 
small hospital, very good institution, really excellent, very 
highly rated care, has written off more than $1 million in the 
last 4 years. What sort of changes would you pursue in 
contracted health care to prevent this kind of ongoing drain? 
This is a small institution. They cannot handle providing care 
and then having the payment denied. I cannot tell you how many 
meetings I have had with your predecessors on this issue. Over 
and over and over I have been promised that something is going 
to be done and they go back and they make a few payments and 
then we are right back in the soup. What can you tell me that 
you would do.
    Mr. Grim. I am happy to be able to report to you that just 
since our meeting the other day we have already had some action 
on that. Our staff out in that location as well as the Area 
Director have looked into it and met with staff from Mercy. The 
Area Director there is going to be looking into talking with 
them about a different sort of contract than we have had with 
them in the past, potentially a capitation based contract. So 
that in advance for so many people and certain types of 
services, Mercy would know how much money they were going to 
receive, our patients would know what sort of services would be 
available through the referral process there. So, it is a very 
unique sort of process, it is not used in very many places, but 
they are going to approach them and see if that might be 
amenable to the leadership there at Mercy.
    Senator Conrad. I welcome that initiative and I thank you 
for thinking outside the box.
    The final question I would have, immediately following this 
hearing the committee will receive testimony on legislation 
Senator Dorgan and I have authored to authorize a rural health 
facility for the Three Affiliated Tribes at Fort Berthold. This 
legislation fulfills a long-standing promise made by the 
Federal Government to replace the hospital that was destroyed 
by the construction of the Garrison Dam and Reservoir. If the 
authorization passed, would you ensure that this facility is 
placed on the construction priority list the Indian Health 
Service is currently formulating?
    Mr. Grim. Based on how the legislation is worded, Senator, 
we would adhere to the legislation.
    Senator Conrad. I thank you for that. Thank you, Mr. 
Chairman.
    The Chairman. Thank you, Senator Conrad. Before I yield to 
Senator Murkowski, let me tell you that I agree with Senator 
Conrad that we are never going to fix the problem if we are 
going to focus just totally on bandaging, giving drugs, 
operating, and so on. That is all what you do after the problem 
has happened. And I am very happy to hear that you also believe 
in prevention as part of the big medicine picture. Because 
although there might be some problems in Indian health that are 
genetic, I do not know, or some based on infrastructure with 
poor water and so on, an awful lot of it has to do with 
lifestyle. Asthma is related to stress as well as other things. 
I am not a doctor but I know that from my readings. Diabetes is 
related to diet. And I have yet to see people who have to live 
on commodities call that a balanced diet. Heart disease is 
related to obesity and cholesterol. Dental problems are related 
to oral hygiene. It just seems to me that if we would put more 
emphasis toward prevention, we would have a much better and 
more efficient use of the money that we have to appropriate and 
spend on Indian health.
    I might mention that some tribes are really taking a lead 
on that. I happen to live on the Southern Ute Reservation in 
Colorado. They just recently built a building that is used for 
a lot of things, as a community center, it also has a 
gymnasium, but the interesting part of it is that they give 
cooking classes and also lifestyle counseling classes on diet. 
And if you have not had a chance to visit that, I would 
recommend you do. It is a wonderful facility, widely used. In 
fact, the tribe has opened it up to non-Indians too. So there 
are a lot of people around the community that take advantage of 
it due to the tribe's good graces. So please come and see that.
    Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.

   STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM ALASKA

    Welcome, Dr. Grim. I appreciate your comments this morning, 
appreciate the opportunity to speak with you yesterday and in 
the previous opportunities we have had to meet. I suppose the 
good word coming from my State is there is an endorsement, 
certainly an enthusiastic response toward your nomination. So I 
am pleased to be able to speak to that support today. The word 
that I hear back from Alaska is that you are a good listener.
    Mr. Grim. Thank you.
    Senator Murkowski. I think that speaks a lot. And if you 
listen well to the concerns and are willing then to implement 
afterwards, I think we all win.
    I am particularly pleased to hear your emphasis on health 
promotion and disease prevention. As you know, in Alaska we 
have very serious challenges when it comes to the health needs 
of our Alaska Natives. We have some statistics that, 
unfortunately, are off the charts when it comes to rates of 
alcoholism. We have seen recently a huge increase in smoking by 
Native women who are pregnant and we are seeing lower birth 
rates. We are seeing more children born with FAS/FAE. We have 
suicide rates that are absolutely unacceptable. The chairman 
has mentioned diabetes, the obesity issues. Many of these, many 
of these we can be more proactive.
    One of the problems that we face in many of the Native 
communities out in the bush is we have got terrible dental 
problems. Part of it is because of the lack of professionals 
out there. Another part is we have basic infrastructure issues. 
We do not have the safe water, and so instead of children even 
drinking powdered milk, they cannot do that because the water 
is not safe, and we cannot get the fresh milk in because of 
transportation issues, so the kids are drinking pop and their 
teeth are rotting.
    We need to work with our communities on that. We need to 
work to push the prevention issues. So I am pleased to assist 
you with that initiative because I think if we work the 
prevention end, your job is made just that much easier in terms 
of the health services that are provided for those in my State. 
So I look forward to working with you on that and so many of 
these others.
    I will extend the invitation, I know you are coming up to 
the State this summer, and look forward to the opportunity to 
introduce you to many of our areas, some of our challenges, 
and, hopefully, many of our opportunities. I do not know 
whether it is in the Administration's kind of spot light, if 
you will, to elevate this position as Director to perhaps an 
Assistant Secretary level, but perhaps you would be the first 
so named. If that is the case, I think we in Alaska would be 
very supportive.
    I do not have any questions for you today but just wanted 
to state for the record that we are looking forward to working 
with you on the health issues that relate to the Alaska Natives 
as well as all Native Americans.
    Mr. Grim. Thank you, Senator Murkowski.
    The Chairman. Senator Dorgan, did you have any comments or 
questions?

  STATEMENT OF HON. BYRON L. DORGAN, U.S. SENATOR FROM NORTH 
                             DAKOTA

    Senator Dorgan. Mr. Chairman, because of the time, we want 
to get on to the bill that is the subject of the next hearing. 
We have an 11:15 vote. So I think I will not ask questions. Dr. 
Grim, I am going to be supportive of your nomination. I think 
you have very strong credentials. I am very pleased by your 
nomination and I want you to succeed.
    Mr. Grim. Thank you, Senator.
    Senator Dorgan. My colleague Senator Conrad asked the 
questions I would have asked. But let me just make a comment, 
if I might. You indicated that the allocations for the IHS 
within the amount of money that is available are the best that 
we can do and you are trying very hard. I understand all of 
that. But in both Democrat and Republican Administrations the 
IHS budgets have not been sufficient to meet the health care 
needs of Native Americans. The mortality in Indian country 
compared to the rest of the country, for example, is seven 
times higher as a result of alcoholism, it is five times higher 
as a result of tuberculosis, four times higher as a result of 
diabetes--on the Fort Berthold Reservation that is 12 times 
higher due to diabetes--3 times higher due to injuries, twice 
as high due to suicides, twice as high due to homicides.
    The fact is we face an enormous challenge and it is very 
serious. And the thing that angers me a bit is this: As you get 
up in the morning and get ready for work, you turn on the radio 
and listen to the news and you hear that this country has $26 
billion to try to persuade Turkey to allow our troops to enter 
Iraq from the North. And I am thinking to myself, where did the 
$26 billion come from? We cannot find a half a billion dollars 
or a billion dollars to address life and death issues dealing 
with health care for Native Americans, all of a sudden we have 
got $26 billion for Turkey. And I see that time after time 
after time. It is a matter of priorities.
    We have got a reservation in North Dakota. Dr. Grim, you 
are a dentist, so you will particularly understand this. One 
dentist is serving 4,000 people out of a trailer house. That is 
not health care. That is not appropriate. On that same 
reservation, there are the same batch of problems with 
inadequate funding in social services, with life and health 
consequences. A young girl named Tamara is beaten severely, 
nose broken, arm broken, hair pulled out at the roots. Why? 
Because she was put in a foster care situation by one person, a 
social worker, who was working 150 cases--150 cases. So they 
put this young 3 year-old girl into foster care and she is 
beaten severely. It will affect her the rest of her life. Why? 
Because we did not have enough money to have enough caseworkers 
to make sure we protected these young children.
    This is not about you, but I get angry about the priorities 
here in our country. We say we do not have the money to deal 
with these issues. You know, you just answered my colleague 
when he asked the question about how much is needed. You know 
we are desperately short of money for health care for Native 
Americans. We are desperately short of money. And it is not 
sufficient for a Democratic Administration or a Republican 
Administration to say we are doing the best we can allocating 
money within our resources. The fact is they find resources, 
every Administration does, for the things they care about. And 
we all ought to care about the fact that a grandmother freezes 
to death in this country on the Rosebud Reservation in her home 
without windows in the winter at 35 below zero--freezes to 
death in her home. Or a young child is beaten severely, or 
someone shows up for health care with a sick child someplace or 
a severe dental problem and the fact is they do not get the 
kind of health care they need.
    So, I have said my piece. I preceded it by saying I am 
pleased that you are nominated. I am going to be proud to 
support your nomination. I will be happy to vote for you. But 
we need to do better, all of us, you, me, my colleagues, the 
President. These are priorities.
    Mr. Chairman, I think my colleague asked the very important 
questions I would have asked as well. Thank you for holding 
this hearing.
    Dr. Grim, you are going to be confirmed by the Senate and 
then all of us are going to wish you well. We want to work with 
you to make you successful in this job.
    Mr. Grim. Thank you, Senator Dorgan. And thanks to all of 
this committee and their support. You have done a lot for 
Indian people over the years and I am honored to be working 
with you.
    The Chairman. Thank you, Dr. Grim.
    [Whereupon, at 10:47 a.m., the committee proceeded to other 
business.]
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                            A P P E N D I X

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              Additional Material Submitted for the Record

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Prepared Statement of Charles W. Grim, D.D.S., Department of Health and 
                            Human Resources

    Mr. Chairman, Mr. Vice Chairman, and other distinguished members of 
the Senate Committee on Indian Affairs:
    It is a pleasure and an honor for me to have been nominated by the 
President, supported by tribal governments across the nation, endorsed 
by Secretary Thompson, and for this committee to consider me as the 
seventh director of the Indian Health Service.
    The opportunity to sit before you today is the culmination of 
events put into motion in 1784 with the signing of the first treaty 
between the Federal Government and an Indian Nation. My ancestors and 
yours helped build this great nation and have brought us to this moment 
and this opportunity. I pledge to both the Federal and tribal 
governments that I will do my best to take full advantage of this 
opportunity and to work with this committee, the Administration, and 
Tribal Governments toward our shared goals and objectives.
    For the benefit of guests of this committee and future researchers 
of the Congressional Record, this is the description of the Indian 
Health Service today: The IHS has the responsibility for the delivery 
of health services to approximately 1.6 million federally recognized 
American Indians and Alaska Natives [AI/ANs] through a system of IHS, 
tribal, and urban operated facilities and programs based on treaties, 
judicial determinations, and Acts of Congress. The mission of the 
agency is to raise the physical, mental, social, and spiritual health 
of AI/ANs to the highest level, in partnership with the population we 
serve. The agency goal is to ensure that comprehensive, culturally 
acceptable personal and public health services are available and 
accessible to the service population. Our foundation is to uphold the 
Federal Government's obligation to promote healthy AI/AN people, 
communities, and cultures and to honor and protect the inherent 
sovereign rights of tribes.
    For those on the committee and those attending this hearing, I 
would like to introduce myself. I am Charles W. Grim. I am a member of 
the Cherokee Nation of Oklahoma. I come from the town of Cushing, 
Oklahoma. I am descended from those who walked the Trail of Tears. I am 
the father of two children, Kristen and Steven, who are here with me 
today. My sister, Denise Grim, is also here to celebrate this honor. My 
mother, Ruth Kannady Grim, who has also traveled to be with me today, 
understands how important an occasion this is for me. I would also like 
to mention my father, Charles Grim, who has passed away but whose 
confidence in me gave me the strength to face moments in life such as 
this. As a child, both my parents, and also my aunt and uncle, Larry 
and Dorothy Snake, instilled in me a sense of my heritage and culture. 
With their encouragement and guidance, I grew up knowing my Indian 
heritage while living in a non-Indian world. As an adolescent, I wanted 
to work for the Indian Health Service as a way to help Indian people. 
And after I decided on dentistry as my career field and graduated from 
dental school, my aunt also encouraged me to work for the IHS as part 
of my National Health Service Corps educational scholarship pay back 
requirement. My first assignment with the IHS was at the Indian health 
Center in Okmulgee, Oklahoma. Working there was like coming home and 
fulfilling the dream I had as a teenager to help Indian people. I knew 
then and I know now, just as strongly, that working for the Indian 
Health Service is a part of my life. I cannot imagine being as 
satisfied or having such a sense of reward working anywhere else. To be 
nominated to lead the Indian Health Service, and to be in a position to 
do so much for so many Indian people, is an unexpected and humbling 
opportunity, as well as a great honor.
    In addition to my personal connection and desire to lead the 
agency, I am a Doctor of Dental Surgery and I have a Masters degree in 
Health Services Administration with focus on the Management and 
Administration of health services, dental care, and hospital and 
ambulatory care. I have served with the U.S. Public Health Service for 
20 years--through assignments to various offices and programs of the 
Indian Health Service. I am ready to take on the job of Director of the 
Indian Health Service.
    I believe the overriding question is: How will I meet the challenge 
of eliminating the disparity between the health status of AI/ANs and 
the rest of the nation? I intend to focus on health promotion and 
disease prevention. The rates of some health disparities are 
decreasing, but the rates of most leading causes of death for Indian 
people remain more than double the rates for the rest of America--for 
accidents, the rate for Indian people is 280 percent of the rate for 
the general U.S. population; for alcoholism, 770 percent; for diabetes, 
420 percent; for homicide, 210 percent; and for suicide, 190 percent. 
The number of AI/ANs enduring end stage renal disease is 2.8 times the 
rate for whites. The rate of diabetic end stage renal disease for AI/
ANs is 6 times the rate for the rest of the nation. Amputations due to 
circulatory consequences of diabetes have decreased significantly, but 
still occur at rates 3 to 4 times the rates for the rest of the nation. 
And the tragedy of Sudden Infant Death Syndrome (SIDS) and adolescent 
suicide occurs within Indian families at more than twice the rate for 
other families.
    In the early history of the Indian Health Service, the greatest 
achievements in reducing health disparities were through increased 
medical care and public health efforts that included massive 
vaccination programs and bringing safe water and sanitation facilities 
to reservation homes and communities. I believe future reductions in 
disparities of any significance will be made through health promotion 
and disease prevention efforts and programs rather than through 
treatment. To continue on a treatment track alone would bankrupt the 
nation's health system, including the IHS. For the Indian health system 
as well as all the United States health programs, there is no practical 
way the health resources of this great nation can begin to meet the 
health demands of an aging population whose chronic health conditions 
are largely the result of a western diet and sedentary lifestyle.
    For example, while the mortality rate for Indian people due to 
diabetes is 420 percent of that for the rest of the nation, the 
occurrence of Type 2 diabetes is 2.6 times the national average, and it 
is rising faster among American Indians and Alaska Native children-and 
young adults than in any other population group but with minimal 
changes in diet and exercise, such as reducing body weight by 10 pounds 
and walking 30-minutes a day--the onset of diabetes can be delayed and, 
in some cases, can be prevented.
    Cardiovascular disease is now the leading cause of mortality among 
Indian people, with a rising rate that is already almost double that of 
the U.S. general population; but by modifying or eliminating health 
risk factors such as obesity, sedentary lifestyles, smoking, high-fat 
diets, and hypertension, that trend can be reversed.
    Another example, infant mortality in Indian country can be reduced 
by 25 percent--25 percent--as more parents understand that placing 
their infants on their back to go to sleep removes one of the major 
risks for SIDS.
    And we need to invest in our communities so that despair does not 
fill the lives of our children. The rate of suicide among Indian youth 
is twice that for the general population. There are many programs, not 
just those of the Indian Health Service, which can be implemented to 
reduce or eliminate the number of our children who are killing 
themselves.
    I believe the more we invest in promoting good health the less will 
be needed for treating the consequences of poor health. The Indian 
Health Service has a proud history of dramatically improving the health 
of Indian people. And the greater involvement, since the passage of the 
Indian Self-Determination and Education Assistance Act in 1975, of 
Indian tribes and Indian people in the decisions affecting their health 
has also produced significant health improvements for Indian people: 
Indian life expectancy has increased by 7.1 years since 1973 (although 
still 6 years below the general U.S. population) and while significant 
disparities still exist, mortality rates have decreased for maternal 
deaths, tuberculosis, gastrointestinal disease, infant deaths, 
unintentional injuries and accidents, pneumonia and influenza, 
homicide, alcoholism, and suicide.
    I will continue to support the decision of tribes to contract, 
compact, or retain the Indian Health Service as their provider of 
choice.
    In a study of indigenous people and their health, cited in the 
British Medical Journal (March 2003), it was noted that lack of self-
governance, if allowed to continue, can have a devastating impact on 
health indicators. The Indian Self-Determination Act gives tribe the 
right to manage their own health programs. The continual increase in 
the number of tribes electing to contract and compact for Indian Health 
Service programs and the increased political influence of Indian tribes 
and organizations at the state and national level, are having a 
positive impact on health indicators. In addition, this Administration 
and the Secretary have put their words into action and increased the 
involvement of tribal and urban Indian representation in advising and 
participating in the decisionmaking processes of the Department.
    Increased tribal involvement also results in the development of an 
AI/AN workforce--for example, 69 percent of the 15,000 employee Indian 
Health Service workforce is AI/AN and, excluding the medical 
professional employees where there is not a large Indian applicant 
pool, 88 percent of the IHS workforce is American Indian or Alaska 
Native. The tribal and urban Indian operated programs have similar to, 
or higher, Indian workforce participation rates than the IHS. Because 
of the location of many of the IHS and tribal facilities, many are the 
major employer in the area. So, in addition to salaries, most of the 
operating funds are spent or invested back into the local and 
surrounding economies, in many cases through tribal and Indian 
community businesses and operations.
    We should invest wisely in our communities and in promoting good 
health. We cannot increase our health promotion and disease prevention 
programs at the expense of our treatment programs. And without 
improvements in other areas that affect health, improvement in health 
status cannot be sustained. Health status is the result of an 
interwoven tapestry of factors such as socioeconomic status, 
educational status, community and spiritual wellness, cultural and 
family support systems, and employment opportunities, to name a few. 
The connection between poverty and poor health cannot be broken just by 
access to health services or treatment alone.
    Based on identified trends in Indian healthcare, I believe we must 
begin to lay the groundwork now for the health environment we want to 
have 5, 10, or 20, years down the road. I believe we must focus on 
identifying emerging infectious and chronic disease patterns, and the 
related dramatically increasing cost of pharmaceuticals to treat 
illness and disease. These issues can best be addressed through health 
promotion and disease prevention activities, so that our people will 
improve their health, which will decrease the demand for health 
services and pharmaceuticals.
    Preventing disease and injury is a worthwhile financial and 
resource investment that will result in long-term savings by reducing 
the need for providing acute and chronic care and expensive treatment 
processes. It also yields the even more 11 important humanitarian 
benefit of reducing pain and suffering and prolonging life.
    I have mentioned my health emphasis will be on health promotion and 
disease prevention. My business emphasis will be to focus on 
strengthening the infrastructure of the Indian health system--the 
Indian Health Service program and the tribal and urban Indian programs. 
The infrastructure supports a very comprehensive public health and 
clinical services delivery program, including such diverse elements as 
water and sewage facilities, diabetes prevention and wellness programs, 
emergency medical services, and organ transplants. The IHS is the 
largest holder of real property in the Department with over 9 million 
square feet of space. There are 49 hospitals, 231 health centers, 5 
school health centers, and 309 health stations, satellite clinics, and 
Alaska village clinics that support the deliver of health care to our 
people.
    Just as the health challenge has changed since 1955 when the IHS 
was transferred to the Department of Health, Education, and Welfare; so 
too has the infrastructure needed to meet those new health demands. In 
1955, our 2,500 employees and annual appropriation, of approximately 
$18 million (or $124 million in today's dollars), provided health 
services for a population of 350,000 with a life expectancy 58 years. 
We have since increased to a staff of approximately 15,000 and an 
appropriation of $3 billion, supplemented by almost half a billion 
dollars from our third-party collection efforts, which provides limited 
comprehensive health services for 1.6 million AI/ANs with an average 
life expectancy of 71 years.
    Our collections are critical to the solvency of our programs 
because these funds return to the service unit to pay for additional 
staff, equipment, or other infrastructure elements to address the 
health needs of that community. It is among my priorities to implement 
a market-based business plan that actively promotes innovation. The 
plan is expected to enhance the level of patient care through increased 
revenue, reduced costs, and improved business processes. I have been 
involved with this plan, developed through a joint IHS-Tribal-urban 
Indian workgroup, since I served as the IHS cochair of the workgroup 
when I was the Oklahoma Area Director. The plan will be implemented as 
part of the reorganization of the Headquarters functions that I have 
also initiated, and will mention later in my statement, in order to 
also strengthen our support for infrastructure development.
    Our workforce is another infrastructure element that is in crisis. 
Our annual average vacancy rate for critical health professions such as 
doctors, dentists, nurses, pharmacists, sanitarians, and engineers is 
approximately 12 percent, ranging from 5 percent for sanitarians to a 
high of 23 percent for dentists. I have initiated a review of the 
various recruitment and retention tools available to the agency in 
order to establish a more rigorous recruitment and retention effort. 
Scholarships, recruitment and retention grants, and health career 
specific collegiate programs are some of the funded tools that will 
create a greater pool of potential IHS and tribal employees. However, 
nationwide the demand for healthcare professionals and support staff 
outpaces the supply. To augment our health workforce, particularly for 
remote and isolated locations that are difficult to staff or do not 
have sufficient workload to justify an onsite or local facility, the 
agency will need to continue its efforts to maximize the use of 
telemedicine and export the use of an electronic health record from the 
few test sites today to across the IHS network as early as next year.
    Another infrastructure issue is the age of the IHS buildings. 
Excluding housing, the IHS has 701 buildings comparable to private 
sector health facilities. The average age of our health facility 
buildings is 36 years, ranging from newly opened facilities this past 
year to the 103 year old Pawnee Health Center. In the private sector, 
according to The Almanac of Hospital Financial and Operating 
Indicators, the average age of a health facility is 9 years. Only 20 
percent of the IHS facilities fall within this range. To strengthen our 
efforts to modernize or replace facilities, I have emphasized 
additional consideration of collaborative projects between the IHS and 
tribes whenever feasible, and I intend to implement a proactive 
approach to assist tribes in developing project proposals and expedite 
the review and approval process.
    The Indian Health Service and the tribes and urban Indian health 
programs are not alone in trying to meet the health needs of Indian 
people--the Department of Health and Human Service is a vast resource 
as well. As the Secretary has stated numerous times at meetings with 
the tribes, during visits to Indian country, and to all of the 
operating Divisions of the Department--the programs of the Department 
must do more to make them work better for AI/ANs and increase 
consultation with tribes in order to improve the HHS policies and 
services to Indian communities. To enact that philosophy, the Secretary 
revitalized the Intra-departmental Council on Native American Affairs, 
a Council on which the Director of the Indian Health Service serves as 
the Vice-Chair, by relocating it into the office of the Secretary from 
an organizational location two levels down within another HHS component 
agency. The Secretary has also incorporated consideration of Indian 
programs into his ``One Department'' initiative as benefits are derived 
from that initiative throughout the Department. For example; I have had 
the privilege of participating in the Intra-departmental Council and 
the ``One Department'' initiative since my appointment last August by 
the President as the Interim Director of the Indian Health Service.
    Some of the benefits to Indian country have been the establishment, 
as one of the four top research priorities of the Department, the 
identification of the research needs in Indian health and the 
conducting of such research; a proposed increase in the IHS sanitation 
facilities construction program of $21 million and the contract health 
services program of $18 million for Fiscal Year 2004; expanding the 
responsibility of the office of Intergovernmental Affairs to increase 
access of tribes to the Secretary and his regional staff; and a review 
of HHS programs to determine which programs tribes are accessing and 
what can be done to help tribes access more programs.
    The Secretary's ``One Department'' initiative also includes 
consolidating similar functions within agencies to increase mission 
effectiveness and economies of scale. I have been asked by this 
committee in previous hearings whether ``One Department'' initiatives 
would be good for the Indian Health Service and Indian people. I fully 
support the ``One Department'' concept and assure you that IHS and 
Indian people will benefit. As we gain efficiencies in administrative 
management areas through consolidations and better use of technology, 
we will be able to redirect resources to our health care programs. I 
can assure you that the Department is working closely with the IHS to 
assess the impact of consolidation on the programs of the agency and 
the affect it will have on employees, services, and the economic 
consequences to our communities. Those discussions have been positive.
    For example, since my last appearance before this committee, the 
Department has finalized their decision that all IHS human resource 
employees can remain at their current work sites and continue providing 
personnel services to our staff--even though the human resource 
position converts to HHS positions on October 1, 2003. Our staff can 
remain in place unless they choose to apply for an HHS position 
elsewhere. I anticipate that future functional consolidations will also 
benefit from the close working relationship between the Department and 
IHS and their considerations of any special needs of our particular 
programs.
    I have heard and share the concerns that, Indian programs stand a 
great risk of being lost or forgotten if they are absorbed into larger 
organizations and programs. To Avoid that we must be vigilant and 
provide to others the information they need in order to make wise 
decisions rather than make decisions based on assumptions. Our 
financial, personnel, and construction needs and requirements are 
nothing like any other ``inside the beltway'' agency. The laws 
governing self-determination, child protection, Buy-Indian, and Indian 
preference in hiring, for example, are unique to the Indian Health 
Service and expertise with those laws and our programs will be exported 
through efforts of Departmental consolidation and I believe that the 
more Indian people and employees with IHS expertise who are dispersed 
throughout the Department at all levels, the more likely the ``One 
Department'' goal of raising the health status of AI/ANs and 
eliminating health disparities for all Americans can be achieved.
    The IHS is the only Federal program delivering hands-on care to 
Indian people based on government-to-government treaties. I have found 
this Administration and particularly this Secretary and his staff to be 
receptive to receiving factual information as well as an Indian 
perspective on the interpretation of laws and regulations. I agree with 
this committee and the tribes of the Nation that influence within the 
Department is necessary. And I believe this Secretary has strengthened 
the position of Director of the Indian Health Service to increase the 
degree of influence over the decisions of the Department that impact 
Indian country.
    I believe that now there is an across-the-board understanding by 
all the Operating Divisions that the Department is responsible for the 
health of all the people of the nation; that the health of AI/ANs is 
not the exclusive responsibility of the Indian Health Service, and that 
their resources and funds need to also be directed to this population 
group. ``One Department'' is not the only restructuring effort being 
undertaken within the Department that affects the Indian Health 
Service. The IHS and tribes are also working together to restructure 
the agency. Even before there was the ``One Department'' initiative, 
the Indian Health Service entered into an IHS Restructuring Initiative 
with the tribes and urban Indian representatives. Their recommendations 
focused on the functions and operations of the agency at the Area 
Office and field level based on projected health challenges the agency 
may face in the future. I remain committed to that consultation process 
and will review the recommendations of the joint workgroup.
    In addition to the IHS Restructuring Initiative and the ``One 
Department'' initiative, upon my interim appointment I established some 
short-term management priorities to improve the responsiveness of the 
agency to the tribes and to the Department. I mentioned some earlier, 
and also among them was a reorganization of the IHS Headquarters 
functions. This process, including Tribal consultation, is ongoing and 
is designed to reflect the restructuring recommendations of the tribes, 
the ``One Department'' initiative of the Department, the President's 
management agenda, and the day-to-day management and operational 
demands of the $3.5 billion Indian health program.
    And, it is not just the Department, the tribes, or the agency 
calling for change. It is also this committee and the Congress. I agree 
with the Secretary when he says, about the Department: ``Any 
organization that does business the same way it did 35 years ago is 
obsolete.'' That applies to the Indian Health Service--the 
reauthorization of the Indian Health Care Improvement Act is currently 
under consideration by this committee. It was passed 28 years ago--but 
we do not need to wait until 35 years have passed to realize that the 
health needs of AI/ANs, much less the world, have dramatically changed 
over time. The proposed language of the Act outlines a restructuring of 
the authorities of the Indian Health Service to reflect the reality 
that changes in the health care environment have changed the ability of 
tribes, urban Indian health programs, the Indian Health Service, and 
the Department to deliver high quality and much needed services. The 
Department supports the purposes of the reauthorization of the Act, but 
has concerns that are valid and deserve further consideration. Just as 
the concerns of the tribes and this committee toward consolidation and 
internal reorganization of the agency are valid and need to be 
addressed.
    Today we are facing many challenges. Change and challenge is 
nothing new to the history of the Nation or to Indian nations. Our 
history as a people attests to our ability to respond to challenges, to 
overcome adversities that we sometimes face, and to maximize our 
opportunities.
    I have great passion about this organization and our mission to 
raise the health of our people to the highest level possible. My 
actions will always reflect the honor of being entrusted to provide 
health services to American Indian and Alaska Native people. I am ready 
to lead the Indian Health Service, with honor and respect for our 
ancestors, and to work with you and the Administration for the benefit 
of American Indian and Alaska Native people.
    I am pleased to respond to any questions you may have concerning my 
nomination.
    Thank you.

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