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Congressional Testimony
July 20, 2000, Thursday
SECTION: CAPITOL HILL HEARING TESTIMONY
LENGTH: 6734 words
COMMITTEE:
SENATE COMMERCE, SCIENCE AND TRANSPORTATION
HEADLINE: TESTIMONY BUYING AIRLINE TICKETS ON THE
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TESTIMONY-BY: JOHN J. CALLAHAN , ASSISTANT
SECRETARY FOR
AFFILIATION: MANAGEMENT AND BUDGET
BODY: July 26, 2000 STATEMENT OF JOHN J. CALLAHAN
ASSISTANT SECRETARY FOR MANAGEMENT AND BUDGET BEFORE THE SENATE COMMITTEE ON
INDIAN AFFAIRS HEARING ON S. 2526 THE INDIAN HEALTH CARE IMPROVEMENT ACT
REAUTHORIZATION BILL Mr. Chairman and Members of the Committee: Good afternoon,
I am pleased to testify today on behalf of the Secretary of the Department of
Health and Human Services on this historic legislation, S.2526, the Indian
Health Care Improvement Act Reauthorization of 2000. Today, I am accompanied by
Dr. Michael Trujillo, Director of the Indian Health Service (HIS), Mr. Michel
Lincoln, Deputy Director, Mr. Gary Hartz, Acting Director of the Office of
Public Health, and Dr. Craig Vanderwagen, Director, Division of Clinical and
Preventive Services, Office of Public Health. Since Dr. Trujillo last testified
before this Committee, the Department has continued to review and analyze this
complex and expansive proposal as reflected in S. 2526. The Indian Health Care
Improvement Act (IHCIA) was originally enacted in 1976 to provide additional
guidance and authority for the programs of the federal government that deliver
health services to American Indian/Alaska Natives. The reauthorization of this
cornerstone authority provides an opportunity for all of us to revisit the
original intent of this legislation, and examine the Act in light of the many
changes that have occurred in the health care environment during the past 24
years. The IHS has the responsibility for the delivery of health services to
Federally recognized American Indian and Alaska Natives (AVAN) through a system
of IHS, tribal, and urban (ITU)- operated facilities and programs based on
treaties, judicial determinations, and Acts of Congress. The mission of the
agency is to raise the physical, mental, social, and spiritual health of
American Indians and Alaska Natives (AVAN) to the highest level, in partnership
with the population served. The agency goal is to assure that comprehensive,
culturally acceptable personal and public health services are available and
accessible to the service population. And, the Department's responsibility is to
uphold the Federal government's obligation to promote healthy AVAN people,
communities, and cultures and to honor and protect the inherent sovereign rights
of tribes. The Tribal Steering Committee Draft bill, upon which S. 2526 was
based, was submitted to Congress by tribes directly and does not necessarily
represent the Administration's views on policies. The Tribal and urban Indian
health care proposals now contained in this bill recommend the most sweeping
changes in the history of the IHCIA. S. 2526 contains recommendations that
require careful analysis to determine the full impact of the bill's many
recommendations. In drafting the bill, tribal and urban Indian representatives
placed no parameters or limitations on changes that they might consider or
recommend for the reauthorization of IHCIA. This bill includes new requirements
for IHS by establishing new and expanded authorities, which will increase
expectations and place additional pressures on IHS' ability to operate programs
within its limited appropriation. We have concerns that these expansions would
detract from IHS' ability to carry out its mission of providing basic health
care services to AVANs. Also, since many of the new provisions convert grants
into programs available for tribal Self-Determination contracts and compacts,
the associated Contract Support Costs could increase proportionately. The FY
2001 Budget included a historic $230 million increase for IHS. Even though this
is the largest funding increase ever requested, IHS would not be able to
implement these expanded authorities. S.2526 contains eight (8) titles that
encompass most of the health related provisions in the existing IHCIA: Title 1,
Indian Health, Human Resources and Development; Title 11, Health Services; Title
III, Facilities; Title IV, Access to Health Services, Title V, Health Services
for Urban Indians; Title VI, Organizational Improvements; Title VII, Behavioral
Health Programs; and Title VIII, Miscellaneous. The Administration is in the
process of reviewing the many new provisions proposed in the tribal draft
legislation in the context of the President's Budget. We are not prepared today
to provide the Committee with a formal position on this expansive legislation
without completing a thorough review. We will share with you today our views to
date on some of the provisions contained in S.2526. Title I - Indian Health,
Human Resources and Development The purpose of this title is to ensure that
Indian health programs have an adequate supply of trained professionals able to
provide culturally appropriate care. In order to achieve this goal, Title I
includes provisions for the education and training of health care professionals.
Many provisions in the existing statute are proposed to be amended to
accommodate the rapid pace of change in the health fields in future years. We
note that Sec. 105 - Indian Health Professions - combines two separate
scholarship programs into one section. Under the existing statute, Sec. 104
contains the Indian Health Service Scholarship Program and Sec. 120 contains the
Matching Grants program. These two programs are separate in their administration
and we would recommend they remain separate in the reauthorization of this
provision. Title II: Health Services A number of provisions in Title 11 of the
bill will assist in our efforts to reduce unnecessary disease and injury and
raise Indian health to the highest possible level. There are many health care
priorities in Indian Country, but effective prevention and treatment of diabetes
and its related complications must rank among the highest. Sec. 204 of the bill
would institutionalize the progress we are making with the diabetes program
funded under the Balanced Budget Act of 1997, by establishing an ongoing
national program within the lHCIA. This would be comparable to the President's
proposal to amend the diabetes program in the Balanced Budget Act to continue
funding for this important program. Sec. 212 would update and expand our
tuberculosis program to focus more broadly on all communicable and infectious
diseases. Section 224(a) clarifies that patients receiving contract health
services (CHS) authorized by the Service will not be liable for payment of
charges or costs associated with provision of those services. This protection,
together with additional protections in Title IV, would provide greater peace of
mind for Indian patients who worry about dunning letters and damage to their
credit because of CHS provider attempts to recover payments from them as well as
from the Service. Title III: Facilities Sec. 301(a)(2) provides for newly
constructed or renovated facilities, whenever practicable, to meet the
construction standards of any nationally recognized accrediting bodies, not just
JCAHO. This provision recognizes the expanding number of accrediting bodies;
however, the Secretary does not recognize all of them for the various provider
types they accredit. Because it appears as though the intent is to assure that
construction and renovation funds maximize the likelihood of the facility being
able to collect Medicare and Medicaid payments, it may be more appropriate to
revise this provision of the bill to reflect that intent. S.2526 greatly expands
agency program reporting requirements. We have general concerns about the
overall reporting burden placed on IHS because it could require the diversion of
resources from other much needed programs, including patient care, facility
maintenance and other critical areas of the IHS programs. In addition, of
concern is the new provision in Sec. 3 01 (c) that would require the Secretary
to report annually on the needs for health care facilities construction,
including the renovation and expansion needs of existing facilities. While the
first year report to Congress does not require consultation with Tribes, IHS
would need to develop a baseline description of existing facilities and
determine the need based on existing programs, facility conditions, facility
efficiency and other factors. Section 303(b) eliminates applicability of
Davis Bacon wage rates for construction of Indian Health
Service facilities. The Administration has significant concerns about this
provision. The Administration is firmly committed to maintaining the important
worker protections provided by the
Davis-Bacon Act which
applies to workers employed by contractors and subcontractors performing on
Federal or Federally-assisted construction projects. Sec. 3 1 0 provides new
authority for joint ventures between IHS and Tribes as an alternative to the
long wait on the IRS facilities construction priority list. This proposed
authority could assist the IHS and Tribal health programs in meeting the
construction needs of facilities, which average 30 years of age, and maintenance
and repair of many of the facilities in Indian country. Before moving ahead on
any new Joint Venture projects in the future, IHS will need to examine the
following issues: a) find a way to integrate and prioritize joint ventures with
the IHS Facilities Construction Priority Lists; b) ensure that long term costs
associated with staffing and operations are consistent with IHS standards for
providing health care facilities and services to Federally Recognized American
Indians and Alaska Natives can be accommodated by future funding levels; and, c)
assure the funding committed to Joint Venture projects addresses priority needs
for health care facilities and the delivery of health care services with the
highest relative need. Title IV: Access to Health Services and Conforming
Amendments to the Social Security Ac In many respects, the changes in Title IV
are the most far-reaching changes in the bill, both for the IHClA and for the
Social Security Act. We currently do not have cost estimates for this bill. In
addition, we have not thoroughly assessed every provision for administrative
feasibility and consistency with the President's Budget. I will highlight some
provisions in this title. Many of the changes in Title IV and conforming
amendments to the Social Security Act focus on provider payment issues. Previous
amendments to the IHCIA and the Social Security Act allow I/T/Us to bill
Medicare and Medicaid in certain, limited ways and were intended to provide
access to additional funds to supplement, not replace the IHS appropriation.
Since those earlier amendments, both the general health system and Indian health
have changed dramatically. It is important to remember that there are
fundamental differences between public health programs like IHS and many other
HHS health programs, and health insurance programs like Medicare and Medicaid.
Public health programs generally have limited funds, but they have broad
discretion on how those funds may be used. Exactly the opposite is the case with
Medicare and Medicaid, which are health insurance programs that guarantee
payment with unlimited Federal funds, but place their limits on both the type of
benefits and the categories of individuals for which those funds can pay. It is
not surprising that IHS and HCFA programs, starting with such basic differences,
have developed some incompatibilities. Title II, sec. 203 adds a number of
detailed provisions for a new provider type called a Qualified Indian Health
Program (QIHP), for I/T/Us that want to participate in Medicare and Medicaid.
The QIHP provisions contain a number of exceptions to the usual coverage,
payment, and other rules for those programs. While creation of an
Indian-specific provider type could address problems Indian providers face, the
proposed QIHP is extremely complex and would present a number of difficulties in
its administration. Similarly, sec. 423 sets out a series of managed care
payment rules and exceptions which may have unintended adverse consequences. In
a growing number of States, health is dominated by managed care. Exempting
Indian health from such systems could leave Indian providers and their patients
without access to the significant advantages of increased benefits and care
coordination common to such managed care systems. A simpler and more effective
approach needs to be developed to address these issues. Some proposed solutions
in the bill are broader than necessary to address the underlying problems. For
example-we understand that some people have read the current Emergency Medical
Treatment and Active Labor Act (EMTALA) to require that Indian clinics transport
emergency patients to their parent hospital even when an appropriate transfer to
a closer hospital is warranted. As HCFA stated in its recent regulation
concerning provider-based status, HCFA does not actually read EMTALA this way.
We believe the problem could be addressed by some targeted technical assistance
to Indian facilities on their responsibilities under EMTALA. In any case, it is
unnecessary and perhaps unwise to exempt Indian clinics from the very important
EMTALA patient protections, as Title 11, sec. 202(e) proposes. We have concerns
with several other provisions in Title IV, including the following issues. 1 00%
Reimbursement to States Several provisions of the bill would extend the I 00%
Federal matching rate to States for additional Medicaid and SCHIP services to
Al/ANs. This would increase Federal program and related administrative costs.
Requirement on Medicare to reimburse for all non facility-based services This
provision would require Medicare to reimburse for all non facility-based
services (e.g., home health, community- based care, ambulance services,
physicians, DME, lab) provided by IHS providers. Currently, the Medicare statute
requires HCFA to reimburse IHS for facility- based services (e.g., hospitals and
SNFs). This would add significant new costs to the Medicare program. Improving
Access of Indian Beneficiaries to Medicare, Medicaid, and SCHIP Sec. 419
proposes to waive Medicaid and SCRIP premiums and Medicare, Medicaid, and SCHIP
cost sharing. The Administration is on record supporting waiver of premiums and
cost sharing for Indian beneficiaries in SCHIP. The Medicare late enrollment
penalty is necessary for an insurance program like Medicare to avoid the
negative economic consequences of "adverse selection" where individuals do not
enroll or pay premiums until they are ill with costly health conditions. A
statutory waiver of the Medicare late enrollment penalty, therefore, is
undesirable and unnecessary given administrative actions, and provisions
elsewhere in the bill, that will encourage low-income Indian elders and persons
with disabilities to enroll in Medicaid, which will pay Medicare premiums for
them. Consultation Many sections of S. 2526 have tribal consultation
requirements. We are concerned that these added responsibilities would stretch
our resources at the expense of other programmatic responsibilities. Tribal
consultation has been an important priority for this Administration. In HHS, we
appreciate the value of consultation and are increasingly involved with Tribes
in this process. However, we have some concerns about the specific manner in
which Section 414(a) of S. 2526 would require consultation to occur. This
provision requires consultation, as defined in Executive Order 13084 of May 14,
1998, to be held with Indian Health Service, Tribes and Urban Indian Health
Programs (I/T/U's) prior to HCFA adopting any policy or regulation. Similar
language in section 514 requires all Health and Human Services agencies to
consult with urban Indian organizations prior to taking any action, or approving
any action of a state, that may affect urban Indians or urban Indian
organizations. While we value meaningful consultation on matters relevant to
tribes and ITU providers, we believe these sections of the bill could be
improved by providing for a process that more specifically identifies
regulations and policies relevant to Tribes, I/T/U providers and urban Indians.
In addition, reference to a particular Executive Order may be impractical if it
is superseded or rescinded. It may be more effective to use language in the
current Department of Health and Human Services (HHS) consultation policy.
Negotiated Rule Making HHS agencies have had first-hand experience with the
positive contributions of negotiated rule making. Section 553 of 5 U.S.C.
Negotiated Rule Making, lists factors to be considered in determining whether or
not to use the negotiated rule making procedure. These factors include: a
limited number of identifiable interests that will be significantly affected by
the rule as well as reasonable likelihood that a committee can be convened with
a balanced representation of persons who are willing to negotiate in good faith
to reach agreement by consensus on the proposed rule within a fixed period of
time. Where such factors are present, negotiated rule making can be very helpful
in structuring a process through which relevant stakeholders participate
constructively in developing a recommended rule. However, S. 2526 would require
negotiated rule making in many of its provisions. For example, Section 414 (b)
would require HCFA to use the negotiated rule making for the development of all
regulations to implement provisions contained in Title IV that would amend the
Social Security Act, and section 802 would require the Secretary to use
negotiated rule making for all regulations to implement this Act. Negotiated
rule making is very resource intensive for both Federal and non-Federal
participants, and may not be the most effective way to obtain necessary I/T/U
provider input in the development IHCIA rules and regulations. We would
recommend instead utilizing the consultation to identify areas in the
reauthorization legislation where the negotiated rule making process would be
appropriate for the development of regulations. Additionally, Section 802(b) of
the bill limits membership on negotiated rule making committees to Federal and
Tribal representatives. For committees to implement provisions related to
Medicare, Medicaid and State Children's Health Insurance Program (SCHIP), it
would be important to include representatives of State agencies charged with
implementing these programs, as well as other key provider and beneficiary
interests. This would increase opportunities for Tribal and other Indian
representatives to build consensus and support in the development of final rules
to implement the bill's various provisions. Other General Comments In a number
of sections in the bill, for example Section 103(a), the word "grant" is
stricken and replaced by "make funds available." Deleting the word "grant
raises" the concern that the Department's regulations at 45 CFR might not apply
to any funding agreements under this bill. We suggest using the term "grant"
where appropriate throughout the bill. There are also several sections, for
example section 516(a), where the Secretary is directed to pay for services that
are not presently provided. In the absence of additional appropriations,
complying with these provisions would require funding reductions for existing
services that are no less necessary. We suggest that any requirement for the
Provision of new services be subject to the availability of appropriations. We
have not had an opportunity to field cross-agency concerns over many exemptions
for tribes, tribal organizations, and urban organizations on broader
long-standing Federal policies, including the
Davis-Bacon Act,
the Buy American Act, Section II 7 of the Internal Revenue Code of 1986, the
Federal Reports Elimination Act of 1998, and the Anti-Deficiency Act. Title V:
Health Services for Urban Indians Title V authorizes the IHS to assist in
meeting the health care needs of American Indians and Alaska Natives living in
urban areas. Currently, urban Indian health programs serve approximately 149,000
urban Indians in 34 cities through the country. We estimate that over 350,000
urban Indians are eligible for services. With a few exceptions, funding
authority for urban Indian health is specifically limited to Title IV and Title
V. All other references to urban Indian health found in the other titles of the
bill address areas such as consultation, rule making planning or reporting only.
S.2526 would streamline the process for contracting and making grants to urban
Indian organizations. While we support a streamlined process for contracting and
grant making, we do have concerns with the elimination of certain criteria in
the existing statute in S. 2526. In the existing IHCIA, Sec. 503 of Title V
requires that the urban organization successfully undertake certain activities
as a condition to entering into a contract with IHS for the provision of health
care and referral services for urban Indians residing in the particular urban
center. The elimination of these criteria would be appropriate for on-going
urban Indian contractors, but for new contractors, it would be important to
retain those requirements as conditions for awarding a contract or grant. Title
V also contains new authority for the establishment of an Urban Indian Health
Care Facility Revolving Loan Fund to provide guaranteed loans to urban Indian
health contractors and grant recipients for construction, renovation, expansion,
or purchase of health care facilities. In addition, Title V authorizes the
extension of Federal Tort Claims Act coverage for urban Indian health programs.
These new provisions could assist urban Indian health programs, however, they
would require additional resources and we would need to assess how these new
provisions fit into the Administration's priorities for Indian health. Title VI:
Organizational Immovernents Sec. 60 1 (a)(2) provides for the elevation of the
Director of the IHS to Assistant Secretary for Indian Health. The Administration
has presented testimony before this committee in support of S. 299, the
stand-alone bill that contains the identical provisions of Sec. 601. We believe
this provision would provide a stronger coordination and advocacy role in budget
and policy matter related to Indian health. In addition, Sec. 602 (d) would
authorize the Secretary, acting through the Assistant Secretary for Indian
Health to enter into contracts, agreements, and joint ventures with other
Federal agencies, States, and private and nonprofit organizations, for the
purpose of enhancing information technology in Indian health programs and
facilities. The Administration promotes the partnership and collaboration with
our sister Federal agencies in a variety of areas related to Indian health in
order to maximize our resources and involvement with other Federal programs in
the provision of health related services to AVANs. Title VII: Behavioral Health
Programs Title VII includes many sections that were transferred from Title 11,
Health Services, in the existing IHCIA. This title includes major revisions,
specifically to integrate Alcohol and Substance Abuse provisions with Mental
Health and Social Service authorities. Where appropriate, the term tribes,
tribal organizations and Indian organizations are referenced in addition to IHS.
A broad range of behavioral health services is described under "continuum of
care." Several related sections were moved from Title VIII in the existing
IHCIA, including the section related to Fetal Alcohol Syndrome and Child Sexual
Abuse. Demonstration programs were eliminated and replaced with language
authorizing programs for Indian tribes and tribal organizations. A new section
would authorize the establishment of at least one inpatient psychiatric
treatment facility per IHS Area. These new centers would be funded on a similar
basis as the Regional Youth Treatment Centers authorized in the existing IHCIA
We are concerned about the feasibility of establishing at least one inpatient
psychiatric treatment facility per Area. The cost could be prohibitive and there
could be difficulties in recruiting and retaining specialized staff, as well as
the complexities of starting a new provider type. Title VIII: Miscellaneous
Section 813 would deem tribal contractors and compactors as ordering agents of
the Indian Health Service. We recommend that this language be revised to be
consistent with the language in H.R. II 67 that authorizes tribal access to
Federal sources of supply only for the purposes of carrying out an agreement
under the Indian Self-Determination and Education Act. This title establishes a
National Bi-Partisan Commission on Indian Health Care Entitlement. This
commission would be comprised of members of Congress, Tribal leaders, and Urban
Indian health leaders to study the desirability and feasibility of making Indian
health an entitlement. While many Tribal leaders and Indian people believe that
the provision of health care to them should be a legal entitlement, there are
many questions regarding the ramifications, including the costs, of such an
entitlement. Mr. Chairman, this concludes my statement. Thank you for the
opportunity to discuss the reauthorization of the Indian Health Care Improvement
Act. We will continue to analyze the implications of this expansive legislation
and will be happy to work with the committee and the Indian Health Care National
Tribal Steering Committee to address the Administration's concerns. As we move
into the new millennium, we must acknowledge and fulfill the long overdue
obligation to advance the health status of Indian people to the highest possible
level. We will be happy to answer any questions that you may have.
LOAD-DATE: August 21, 2000, Monday