S. Rept. 106-152 - AMENDING THE INDIAN HEALTH CARE IMPROVEMENT ACT TO MAKE PERMANENT THE DEMONSTRATION PROGRAM THAT ALLOWS FOR DIRECT BILLING OF MEDICARE, MEDICAID, AND OTHER THIRD PARTY PAYORS, AND TO EXPAND THE ELIGIBILITY UNDER SUCH PROGRAM TO OTHER TRIBES AND TRIBAL ORGANIZATIONS106th Congress (1999-2000)
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Calendar No. 272
106th Congress Report
SENATE
1st Session 106-152
======================================================================
AMENDING THE INDIAN HEALTH CARE IMPROVEMENT ACT TO MAKE PERMANENT THE
DEMONSTRATION PROGRAM THAT ALLOWS FOR DIRECT BILLING OF MEDICARE,
MEDICAID, AND OTHER THIRD PARTY PAYORS, AND TO EXPAND THE ELIGIBILITY
UNDER SUCH PROGRAM TO OTHER TRIBES AND TRIBAL ORGANIZATIONS
_______
September 8, 1999.--Ordered to be printed
_______________________________________________________________________
Mr. Campbell, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 406]
The Committee on Indian Affairs, to which was referred the
bill (S. 406) to amend the Indian Health Care Improvement Act
to make permanent the demonstration program that allows for
direct billing of medicare, medicaid, and other third party
payors, and to expand the eligibility under such program to
other tribes and tribal organizations, having considered the
same, reports favorably thereon with an amendment in the nature
of a substitute, and recommends that the bill (as amended) to
pass.
Purpose
The purpose of S. 406 is to make permanent a direct billing
demonstration program authorized by the Indian Health Care
Improvement Act Amendments of 1988, Pub. L. 100-713. The bill
makes the program permanent for the four demonstration programs
and expands the eligibility to other tribes and tribal
organizations which operate IHS hospitals and clinics. It
provides that all funds received through the program be used
specifically to maintain accreditation or, if that has been
secured, to address the lack of health resources available to
that tribe. The bill recognizes the success of the
demonstration program, and that the program enhances and
reinforces the ideas contained in the Indian Self-Determination
and Assistance Act (Pub. L. 93-638, 25 U.S.C. 450 et seq.) to
strengthen the government-to-government relationship between
tribes and the Federal government.
Background
In exchange for the cession of millions of acres of land to
which Indian tribes held aboriginal title, the United States
entered into treaties with Indian nations. Many of the treaties
provided that health care services would be guaranteed to the
citizens of Indian country in perpetuity.
The Federal obligation for the provision of health care
services in Indian country also arises out of the special trust
relationship between the United States and Indian tribes, as
reflected in Article I, Section 8, Clause 3 of the U.S.
Constitution, which has been given form and substance by
numerous treaties, laws, Supreme Court decisions, and Executive
Orders.
The first Federal statute authorizing the appropriation of
Federal funds to carry out the United States' trust and treaty
responsibilities was the Snyder Act of 1921, 25 U.S.C. 13. In
1976, the Indian Health Care Improvement Act (``IHCIA'') became
law. The IHCIA was the first comprehensive statute specifically
addressing the provision of health care in Indian country and
the Federal administration of health care of Native Americans.
In 1988, amendments to the IHCIA provided for the creation of a
Medicare and Medicaid direct billing demonstration program
which is made permanent by this legislation.
a. the IHS and billing practices
Prior to 1988, tribes who operated IHS hospitals and
clinics submitted their requests for reimbursement for Medicare
and Medicaid outlays or expenditures to the Indian Health
Service. The submission of that request began a complex,
arduous process which did not always result in payment.
Once a patient was seen by the IHS facility, a claim was
generated and sent to the Indian Health Service Area Office.
The Area Office, in turn, made a claim to the Fiscal
Intermediary (the agent responsible for processing Medicare and
Medicaid claims (oftentimes a state) responsible for payment of
the claim.
Once the Fiscal Intermediary paid the IHS Area Office, the
funds were deposited in the Federal reserve and sent to the
Department of the Treasury, where payment was apportioned back
to the IHS Headquarters. The Area Office would then request
funds from IHS Headquarters, and once the amount an Area Office
would receive was determined, the Area Office would modify the
Tribe's ``638'' contract to reflect the actual amount received
from IHS Headquarters and which was to be paid to the tribe.
When the payment was received by the tribe operating IHS
facility, it was always difficult, if not impossible, for the
tribe to determine which of the submitted claims had been paid
and which had been denied, as there was no list provided which
identified claim numbers to the tribe. Oftentimes, according to
tribal officials, if a payment register was received, it would
not be for months or years after the original claim was made
and no attempt could be made to resubmit the claim. Officials
reported periods as long as two years between submission of a
claim and reimbursement or denial of the claim.
Tribal officials also claimed that for a period of time the
problems with a claim resulted from incorrect submissions made
by the IHS, whose computer system had malfunctioned. A Medicare
audit later uncovered the errors, and tribes were made to repay
the overpayment claimed by the IHS system, along with
penalties, even though they had no control over the submission
to the Fiscal Intermediary, nor any way of determining that
they had in fact received an overpayment.\1\
---------------------------------------------------------------------------
\1\ See Department of Health and Human Services, Report to
Congress on the Tribal Demonstration Program on Direct Billing for
Medicare, Medicaid and Other Third Party Payors, Appendix D, December
15, 1998.
---------------------------------------------------------------------------
b. history of the demonstration program
In 1988, the Indian Health Care Improvement Act was
amended. In the course of gathering information regarding the
IHCIA, several tribal leaders submitted comments regarding the
desire of tribes to streamline the process for billing Medicare
and Medicaid reimbursements.
Specifically, Indian tribes and tribal organizations who
contracted the operation and administration of IHS facilities
stated that,
. . . should they be allowed to retain all of the
funds they collect from Medicaid and Medicare
reimbursements and third party insurers, they could
better control their own cost accounting systems and
accounts receivable, and that they could thereby
maximize and increase the amounts collected from such
sources. Tribes and tribal organizations believe that
the policy of self-determination dictates this step
toward a degree of financial autonomy that will better
equip them to one day assume the full range of
responsibilities that are associated with the provision
of health care. Evidence submitted by tribalcontractors
in Alaska would indicate that because of certain legal impediments that
exist to the collection of third party resources by the Indian Health
Service, tribal contractors can in fact collect amounts from third
party sources far in excess of the amounts that Indian Health Service
is able to collect.--S. Rep. 100-508, 100th Cong., 2nd Sess. 1988, 1988
U.S.C.C.A.N. 6183, 1988 WL 169927.
The Committee, in its report to the Senate, stated its
intention to review the effectiveness of the demonstration
program after several years in order to make an informed
decision as to whether to continue the program and offer it to
additional participants. S. Rep. 100-508, 100th Cong., 2nd
Sess. 1988, 1988 U.S.C.C.A.N. 6183, 1988 WL 169927.
In 1996, Congress, based on evidence presented to it
regarding the success of the Demonstration Program, extended
the Demonstration Program for two more years to allow time for
the DHHS to make its report to Congress. The program was
extended again in 1998, based upon a favorable report made to
Congress by DHHS.
c. Demonstration Program Results
Four facilities were chosen to participate in the
Demonstration Program: the Southeast Alaska Regional Health
Consortium (``SEARHC''), Sitka, Alaska; the Bristol Bay Area
Health Corporation, Dillingham, Alaska; the Choctaw Nation of
Oklahoma, Durant Oklahoma; and the Mississippi Band of Choctaw
Indians, Philadelphia, Mississippi.
Under the terms of the Demonstration Program, the
participants were authorized to make claims directly to the
Fiscal Intermediary for reimbursement. In order to become a
participant, the tribe's facility had to meet IHS requirements
for operation of its own programs and the facility needed to be
accredited by an accrediting body designated by the Secretary--
the Joint Commission on Accreditation of Healthcare
Organizations (``JCAHO'').
All funds reimbursed were required to be used for specific
purposes. The first priority for the funds received was to make
improvements within the facility which would allow it to
maintain compliance with the conditions and requirements
applicable generally to all facilities under Medicare and
Medicaid programs (to continue to be accredited by the
accrediting body). If funds remained after compliance was
maintained, the excess was to be used only to improve the
health resources available to the Indian tribe. All funds were
to be expended in accordance with IHS regulations applicable to
funds provided by the IHS under a contract entered into under
the Indian Self-Determination Act (25 U.S.C. 450f et seq.).
The Medicare and Medicaid Direct Billing Demonstration
Program was, by all accounts, a success. The Department of
Health and Human Services, in a report delivered to Congress in
December of 1998, stated that the ``demonstration project has
been a success as it has simplified, streamlined, and increased
collections.'' The DHHS reported that the direct billing
process had four positive effects for the four participating
tribes.
Medicare and Medicaid collections increased dramatically at
all four facilities. The increase in collections for both
Medicaid and Medicare combined ranged from 152% at the SEARHC
facility to 364% at the Bristol Bay facility.
The increased collections were used by all four tribes to
address compliance issues at their facilities. The body
designated by the Secretary as responsible for accreditation
was the Joint Commission on Accreditation of Healthcare
Organizations (JCAHO), and all programs were required to meet
JCAHO standards for accreditation before participating in the
Demonstration Project.
During the term of the Demonstration Project, all four
facilities reported increases in their status and ratings with
the JCAHO and three of the projects reported significant
increases in their standing with the JCAHO. SEARHC reported
receiving the highest score possible. The SEARHC facility also
received the highest ranking possible for the years 1996 and
1997.
Three of the four participants also reported that they
expended excess funds to improve the health resources available
to the tribe. Most of these funds were used to improve
facilities, to acquire additional medical equipment, and to
hire additional staff. The Mississippi Band of Choctaw Indians
reported that additional funds were used to open three new
clinics, geared toward tuberculosis, diabetes and Women's
Wellness. The Choctaw Nation of Oklahoma reported program
expansions at three locations, the opening of a diabetes
treatment center and the use of an improved information system.
The remaining participants reported that the increased
collections were used to hire new staff and implement projects
that both improved their JCAHO rating and improved the health
resources offered by the tribe.
Finally, all projects reported a large decrease in the
amount of time between billing and collection. Each tribe
reported saving at least two months time, and one tribe
reported saving up to eight months time between billing and
collection. This was largely due to increased, direct contact
with the Fiscal Intermediary. The participants reported that
the direct contact with the Fiscal Intermediary allowed them to
``improve billings and collection practices, improve management
of accounts receivable, reduce the time between billing and
collection, and improve management planning on use of
collections.'' \2\
---------------------------------------------------------------------------
\2\ See Department of Health and Human Services, Report to Congress
on the Tribal Demonstration Program on Direct Billing for Medicare,
Medicaid and Other Third Party Payors, page 9, December 15, 1998.
---------------------------------------------------------------------------
The Department went on to recommend that the Demonstration
Program be made permanent and that the program be open to an
expanded number of participants.\3\
---------------------------------------------------------------------------
\3\ Department of Health and Human Services, Report to Congress on
the Tribal Demonstration Program on Direct Billing for Medicare,
Medicaid and Other Third Party Payors, page 10, December 15, 1998.
---------------------------------------------------------------------------
On August 4, 1999, the Committee held a hearing to discuss
the provisions of S. 406. Witnesses attending the hearing
included a representative of the DHHS/IHS, Mr. Michel E.
Lincoln, a participant in the pilot project, the Honorable
Gregory Pyle, Chief of the Choctaw Nation of Oklahoma, Dr.
Buford Rolin of the National Indian Health Board and W. Ron
Allen of the National Congress of American Indians.
Every witness stated their support for the provision of S.
406. The Honorable Gregory Pyle summed it up this way,
``Without question Senate Bill 406 is a win win situation for
the tribes and the Indian Health Service * * * ''
S. 406 creates a more efficient and effective means for the
Medicare and Medicaid reimbursement to tribes. But more
importantly, it is a recognition of the government to
government relationship that exists between the federal
government and Indian tribes, and furthers the policy of tribal
self-determination by allowing tribes to best determine the
allocation and use of funds received.
Legislative History
S. 406 was introduced on February 10, 1999, by Senator
Murkowski for himself, and Senators Lott, Campbell, Inouye,
Inhofe, Baucus and Cochran. Senator Hatch was added as a
cosponsor on September 8, 1999. S. 406 was referred to the
Committee on Indian Affairs. The bill was the subject of a
hearing held by the Senate Committee on Indian Affairs on
August 4, 1999. S. 406 was ordered to be reported to the full
Senate on August 4, 1999.
Section-by-Section Analysis
Section 1. Short title
This section contains the title of the Act as the ``Alaska
Native and American Indian Direct Reimbursement Act of 1999.''
Section 2. Findings
This section authorizes the permanent establishment of the
direct billing program; states the benefits of the program;
states the expiration and extension dates; and gives the
benefit of providing permanent status to the demonstration
program.
Section 3. Direct billing of Medicare, and other third party payors
Subsection (a) amends Section 405 of 25 U.S.C. 1645 to
provide for the permanent authorization and establishment of
the direct billing program. Subsection (a) also provides for
the amendments of Section 405 of IHCIA as follows.
Subsection (a)(1) authorizes tribes to directly bill for
payment to be made under the Medicare program (Title XVIII of
the Social Security Act (42 U.S.C. 1395 et seq.)), State plans
for medical assistance approved under Title XIX of the Social
Security Act, and third party payors.
Subsection (a)(2) provides for direct billing from the
Medicaid program (section 1905(b) of the Social Security Act,
42 U.S.C. 1396(b)).
Subsection (b)(1) describes that the funds reimbursed will
first be used by the hospital or clinic for the purposes of
making any improvements in the hospital or clinic that may be
necessary to achieve or maintain compliance with the conditions
and requirements applicable to facilities of such type under
the Medicare or Medicaid programs.
Subsection (b)(2) states that all tribal hospitals and
clinics participating in the program shall be subject to all
auditing requirements applicable to programs administered
directly by the Service.
Subsection (b)(3) provides for Secretarial oversight of the
program by requiring the submission of annual reports by
participants of the program.
Subsection (b)(4) ensures that no payments will be made out
of the special funds described in Section 1880(c) of the Social
Security Act (42 U.S.C. 1395qq(c)) or section 402(a) of the
IHCIA.
Subsection (c)(1) establishes the eligibility requirements
for participation in the program.
Subsection (c)(2) sets forth the required contents of the
tribal application for participation in the program; the
timeline for approval by the Secretary or the submitted
applications; allows for the continued, uninterrupted
participation of the demonstration program participants; and
states the duration of the approved application.
Subsection (d)(1) gives the authority to the Secretary for
the examination of any administrative changes that may be
necessary to facilitate direct billing and reimbursement.
Subsection (d)(2) sets out the reporting requirements for
accounting information that a participant will have to submit
to the Secretary, and provides for periodic changes in the
required information.
Subsection (e) allows for a participant to withdraw from
the program in the same manner that a tribe retrocedes a
contracted program to the Secretary under authority of the
Indian Self-Determination Act (25 U.S.C. 450 et seq.)
Subsection (b) provides for conforming amendments of this
Act.
Subsection (c) states the effective date of this Act as
October 1, 2000.
Cost and Budgetary Considerations
U.S. Congress,
Congressional Budget Office,
Washington, DC, August 27, 1999.
Hon. Ben Nighthorse Campbell,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 406, the Alaska
Native and American Indian Direct Reimbursement Act of 1999.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Dorothy
Rosenbaum.
Sincerely,
Barry B. Anderson
(For Dan L. Crippen, Director).
Enclosure.
congressional budget office cost estimate
S. 406--Alaska Native and American Indian Direct Reimbursement Act of
1999
Summary: S.406 would extend indefinitely an Indian Health
Services (IHS) demonstration project that allows four tribally-
operated IHS facilities to bill the Medicare and Medicaid
programs directly, rather than submitting their claims through
the IHS. The bill also would allow all other tribally-operated
IHS facilities to bill Medicare and Medicaid directly. CBO
estimates that the bill would raise federal outlays by $9 to
$10 million in each of fiscal years 2001 to 2004. Federal
Medicare outlays would be higher by about $3 million a year,
and federal Medicaid outlays would be higher by about $7
million a year. Because the bill would affect direct spending,
pay-as-you-go procedures would apply.
S. 406 contains no private-sector or intergovernmental
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
Participation in the direct billing program could improve the
cash-flow of health facilities operated by tribal governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 406 is shown in the following table. The
costs of this legislation fall within budget functions 550
(health) and 570 (Medicare).
----------------------------------------------------------------------------------------------------------------
Outlays, by fiscal years, in million of dollars--
-----------------------------------------------------------
1999 2000 2001 2002 2003 2004
------------------------------------------------------------------------------------------------------------ ------
CHANGES IN DIRECT SPENDING
Medicare............................................... O 0 3 3 3 3
Medicaid............................................... O 0 7 7 6 6
--------------------------------------------------------
Total.................................................. O 0 10 10 9 9
----------------------------------------------------------------------------------------------------------------
Note.--Components may not sum to totals because of rounding.
Basis of estimate: Under current law, four tribally-
operated Indian Health Service demonstration sites are
authorized to bill the Medicare and Medicaid programs directly
rather than submitting their claims through the IHS. The
demonstration authority expires September 30, 2000. S. 406
would allow all tribally-operated IHS facilities to bill
Medicare and Medicaid directly.
According to IHS, seven hospitals are tribally-operated and
would likely choose to bill Medicare and Medicaid directly. In
1997, Medicare and Medicaid collections totaled $55 million in
these facilities. In addition, more than 150 health stations,
health centers, and clinics would be eligible to bill directly
under the legislation. CBO assumes that all of the hospitals
would choose to bill directly over the next several years but
that only a few of the largest of the other facilities would
develop the infrastructure necessary to adopt direct billing.
CBO further assumes that a few additional hospitals would
become tribally-operated and begin to bill directly.
Based on information from the IHS on the experiences in the
demonstration sites, CBO assumes that direct billing would
increase Medicare and Medicaid payments for two reasons. First,
the demonstration sites report a reduction in the amount of
time between filing reimbursement claims and receiving payment.
CBO therefore assumes that in the first year a facility
participated in direct billing, it would receive one to two
extra months worth of Medicare and Medicaid payments. The
legislation would also increase federal costs in the four
existing demonstration sites because under current law they are
required to return to billing Medicare and Medicaid through IHS
and will therefore experience a one- to two-month slow-down in
Medicare and Medicaid collections. Of the $37 million in
estimated Medicare and Medicaid costs over the 2000-2004
period, $11 million is attributable to the one-time
acceleration of payments.
Second, demonstration sites reported increased Medicare and
Medicaid payments under direct billing because of improved
claims processing. The sites reported that they were better
able to track their claims and to correct errors under direct
billing than when they filed their claims through the IHS.
Medicare and Medicaid payments have grown dramatically in both
demonstration sites and nondemonstration IHS facilities in the
ten years since the demonstration was authorized. Much of the
growth stems from higher Medicare and Medicaid reimbursement
rates for IHS facilities, efforts by IHS to improve its
Medicare and Medicaid collections, and general growth in
medical costs and enrollment, rather than from direct billing.
Nonetheless, based on the experience in the demonstration
sites, CBO assumes that the improved claims processing
procedures that direct billing enables would increase Medicare
and Medicaid payments by about 10 percent in the facilities
that choose to undertake it.
In addition, direct billing may slightly reduce IHS
administrative costs, which are subject to annual
appropriations.
Pay-as-you-go considerations: Section 252 of the Balanced
Budget and Emergency Deficit Control Act sets up pay-as-you-go
procedures for legislation affecting direct spending or
receipts. The net changes in outlays and governmental receipts
that are subject to pay-as-you-go procedures are shown in the
following table. For the purpose of enforcing pay-as-you-go
procedures, only the effects in the current year, the budget
year, and the succeeding four years are counted.
----------------------------------------------------------------------------------------------------------------
By fiscal years, in millions of dollars--
----------------------------------------------------------------------------
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
----------------------------------------------------------------------------------------------------------------
Changes in outlays................. 0 0 10 9 9 9 9 10 11 11 12
Changes in receipts................ Not applicable
----------------------------------------------------------------------------------------------------------------
Estimated impact on state, local, and tribal governments:
S. 406 contains no intergovernmental mandates as defined in
UMRA. By allowing all tribally-operated IHS facilities to bill
Medicare and Medicaid directly, the bill would shorten the
period of time for receiving reimbursements and improve
processing procedures. Medicare and Medicaid amounts supporting
trial health facilities are 100-percent federally funded. The
direct billing would increase the cash-flow position of
facilities that chose to participate.
Estimated impact on the private sector: The bill contains
no private-sector mandates as defined in UMRA.
Previous CBO estimates: In July 1998, in a letter to
Senator Frank H. Murkowski, CBO estimated that extending the
direct billing authority would increase Medicare and Medicaid
costs by about $5 million a year. CBO relied on a similar
methodology in this estimate, but the estimate now is higher
for two reasons. First, in January 1999 the Department of
Health and Human Services increased the rates paid to IHS
facilities by an estimated 15 percent. The higher rates
increase the cost of the legislation because there would be
larger amounts paid to the facilities that implement direct
billing. Second, a very large hospital, Alaska Native Medical
Center (ANMC), whose Medicare and Medicaid collections are
almost as large as the total for the other tribally-operated
hospitals that do not participate in the demonstration project,
has become tribally-operated since CBO completed the July 1998
estimate. In the earlier estimate CBO assumed that ANMC would
become tribally-operated and participate in direct billing late
in the projection period. Now CBO assumes ANMC would
participate shortly after the bill becomes effective.
Estimate prepared by: Federal Costs: Dorothy Rosenbaum.
Impact on State, Local, and Tribal Governments: Leo Lex. Impact
on the Private Sector: Stuart Hagen.
Estimate approved by: Paul N. Van de Water, Assistant
Director for Budget Analysis.
Regulatory and Paperwork Impact Statement
Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires that each report accompanying a bill to
evaluate the regulatory and paperwork impact that would be
incurred in carrying out the bill. The Committee believes that
S. 1770 will have minimal regulatory or paperwork impact.
Changes in Existing Law
In compliance with subsection 12 of the XXVI of the
Standing Rules of the Senate, the Committee states that
enactment of S. 406, as amended, will result in the following
changes in the following statutes as noted below. Deletions are
in brackets; new material is in italic.
1. Section 405 of the Indian Health Care Improvement Act
(25 U.S.C. 1645) is amended as follows:
[(a) Establishment.--The Secretary shall establish a
demonstration program under which Indian tribes, tribal
organizations, and Alaska Native health organizations, which
are contracting the entire operation of an entire hospital or
clinic of the Service under the authority of the Indian Self-
Determination Act (25 U.S.C. 450f et seq.), shall directly bill
for, and receive payment for, health care services provided by
such hospital or clinic for which payment is made under title
XVIII of the Social Security Act (42 U.S.C. 1395 et seq.)
(medicare), under a State plan for medical assistance approved
under title XIX of the Social Security Act (42 U.S.C. 1396 et
seq.) (medicaid), or from any other third-party payor. The last
sentence of section 1905(b) of the Social Security Act (42
U.S.C. 1396d(b)) shall apply for purposes of the demonstration
program.
[(b) Direct Reimbursement.--
[(1) Each hospital or clinic participating in the
demonstration program described in subsection (a) of
this section shall be reimbursed directly under the
medicare and medicaid programs for services furnished,
without regard to the provisions of section 1880(c) of
the Social Security Act (42 U.S.C. 1395qq(c)) and
sections 1642(a) and 1680c(b)(2)(A) of this title, but
all funds so reimbursed shall first be used by the
hospital or clinic for the purpose of making any
improvements in the hospital or clinic that may be
necessary to achieve or maintain compliance with the
conditions and requirements applicable generally to
facilities of such type under the medicare or medicaid
program. Any funds so reimbursed which are in excess of
the amount necessary to achieve or maintain such
conditions or requirements shall be used--
[(A) solely for improving the health
resources deficiency level of the Indian tribe,
and
[(B) in accordance with the regulations of
the Service applicable to funds provided by the
Service under any contract entered into under
the Indian Self-Determination Act (25 U.S.C.
450f et seq.).
[(2) The amounts paid to the hospitals and clinics
participating in the demonstration program described in
subsection (a) of this section shall be subject to all
auditing requirements applicable to programs
administered directly by the Service and to facilities
participating in the medicare and medicaid programs.
[(3) The Secretary shall monitor the performance of
hospitals and clinics participating in the
demonstration program described in subsection (a) of
this section, and shall require such hospitals and
clinics to submit reports on the program to the
Secretary on a quarterly basis (or more frequently if
the Secretary deems it to be necessary).
[(4) Notwithstanding section 1880(c) of the Social
Security Act (42 U.S.C. 1395qq(c)) or section 1642(a)
of this title, no payment may be made out of the
special fund described in section 1880(c) of the Social
Security Act, or section 1642(a) of this title, for the
benefit of any hospital or clinic participating in the
demonstration program described in subsection (a) of
this section during the period of such participation.
[(c) Requirement for Participation.--
[(1--In order to be considered for participation in
the demonstration program described in subsection (a)
of this section, a hospital or clinic must submit an
application to the Secretary which establishes to the
satisfaction of the Secretary that--
[(A) the Indian tribe, tribal organization,
or Alaska Native health organization contracts
the entire operation of the Service facility.
[(B) the facility is eligible to participate
in the medicare and medicaid programs under
sections 1880 and 1911 of the Social Security
Act (42 U.S.C. 1395qq, 1396j);
[(C) the facility meets any requirements
which apply to programs operated directly by
the Service; and
[(D) the facility is accredited by the Joint
Commission on Accreditation of Hospitals, or
has submitted a plan, which has been approved
by the Secretary, for achieving such
accreditation prior to October 1, 1990.
[(2) From among the qualified applicants, the
Secretary shall, prior to October 1, 1989, select no
more than 4 facilities to participate in the
demonstration program described in subsection (a) of
this section. The demonstration program described in
subsection (a) of this section shall begin by no later
than October 1, 1991, and end on September 30, 1998.
[(d) Examination and Implementation Changes.--
[(1) On November 23, 1998, the Secretary, acting
through the Service, shall commence an examination of--
[(A) any administrative changes which may be
necessary to allow direct billing and
reimbursement under the demonstration program
described in subsection (a) of this section,
including any agreements with States which may be
necessary to provide for such direct billing
under the medicaid program; and
[(B) any changes which may be necessary to
enable participants in such demonstration
program to provide to the Service medical
records information on patients served under
such demonstration program which is consistent
with the medical records information system of
the Service.
[(2) Prior to the commencement of the demonstration
program described in subsection (a) of this section,
the Secretary shall implement all changes required as a
result of the examinations conducted under paragraph
(1).
[(3) Prior to October 1, 1990, the Secretary shall
determine any accounting information which a
participant in the demonstration program described in
subsection (a) of this section would be required to
report.
[(e) Report.--The Secretary shall submit a final report at
the end of fiscal year 1996, on the activities carried out
under the demonstration program described in subsection (a) of
this section which shall include an evaluation of whether such
activities have fulfilled the objectives of such program. In
such report the Secretary shall provide a recommendation, based
upon the results of such demonstration program, as to whether
direct billing of, and reimbursement by, the medicare and
medicaid programs and other third-party payors should be
authorized for all Indian tribes and Alaska Native health
organizations which are contracting the entire operation of a
facility of the Service.
[(f) Retrocession of Contract.--The Secretary shall provide
for the retrocession of any contract entered into between a
participant in the demonstration program described in
subsection (a) of this section and the Service under the
authority of the Indian Self-Determination Act (25 U.S.C. 450f
et seq.). All cost accounting and billing authority shall be
retroceded to the Secretary upon the Secretary's acceptance of
a retroceded contract.]
(a) Establishment of Direct Billing Program.--
(1) In general.--The Secretary shall establish a
program under which Indian tribes, tribal
organizations, and Alaska Native health organizations
that contract or compact for the operation of a
hospital or clinic of the Service under the Indian
Self-Determination and Education Assistance Act may
elect to directly bill for, and receive payment for,
health care services provided by such hospital or
clinic for which payment is made under title XVIII of
the Social Security Act (42 U.S.C. 1395 et seq.) (in
this section referred to as the ``medicare program''),
under a State plan for medical assistance approved
under title XIX of the Social Security Act (42 U.S.C.
1396 et seq.) (in this section referred to as the
``medical program''), or from any other third party
payor.
(2) Application of 100 percent fmap.--The third
sentence of section 1905(b) of the Social Security Act
(42 U.S.C. 1396d(b)) shall apply for purposes of
reimbursement under the medicaid program for health
care services directly billed under the program
established under this section.
(b) Direct Reimbursement.--
(1) Use of funds.--Each hospital or clinic
participating in the program described in subsection
(a) of this section shall be reimbursed directly under
the medicare and medicaid programs for services
furnished, without regard to the provisions of section
1880(c) of the Social Security Act (42 U.S.C.
1395qq(c)) and sections 402(a) and 813(b)(2)(A), but
all funds so reimbursed shall first be used by the
hospital or clinic for the purpose of making any
improvements in the hospital or clinic that may be
necessary to achieve or maintain compliance with the
conditions and requirements applicable generally to
facilities of such type under the medicare or medicaid
programs. Any funds so reimbursed which are in excess
of the amount necessary to achieve or maintain such
conditions shall be used--
(A) solely for improving the health resources
deficiency level of the Indian tribe; and
(B) in accordance with the regulations of the
Service applicable to funds provided by the
Service under any contract entered into under
the Indian Self-Determination Act (25 U.S.C.
450f et seq.).
(2) Audits.--The amounts paid to the hospitals and
clinics participating in the program established under
this section shall be subject to all auditing
requirements applicable to programs administered
directly by the Service and to facilities participating
in the medicare and medicaid programs.
(3) Secretarial oversight.--Any participant in the
demonstration program authorized under this section as
in effect on the day before the date of enactment of
the Alaska Native and American Indian Direct
Reimbursement Act of 1999 shall only be required to
submit annual reports under this paragraph.
(4) No payments from special funds.--Notwithstanding
section 1880(c) of the Social Security Act (42 U.S.C.
1395qq(c)) or section 402(a), no payment may be made
out of the special funds described in such sections for
the benefit of any hospital or clinic during the period
that the hospital or clinic participates in the program
established under this section.
(c) Requirements for Participation.--
(1) Application.--Except as provided in paragraph
(2)(B), in order to be eligible for participation in
the program established under this section, an Indian
tribe, tribal organization, or Alaska Native health
organization shall submit an application to the
Secretary that establishes to the satisfaction of the
Secretary that--
(A) the Indian tribe, tribal organization, or
Alaska Native health organization contracts or
compacts for the operation of a facility of the
Service;
(B) the facility is eligible to participate in the
medicare or medicaid programs under section 1880 or
1911 of the Social Security Act (42 U.S.C. 1395qq;
1396j);
(C) the facility meets the requirements that apply to
programs operated directly by the Service; and
(D) the facility is accredited by an accrediting body
designated by the Secretary or has submitted a plan,
which has been approved by the Secretary, for achieving
such accreditation.
(2) Approval.--
(A) In general.--The Secretary shall review
and approve a qualified application not later
than 90 days after the date the application is
submitted to the Secretary unless the Secretary
determines that any of the criteria set forth
in paragraph (1) are not met.
(B) Grandfather of demonstration program
participants.--Any participant in the
demonstration program authorized under this
section as in effect on the day before the date
of enactment of the Alaska Native and American
Indian Direct Reimbursement Act of 1999 shall
be deemed approved for participation in the
program established under this section and
shall not be required to submit an application
in order to participate in the program.
(C) Duration.--an approval by the Secretary
of a qualified application under subparagraph
(A), or a deemed approval of a demonstration
program under subparagraph (B), shall continue
in effect as long as the approved applicant or
the deemed approved demonstration program meets
the requirements of this section.
(d) Examination and Implementation of Changes.--
(1) In general.--The Secretary, acting through the
Service, and with the assistance of the Administrator
of the Health Care Financing Administration, shall
examine on an ongoing basis and implement--
(A) any administrative changes that may be
necessary to facilitate direct billing and
reimbursement under the program established
under this section, including any agreements
with States that may be necessary to provide
for direct billing under the medicaid program;
and
(B) any changes that may be necessary to
enable participants in the program established
under this section to provide to the Service
medical records information on patients served
under the program that is consistent with the
medical records information system of the
Service.
(2) Accounting information.--The accounting
information that a participant in the program
established under this section shall be required
toreport shall be the same as the information required
to be reported by participants in the demonstration
program authorized under this section as in effect on
the day before the date of enactment of the Alaska
Native and American Indian Direct Reimbursement Act of
1999. The Secretary may from time to time, after
consultation with the program participants, change the
accounting information submission requirements.
(e) Withdrawl From Program.--A participant in the program
established under this section may withdraw from participation
in the same manner and under the same conditions that a tribe
or tribal organization may retrocede a contracted program to
the Secretary under authority of the Indian Self-Determination
Act (25 U.S.C. 450 et seq.). All cost accounting and billing
authority under the program established under this section
shall be returned to the Secretary upon the Secretary's
acceptance of the withdrawal of participation in this program.
2. Section 1880 of the Social Security Act (42 U.S.C.
1395qq) is amended by adding at the end the following:
(e) For provisions relating to the authority of certain
Indian tribes, tribal organizations, and Alaska Native health
organizations to elect to directly bill for, and receive
payment for, health care services provided by a hospital or
clinic of such tribes or organizations and for which payment
may be made under this title, see section 405 of the Indian
Health Care Improvement Act (25 U.S.C. 1645).
3. Section 1911 of the Social Security Act (42 U.S.C.
1396j) is amended by adding at the end the following:
(d) For provisions relating to the authority of certain
Indian tribes, tribal organizations, and Alaska Native health
organizations to elect to directly bill for, and receive
payment for, health care services provided by a hospital or
clinic of such tribes or organizations and for which payment
may be made under this title, see section 405 of the Indian
Health Care Improvement Act (25 U.S.c. 1645).