    [Senate Hearing 108-204]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 108-204

           REAUTHORIZATION OF THE INDIAN HEALTH CARE IMPROVEMENT ACT
    =======================================================================

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON INDIAN AFFAIRS
                              UNITED STATES SENATE

                          ONE HUNDRED EIGHTH CONGRESS

                                 FIRST SESSION

                                       ON

                                     S. 556

     TO AMEND THE INDIAN HEALTH CARE IMPROVEMENT ACT TO REVISE AND EXTEND
                                    THAT ACT

                                   __________

                                 JULY 23, 2003
                                 WASHINGTON, DC

                           U.S. GOVERNMENT PRINTING OFFICE
    88-704                     WASHINGTON : 2003
    _____________________________________________________________________________
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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
    S. 556, text of..................................................     2
    Statements:
        Benjamin, Melanie, chief executive, Mille Lacs Band Assembly,
          Onamia, MN.................................................   345
        Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado,
          chairman, Committee on Indian Affairs......................     1
        Dixon, Mim, Dixon & Associates, Boulder, CO..................   356
        Johnson, Hon. Tim, U.S. Senator from South Dakota............   348
        Moose, Samuel, commissioner, Health and Human Services, Mille
          Lacs Band Assembly, Onamia, MN.............................   345
        Munson, Myra M., esquire, Sonosky, Chambers, Sachse, Miller,
          LLP, Juneau, AK............................................   352
        Rolin, Buford L., vice chairman, Poarch Band of Creek
          Indians, Atmore, AL........................................   349

                                    Appendix

    Prepared statements:
        Benjamin, Melanie............................................   363
        Dixon, Mim...................................................   372
        Munson, Myra M. (with attachment)............................   377
        Rolin, Buford L. (with attachment)...........................   366

           REAUTHORIZATION OF THE INDIAN HEALTH CARE IMPROVEMENT ACT

                                  ----------

                            WEDNESDAY, JULY 23, 2003

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

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

        The Chairman. The Committee on Indian Affairs will be in
    session.
        Welcome to the third hearing in a series held by the
    Committee on S. 556, a bill to Reauthorize the Indian Health
    Care Improvement Act. Today we will hear from tribal leaders
    and tribal health care experts on issues related to Indian
    access to health care and services. The committee will receive
    testimony on how Indian access is affected by Medicare,
    Medicaid, and other Federal health care programs, and what
    improvements are needed to increase Indian access.
        [Text of S. 556 follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. In the interest of time, we are going to go
    ahead and start with our panel which includes Melanie Benjamin,
    chief executive, Mille Lacs Band Assembly, Onamia, MN; Buford
    L. Rolin, vice chairman, Poarch Band of Cree Indians, Atmore,
    AL; Myra M. Munson, Esq., Sonosky, Chambers, Sachse, Miller &
    Munson, LLP, Juneau, AK; and Mim Dixon, Dixon & Associates,
    Boulder, CO.
        I read all your written testimony this morning. It will all
    be included in the record. If you would like to abbreviate or
    diverge from that written testimony, feel free to do so.
        We will start with Ms. Benjamin.

    STATEMENT OF MELANIE BENJAMIN, CHIEF EXECUTIVE, MILLE LACS BAND
    ASSEMBLY, ONAMIA, MN, ACCOMPANIED BY SAMUEL MOOSE, COMMISSIONER
                      OF HEALTH AND HUMAN SERVICES

        Ms. Benjamin. Good morning, Chairman Campbell, Vice
    Chairman Inouye, and distinguished members of the Senate
    Committee on Indian Affairs. I am Melanie Benjamin. I am the
    chief executive of the Mille Lacs Band of Ojibwe. Accompanying
    me today is Samuel Moose, who is the commissioner of Health and
    Human Services. I also brought summer youth as well. This will
    be their first opportunity to participate in this hearing.
        The Chairman. Are those the young people back here?
        Ms. Benjamin. Yes.
        The Chairman. We are glad to have them here.
        Ms. Benjamin. The Mille Lacs Band is a federally-recognized
    tribe of 3,570 members located in East Central Minnesota. As an
    elected tribal leader, I have an interest in the general
    direction of Federal Indian policy. I am greatly concerned with
    the dismal state of health across Indian country, and in
    particular, on the Mille Lacs Reservation.
        My comments to the Senate Committee on Indian Affairs are
    provided from this perspective. At the outset, I wish to
    respectfully point out that I am not an expert on health care
    issues, nor on Medicaid or Medicare. There are individuals on
    this panel who are experts and possess the technical knowledge
    to more adequately address these subjects.
        Today I will briefly discuss three topics as they relate to
    Medicaid and Medicare under Title IV of the Indian Health Care
    Improvement Act, sovereignty, the Federal trust responsibility,
    and Indian Health disparities. The access to health services
    under title IV provisions have a direct connection to the
    health disparities in Indian country and must be addressed by
    Congress.
        When the Indian Health Care Improvement Act was first
    enacted in 1976, Congress recognized its trust responsibility
    toward the tribes to provide adequate health care. Throughout
    the subsequent amendments and reauthorizations of the act, one
    of the major underlying policies has been to provide tribes
    access to other Federal health care sources, like Medicaid and
    Medicare programs that do not face funding limits like our
    Indian Health Service programs do.
        The intent was and is to improve our health status through
    that access. Since then Medicaid and Medicare reimbursement to
    tribes, including the Mille Lacs Band, have become a
    significant source of revenue for our health care programs and
    operations.
        Over the last 15 years, the Mille Lacs Band has actively
    participated in the formulation of tribal self-governance
    policy. We were one of the first 10 self-governance tribes. We
    participated in the original demonstration project and the
    writing of the permanent acts for BIA and Indian Health Service
    self-governance. We have also been on the rulemaking committees
    for the implementation of self-governance laws.
        Currently, the Mille Lacs Band is an active member of the
    Tribal Self-Governance Advisory Committee that advises Federal
    agencies on Indian policy matters affecting the self-governance
    tribes. The Mille Lacs Band has supported and advocated for
    self-governance laws because our philosophy is that we should
    be free to govern ourselves and develop our own policies in the
    administration of our tribal programs. We should not be
    entangled by Federal or State bureaucracy. To us, developing
    our own policies is an important exercise of sovereignty.
        There are three principles that the Mille Lacs Band of
    Ojibwe considers when analyzing Federal programs. First, we
    assert that our primary relationship is with the Federal
    Government. Second, we retain all sovereignty not expressly
    taken away. Therefore, we should have the ability to control
    funds reserved for us under Federal law. Third, we should have
    equal access to the same funding avenues as States. This third
    principle raises the fundamental flaw of the Medicaid and
    Medicare programs and the treatment of tribes.
        It is my understanding that the design of the Medicaid and
    Medicare programs is a Federal-State collaboration. The problem
    is that tribes do not fit into the picture at all. This design
    flaw makes it very difficult to meet criteria for receiving
    reimbursements.
        An example is that counties receive an administrative match
    from the State for their administrative costs, while tribes
    cannot. According to the Mille Lacs Band of Ojibwe's Commission
    of Health and Human Services, our inability to recover the
    administrative match demonstrates that tribes do not have equal
    access to Medicaid and Medicare reimbursements.
        The reason is that States determine how their block grants
    will be distributed under their own guidelines. As a result,
    the Mille Lacs Band and many other tribes lose out on potential
    and critical avenues of funding we desperately need. Others on
    this panel have addressed this and other legal barriers more
    specifically, but from a tribal leader perspective, it is clear
    that States and managed care systems have predominance over
    tribes under Medicaid and Medicare.
        Clearly, the establishment of Medicaid and Medicare
    entitlement programs happened at a time in history when the
    Congress did not focus on tribal sovereignty. However, today
    tribes are treated as governments in Federal legislation and
    tribal sovereignty is recognized. Indian people are provided
    direct access to Federal programs and funding.
        The Mille Lacs Band of Ojibwe receives direct funding for
    our Self-Governance Indian Health Service annual funding
    agreement. But when it comes to Medicaid and Medicare programs,
    it is a different situation. The process of devolution, where
    Federal funds in the form of block grants are provided to the
    States who then distribute those funds under their guidelines,
    has created a framework that leaves the tribes unable to access
    needed funds.
        It is time to change the Medicaid and Medicare provisions
    under title IV of the Indian Health Care Improvement Act to
    reflect the new enlightened view of tribal sovereignty and
    provide tribes more access to health care services as the act
    was originally intended. Through our treaties, Federal
    statutes, executive orders, and court decisions, a Federal
    trust responsibility has been established and recognized over
    the course of dealings with tribes.
        The Mille Lacs Band of Ojibwe signed several treaties with
    the United States and the provision of proper health care
    became an expectation of the Band and an obligation of the
    Federal Government. In addition, the Snyder Act of 1921, the
    Transfer Fact of 1954, the Self-Determination Act of 1975, the
    Indian Health Care Improvement of Act of 1976, as well as the
    enactment of the Indian Health Service Self-Governance Act, all
    evidence the trust obligations that flow to the tribes from the
    Federal Government for the provision of health care.
        In spite of the clear legal duty created by these Federal
    statutes, the Federal obligation to provide adequate health
    care to tribes has never been properly funded. Historically,
    this insufficient funding has interfered with our ability to
    provide comprehensive health care to Mille Lacs Band members.
    According to IHS estimates, the Mille Lacs Band, and all other
    tribes in our region, are funded at approximately 30 percent of
    need. This means more than two-thirds of our need is not being
    met and explains why the status of Indian health on the Mille
    Lacs Band Reservation, and many other reservations, is so poor.
        I am told that the Federal Government spends nearly twice
    as much for a prisoner's health care than it does for Indians.
    This fact is an example of why our health status is at the
    bottom of every disease category. It seems ironic that Indian
    health care, through the Indian Health Service, is not an
    entitlement for Indian people when tribes essentially pre-paid
    for our health care by ceding millions of acres of land to the
    Federal Government.
        It seems more ironic that the tribes have problems
    accessing the Federal entitlement programs like Medicaid and
    Medicare which were designed for all State citizens. This
    funding disparity becomes a matter of fairness and equity
    because Indian people are also citizens of the States in which
    we reside. It is only logical that we should have the same
    access to the same services as do other non-Indian citizens.
        Given that we have been historically under-funded for our
    health care needs, and tribes likely will not receive funding
    for the level of need in the next appropriations cycle, the
    Federal trust responsibility needs to be taken seriously and
    changes made to allow tribes full participation in the existing
    entitlement programs of Medicaid and Medicare. It is fair and
    it is right.
        Finally, I am not going to cite the long and tragic list of
    statistics that tell the story of health disparities throughout
    Indian country. Instead, I will talk about my own Reservation.
    Diabetes is a serious problem in the Mille Lacs community. I do
    not know of one family without diabetes among one of their
    family members. For many our Band members, it is not a matter
    of if they get the disease, but when. Band members are losing
    their vision. They are losing their limbs. Many are so close to
    needing kidney dialysis treatments.
        More alarming is the chronic health conditions occurring in
    our children and our youth. They are our future. I have serious
    concerns for their long-term health and longevity. I do not
    have answers but I do know that adequate and comprehensive
    health care is absolutely critical to preserving our tribal
    communities. We are fighting to protect our members' lives on
    our reservations and in our communities.
        If Congress makes the necessary changes to Title IV of the
    Indian Health Care Improvement Act, and provides more access to
    Federal health care services and funds, it will at least give
    us another weapon in the war against health disparities.
        Thank you for this opportunity to testify. I would also ask
    that my written statement be made part of the record of this
    hearing.
        The Chairman. Without objection, so ordered.
        [Prepared statement of Ms. Benjamin appears in appendix.]
        The Chairman. Thank you, Ms. Benjamin.
        Senator Johnson, I do not know how tight your schedule is.
    Do you have a statement?

     STATEMENT OF HON. TIM JOHNSON, U.S. SENATOR FROM SOUTH DAKOTA

        Senator Johnson. Mr. Chairman, I just commend you for
    holding this very timely hearing. There are few areas where we
    have a greater crisis than in health care as we go about the
    debate on Medicare and Medicaid within the context of
    prescription drug coverage. I think that we have made some real
    progress on the Senate side, but it is essential that we
    continue to be closely consultative with the tribes. I think
    you have an excellent panel here.
        I am going to have to excuse myself for some conflicting
    obligations that I have, but I will be examining the testimony
    closely and look forward to working with you and other members
    of the committee to see what we can do. The overall level of
    funding, of course, is the first problem. The IHS is funded at
    roughly half of what they ought to be funded.
        But even beyond that, I think it is proper that we focus on
    the role of Medicare-Medicaid third-party payment mechanisms
    and what we do to better utilize those resources to live up to
    our obligations in Indian country.
        I thank you very much.
        The Chairman. For the panel's information, members will be
    coming and going. Some will not be here. It does not mean they
    are not interested in the issue. Every one of us is over-
    scheduled with two or three things to do at the same time. It
    comes with the territory here. Please understand why some
    members are not here.
        Let us go ahead with Buford Rolin. Thank you for being
    here.

      STATEMENT OF BUFORD L. ROLIN, VICE CHAIRMAN, POARCH BAND OF
                       CREEK INDIANS, ATMORE, AL

        Mr. Rolin. Thank you, Senator Campbell.
        Chairman Campbell, Vice Chairman Inouye, and distinguished
    members of the Senate Committee on Indian Affairs, I am Buford
    Rolin, Vice Chairman of the Poarch Band of Creek Indians from
    Atmore, AL. I serve as an elected member of the National Indian
    Health Board representing the Nashville area. It is indeed an
    honor for me to come before you this morning to offer this
    testimony on the reauthorization of the Indian Health Care
    Improvement Act.
        As you know, the Indian Health Service's National Indian
    Health Board serves all federally-recognized tribes throughout
    the Nation. We have a membership of 12 members that are elected
    to the Board by their respective areas. Our goal is to advocate
    for Indian people, not only in the budgetary area, but health
    issues throughout.
        I would like to commend the testimony of chief executive
    officer Melanie Benjamin and her concerns. She has expressed
    them well. I know the other panelists will have equal concerns
    that they will talk about.
        Given the two previous hearings of the committee that was
    held during the 108th Congress, I am going to be brief this
    morning. I realize that the members are quite aware, as you
    have just stated, about the needs of the health care of the
    Indian people, the reauthorization, and how important it is in
    the Indian Health Care Improvement Act. We realize the
    political realities that are facing Congress, and we appreciate
    the fact that you are holding these hearings this.
        Let me talk a little bit about the process of what has
    taken place over the years since 1999 with the first bill that
    we introduced to reauthorize the Indian Health Care Improvement
    Act. In 1999, the National Steering Committee was formed by the
    Indian Health Service. It represented tribal leaders throughout
    the Nation as well as members from the organizations and urban
    areas.
        Over the last several years, the NSC has worked closely
    with Indian country, the Administration and Congress, and the
    Indian Health Service to develop amendments to the Indian
    Health Care Improvement Act. Let me begin first by talking
    about the Centers for Medicaid and Medicare services.
        At the request of the CMS, we have established a tribal
    technical work group that has been representative of Indian
    people throughout this Nation. The TTAG was formed in 2001 and
    consists of tribal leaders, area Indian health boards, and
    designated national tribal organizations.
        The activities of the TTAG are coordinated through the
    Intergovernmental and tribal Affairs Office within CMS. The
    TTAG has forwarded several recommendations to Congress and CMS
    regarding recommended changes to the reimbursement
    methodologies in place for the Indian Health Service, tribal
    health programs, and urban Indian problems.
        The TTAG is very adamant about its position that any
    reforms in Medicare, medicaid, or CHIP programs must allow for
    tribal allocation or other direct funding mechanisms that
    authorize Indian health program access to CMS.
        The TTAG has also worked very closely the NSC to develop
    the changes in Title IV of the Indian Health Care Improvement
    Act, as reflected in H.R. 2440, which include the most recent
    NSC recommendation.
        As the committee is well aware, the Indian Health Service
    lags far behind other segments of the population and has failed
    to keep pace with inflation as far as health care is concerned.
    Current Indian Health Service funding is so inadequate that
    less than 60 percent of the health care needs of American
    Indians and Alaska Native people are being met.
        In order to address additional health care resources, Title
    IV of the Indian Health Care Improvement Act is critical to
    address the Medicare-Medicaid and other third party
    reimbursements, as Chief Executive Officer Benjamin has stated
    this morning.
        It is one of the most important provisions of the Indian
    Health Care Improvement Act. It makes IHS hospitals eligible
    for Medicare reimbursements and facilities eligible for
    Medicaid reimbursement. Title IV also makes it possible for
    Medicare and Medicaid eligible American Indians and Alaska
    natives to use these benefits.
        Since the passage of the Indian Health Care Improvement Act
    in 1976, Medicare and Medicaid payments have become sources of
    income for tribal programs, so much so that in fiscal year
    2002, $460 million was collected for these services. This
    amount enhances the resources available already to hospitals
    and clinics' budgets by 30 percent. We are indeed appreciative
    of that.
        But in order to further improve the ability of Indian
    country as far as health providers to access third party
    resources, the NSC has developed several changes to title IV
    that was indicated in S. 212 and continues through S. 556. I
    would like to note that S. 556 introduced to Congress is
    identical to S. 212. Therefore, many of the concerns raised in
    regards to S. 212 remain.
        In response to those concerns, however, the National
    Steering Committee has revised the recommendations for
    reauthorization. The changes are reflected in H.R. 2440. By the
    way, that bill was introduced June 11, 2003.
        I think it is quite helpful to point out that the Senate
    Committee on Indian Affairs and the House Resources Committee's
    hearing on the Indian Health Care Improvement Act last week
    indicates the cooperation and the spirit of the two houses to
    support this reauthorization. H.R. 2440 reflects several
    changes made to the original tribal proposal as introduced in
    1999. Those changes listed have come about and we will see that
    in H.R. 2440.
        There are four areas that I would like to quickly talk
    about that we have been removed from the previous legislation.
    One is the Qualified Indian Health Program. This provision has
    been removed. We have requested that a provider type with
    Indian health programs appear, such as Medicaid, so that we can
    more fully exercise our statutory rights in that aspect.
        Secretary Thompson expressed his concern for that in S.
    212. His concern was that over a 10-year period it would cost
    in excess of $3 billion. However, in place of the QIHP
    proposal, tribes are requesting that the Secretary prepare a
    program or a report that would, in fact, examine whether these
    payments under the current methodologies are sufficient to
    continue to be applicable as a most favorable provider under
    the Social Security Act. The current all-inclusive rate
    certainly is appreciated, and we would hope that in this
    process none of that would be discontinued.
        Another concern that the Secretary had, of course, was the
    extension of the 100 percent Federal Medical Assistance
    Percentage. Tribal leaders agreed to delete this provision as
    well. The Centers for Medicare and Medicaid Services requested
    that be done. The States are very supportive of the 100 percent
    FMAP expansion. Secretary Thompson's concern was the cost of $2
    billion over a 10-year period.
        A third area of his concern was the waiver of the Medicare
    late enrollment penalty as far as Part B of Medicare is
    concerned and the barriers that it may create as far as giving
    Indians the opportunity to enroll late as opposed to other
    enrollees within the Medicare programs. Tribal leaders
    reluctantly agreed to remove that factor as well.
        Finally, an area of concern that we had, and the Secretary
    objected to, was the fact that tribal leaders had asked for,
    and called for, regulations in a negotiated rulemaking process.
    Our concerns here were relative to the complexity of the Social
    Security Act and to having to negotiate a rulemaking process.
    In response to this concern again, tribal leaders eliminated
    the Social Security Act changes from the bill's negotiated
    rulemaking provision.
        We believe the changes to the original tribal proposal
    submitted in 1999 significantly reduces the bill's Federal
    budget impact. S. 212, or its identical bill, S. 556, as it was
    scored in 2001, has a Federal budget impact of $6.9 billion.
    With the deletion of QIHP and the FMAP, the score reflects a
    70-percent decrease.
        We request, and ask this committee, to submit a request to
    the Congressional Budget Office to either score S. 556, without
    the above-mentioned provisions, provide a fiscal budget impact
    on H.R. 2440.
        It has been my pleasure to brief this committee on the
    concerns that the National Indian Health Board has relative to
    the Indian Health Care Improvement Act. As I have been
    involved, along with other tribal leaders, including Chief
    Executive Officer Benjamin and the other panelists here this
    morning, we will continue to stay involved to make sure that
    this Act hopefully will be passed this year.
        Further, we request that any concerns regarding this
    legislation are raised in a timely manner so that passage of
    the bill will occur during this session and there are no delays
    that would jeopardize the passage of this bill.
        I thank you for your time. I would also ask that my written
    statement be made part of the record of this hearing.
        The Chairman. Without objection, so ordered.
        [Prepared statement of Buford Rolin appears in appendix.]
        The Chairman. Thank you, Mr. Rolin.
        Ms. Munson.

       STATEMENT OF MYRA M. MUNSON, ESQUIRE, SONOSKY, CHAMBERS,
                SACHSE, MILLER & MUNSON, LLP, JUNEAU, AK

        Ms. Munson. Thank you, Mr. Chairman.
        The last time I had the privilege of testifying before this
    committee was in the late 1980's when I was still commissioner
    of Health and Social Services for the State of Alaska. Since
    joining the law firm I am a member of now, I have had the
    opportunity to work with tribal leaders and tribal health
    providers on every major health reform initiative that has been
    discussed in the Congress, and since 1998 when the work began
    on the reauthorization of the Indian Health Care Improvement
    Act.
        It is fundamental that the United States owes a duty to
    Indians to provide them with health care. Everything flows from
    that. It is equally fundamental in the decisionmaking that that
    health care, in order to be delivered in a responsible way,
    must be culturally competent.
        That requires not merely that individual Indians have
    access to health care, which most do not, at least in any way
    comparable to that of other citizens of the United States and
    the States, but it is important that the health care they have
    access to is that operated by their own tribes or the Indian
    Health Service, carried out to the extent possible to Indian
    people, and managed by Indian people.
        Indian people and Indian tribes expected that the duty of
    the United States would be satisfied by providing them with
    direct appropriations to the Indian Health Service and
    eventually down to the tribes through the Self-Determination
    Act. Congress has not been able to effect the appropriations
    necessary to meet any level of health care for Indian people
    comparable to that, provided even to Federal employees, let
    alone to other Americans.
        Instead, in 1976 when the Health Care Improvement Act was
    first authorized, Congress, realizing it could not meet the
    needs exclusively through direct appropriations, chose to
    authorize the Indian Health Service and tribes eventually as
    they took over the programs to bill for certain services
    provided to Medicare or Medicaid eligible Indians, to bill
    those programs and recover those revenues.
        That made a fundamental shift and one which has been very
    difficult for tribes and for their members to absorb. It
    essentially made many Indians into welfare recipients when they
    had never been before. It made them apply for benefits through
    the Medicaid program in order to have access to the very care
    they had been promised and for which they had ceded their
    lands.
        However, time passes and Indian people and Indian tribal
    leaders are pragmatic. Indian Health Services had to be
    pragmatic about this. The resistance to participating in those
    programs has had to be overcome simply to make enough money
    available to try to begin to provide for the needs for health
    care.
        Tribes and the Indian Health Service have worked to become
    competent billers of the Medicare and Medicaid programs and to
    be able to participate without losing the integrity of the very
    special programs that they offer.
        The Indian health system is truly the only system of health
    care that exists in the United States. For all the promise of
    managed care, somehow it would bring a preventative focus to
    care; it would be a birth-to-death kind of model. In fact, it
    is as profit-driven as all other health care in the United
    States and tends to focus on illness and not on health, on
    response and not on prevention.
        The Indian health system is fundamentally different than
    that in that it is truly a birth-to-death program. The people
    who are running health programs, and many of the programs that
    I work with, were born in the hospitals that they now operate
    and that they now run. Their children were born in those
    hospitals. They expect their great-grandchildren to be born and
    cared for in a program that they operate. That is not an
    expectation that those of us who rely on the private sector
    health care system care enjoy. But to make that real, of
    course, there must be adequate financing.
        The Medicare and Medicaid programs are complex and not the
    things that are typically are dealt with by this committee or
    the Resources Committee in the House. They are relatively
    foreign. You may have experienced this yourself, or you may
    have talked with someone who has had to assist an elder parent
    in applying for Medicare or making sense of their benefits, or
    assisted someone in applying for Medicaid in order that they
    could be in a nursing home or get other care that they need--
    these are difficult programs to participate in.
        In my written testimony, I have described very briefly the
    basics of those programs. I think for those of you who are, in
    fact, familiar with Indian people, and the way in which they
    live, when you read about those programs, you will see the way
    in which they diverge.
        However, the Medicare and Medicaid programs are rife with
    special exceptions. There is a tendency to believe that it is
    all one program and it exists in exactly the same way for
    everyone. Fundamentally not true. There are exceptions built in
    throughout Medicare and Medicaid to assure that special
    populations will get some level of care to guarantee their
    access, and that certain kinds of providers will continue to
    exist even as the rates get cranked down in those programs to
    manage the cost increases.
        So there are federally-qualified health centers, rural
    health centers, and critical access hospitals, children's
    hospitals, and cancer treatment centers. The list goes on and
    on of various kinds of specific providers, each one of which,
    if you meet all the finely-tuned rules, you get a special level
    of compensation under the program different than applies to
    others.
        Fundamentally, as we worked on trying to revise the
    Medicare-Medicaid provisions and access by the Indian Health
    Service and tribes, we kept that in mind. We recognized that
    the duty to provide health care to Indians is fundamental. The
    existence of the Indian Health Service and of tribal health
    programs is fundamental. Medicaid and Medicare should recognize
    those special provider types.
        As Mr. Rolin said, the Steering Committee agreed,
    reluctantly, to drop the qualified Indian Health Program as a
    new and special provider type in order to try to move this bill
    forward. Instead, what we have done is try to tailor very
    narrow provisions to other parts of Medicaid where there are
    special compensation or reimbursement rules or Medicare to
    permit the kinds of activities that are so essential on
    reservations and in Indian communities in which health care is
    being provided.
        For instance, there is a provision that allows visiting
    nurse services to be reimbursed, provided they are provided
    through a rural health center in a setting which is a shortage
    area for home and community-based care services. There are lots
    of rules attached to that. We ask that the same kind of
    visiting nurse services be reimbursed when they are provided in
    any Indian Health Service program without having to go through
    becoming a rural health center and proving you are in a
    shortage area. We know there are those shortages.
        I have provided for the committee comments on H.R. 2440
    provisions. Those reflect the best drafting. I can say with
    some great humility, I wrote much of what is in S. 556
    regarding the Social Security Act provisions and the title IV
    provisions. They were written conceptually.
        I could spend my lifetime and never penetrate to the depths
    of the Social Security Act and get an amendment quite right. We
    were blessed with the assistance of Representative Young to
    have an opportunity to work with House Legislative Counsel who
    assisted us in turning our concepts into real Social Security
    Act amendments. We encourage you to look at those and less at
    the S. 556 provisions.
        There is a side-by-side analysis that has been provided to
    committee members so that you can track from S. 556 to the
    House bill and understand what is left and how it has been
    redone. There is also a section-by-section analysis which is
    attached to my testimony.
        I want to mention basically six principles that drive the
    kinds of amendments. They are first to improve access to
    Medicare and Medicaid enrollment. It is not, as I mentioned
    earlier, a natural thought for an Indian elder to seek to apply
    for Medicare. Many Indian elders are not eligible for Medicare.
    They are not eligible for Social Security because they did not
    work in jobs that participate in Social Security during their
    work years.
        But for those who are, it is not natural for them to
    consider enrolling in part B and using up $700 a year of their
    limited income to pay part B premiums. Applying for Medicaid is
    certainly not something they think about even though they may
    be living in poverty--because they are used to caring for
    themselves. They expect the Indian health programs to provide
    the health care they need.
        Those programs are not accessible because people resist
    applying and because in many States services and access by
    Indian people to the programs operated by the State is not
    readily available. Some of that is a matter of direct policy by
    States, of where they locate their services, and some of it is
    because of the sheer remoteness of where Indian people live in
    relationship to State services. Finding ways to involve tribes
    meaningfully in those activities is an important feature of the
    act so that the rights of Indian people to participate in those
    programs can be protected.
        In addition, reducing co-payments, co-insurance, and
    deductible obligations without reducing the reimbursement to
    the tribal or Indian Health Services program also helps to
    overcome the barrier to access to those programs.
        Second, and I have mentioned this before, Indian health
    programs should enjoy the same kind of special consideration in
    the Social Security Act provisions that other kinds of health
    care programs, like federally-qualified health centers, or
    rural health centers, enjoy. You should not be taken in when
    somebody says, ``Oh, they are trying to create an exception.''
    There are a thousand exceptions.
        The Social Security Act provisions on Medicare and Medicaid
    are basically about two general rules. Everything else is an
    exception to those rules. We are simply looking for some of the
    same kinds of things. Nothing we have asked for is
    fundamentally different than is available for some other kind
    of provider.
        Third, we are looking to minimize administrative barriers.
    Mr. Rolin spoke to the fact that currently most of the Indian
    health programs are reimbursed on an encounter per-day rate. We
    look to maintain that rate while a study of reimbursement is
    carried out to ensure that any changes in those reimbursement
    methodologies are carried out in a way that will minimize
    administrative burdens and will control the costs of trying to
    build new billing systems, and to respond to the administrative
    requirements of those programs.
        Fourth, we want to encourage cooperation with the States.
    Medicaid is a partnership with States that cannot be
    effectively carried out by tribes without a good relationship
    with the States. We look for additional consultation on their
    part, and in some other provisions to find ways to improve the
    relationships.
        Among those is to reduce the role of the States in
    licensing tribal facilities and tribal providers so long as
    they meet the quality standards imposed by the Social Security
    Act. It basically would put the tribal providers in the same
    position that the Federal Indian Health Service providers are,
    vis-a-vis State regulation. We look to try to achieve that more
    uniformly.
        Finally, we want to improve communication by the formation
    of a technical assistance group in which people like myself and
    Mim Dixon, along with health care providers from tribal
    programs and others can work on behalf of tribal leaders, and
    in direct interaction with CMS, to work through issues as they
    arise so that when the Department of Health and Human Services
    is making policy changes, they do so fully aware of the
    consequences of them. What happens now all too often is that
    they make the change and it is only months down the road that
    the impact of that change becomes apparent and we all scramble
    to find a way to fix it.
        I join with the others in encouraging that this committee
    keep this bill intact, that it endorse these provisions, and
    that it work closely with other committees of the Senate and
    the House who have jurisdiction over certain of these
    provisions relating to the Social Security Act to ensure that
    they will give those requests the serious attention that they
    are due. It is easy to lose small changes. In an environment in
    which you are trying to make changes as massive as adopting
    Medicare prescription drugs, the very tiny nature of what we
    are asking for should not stop serious consideration of them.
        Thank you very much. I would also ask that my written
    statement be made part of the record of this hearing.
        The Chairman. Without objection, so ordered.
        [Prepared statement of Ms. Munson appears in appendix.]
        The Chairman. Thank you, Ms. Munson.
        By the way, do not worry about not getting things right. We
    work year-around here and if you could read our mail, we never
    get things right. We just have to keep trying. That is why you
    never get rid of us, I guess.
        Before I go on, I did not know what Senator Murkowski's
    schedule is, particularly since Ms. Munson is from Juneau.
        Do you have any opening statement or comments before we go
    on? I do not know if you have to leave.
        Senator Murkowski. Thank you, Mr. Chairman.
        I will be leaving in about 15 minutes, but I did want to
    hear the testimony of Ms. Munson and welcome her as a
    constituent. I also want to welcome a former constituent, Ms.
    Dixon. I am looking forward to her testimony. I understand she
    is from Fairbanks, as I am. We share a lot there.
        I just wanted to listen to the comments this morning and
    thank you, Mr. Chairman, for continuing on this very important
    issue of the reauthorization of Indian health.
        The Chairman. Thank you.
        Ms. Dixon, please proceed.

        STATEMENT OF MIM DIXON, DIXON & ASSOCIATES, BOULDER, CO

        Ms. Dixon. Thank you, Chairman Campbell and Senator
    Murkowski, tribal leaders, and honored guests today.
        There has been a lot of talk recently about modernizing
    Medicare and, in a way, the proposed Title IV of the Indian
    Health Care Improvement Act, and the proposed amendments to
    Medicaid, Medicare, and the Social Security Act, could be
    considering modernizing Indian health care. As we know, this is
    not an appropriations bill and it will not provide the funding
    to bring programs and facilities up to standards.
        So when I talk about modernizing Indian health care, I am
    not talking about the delivery of services. Rather I am talking
    about modernizing the legal and regulatory framework that
    allows the Indian health programs to bill Medicaid, SCHIP,
    Medicare, and private insurance, and to be paid for the covered
    services that are provided to mutual beneficiaries.
        Title IV and the Social Security Act amendments are needed
    to respond to changes that have occurred in health care
    delivery in our country in the past decade. Just a few years
    ago there was no Medicaid managed care. There was no SCHIP.
    There was no Medicare Part C or D or E. In most States, tribes
    have not been included in the planning for these changes in
    Medicaid, or to the development of SCHIP programs.
        It is difficult for Indian health care to interface with
    the Medicaid, SCHIP and Medicare of today. Indian health
    programs are unique in many ways that make it impossible for
    many Indian health facilities and programs to meet the usual
    requirements to become providers under managed care programs.
        Yet the Indian Health Service beneficiaries who are
    enrolled in managed care programs under their Medicaid and
    SCHIP programs will go off-plan to seek care at their Indian
    health care facility. It is essential that they have that
    unrestricted choice and that the Indian health facility can
    bill and be paid for the services it provides.
        Provisions in the Indian Health Care Improvement Act also
    allow tribes to take advantage of some of the opportunities
    provided by managed care. For example, they could use funds
    from the Indian Health Serve as to purchase managed care plans
    or other insurance programs for their beneficiaries. The
    measures would also require States to allow Indian health
    providers to service case managers for American Indian and
    Alaska Native Medicaid beneficiaries.
        Despite the increasing reliance of Indian health programs
    on third-party collections, many American Indians who are
    eligible for Medicaid and SCHIP are not enrolled in those
    programs. To remedy this situation, this bill authorizes
    funding for tribes for outreach services. The bills would also
    eliminate financial barriers to enrollment in Medicaid and
    SCHIP, such as premiums, deductibles, and co-pays.
        Many of the issues relating to Indian health care financing
    are extremely complicated. Tribes have recognized that there is
    a need for a national Tribal Technical Advisory Group to work
    closely with CMS to resolve problems as they arise. To operate
    effectively, this TTAG must be authorized in law. The TTAG will
    be essential for helping to implement the provisions in Title
    IV of the Indian Health Care Improvement Act, and for all the
    proposed changes in Medicare under the proposed prescription
    drug legislation and proposed Medicaid reform.
        In closing, it is important to remember the purpose of this
    legislation. At the heart of the provisions in title IV is
    enhancing access to care for American Indians and Alaska
    Natives, protecting their rights to choose their health care
    providers, and assuring that Indian health care facilities get
    paid when they provide services under Medicaid, SCHIP, and
    Medicare to those beneficiaries.
        I have submitted written testimony which provides greater
    detail on these points. Thank you. I would also ask that my
    written statement be made part of the record of this hearing.
        The Chairman. Without objection, so ordered.
        [Prepared statement of Ms. Dixon appears in appendix.]
        The Chairman. Thank you, Ms. Dixon.
        Let me ask a couple of questions. Let me start with Ms.
    Benjamin. Thank you for being here.
        I have been a big supporter, as you know, for years of
    self-governance. It seems to me that the tribes, if they have
    the capability, should be offered that opportunity. In most
    cases they do a better job than the Federal Government could
    have done.
        But with that in mind, I guess there are some things that
    probably ought to remain with the Agency. Let me just ask you a
    couple of things on that. With that thought in mind, what is
    your view on Secretarial oversight for the tribal direct
    billing program?
        Ms. Benjamin. That's a hard question.
        The Chairman. Yes; I know. That is why I asked you.
    [Laughter.]
        Do you think tribes could do that better than can be done
    through the Agency?
        Ms. Benjamin. We know what our need is for our membership.
    I think we can address the health disparity issues better than
    an outside entity doing that. So I would support that tribes
    would have that authority to do that.
        The Chairman. Your testimony also includes a concern that
    tribes are usually not consulted in the design of the State
    Medicaid programs. It is not unusual, unfortunately. We hear
    that very often here in the committee that there is a lack of
    good in-depth consulting with the tribes before decisions are
    made.
        How do we encourage tribal State collaboration in the
    design of health insurance programs so that they are inclusive
    of Indian people's needs?
        Ms. Benjamin. I guess I can look at our example. Currently
    what we have for our membership is called a ``Circle of
    Health.'' We provide some health care opportunities for all of
    our members, regardless of where they live in the United
    States. There is a process that they have to go through, of
    course. Our goal is to make sure that people that may not live
    on the reservation, that live in different States, and do not
    have access, that we are providing a service to them as well.
        The Chairman. Do you do that through the mail? Do you offer
    advice, say, of 500 miles away and cannot get home to the
    clinic?
        Ms. Benjamin. We send them applications where they would be
    able to get some insurance in their State. We help pay the
    premiums for that, to get that done. We want to make sure that
    our membership is not forgotten, if they live elsewhere beside
    the reservation.
        The Chairman. That is a great idea. Has that been pretty
    successful?
        Ms. Benjamin. It is successful. We still have a lot of
    folks that still have not utilized that program. We are
    continuously trying to educate them and the opportunities
    through our mailings or newsletters. We also make sure that
    they know what services are available.
        Also, what we are doing with the State of Minnesota is that
    we try to partner in any way we can. Currently we have some
    discussions with the TANF program to provide services for
    Indian people in the Minneapolis-St. Paul area. We also feel
    that we can show more compassion to Indian people, to our own
    tribal members or whoever, to get them to become more self-
    sufficient because of our cultural backgrounds. We can relate
    to some of those issues, we feel, in a better way than the
    State or county agencies that are out there.
        Those are two examples of what we are trying to do. We want
    to provide a system that we can hopefully improve lives for
    membership of our own tribe and other Indian people, even
    though they do not live directly on the reservation.
        The Chairman. You mentioned that your tribe has difficulty
    collecting third-party reimbursements, and the little you do
    collect often goes to meeting health care needs of your tribal
    members. What are the most serious impediments to preventing
    the tribe from collecting third-party reimbursements?
        Ms. Benjamin. I would like to refer that question to Samuel
    Moose, the Commissioner of Health and Human Services because he
    administers that. Can you assist me, Sam?
        Mr. Moose. We are always negotiating with the State and
    through our State liaison some opportunities within the various
    programs. Some of the difficulties that we run into is that the
    State delegates some of that authority to the local county
    agencies where they were negotiating those rates and
    opportunities. We have had difficulties in the past.
        The Chairman. Do they just refuse to negotiate? Do they
    drag their feet?
        Mr. Moose. Yes; they drag their feet. Some of them come to
    the table. We really do not make any progress with the issues.
    There is always a history. There is always something that comes
    up that somehow creates barrier.
        The Chairman. It is called jumping through hoops.
        Mr. Moose. Yes.
        The Chairman. It is not uncommon, I guess.
        Vice Chairman Rolin, you have put a number of years of
    dedication to improving the health of Indian people. I want to
    commend you for that. You have been in here a number of times
    testifying on their behalf. I thank you for that.
        On the Federal medical assistance percentage, I understand
    that the National Steering Committee decided to remove the 100
    percent FMAP expansion provision in S. 556 in response to the
    Administration's concern that it would be too costly; is that
    correct?
        Mr. Rolin. That is correct.
        The Chairman. What cost estimates were included in that
    decision?
        Mr. Rolin. Myra might be able to answer that. She has
    handled that technical portion.
        The Chairman. We call that passing the buck around here,
    Myra. Go ahead. [Laughter.]
        Mr. Rolin. That has been her area of expertise.
        Ms. Munson. If Congress would pass the buck, we would have
    no problems here. [Laughter.]
        The Chairman. Bucks, plural.
        Ms. Munson. Many, many bucks. The truth is we really do not
    know. What we do know is that they came up with an estimate of
    $2.48 billion for the 100 percent FMAP. We believe that that is
    a substantial over-estimate of increased costs since we believe
    that States that currently claiming 100 percent FMAP for a wide
    variety of activities that they believe, and I think correctly,
    are already authorized as ``through the facility.''
        A significant amount of the FMAP issue arises out of the
    difference of interpretation of that phrase, ``through the
    facility,'' with tribal health programs and the States
    interpreting it to mean not only the things provided in the
    building, but things which may be referred out that have to be
    purchased from other providers. They should also be entitled to
    that 100 percent FMAP. We think that CBO has over-estimated the
    number, but we do not have the benefit of having any details so
    we cannot tell you exactly in what ways.
        The Chairman. I see.
        Mr. Rolin. Senator, if I might add, you noted in my
    testimony also the States support that. They believe this would
    be a direct support as far as funding for tribes. They have
    been most supportive in that aspect.
        The Chairman. We often hear that States deny health care to
    Indian people by saying it is a Federal responsibility. Is the
    NSC aware of cases where States have refused public health
    insurance coverage for eligible Indian people because of that
    concept?
        Mr. Rolin. I do not know of any. Ms. Dixon, are you
    familiar with any? I am not aware of any. I know my State has
    not.
        The Chairman. Ms. Dixon.
        Ms. Dixon. I think it is a matter of degree. It is not as
    black and white as that. I think that there is a higher level
    of cooperation with the State looking for ways to enhance and
    support the Indian health system when there is 100 percent FMAP
    and they are not trying to conserve State funds and they
    realize that the Federal are there.
        For those services where there is not 100 percent FMAP,
    Medicaid directors tend to take the most conservative approach
    in terms of allowing tribes to carry out their mission with
    Medicaid funding.
        The Chairman. Okay.
        Ms. Munson.
        Ms. Munson. If I could, Mr. Chairman, I think the denial
    plays out in one other way. I think any Indian person who gets
    their application in and manages to fill it out completely will
    be granted their eligibility if they satisfy all the
    conditions. The trick is: Will they ever get the application?
    Will they understand it? Will they get it completed? Will they
    meet the deadlines for personal interviews or whatever other
    hoops they may have to jump through to get it considered? Will,
    in fact, it be returned to them because there is something
    missing? Will they have had difficulty getting access?
        We believe, and there is pretty good demonstrated evidence
    of this, that even in States that cooperate, Indian people are
    substantially under-represented in the Medicaid rolls compared
    to the level of poverty in Indian country. We think there are
    many barriers; most of them subtle.
        The Chairman. Including educational problems. Sometimes
    Indian people do not have the educational opportunities and
    when they have to fill out some of these complicated Federal or
    State forms, they are already at a disadvantage.
        Ms. Munson. Absolutely.
        The Chairman. Ms. Dixon, we are dealing with managed care.
    You hear it all the time here in Congress, as you probably
    know. It seems to be the new rage. It seems to be the way we
    are going. But we do get some feedback that one size does not
    fit all, particularly in the difference between rural America
    and urban America. But I think also that might apply to the
    problems that many Indian people face, and that is cultural
    differences.
        What are your recommendations to try to improve the health
    care system from a culturally-sensitive aspect for Indian
    people?
        Ms. Dixon. That is a really good question. First, let me
    say that in essence the Indian health system is a culturally-
    sensitive managed care system. The issue is not so much the
    cultural sensitivity within the Indian health system, it is
    forcing Indian people to enroll in managed care plans that are
    operated by the State under Medicaid. And now with the
    revisions to Medicare that we are talking about, that is a
    potential there as well. It has not been so much Medicare up to
    now, as Medicaid.
        Then forcing them to enroll in a Medicaid managed care plan
    for which the Indian Health System is not a provider. Then they
    are into a health care system that is off the reservation, or
    outside their communities, where people have little knowledge
    of the culture, where there are not people who speak the
    language, where people do not understand the living conditions.
    Often times facilities are very hard to access because they are
    far away. They are defaulted to a facility that might require a
    great deal of transportation to get there. They do not have the
    vehicles and the transportation.
        What we have recommended--and what tribes have been
    recommending ever since the National Indian Health Board did
    its study of the nine State Medicaid programs that have gone
    into managed care, that had a significant Indian population in
    those States--is that Indian people be exempted from mandatory
    enrollment, that States keep a carve-out for Indian health that
    is paid for on a ``fee-for-service.'' We call it ``fee- for-
    service,'' but it really is not. It is called the ``encounter
    rate'' or the ``all-inclusive rate.'' Sometimes it is the ``OMB
    rate'' or the ``IHS rate.'' It is not exactly ``fee-for-
    service,'' but it is not the capitated managed care payment.
        Also, Indian people should be allowed to go to their local
    Indian facility, if that is what they choose. If they choose to
    use another facility under Medicaid, they should be allowed to
    do that as well. But they should not be penalized, and the
    Indian health facility should not be penalized if a Medicaid
    recipient chooses to use their local tribal or Indian health
    care facility.
        The Chairman. I agree.
        Ms. Benjamin.
        Ms. Benjamin. I wanted to comment on the cultural sensitive
    way of how some of our people deal with the providers. Many of
    our elders' first language would be Ojibwe. There is that
    communication barrier sometimes with the providers.
        What we provide is traditional healers. They then have a
    comfort level dealing with someone that can speak and
    understand their language. Our issue with the traditional
    healers is that they are not recognized. We are not included in
    the billing process when we use traditional healing for our
    membership.
        The Chairman. I think some other tribes have had quite a
    bit success with that, too. I think the Navajos do that, not
    only with working with the State for health care but such as
    surgery, for instance. I understand that they have spiritual
    leaders that understand the traditional healing ways of the
    Navajos who work with the doctors. I think that is a terrific
    idea.
        I have often wondered if it creates a liability issue or
    what is sometimes called the unintended consequences of doing
    something. I wonder if there is something in there that comes
    around to haunt you later on why you try to do that. But it
    seems to me it is the only way to go, particularly for
    traditional people. That comfort level goes up considerably if
    they know there is a spiritual attachment to healing.
        Mr. Rolin.
        Mr. Rolin. Senator, I have just one more comment regarding
    the FMAP. I noticed in the most recent Senate prescription bill
    that Native Hawaiian providers were included. However, our
    providers were left out. Certainly that is a concern we have as
    well. We wanted to share that with you.
        The Chairman. Thank you for bringing that to my attention.
    I did not know that. I will make sure that we look into that
    and find out why.
        Mr. Rolin. Thank you.
        The Chairman. I have no further questions that I will ask
    today. I will put some in writing to you. We have many members
    who are not here today. They will be submitting questions in
    writing, too. We would appreciate your getting those back to
    us.
        Without objection, so ordered.
        We will keep the hearing open for 2 weeks for any
    additional testimony or letters from anyone in the audience or
    from our panelists.
        I thank you for appearing today.
        This committee is adjourned.
        [Whereupon, at 11:17 a.m., the committee was adjourned, to
    reconvene at the call of the Chair.]
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                                A P P E N D I X

                                  ----------

                  Additional Material Submitted for the Record

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

      Prepared Statement of Melanie Benjamin, Chief Executive, Mille Lacs
                                 Band of Ojibwe

        Chairman Campbell, Vice Chairman Inouye and distinguished members
    of the Senate Committee on Indian Affairs, my name is Melanie Benjamin
    and I am the chief executive of the Mille Lacs Band of Ojibwe. The
    Mille Lacs Band is a federally recognized tribe of 3,570 members
    located in East Central Minnesota. We operate three clinics in three
    Mille Lacs Band districts on our reservation and serve a user
    population of several thousand.
        Three topics will be discussed as they relate to Medicaid and
    Medicare under Title IV of the Indian Health Care Improvement Act:
    Sovereignty, the Federal trust responsibility and the health
    disparities that exist between Indians and the rest of the American
    population. The access to health services under title IV have a direct
    connection to the health disparities in Indian country and must be
    addressed by the Congress. Following the general discussion of the
    three topics under Medicaid and Medicare will be the Mille Lacs Band
    recommendation of the establishment of a Tribal Leaders Group and
    Tribal Technical Advisory Group specific to the Centers for Medicare
    and Medicaid Services and their work with the Indian Health Service
    [IHS]. The statement concludes with one final issue of concern to the
    Mille Lacs Band: the Department of Health and Human Services' ``One''
    HHS Initiative.
        When the Indian Health Care Improvement Act was first enacted in
    1976, Congress recognized its trust responsibility toward the tribes to
    provide adequate health care. Throughout the subsequent amendments and
    reauthorizations of the Act, one of the major underlying policies has
    been to provide tribes access to other Federal health care sources like
    Medicare and Medicaid programs. These programs have unlimited funding,
    as opposed to Indian Health Service programs that have funding limits
    each year. The intent was and is to improve our health status through
    that access. Since then Medicare and Medicaid reimbursements to tribes,
    including the Mille Lacs Band, have become a significant source of
    revenue for our health care programs and operations.
        Over the last 15 years, the Mille Lacs Band of Ojibwe has actively
    participated in the formulation of Tribal Self-Governance policy. We
    take pride in being one of the first ten Self-Governance tribes. We
    participated in the original demonstration project and the 1 writing of
    the permanent Acts for BIA and IHS Self-Governance. The Mille Lacs Band
    has also been on the rulemaking committees for the implementation of
    Self-Governance laws. Presently, the Mille Lacs Band of Ojibwe is an
    active member with the Tribal Self-Governance Advisory Committee that
    advises Federal agencies on Indian policy matters affecting the Self-
    Governance tribes.
        The Mille Lacs Band has supported and advocated for Self-Governance
    laws because our philosophy is that we should be free to govern
    ourselves and develop our own policies in the administration of our
    tribal programs. To us, this is an important exercise of sovereignty.
    In that exercise of sovereignty, we should not be entangled by a
    Federal or State bureaucracy.
        There are three principles that the Mille Lacs Band of Ojibwe
    considers when analyzing Federal programs. First, we assert that our
    primary relationship is with the Federal Government. This tribal-
    Federal relationship has been established through treaties with the
    United States, Executive orders, Federal statutes and numerous court
    decisions recognizing the same. Second, we retain all sovereignty not
    expressly taken away, and therefore we should have the ability to
    control funds reserved for us under Federal law. Third, we should have
    equal access to the same funding avenues as States. This third
    principle raises the fundamental flaw of the Medicaid and Medicare
    programs.
        It is the Band's understanding that the design of the Medicaid and
    Medicare programs is a Federal--State collaboration. The problem is
    that tribes do not fit into the picture at all and this design flaw
    makes it very difficult to meet the criteria for receiving
    reimbursements. An example is that counties receive an administrative
    match from the state for their administrative costs while tribes
    cannot. According to the Mille Lacs Band of Ojibwe Commissioner of
    Health and Human Services, our inability to recover the administrative
    match demonstrates that tribes do not have equal access to Medicaid and
    Medicare reimbursements. The reason is that States determine how their
    block grants will be distributed under their own guidelines. As a
    result, the Mille Lacs Band and many other tribes lose out on potential
    and critical avenues of funding we desperately need because Federal
    funding through the Indian health service. Others on this panel have
    addressed this and other legal barriers more specifically, but from a
    tribal leader perspective it is clear that states and managed care
    systems have predominance over tribes under Medicaid and Medicare.
        Clearly, the establishment of the Medicaid and Medicare entitlement
    programs happened at a time in history when the Congress did not focus
    on tribal sovereignty. Presently tribes are treated as governments in
    Federal legislation and tribal sovereignty is recognized. Indian people
    are provided direct access to Federal programs and funding. The Mille
    Lacs Band of Ojibwe receives direct funding through our Self-Governance
    Indian Health Service and Bureau of Indian Affairs Annual Funding
    Agreements. But when it comes to Medicaid and Medicare programs, it is
    a different situation. It is time to change the Medicaid and Medicare
    provisions under Title IV of the Indian Health Care Improvement Act to
    reflect the new enlightened view of tribal sovereignty and provide
    tribes more access to health care services as the Act was originally
    intended.
        Through our treaties, Federal statutes, Executive orders and court
    decisions, a Federal trust responsibility has been established and
    recognized over the course of dealings with tribes. The Mille Lacs Band
    of Ojibwe signed several treaties with the United States, and the
    provision of proper health care became an expectation of the Band and
    an obligation of the Federal Government. In addition, the Snyder Act of
    1921, the Transfer Act of 1954, the Self-Determination Act of 1975, the
    Indian Health Care Improvement Act of 1976, as well as the enactment of
    the IHS Self-Governance Act, all evidence the trust obligations that
    flow to the tribes from the Federal Government for the provision of
    health care.
        In spite of the clear legal duty created by these Federal statutes,
    the Federal obligation to provide adequate health care to tribes has
    never been properly funded. Historically, this insufficient funding has
    interfered with our ability to provide comprehensive health care to
    Mille Lacs Band members. According to IRS estimates, the Mille Lacs
    Band and all other tribes in the Bemidji are funded at approximately 30
    percent of need. This means more than two-thirds of our need is not
    being met and explains why the status of Indian health on the Mille
    Lacs Band Reservation and almost all other tribal reservations is so
    poor. We are told that the Federal Government spends nearly twice as
    much for a prisoner's health care than it does for Indians. This fact
    is an example of why our health status is at the bottom of every
    disease category.
        It seems ironic that Indian health care through the IHS is not an
    entitlement for Indian people when tribes essentially pre-paid for our
    health care by ceding millions of acres of land to the Federal
    Government. It seems even more ironic that tribes have problems
    accessing the Federal entitlement programs like Medicaid and Medicare
    which were designed for all state citizens. This funding disparity
    becomes a matter of fairness and equity because Indian people are also
    citizens of the States in which we reside. It is only logical that we
    should have the same access to the same services as do other non-Indian
    citizens.
        Given that we have been historically under funded for our health
    care needs and that tribes likely will not receive funding for the
    level of need in the next appropriations cycle, the Federal trust
    responsibility needs to be taken seriously and changes made to allow
    tribes full participation in the existing entitlement programs of
    Medicaid and Medicare. It is fair and it is right.
        It has been more than 25 years ago since the Indian Health Care
    Improvement Act was enacted. The primary purpose of the legislation was
    to improve the health status of Indians to a level comparable with the
    general U.S. population. While strides have certainly been made in the
    delivery of Indian health care in that time, there continue to be
    health disparities in Indian country that are recited time and time
    again. The numbers change slightly, but one constant is that Indians
    rank highest in nearly every category of disease incidence than the
    general American population. It is plain and simple that Indian health
    status is not improving and something must be done.
        On the Mille Lacs Band Reservation, diabetes is a very serious
    problem. There is not one family without diabetes among one of their
    family members. For many of our Band members, it is not a matter of if
    they get the disease, but when. Band members are losing their vision
    due to glaucoma complications, they are losing their limbs because of
    circulatory problems and many are close to requiring kidney dialysis
    treatments. This chronic disease affects our members' quality of life
    and it affects the lives of their family members.
        More alarming is that diabetes and other long-term chronic health
    conditions are now occurring in our children and our youth. We have
    serious concerns for their long-term health and longevity. Our children
    and youth are our future and we must aggressively confront these health
    problems to preserve our tribal communities. There are no answers but
    it is clear that adequate and comprehensive Indian health care is a
    critical part of the solution.
        The ability to provide comprehensive health care on our
    reservations is paramount because frequently our members will use only
    our tribal health facilities. The Mille Lacs Band is located in a rural
    area and other health care facilities are long distances. Our three
    clinics attempt to provide the health care our members need, but
    resources are quickly used and we make every effort to access outside
    funding through Medicaid and Medicare reimbursements within the
    limitations of existing law. More often than not, our efforts cannot
    meet our needs. We are fighting to protect the lives and health of our
    members on our reservations and in our communities. If Congress makes
    the necessary changes to Title IV of the Indian Health Care Improvement
    Act and provides more access to Federal health care services and funds,
    it will at least give us another weapon in this war on health
    disparities.
        Under Executive Order Number 113175, the Tribal Consultation
    Policy, the Indian Health Service frequently solicits tribal input on
    health care matters that affect Indian country. The same cannot be said
    for other agencies within the Federal Department of Health and Human
    Services. Two examples that demonstrate the lack of tribal consultation
    are the proposed Medicaid and Medicare Reform that will affect tribal
    health care programs throughout Indian country.
        The Department of Health and Human Services and the Mille Lacs Band
    of Ojibwe, along with the other federally recognized tribes throughout
    the United States, share the common goal of providing accessible and
    culturally-appropriate health care that we believe is best achieved by
    working together at the earliest stages of policy development and
    certainly prior to implementation. The Mille Lacs Band of Ojibwe
    endorses and supports the Secretarial appointment of a Tribal Leaders
    Group [TLG] that would provide policy guidance throughout the
    Department of Health and Human Services. The Mille Lacs Band also
    endorses and supports the Tribal Technical Advisory Group [TTAG] that
    would provide technical expertise on complicated Indian policy matters
    and issues specifically to the Centers for Medicare and Medicaid
    Services.
        The Tribal Leaders Group has been sanctioned by the National Indian
    Health Board, the National Congress of American Indians and the Tribal
    Self-Governance Advisory Committee, and would be comprised of tribal
    leadership from each of the Indian Health Service areas. These three
    organizations are recognized by the Federal Government and the agencies
    that handle Indian affairs, but on many occasions Indian policy is
    overlooked by lawmakers and policymakers during the process of policy
    development. The Tribal Leaders Group would provide important policy
    recommendations to the Department of Health and Human Services on
    proposed initiatives that affect health care delivery throughout Indian
    Country, which in turn furthers the government-to-government
    relationship that fulfills the objectives of the tribal consultation
    policy.
        On a more specific level, the Tribal Technical Advisory Group
    [TTAG] would provide the technical expertise and knowledge to the
    Centers for Medicare and Medicaid Services that is required when
    dealing with complex issues like Medicaid and Medicare Reform. The TTAG
    is also sanctioned by the National Indian Health Board, the National
    Congress of American Indians and the Tribal Self-Governance Advisory
    Committee. The Centers for Medicare and Medicaid Services has drafted a
    charter for the TTAG that provides representation from the three
    national Indian organizations identified above; however, the Mille Lacs
    Band and the TTAG believe that the Group should also require the
    participation of at least three technical advisers that are familiar
    with health care financing and administration and how proposed changes
    will affect Indian country.
        Through the Secretarial appointment of the Tribal Leaders Group and
    the Tribal Technical Advisory Group, tribal involvement from the
    earliest stages of policy development will ensure that Indian issues
    will be adequately addressed. Involvement and consultation also
    furthers the government-to-government relationship that the Mille Lacs
    Band of Ojibwe believes is part of the Federal trust responsibility to
    tribes.
        The Mille Lacs Band of Ojibwe has a number of concerns with the
    Secretary of the Department of Health and Human Services' One HHS
    Initiative. First, the Initiative has not involved tribal consultation
    and that lack of consultation undermines the government-to-government
    relationship that tribes enjoy with the Federal Government. One of the
    underlying policies of Executive Order Number 13175 was and is to
    involve tribes at the policymaking level and work with decisionmakers
    to enhance the government-to-government relationship. The Mille Lacs
    Band of Ojibwe and other tribes want to be involved and consulted on
    health and human service policy matters that affect Indian country
    because we know best what our tribal communities need and can provide
    that knowledge to HHS officials.
        Second, tribes' unique status as sovereign governments who are
    federally-recognized political entities is overlooked by the One HHS
    initiative. As a federally-recognized tribe, the Mille Lacs Band of
    Ojibwe is a sovereign government that has a government-to-government
    relationship with the Federal Government and its agencies. Our Self-
    Governance compacts are an expression of that relationship. As
    political entities recognized by the Federal Government, the Mille Lacs
    Band and other tribes cannot be treated as simply another racial
    minority group. The U.S. Constitution, our Treaties, Presidential
    Executive orders, and Federal statutes and court decisions all affirm
    our political status as sovereign governments that are distinctly
    separate from all other racial and minority groups. By engaging in
    tribal consultation, Federal agencies will support tribes' government-
    to-government relationship expressed in the above mentioned
    instruments.
        Third, implementation of the One HHS Initiative is a departmental
    reorganization that fails to recognize the Indian Health Services'
    unique responsibility to Indian tribes. The restructuring of the HHS
    does not acknowledge the unique relationship between the Indian Health
    Service and the federally-recognized tribes. By incorporating Indian
    health care into public health and minority health programs, the Indian
    Health Service may lose its ability to provide direct medical services
    to tribes and eventually may see the loss of programs designed
    specifically for tribes. Inherent in the restructuring is an alteration
    of the Federal trust responsibility. Indian Health Service exists to
    fulfill the Federal trust responsibility of providing health care to
    tribes across the United States and attempting to improve the health
    status in Indian country. Removing that trust responsibility runs
    counter to the very purpose of the Indian Health Care Improvement Act.
        The Mille Lacs Band of Ojibwe recognizes that improvements have
    been made in the delivery of health and human services since the
    enactment of the Indian Health Care Improvement Act in 1976. However,
    we still have significant health disparities in our communities that
    have not seen improvement. This tells us there must be greater efforts
    to address Indian health disparities. Those efforts must involve tribal
    consultation and coordinated discussions for any result to be obtained.
    It is not too late to engage tribes and begin working together to move
    forward and improve Indian health disparities.
        Miigwech.
                                     ______

      Prepared Statement of Buford Rolin, Vice Chairman, Poarch Creek of
                                    Indians

        Chairman Campbell, Vice Chairman Inouye, and distinguished members
    of the Senate Indian Affairs Committee, I am Buford Rolin, member at
    large of the National Indian Health Board. I am an elected official of
    the Poarch Creek Band of Indians, serving as vice chairman. On behalf
    of the National Indian Health Board, it is an honor and pleasure to
    offer my testimony this morning on the Reauthorization of the Indian
    Health Care Improvement Act.
        The NIHB serves nearly all federally recognized American Indian and
    Alaska Native (AI/AN) tribal governments in advocating for the
    improvement of health care delivery to American Indians and Alaska
    Natives. We strive to advance the level of health care and the adequacy
    of funding for health services that are operated by the Indian Health
    Service, programs operated directly by Tribal Governments, and other
    programs. Our Board Members represent each of the 12 areas of IHS and
    are elected at-large by the respective Tribal Governmental Officials
    within their regional area.
        I would first like to commend the witnesses that testified before
    me this morning, Mim Dixon and Myra Munson, for their tireless work and
    expertise on American Indian and Alaska Native issues related to
    Medicare, Medicaid and the Children's Health Insurance Program. I am
    also much honored to testify this morning alongside Chief Executive
    Melanie Benjamin of the Mille Lacs Band of Ojibwe.
        Given the two previous hearings the committee has held on the
    Indian Health Care Improvement Act during the 108th Congress, I'm going
    to be brief this morning. I realize the members are quite aware of the
    need and purpose of the reauthorization; therefore I would like to
    focus on the efforts of tribal leaders to craft legislation that
    addresses previous concerns raised by the Administration and responds
    to the current political realities facing Congress.
        The National Steering Committee [NSC] was formed by the Indian
    Health Service in 1999 to develop and submit recommendations for
    changes to the Indian Health Care Improvement Act. The NSC is comprised
    of elected tribal representatives throughout Indian country, and also
    includes urban health program representation. The NSC is currently
    cochaired by Julia Davis-Wheeler, NIHB Chair, and Rachel Joseph of the
    Lone Pine Paiute Shoshone Tribe.
        Over the last several years, the NSC has worked closely with Indian
    country, the Administration, Congress, and the Indian Health Service to
    develop amendments to the Indian Health Care Improvement Act. Indian
    country has proceeded through this process in a spirit of cooperation
    and negotiation and the language has gone through several changes.
        At the request of Tribal leaders, the Centers for Medicare and
    Medicaid Services [CMS] established the Tribal Technical Advisory Group
    (TTAG) to advise CMS on Medicare, Medicaid, and Children's Health
    Insurance (CHIP) policy issues related to American Indians and Alaska
    Natives. The TTAG was formed in 2001 and consists of Tribal leaders,
    Area Indian Health Boards, and designated national Tribal
    organizations, including the National Indian Health Board. The
    activities of the TTAG are coordinated primarily through the
    Intergovernmental and Tribal Affairs Office within CMS.
        The TTAG has forwarded several recommendations to Congress and CMS
    regarding recommended changes to the reimbursement methodologies in
    place for the Indian Health Service, Tribal health programs, and Urban
    Indian programs. The TTAG is adamant in its position that any reform or
    changes in the Medicare, Medicaid, or CHIP programs must allow for
    Tribal allocation or other direct funding mechanisms that authorize
    Indian health programs access to Centers for Medicare & Medicaid
    Services (CMS) program funding.
        The TTAG has worked closely with the National Steering Committee to
    develop the changes to Title IV of the Indian Health Care Improvement
    Act that are reflected in H.R. 2440, which are the most recent NSC
    recommendations.
        As the committee is well aware, funding for the Indian Health
    Service lags far behind other segments of the population and has failed
    to keep pace with population increases and inflation. Current Indian
    Health Service funding is so inadequate that less than 60 percent of
    the health care needs of American Indians and Alaska Natives are being
    met. In order to address the need for additional health care resources,
    Title IV of the Indian Health Care Improvement Act addresses access to
    Medicare, Medicaid and other third party reimbursements. It is one of
    the most important provisions of the Indian Health Care Improvement Act
    as it makes IHS hospitals eligible for Medicare reimbursements, and
    also makes IHS facilities eligible for Medicaid reimbursements. Title
    IV makes it possible for Medicare and Medicaid eligible American
    Indians and Alaska Natives to utilize these benefits.
        Since the passage of the Health Care Improvement Act in 1976,
    Medicare and Medicaid payments have become vital sources of revenue for
    basic tribal hospital and clinic operations. In fiscal year 2002 alone,
    IHS and tribally operated hospitals and clinics collected $460 million
    for services provided to Indian people enrolled in these programs. This
    amount enhances the resources available for the IHS hospitals and
    health clinics budget by nearly 30 percent.
        In order to further improve the ability of Indian Country health
    providers to access third party resources, the NSC developed several
    changes to Title IV that were included in S. 212 introduced during the
    107th Congress. When asked to respond to the language contained in S.
    212, several concerns were raised by Health and Human Services
    Secretary Tommy G. Thompson regarding the proposed changes to title IV.
    The concerns were primarily related to costs. I would like to note that
    S. 556 introduced during this Congress is identical to S. 212 and
    therefore many of the concerns raised in regards to S. 212 remain.
        In response to those concerns, the National Steering Committee
    revised their recommendations for the reauthorization and those changes
    are reflected in H.R. 2440, which was introduced on June 11, 2003. I
    think it was,quite helpful to hold the joint Senate Committee on Indian
    Affairs and House Resources Committee hearing on the IHCIA last week as
    it illustrates the efforts of both houses to pass a bill this session.
    Although the bill was introduced in the House, it was developed with
    input and involvement from both Senate and House members and staff.
        H.R. 2440 reflects several changes made to the original tribal
    proposal prepared in 1999 by the National Steering Committee (NSC). The
    legislation includes revisions to the 1999 proposal in response to the
    Secretary Thompson's concerns. Some of the major changes of the revised
    Tribal recommendations made ii?- H.R. 2440 that respond to the
    Administration's concerns about S. 212.
        Qualified Indian Health Program [QIHP]. This provision has been
    removed. The NSC designed QIHP as a new provider type through which
    Indian health programs and urban Indian health programs could more
    fully exercise their statutory authority to receive payments under
    Medicare, Medicaid and SCHIP. Secretary Thompson expressed concern that
    QIHP was complex and would be administratively burdensome. Tribal
    leaders acknowledged that the CBO score of this provision--in excess of
    $3 billion over 10 years--could be a barrier to Congressional
    acceptance of QIHP and therefore removed it.
        In place of the QIHP proposal, Tribal leaders seek a comprehensive
    study by the Department of Health and Human Services [DHHS] of
    reimbursement methodologies of Medicare and Medicaid for the Indian
    Health Service [IHS], Tribal health programs, and health programs of
    urban Indian organizations. The new provision found in H.R. 2440
    directs the Secretary to perform such a study and report the findings
    to Congress. The Secretary is to examine whether payment amounts under
    current methodologies are sufficient to assure access to care and
    whether these methodologies should be revised consistent with those
    applicable to the ``most favored'' providers under the Social Security
    Act. The current ``all-inclusive'' rate system through which IHS and
    tribal hospitals and some clinics now receive Medicare and Medicaid
    reimbursements would remain in place until the Secretary's
    recommendations are reported to Congress and Congress decides whether
    to make any changes.
        Extension of 100 percent Federal Medical Assistance Percentage
    [FMAP]. Tribal leaders also agreed to delete a provision that would
    have extended the 100 percent FMAP to services provided to Medicaid
    eligible Indians referred by IHS or tribal programs to outside
    providers, such as referrals made through the contract health services
    program. Under current interpretation of the Centers for Medicare and
    Medicaid Services [CMS], the 100 percent FMAP is made available to
    States only for reimbursements for services provided directly in an IHS
    or tribal facility, even though the only reason the patient required
    care outside the IHS or tribal facility was that the facility could not
    directly provide the service and had to rely on an outside provider.
        While State governments are very supportive of the 100 percent FMAP
    expansion, DHHS objected that its cost was too high--more than $2
    billion over 10 years--and that its financial benefits would flow only
    to the States, not to Indian health programs and their Indian
    beneficiaries. While the NSC disagrees with the Department's
    interpretation of the statute and their conclusions about the effect of
    the proposed amendment, we agreed to delete the provision from the
    IHCIA.
        Waiver of Medicare Late Enrollment Penalty. The 1999 tribal
    proposal--and S. 212 and S. 556--sought to waive the premium penalty
    for any Medicare-eligible Indian who did not timely enroll in Medicare
    Part B because of a number of barriers. The DHHS strongly objected to
    this provision as it would treat Indians differently than other
    Medicare-eligible persons who do not timely enroll. The DHHS asserts
    that the penalty is needed to encourage eligible persons to enroll and
    begin paying Part B premiums when they first become eligible, rather
    than waiting until they become ill and need to use their Medicare
    coverage. Tribal leaders also agreed, reluctantly, to delete this
    provision.
        Regulations. Secretary Thompson objected to the tribal leaders'
    call for all regulations--including Social Security Act regulations
    affecting Indian health providers--to be prepared through Negotiated
    Rulemaking with tribal representatives. He asserted that the large
    number and complexity of Social Security Act regulations makes
    negotiated rulemaking unfeasible. In response to this concern, tribal
    leaders eliminated Social Security Act changes from the bill's
    negotiated rulemaking provision.
        We believe the changes to the original tribal proposal submitted in
    1999 significantly reduce the bill's Federal budget impact. S. 212
    [identical to S. 556] was scored in 2001 as having a Federal budget
    impact of $6.9 billion over 10 years. Deletion of the QIHP and the 100
    percent FMAP provisions together reduce the bill's score by about 70
    percent. We ask that the committee submit a request to the
    Congressional Budget Office to either score S. 556 without the above
    mentioned provisions, or provide a fiscal budget impact on H.R. 2440.
        Conclusion. On behalf of the National Indian Health Board, I would
    like to thank the committee for its consideration of my testimony and
    for your diligence in making the health of American Indian and Alaska
    Native people a high priority of the 108th Congress. I have been
    involved with the National Steering Committee since its inception in
    1999 and have seen the hard work and compromises that the tribal
    leaders have made. Tribal leaders have come to the table to work out
    the more contentious provisions and we urge the committee to act
    swiftly on this important piece of legislation. Further, we request
    that any concerns regarding this legislation are raised in a timely
    manner so that passage of this bill during this session is not
    jeopardized.
                                     ______

    Buford Rolin, Member at Large, National Indian Health Board, Responses
                                  to Questions

        On behalf of the National Indian Health Board [NIHB], a non-profit
    organization established in 1972 to serve nearly 558 federally
    recognized tribal governments in advocating for the improvement of
    health care delivery for American Indians and Alaska Natives, I am
    pleased to respond to your letter dated August 1, 2003 regarding my
    recent testimony on S. 556, the Indian Health Care Improvement Act
    Reauthorization.
        No. 1. Federal Medical Assistance Program [FMAP]. There appears to
    be a concern that a 100-percent FMAP provision is too costly.
        Question A--What is the purpose of the 100 percent FMAP and what
    are the cost estimates used to determine the provision was too costly?
        Response. The discussion of the 100 percent FMAP provision, section
    212 of S. 556, has become quite complicated. The National Steering
    Committee [NSC] endorses passage of a provision of law that will
    clarify the intent of Congress and require full implementation of what
    we, and many states, believe is existing law. We are hopeful that the
    100 percent FMAP provision will compel the Centers for Medicare and
    Medicaid Services [CMS] to do what we think it should already do.
        After the Congressional Budget Office [CBO] issued its score on the
    provision in S. 212, the predecessor to S. 556, and the Administration
    expressed its objection to the provision, the NSC reluctantly
    determined that the provision was likely to hinder efforts to
    reauthorize the Indian Health Care Improvement Act and therefore agreed
    to its removal from the bill in favor of free-standing legislation.
    Current law states: ``the Federal medical assistance percentage shall
    be 100 per centum with respect to amounts expended as medical
    assistance for services which are received through an Indian Health
    Service facility whether operated by the Indian Health Service or by an
    Indian tribe or tribal organization (as defined in section 1602 of
    Title 25).''
        42 U.S.C. Sec.  1396 (d) (b) (emphasis added.). The NSC believes
    that ``through'' encompasses all services provided directly by the
    Indian Health Service [IHS] and tribes and tribal organizations
    operating health programs under the Indian Self-Determination and
    Education Assistance Act [ISDEAA], as well as non-facility based
    services--such as home and community-based services--and services that
    the Indian health program would have paid for from its contract health
    service program, but for the patient being Medicaid eligible. CMS has
    generally interpreted ``through'' to mean ``in,'' applying the 100
    percent FMAP only for services provided in an IHS or tribal facility.
        Authorization of 100 percent reimbursement for States for services
    provided through the IHS reflects Congressional understanding that the
    obligation to provide health care to American Indians and Alaska
    Natives is a Federal obligation deriving from the Constitution,
    treaties and laws and paid for by tribes with hundreds of millions of
    acres of land. Pragmatically, it serves to encourage States to
    recognize the importance of IHS and tribal providers to ensuring that
    Indians have access to culturally appropriate and sensitive health
    care. Please see the response to question B for a more thorough
    discussion of this latter point.
        Unfortunately, the NSC is not privy to the CBO scoring methodology
    or to information that may have been provided to CBO by CMS. We do
    believe it is highly probable that the score is inflated substantially.
    Many States have interpreted the current law to permit them to claim
    exactly what is described in Sec.  212 of S. 556. Accordingly, they
    have been claiming, and until recently, often been being reimbursed, at
    that level. Thus, the expenditures are not new, but part of the current
    budget.
        Second, we believe it possible that the score includes an estimate
    of the cost of all services to Indians by non-IHS providers whether
    there was a referral from the IHS or tribal health program or not. This
    would significantly inflate the score. The intent of the NSC is only
    that services provided based on such a referral be included. By
    limiting it in this way, the continuity of care for Indian patients and
    the integrity of the Indian health system are retained.
        The score was so high that it also makes us wonder if CBO was
    relying on census numbers for estimating the number of Indians instead
    of the number of active users in the Indian health system. What is
    clear to us is that American Indians and Alaska Natives are not
    receiving the benefit of services in amounts anywhere equivalent to the
    CBO estimates and that the Indian health system continues to be
    dramatically underfunded to carry out its mission. Both should be
    remedied.
        Question B--If FMAP is not enacted, is there a chance that some
    States may not extend services to Indians unless the 100-percent FMAP
    applies?
        Response. The relationship between States and tribes varies
    dramatically from State to State, administration to administration,
    issue to issue. It ranges from enmity, to distrust, to indifference
    with occasional shining lights of cooperation. The hostilities arise
    typically from historical and present conflicts over control of
    resources--land, minerals, water, tax base, to name a few. The
    indifference arises from a view that since there is a direct Federal/
    tribal government-to-government relationship, the State has no role.
    This is reinforced by the human tendency to set priorities based on the
    ``out-of-sight out-of-mind'' principle under which rural and remote
    communities suffer, including Indian communities. Increased
    reimbursement for Medicaid expenditures won't cure all of this, but it
    would be a substantial help.
        After the execution of the 1996 Memorandum of Agreement between the
    Health Care Financing Administration [HCFA] [now CMS] and IHS, many
    States demonstrated a significantly higher willingness to work with IHS
    and tribes to include them in their Medicaid programs as providers and
    as programs able to assist Medicaid-eligible Indians to exercise their
    right to participate in the Medicaid program. This did not happen
    overnight and it continues to require diligence and outreach by IHS and
    tribes, but gradually it did happen.
        We hesitate to say that states will roll back their cooperation if
    the narrower interpretations by CMS of their right of recovery is not
    overcome, but in a time when all states are experiencing financial
    pressures, particularly centered on their Medicaid programs, it is a
    high risk. It is a risk we do not believe we should have to take.
        No. 2. 1996 MOA between IHS and DHHS: The 1996 Memorandum of
    Agreement between IHS and DHHS established a 100-percent FMAP which
    applies to certain services provided by IHS and Tribal ``638'' programs
    at their facilities.
        Question--Does the MOA apply to tribes who provide programs that
    are not contracted such as long-term care and, if not, should it?
        Response. In our view the MOA did not change anything substantive
    about the coverage. It makes tribal health facilities, health
    facilities of the IHS, as if there were a lease between IHS and the
    tribe, in order to avoid the wasteful exercise of IHS actually having
    to enter into such leases. Whether the MCA extends to long-term care,
    is really a question about whether the IHS and tribes should offer
    long-term care health services, and whether tribes have the right to do
    so, even if not directly funded by IHS to do so. We believe the answer
    to all these questions is ``yes.'' Tragically, long-term care wasn't a
    priority of the IHS because Indians did not live long enough to require
    it. Tragically, long-term care couldn't be a priority because IHS was
    so short-funded it could not meet acute care demand, let alone expand
    to long-term care. Tragically, Indians who were reluctant to leave
    their families and communities to receive long-term care simply had to
    forego that option because there were few, if any, nursing homes on or
    near reservations and predominantly Indian communities.
        Thankfully, life expectancy is increasing and long-term care
    doesn't only have to mean nursing home care, although it is still an
    important component. Indian tribes and tribal organizations are
    exercising their right to assume responsibility for carrying out
    programs of the IHS under both Title I (self-determination) and Title V
    (self-governance) of the ISDEAA and achieving efficiencies and program
    improvements only imagined by the IHS under which they can exercise
    authority to set priorities locally and redesign their programs
    accordingly. Some tribes have even developed the capability of
    contributing tribal resources to the mix of funding for health services
    and this has meant expansion of services, including long-term care.
    When this occurs, the MOA absolutely should cover tribal long-term
    care. In our view, the better question would be why it shouldn't cover
    long-term care.
        Most health care expenditures come at the end of life--some of that
    expense is due to long-term care. Why should Federal financial
    participation in delivering health services to American Indians and
    Alaska Natives end just at the point the expense becomes greatest?
        No. 3. States Denying Care to Indians. Federal health care to
    Indians arises from the special relationship with and obligations of
    the United States. But, as U.S. citizens, Indians also have equal
    access to other public health programs available to all other U.S.
    citizens.
        Question--Is the National Steering Committee aware of cases where
    States have refused public health insurance coverage for eligible
    Indians because of the belief that health care is a ``Federal
    responsibility''?
        Response. The National Steering Committee is not aware of a
    consistent pattern of such refusals however, tribal leaders are aware
    of individual cases where this has occurred at the application level.
    Despite the well established Federal responsibility to provide health
    services to American Indians and Alaska Natives, tribal members are
    often discriminated against and are denied the opportunity to even
    apply for other public health programs based on the ``Indians receive
    free health care,'' misconception. The result is that tribal members
    often avoid utilizing such resources in order to avoid such
    discrimination and do not utilize those resources that are available to
    them.
        Another barrier that exists for tribal members in accessing
    services outside of the HIS, Tribal, and Urban (I/T/U) system is the
    eligibility application process. The application process is quite
    lengthy and arduous, which discourages participation. Tribal leaders
    are aware of these problems and are taking steps to address them, such
    as working with States to increase participation.

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