2015 October TSGAC Combined - Internet Copy

Transcription

IHS SELF-GOVERNANCE ADVISORY
COMMITTEE (TSGAC)
QUARTERLY MEETING
October 6-7, 2015
Embassy Suites DC Convention Center
900 10th Street Northwest, Washington, DC 20001
Phone: (202) 739-2001
IHS Tribal Self-Governance Advisory Committee and Technical Workgroup
Quarterly Meeting
Tuesday, October 6, 2015
Wednesday, October 7, 2015
Embassy Suites Washington DC - DC Convention Center
th
900-10 Street NW
Washington, DC 20001
Phone: (202) 739-2001
Table of Contents
1. TSGAC AGENDA


2015-2016 TSGAC Calendar
TSGAC Membership Matrix
2. TSGAC Committee Business




July Quarterly meeting Summary
July Quarterly Meeting Assignment Matrix
TSGAC Correspondence Matrix
Bemidji Area Nomination
3. Tribal Caucus



Updated IHS Advance Appropriations Strategy White Paper
Updated Title VI Strategy White Paper
Updated ACA Implementation White Paper
4. OTSG Update

TSGAC Comments on IHS 2014 Report to Congress
5. CSC Workgroup Update

Updated CSC Strategic Plan Strategy White Paper
6. Budget Update


IHS Budget Summary Recommendations
Table of unfunded IHCIA Provisions (Updated July 2011)
7. ACA Implementation and Update
 Policy Memo: Federal Poverty Levels for Medicaid and Marketplace
Enrollment in 2016
 Policy Memo: Indexing Adjustments Related to Certain Affordable Care
Act Provisions for 2015 and 2016
8. Tribes as Employers under ACA


NIHB Response to Notice 2015-16 on Section 4980I — Excise Tax on High Cost
Employer-Sponsored Health Coverage
IRS Notice 2015-15





Request for Administrative Relief from Employer Mandate Tax Penalties For
Tribal Member Employees Who Are Exempt from the Individual Mandate
Relief from the ACA’s Employer Mandate: Consideration of Applying “Veteran’s
Approach” to Tribal Governments
Example of Impact of Employer Mandate on a Tribe / Tribal Employees
First Letter to the White House: Request for Tribal Relief from the Affordable
Care Act Employer Mandate
Second Letter to the White House: Request for Tribal Relief from the Affordable
Care Act Employer Mandate
9. CMS TTAG Updates


TTAG Workgroup Report
Hobbs Straus Alert for 100% FMAP Proposal
10. IHS Updates on ACA and IHCIA


TSGAC Letter to IHS Regarding Quality Reporting Measures
TSGAC Comments Regarding Medicare-Like Rate Proposal
IHS TRIBAL SELF-GOVERNANCE ADVISORY COMMITTEE
c/o Self-Governance Communication and Education
P.O. Box 1734, McAlester, OK 74501
Telephone (918) 302-0252 ~ Facsimile (918) 423-7639 ~ Website: www.Tribalselfgov.org
INDIAN HEALTH SERVICE TRIBAL SELF-GOVERNANCE ADVISORY COMMITTEE
AND TECHNICAL WORKGROUP QUARTERLY MEETING
Tuesday, October 6, 2015 (8:00 am to 5:00 pm)
Wednesday, October 7, 2015 (8:30 am to 1:30 pm)
th
900-10 Street NW
Phone: (202) 739-2001
AGENDA
Tuesday, October 6, 2015 (8:00 am to 5:00 pm)
Meeting of IHS Tribal Self-Governance Advisory Committee (TSGAC) and Technical Workgroup
with Deputy Director Robert G. McSwain
8:00 am
Tribal Caucus
Facilitated by: Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut
and Chairwoman, Indian Health Service (IHS) Tribal Self-Governance Advisory
Committee (TSGAC)
Strategy Session Update:
 Budget Priorities from the Tribal Self-Governance Strategic Planning Meeting
Legislative Update:
 Exemption from sequestration
 Self-Governance Authority Expansion – Indian Self-Determination and Education
Assistance Act (ISDEAA) Title VI Update
 Contract Support Costs (CSC) Mandatory Appropriation
9:00 am
TSGAC Opening Remarks
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut and
Chairwoman, IHS TSGAC
9:10 am
TSGAC Committee Business
 Approval of Meeting Summary (July 2015)
 2016 Quarterly Meeting Calendar
 Approval of Bemidji Area Representative
 Approval of ISAC Member
9:20 am
IHS Opening Remarks and Update
Robert G. McSwain, Deputy Director, Indian Health Service
9:40 am
Office of Tribal Self-Governance Update
P. Benjamin Smith, Director, Office of Tribal Self-Governance, IHS
10:00 am
Break
IHS TSGAC & Technical Workgroup Quarterly Meeting
October 6-7, 2015 – AGENDA
Page 2
10:15 am
Contract Support Cost Workgroup Update and Discussion
 Mandatory Contract Support Cost FY 2016 President’s Budget Proposal
 Contract Support Cost Workgroup Update
 Resolution of Incurred Cost and Categorical Duplication Issues
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut
Chairman W. Ron Allen, Jamestown S’Klallam Tribe
Mickey Peercy and Rhonda Butcher, IHS Contract Support Costs Workgroup Members
Roselyn Tso, IHS CSC Team Lead
11:15 am
Budget Update
 Exemption from sequestration
 Budget Priorities from the Tribal Self-Governance Strategic Planning Meeting
 IHS Budget Summit Recommendations
 FY 2016 Funding Plan
 Preparing for FY 2017 Budget Formulation (Regional Recommendations)
 Unfunded IHCIA Provisions
Liz Fowler, Deputy Director for Management Operations, IHS
Melanie Fourkiller, Policy Analyst, Choctaw Nation and TSGAC Tribal Co-Chair
Caitrin Shuy, Director, Congressional Relations, NIHB
12:00 noon
Lunch Break
1:30 pm
Patient Protection and Affordable Care Act (ACA) Implementation and Update
 IHS funding for TSGAC Outreach and Education
 Limited Cost Sharing Plans – enrollment and referrals
 Tribal sponsorship through Marketplace – recent progress
Mim Dixon, Consultant, Tribal Self-Governance Advisory Committee
Cyndi Ferguson, Self-Governance Specialist/Policy Analyst, SENSE Incorporated
Doneg McDonough, Consultant, Tribal Self-Governance Advisory Committee
1:40 pm
Tribes as Employers under ACA
 Cadillac Health Care Plan “Tax”
 Employer Mandate Exemption
Doneg McDonough, Consultant, Tribal Self-Governance Advisory Committee
Elliott Milhollin, Partner, Hobbs Strauss Dean & Walker
Laura Bird, Legislative Associate, National Congress of American Indians
2:00 pm
CMS TTAG Updates
 Pending rule for grandfathered FQHCs
 100% FMAP Proposals
 Essential Community Provider networks and data collection
Geoffrey Roth, Senior Advisor to the Director, IHS
Kitty Marx, Director, CMCS Division of Tribal Affairs, CMS
2:45 pm
IHS Updates on ACA and IHCIA
 IHS Medicare-Like Rates Regulation – status and measurement of outcomes
 Aligning Quality Data Requirements for Medicare, Medicaid and GPRA
Geoffrey Roth, Senior Advisor to the Director, IHS
October 6-7, 2015 – AGENDA
Page 3
3:00 pm
Break
3:15 pm
Joint TSGAC and IHS Deputy Director Discussion
 Open discussion for new issues or items already discussed.
 SDPI funding
 Grant funding outside Self-Governance
4:45 pm
Closing Remarks
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut and Chairwoman,
IHS TSGAC
Robert McSwain, Acting Director, Indian Health Service
Wednesday, October 7, 2015 (8:30 am – 1:30 pm)
Meeting of IHS Tribal Self-Governance Advisory Committee (TSGAC) and Technical Workgroup
with Deputy Director Robert G. McSwain
8:30 am
Welcome
Invocation
Roll Call
Introductions – All Participants & Invited Guests
9:00 am
Opening Remarks
IHS TSGAC
Robert McSwain, Deputy Director, Indian Health Service
9:30 am
Open discussion for new issues or items already discussed.
10:30 am
ACA Employer Mandate Exemption and Cadillac Tax Discussion
IHS TSGAC
Dr. Elaine Buckberg, Deputy Assistant Secretary for Policy, Office of Economic Policy,
Department of Treasury
11:30 am
Lunch
12:30 pm
TSGAC Technical Workgroup Meeting
1:00 pm
Adjourn TSGAC Meeting
2015-2016 National Calendar
Date
Meeting
Location
October 6-7,2015
IHS TSGAC Quarterly Meeting
October 7-8, 2015
DOI SGAC Quarterly Meeting
October 14-17, 2015
NIEA 2015 Convention and Trade Show
Portland, OR
October 15-17, 2015
AFN Annual Convention
Anchorage, AK
October 26-28, 2015
USET Annual Meeting
Choctaw, MS
Embassy Suites-DC
Convention Center
November 18-19, 2015 TIBC Meeting
Washington, DC
December 1-2, 2015
HHS STAC Meeting
Washington, DC
January 26-27, 2016
January 27-28, 2016
February 22-25, 2016
NCAI Executive Council Winter Session
March 29-30, 2016
March 30-31, 2016
April 24-28, 2016
2016 Annual Consultation Conference
2016 NCAI Mid Year Conference &
Marketplace
June 27-30, 2016
July 19-20, 2016
July 20-21, 2016
September 7-8, 2016
2016 Tribal Self-Governance Annual
Strategy Session
Embassy Suites-DC
Convention Center
Washington, DC
Embassy Suites-DC
Convention Center
Buena Vista PalaceOrlando, FL
Spokane, WA
Embassy Suites-DC
Convention Center
TBD
September 19-23, 2016 NIHB Annual Consumer Conference
Tucson Area
October 5-8, 2016
NIEA National Convention
Reno, NV
October 9-14, 2016
73rd Annual NCA Convention & Marketplace Phoenix, AZ
October 25-26, 2016
October 26-27, 2016
Embassy Suites-DC
Convention Center
Telephone (918) 302-0252 ~ Facsimile (918) 423-7639 ~ Website: www.tribalselfgov.org
MEMBERSHIP LIST
(July 27, 2015)
AREA
MEMBER (name/title/organization)
STATUS CONTACT INFORMATION
Alaska
Jaylene Peterson-Nyren
Executive Director, Kenaitze Indian Tribe
Primary
Gerald “Jerry” Moses
Senior Director, Intergovernmental Affairs,
Alaska Native Tribal Health Consortium
Alternate
Luis Romero, Governor
Pueblo of Taos
Primary
Raymond Loretto, DVM, Governor
Pueblo of Jemez
Alternate
Greg Matson, Vice Chairman
Oneida Tribe of Wisconsin
Primary
Jessica Burger, Tribal Councilor, 9-County
Representative [PENDING APPROVAL]
Little River Band of Ottawa Indians
Alternate
Beau Mitchell, Council Member
Chippewa Cree Tribe
Primary
Shelly Fyant, Tribal Council Member
The Confederated Salish and Kootenai Tribes
of the Flathead Nation
Alternate
Ryan Jackson, Council Member
Hoopa Valley Tribe
Primary
Robert Smith, Chairman
Pala Band of Mission Indians
Alternate
Marilynn (Lynn) Malerba, Chief
Mohegan Tribe of Connecticut
TSGAC Chairwoman
Primary
Casey Cooper, Chief Executive Officer
Eastern Band of Cherokee Indians Hospital
Alternate
Albuquerque
Bemidji
Billings
California
Nashville
Page 1 of 6
150 N Willow St.
Kenai, AK 99611
P: (907) 335-7200
Email: [email protected]
4000 Ambassador Drive, LIGA
Department
Anchorage, AK 99508
P: (907) 729-1900
PO Box 1846
Taos, NM 87571
P: 575-758-9593 ~ F: 575-758-4604
PO BOX 100
Jemez Pueblo, NM 87024
P: 575-834-7359 ~ F: 575-834-7331
Email:
[email protected]
PO Box 365
Oneida, WI 54155
P: (920) 869-4403
2608 Government Center Drive
Manistee, MI 49660
P: (231) 398-6867
PO Box 544
Box Elder, MT 59521
PO BOX 278
Pablo, MT 59855
P: (406) 275-2700 ~ F: (406) 275-2806
Email:
PO Box 1348
Hoopa, CA 95546
35961 Pala-Temecula Rd.
Pala, CA 92059
P: 760-891-3519 ~ F: 760-891-3584
5 Crow Hill Road
Uncasville, CT 06382
P: 860-862-6192 ~ F:
43 John Crowe Hill Rd.
PO Box 666
Cherokee, NC 28719
Email:
[email protected]
TSGAC & Technical Work Group Membership List
July 27, 2015
Navajo
Oklahoma
Oklahoma
Phoenix
Portland
Jonathan Nez, Vice President
Navajo Nation
Primary
PO BOX 7440
Window Rock, AZ 86515
P: (928) 871-7000
Nathaniel Brown, Honorable Delegate of
rd
the 23 Navajo Nation Council
Alternate
PO BOX 3390
Window Rock, AZ 86515
P: (928) 871-6380
John Barrett, Jr., Chairman
Rhonda Butcher, Director
Citizen Potawatomi Nation
Primary
Proxy
George Thurman, Principal Chief
Sac and Fox Nation
Alternate
Jefferson Keel, Lt. Governor
Chickasaw Nation
Primary
Gary Batton, Chief
Mickey Peercy, Executive Director
Choctaw Nation of Oklahoma
Alternate
Proxy
Lindsey Manning, Chairman
Shoshone-Paiute Tribes of the Duck Valley
Indian Reservation
Primary
1601 S. Gordon Cooper Dr.
Shawnee, OK 74801
P: 405-275-3121 x 1157
F:405-275-4658
Route 2, Box 47
Stroud, OK 74079
P: 918-968-3526
Email::[email protected]
PO Box 1548
Ada, OK 74821
P: 580-436-7232 ~ F: 580-436-7209
PO Box 1210
Durant, OK 74702
P: 580-924-8280 ~ F: 580-920-3138
PO BOX 219
Owyhee, Nevada 89832
P: 208-759-3100 ~ F: 208-759-3102
VACANT
Alternate
W. Ron Allen, Tribal Chairman/CEO
Jamestown S’Klallam Tribe
TSGAC Vice-Chairman
Primary
1033 Old Blyn Highway
Sequim, WA 98382
P: 360-681-4621 ~ F: 360-681-4643
Tyson Johnston, Vice President
Quinault Indian Nation
Alternate
P.O. Box 189 (1214 Aalis Drive)
Taholah, WA 98587
P: 360-276-8211 ~ F: 360-276-4191
Page 2 of 6
TSGAC TECHNICAL WORKGROUP
AREA
MEMBER (name/title/organization)
STATUS CONTACT INFORMATION
Alaska
Dave Mather, Ph.D
Mather & Associates
Tech Rep
Brandon Biddle
Alaska Native Tribal Health Consortium
Tech Rep
Alberta Unok
Deputy Director
Alaska Native Health Board
Tech Rep
Albuquerque
Shawn Duran
Tech Rep
Bemidji
John Mojica
Mille Lacs Band of Ojibwe
Tech Rep
Billings
Ed Parisian
Chippewa Cree Tribe
Tech Rep
California
D.C.
(National)
Nashville
1569 Northfield Rd
Fairbanks, AK 99709
P: 907-455-6942 ~ F: 907-455-7391
4000 Ambassador Drive
Anchorage, Alaska 99508
P: 907-729-4687
Anchorage, Alaska 99508
P: 907-562-6006
P.O. Box 1846
Taos, N.M. 87571
Office: 575.758.8626 ext. 115
Fax: 575.758.8831
Mobile: 575.741.0208
43408 Oodena Drive
Onamia, MN 56359
P: 320-532-7479 ~ F: 320-532-7505
PO Box 544
Box Elder, MT 59521
Tech Rep
C. Juliet Pittman
SENSE Incorporated
Tech Rep
Cyndi Ferguson
SENSE Incorporated
Tech Rep
Mim Dixon
Tech Rep
(Health
Reform)
Doneg McDonough
Tech Rep
(Health
Reform)
Tech Rep
Dee Sabattus
United South and Eastern Tribes
Page 3 of 6
Upshaw Place
th
1130 -20 Street, NW; Suite 220
P: 202-628-1151 ~ F: 202-638-4502
Upshaw Place
th
1130 -20 Street, NW; Suite 220
P: (202) 628-1151 ~ F: (603) 754-7625
C: (202) 638-4502
4139 Dietz Farm Circle NW
Albuquerque, NM 87107
Phone (505)345-2221
Fax (505)345-2960
Phone: 202-486-3343 (cell)
Fax: 202-499-1384
711 Stewarts Pike Ferry, Suite 100
Nashville, TN 37214
July 27, 2015
Hillary Andrews
United South and Eastern Tribes
Tech Rep
Navajo
Carolyn Drouin
Navajo Nation Washington Office
Oklahoma
Mickey Peercy
Choctaw Nation
Tech Rep
Rhonda Farrimond
Choctaw Nation
Tech Rep
Melanie Fourkiller
Choctaw Nation
Tribal Technical Co-Chair
Tech Rep
Theodore Scribner
Chickasaw Nation
Tech Rep
Vickie Hanvey
Cherokee Nation
Tech Rep
Kasie Nichols
Citizen Potawatomi Nation
Tech Rep
Clint Hastings
Cherokee Nation
Tech Rep
Jennifer McLaughlin
Jamestown S’Klallam Tribe
Tech Rep
Jim Roberts
Northwest Portland Area Indian Health Board
Tech Rep
Eugena R Hobucket
Quinault Indian Nation
Tech Rep
Portland
Page 4 of 6
400 North Capitol Street, NW
Suite 585 Washington, DC 20001
750 First Street NE, Suite 1010
Washington, D.C. 20002
P: 202.682.7390 ~ F: 202.682.7391
E-mail: [email protected]
PO Box 1210
Durant, OK 74702
P: 580-924-8280 ~ F: 580-920-3138
PO Box 1210
Durant, OK 74702
P: 580-924-8280 ~ F: 580-920-3138
PO Box 1210
Durant, OK 74702
P: 580-924-8280 ~ F: 580-920-3138
C: 918-453-7338
PO Box 1548
Ada, OK 74821-1548
P: 580-436-7214 ~ F: 580-310-6461
Email:[email protected]
PO Box 948
Tahlequah, OK 74465
P: 918-456-0671 ~ F: 918-458-6157
1601 S. Gordon Cooper Dr.
Shawnee, OK 74801
P: 405.275.3121 ~ F: 405.275.0198
C: 405-474-9126
[email protected]
PO Box 948
Tahlequah, OK 74465
P: 918-456-0671 ~ F: 918-458-6157
1033 Old Blyn Highway
Sequim, WA 98382
P: (360) 681-4612 ~ F: (360) 681-4648
527 SW Hall #300
Portland, OR 97201
P: (503) 228-4185 ~ F: (503) 228-8182
PO BOX 189
Taholah WA 98587
P: (360) 276-8211 ~ F: (360) 276-8201
FEDERAL TECHS
AREA
MEMBER (name/title)
STATUS
CONTACT INFORMATION
HQ
Jennifer Cooper
Deputy Director, OTSG
(Federal Tech Co-Chair)
OTSG Rep
801 Thompson Ave, Suite 240
Rockville, MD 20852
P: 301-443-7821 ~F: 310-443-1050
[email protected]
Jeremy Marshall, Policy Analyst, OTSG
OTSG Rep
Rockville, MD 20852
P: 301-443-7821 ~F: 310-443-1050
[email protected]
Jessica Smith-Kaprosy, Policy Analyst, OTSG
OTSG Rep
Rockville, MD 20852
P: 301-443-7821 ~F: 310-443-1050
[email protected]
Aberdeen
Sandy Nelson (POC)
Director, Office of Tribal Programs
Area Rep
115 4th Avenue, SE, Suite 309
Aberdeen, SD 57401
P: 605-226-7276 ~F: 605-226-7541
[email protected]
Alaska
Evangelyn Dotomain (POC)
Director, Office of Tribal Programs
Area Rep
Anchorage, AK 99508-5928
P: 907-729-3677 ~F: 907-729-3678
[email protected]
California
Travis Coleman
IHS Agency Lead Negotiator
Area Rep
Nashville
Lindsay King
Area Rep
650 Capitol Mall, Ste 7-100
Sacramento, CA 95814
P: 916-930-3927 ~F: 916-930-3952
[email protected]
711 Stewarts Ferry Pike
Nashville, TN 37214-2634
P: 615- 467-1521 ~F: 615-467-1625
[email protected]
Navajo
Floyd Thompson
Executive Officer/ IHS Agency Lead Negotiator
Area Rep
Alva Tom (POC)
Director, Indian Self-Determination
Area Rep
Max Tahsuda
Director, Tribal Self-Determination
(Acting) IHS Agency Lead Negotiator (Alaska)
Denise Imholt
Area Rep
Robert L. Price (POC)
Public Health Advisor
Office of Tribal Affairs
Area Rep
Oklahoma
Portland
Tucson
Page 5 of 6
Area Rep
Hwy 264 (St. Michael, AZ)
Window Rock, AZ 86515-9020
P: 928-871-1444 ~F: 928-871-5819
[email protected]
Hwy 264 (St. Michael, AZ)
Window Rock, AZ 86515-9020
P: 928-871-1444 ~F: 928-871-5819
[email protected]
701 Market Drive
Oklahoma City, OK 73114
P: 405-951-3761 ~F: 405-951-3868
[email protected]
1414 NW Northrup Street, Suite 800
Portland, OR 97209
P: 503-414-7792 ~F:503-414-7791
[email protected]
7900 South J Stock Road
Tucson, AZ 85746
P: 520-295-2403 ~F:520-295-2540
[email protected]
July 27, 2015
OTHER RESOURCES
MEMBER (name/title)
ORGANIZATION
CONTACT INFORMATION
Laura Bird
Policy Analyst
National Congress of American
Indians
Caitrin Shuy
Director of Congressional Relations
National Indian Health Board
1516 P ST NW
Washington, DC
P: 202-507-4085
TSGAC Mailing Address:
Page 6 of 6
INDIAN HEALTH SERVICE TRIBAL SELF-GOVERNANCE ADVISORY COMMITTEE
AND TECHNICAL WORKGROUP QUARTERLY MEETING
Tuesday, July 21, 2015 (8:00 am to 5:00 pm)
Wednesday, July 22, 2015 (8:30 am to 1:30 pm)
th
900-10 Street NW
Phone: (202) 739-2001
Meeting Summary
Tuesday, July 21, 2015 (8:00 am to 5:00 pm)
Meeting of Indian Health Service (IHS) Tribal Self-Governance Advisory Committee
(TSGAC) and Technical Workgroup with IHS Deputy Director Robert G. McSwain
Chief Lynn Malerba, TSGAC Chairwoman, called the TSGAC meeting to Order at 9:10 AM Eastern.
Invocation
Vice-President Johnston provided the opening invocation.
TSGAC members and guests introduced themselves.
Roll Call
Alaska:
Jerry Moses, Senior Director, Intergovernmental Affairs, Alaska Native Tribal Health
Consortium
California:
Shane McCullough, Councilman, Hoopa Valley Tribe
Nashville:
Marilynn “Lynn” Malerba, Chief, Mohegan Tribe
Tobias Vanderhoop, Chairman, Wampanoag Tribe of Gay Head (Aquinnah)
Stephanie White, Treasurer, Wampanoag Tribe of Gay Head (Aquinnah)
Navajo:
Carolyn Drouin, Proxy for Vice President Nez
Oklahoma 1: Rhonda Butcher, Proxy for Chairman Baker
George Thurman, Principal Chief, Sac and Fox Nation
Oklahoma 2: Mickey Peercy, Proxy for Chief Batton, Choctaw Nation
Vickey Hanvey, Proxy for Principal Chief Baker
Phoenix:
Lindsay Manning, Chairman, Shoshone-Paiute Tribes of the Duck Valley Indian
Reservation
Portland:
W. Ron Allen, Chairman, Jamestown S’Klallam Tribe
Tyson Johnston, Vice President, Quinault Indian Nation
Julie Finkbonner, Councilwoman, Lummi Indian Nation
Aliza Brown, 3rd Councilwoman, Quinault Indian Nation
Albuquerque: Raymond Loretto, DVM, Governor, Pueblo of Jemez
Shawn Duran, Tribal Administrator, Taos Pueblo
July 21-22, 2015 – MEETING SUMMARY
Page 2
TSGAC Opening Remarks
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut and Chairwoman, IHS TSGAC
Chief Malerba welcomed TSGAC Member and thanked everyone for traveling. She also thanked
everyone for their hard work and continued partnership.
IHS Opening Remarks and Update
Robert G. McSwain, Deputy Director, Indian Health Service
- Deputy Director thanked attendees for traveling to DC and looks forward to his second meeting
with Self-Governance.
- Mr. McSwain also highlighted the first DSTAC/TSGAC meeting in May. During the meeting the
two groups discuss commonalities.
o Mr. McSwain feels that the meeting worked towards improving the relationship between
DSTAC/TSGAC and hopes to see additional meetings in the future.
- Change in title to Deputy Director
o Mr. McSwain’s “Acting” status expired in early July and he had to return to his prior title.
o Though his time as the Acting Director ran out, the Secretary has given him full
authorities to act as the Director of IHS.
- FY 2017 Budget Request
o IHS has moved the 2017 budget forward and things look good from the Secretary’s
office.
o The request still needs to clear OMB and will be shared with the full Presidential budget
in February 2016.
o IHS continues to advocate for Indian health care and budget increases to support need.
- Joint Ventures are moving ahead and scoring summaries will be going out to Tribes.
- Contract Support Costs
o Leadership agreed that the issues raised in the TSGAC letter regarding CSC will
referred to the CSC Workgroup for discussion and further input.
- Medicaid Expansion
o Alaska just announced they are going to expand Medicaid. This will continue to support
expanded services in Alaska.
- Gen I Initiatives
o IHS has allocated $25 million to support Generation Indigenous Initiatives including
Suicide and Meth Prevention
o SAMHSA also has $25 million to support similar prevention programs.
o Pathways Internships
 IHS already has 28 pathways internships across the Nation.
- Staffing and Housing
o Mr. McSwain has charged the FAAB to look at the need for residency housing.
- Mr. McSwain values his partnership with TSGAC and plans to move forward. He has identified
several outstanding issues on which he hopes to move forward in the near future.
Office of Tribal Self-Governance Update
P. Benjamin Smith, Director, Office of Tribal Self-Governance
- Self-Governance Tribes are setting a path for the future…Tribes are changing the interaction with
the Federal government, encouraging greater consultation and taking over more of federal
responsibilities.
- OTSG has hosted two regional trainings thus far and both were very successful. An additional
training is being hosted at the Mohegan Sun in August.
- OTSG is hosting internal training this week on writing clarity, internal procedures, and the
importance of fundamental contract principles to ISDEAA negotiations.
-
-
-
-
Page 3
OTSG Staff Update
o Alexandria Smith is the new OTSG Staff Assistant
 She has experience in the Marine Corp for four years and will work with all the
analysts to keep the analysts and office running.
o Jennifer Cooper will return to OTSG on 7/27/15 as the Deputy Director full time.
o The office will be recruiting for a program management and policy analyst soon.
OTSG Database
o Will be changed to the Office of Tribal Self-Governance Funds Management (OTSGFM)
System and is being updated to meet the standards of modern technology.
o The new system will continue to provide access to funding agreements, provide information
for budget justification.
o It will also meet USA Spending requirements.
Planning and Cooperative Agreements Update
o Over seventeen applications were received this year; seven agreements were awarded.
o Five planning cooperative agreements
 Two of these went to the Great Plains (one of the areas without current
representation in SG) – Rosebud and Winnebago
 Otoe Missouria
 Ponca Tribe of Oklahoma
 Match-e-be-nash-she-wish Band of Potawatomi Indians of Michigan (Gun Lake)
o Two negotiation cooperative agreements
 Seminole Nation of Oklahoma
 Osage Nation of Oklahoma
ACA Update
o TSGAC has been able to provide substantial policy analysis, outreach and education.
o OTSG will be doing another year of implementation of NIHOE.
Information Technology: Meaningful Use and ICD-10 Update
CDR Mark Rives, MBA, MSCIS, Director, Office of Information Technology, IHS
- There have been substantial changes in the Office of Information Technology.
- The Information Systems Advisory Committee met via teleconference last week, ushered in some
new members, and have filled several vacancies.
o There’s been a selection of Tribal and Federal Co-Chairs.
o A number of positions were filled with sites that are non-RPMS systems.
- ICD-10 Roll Out
o Rolling out ICD-10 upgrades to RPMS has gone fairly smoothly; no major problems.
o A number of change requests were submitted for issues uncovered during beta testing.
- Meaningful Use Stage 2
o Install 2014 Certified EHR
o Signed Data Sharing Agreements
o Onboard data to RPMS Network
o And conducted patient outreach
- Participation Agreements
o Interim MPA and network policies went into place on June 22, 2015.
o There were revisions to the MPA and joinder agreement based on comments.
 There were some concerns about the adoption of IHS policy from Tribes, and OIT
will respond to the concerns quickly.
- RPMS Network
o The focus is to ensure that sites can attest for Meaningful Use Stage 2, full functionality will
not happen until afterwards.
-
-
Page 4
The Sequoia Project
o IHS is participating with the Nationwide Health Information Network (third party process)
o More information http://sequoiaproject.org/
IT Security
o In order to be more pro-active and prevent any breaches, IHS made network changes to
increase security. However, IHS has NOT experienced any breaches.
o Changes for users and system administrators mandated by OMB and HHS.
o Changes reflect modern security practices (e.g. two-factor authentication).
Contract Support Cost Workgroup Update and Discussion
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut
Mickey Peercy and Rhonda Butcher, IHS Contract Support Costs Workgroup Members
- Meetings
o IHS needs to make meetings more productive and there should be clear outcomes from the
August meeting.
o TSGAC requests more regular/rapid follow up meetings to move decisions forward. This
will avoid using extra time in the meeting to review previous workgroup meetings.
o There has been a lot of staff turnover; new staff should know CSC well and be able to
negotiate with Tribes on solutions.
o There has been very little discussion between IHS and workgroup to effect decisions, and
the technical workgroup products have not progressed thru the full workgroup or used to
make decisions.
o TSGAC also requests additional follow up to discuss the incurred costs methodology.
Tribes and Federal policy should work together to find decisions that are good for Tribes
and the IHS.
- Negotiations
o TSGAC needs ALNs to work more collaboratively and from a common sense perspective.
Continually denying Tribes is not productive.
- IBC Rate Determinations
o Only 5% of Tribes have a current IDC rate.
o If you change methodology and/or choose not to recognize the rate, it affects all other rates,
including those not related to IHS.
o Almost 60% have Tribes have a 2013 or earlier IDC rate, which will affect the incurred costs
methodology.
- Cost Incurred Approach
o Incurred costs is not included in the policy and the agency has variance in its definition.
o There’s been no discussion between the workgroup and IBC to determine the effect that the
cost incurred approach will have on CSC.
- TSGAC recommends that IHS bring someone who is knowledgeable about IDC and CSC
negotiations to update the CSC policy. They also recommend that IHS work more closely with the
DOI CSC Workgroup.
- Deputy Director McSwain Response:
o IHS has sent an invitation to the August CSC Workgroup meeting to IBC and DCA.
o He will charge the group to come up with a workplan that clearly identifies outcomes at the
next CSC meeting.
o He will also ask that the committee set a schedule for meetings.
o IHS is continuing to educate the new OMB examiner.
- Admiral Sandra Pattea
o
o
o
o
o
Page 5
CSC workgroup spent time reviewing CSC policy for new Tribal leaders and members on
the workgroup.
One request from the workgroup that has been a great success is the development of the
ACC tool which has created consistency between Tribes.
In February the CSC workgroup considered the mandatory proposal.
The CSC leads have also provided training and updates in nearly 8 regions.
IHS recognizes that staffing levels play a role in slowing down the process.
Discussion and Update on Budget Issues
Caitrin Shuy, Director of Congressional Relations, NIHB
- Ms. Shuy extended an invitation to the NIHB Annual Consumer Conference
o Deadline to submit proposals for breakout session is August 14th
o NIHB will also host a Congressional Reception.
o She also requested that TSGAC nominate individuals for NIHB awards banquet and gala.
o Update from the National Tribal Budget Formulation Workgroup requested additional funds
to implement IHCIA provisions in FY2017.
- The national budget formulation meeting is on February 17-18, 2016 in Washington, DC
- TSGAC would like to start to advocate for long term care services in particular.
o We need to provide the economics of access or lack thereof to support funding requests.
- Appropriations
o President recommend 5.1 billion (Tribal rec was 5.4 billion)
 House 4.787 billion
 Senate 4.777 billion
o There is still an impasse about how the democrats and republicans will solve the
appropriations issue.
- House appropriation language includes a request for HHS to clarify the definition of Indian and to
create authorizing legislation to authorize Medicare-like rates.
TSGAC Members’ Executive Session with IHS Acting Director
Patient Protection and Affordable Care Act (ACA) Implementation and Update
Mim Dixon, Consultant, Tribal Self-Governance Advisory Committee
Cyndi Ferguson, Self-Governance Specialist/Policy Analyst, SENSE Incorporated
- Six Month Update of the NIHOE Project is included in the packet and highlights the work that has
occurred through the year.
- The webinars have been very popular and all materials are uploaded post-webinar training.
- Positive stories about Tribal Sponsorship have been uploaded to the new website.
- The technical group has also initiated a joint project with DSTAC to make sure all Tribes have
access to premium sponsorship.
- The group has also completed a report on Qualified Health Plans. The report included five regions
and identified potential improvements to the system.
o The report found that while some QHPs did offer contracts to ITUs, there are very few ITUs
in contract with QHP. Furthermore, number of QHPs did not offer the Indian Addendum.
o During the TTAG meeting last week, the CMS Center Director agreed to respond to the
report and do additional research across the country.
Behavioral Health Topic Discussion
Dr. Alec Thundercloud, Director, Office of Clinical and Preventive Services, IHS
Dr. Beverly Cotton, Director, Division of Behavioral Health, OCPS, IHS
Special Diabetes Program for Indians
-
-
-
-
-
-
Page 6
A two year reauthorization in April 2015.
TLDC reviewed Tribal and Urban comments on May 14, 2015 and made recommendations to the
Director for future SDPI distribution.
The decision from IHS was sent on June 29, 2015 based on recommendations from TLDC.
o SDPI set aside funds formerly assigned to CDC will now be assigned to the community
directed grant
o New and competing continuation funding opportunity announcement plans
o No changes to the national funding formula
o More recent data (FY2012) will be used in the funding formula
DP/HH will be merged with the SDPI Community-Directed (C-D) grant program
o Current DP/HH grantees are funded through September 29, 2016
o No-cost extensions until September 2017
o 3-month grant close-out period up to December 2017
C-D programs that would like to implement activities/services similar to those done as part of the
DP/HH initiatives can do so by either:
o Selecting an appropriate best practice
o Proposing DP/HH activities or services as part of “Other Activities/Services not related to
selected Best Practice”.
Funding Opportunity Announcement (FOA)
o Will be posted on Federal Register and available in Grants.gov soon.
o 5-year project period (contingent on funds availability)
Funds will be awarded to all applicants who successfully meet application criteria. Competition is to
achieve a fundable score on the objective application review (not against each other).
Applications must be completed on time.
New Tribes will be able to join this round.
FY16 C-D Grant Amounts
o $25.4 million from merging DP/HH into C-D plus $1m formerly assigned to CDC
 1 million will go to increase the Urban set-aside
 25.4 will go into C-D to provide funding for
 Tribes not currently funded
 More current data
 Increase funds to all areas
Budget Period for FY 2016
o One budget cycle starting in FY 2016
 January 1-December 31, 2016
 Use carry-over funds in the fourth quarter for October fiscal year.
 If you don’t have carry-over funds then they will find supplemental.
o TSGAC recommended that IHS consider a different fiscal year solution.
Methamphetamine and Suicide Prevention/Domestic Violence Prevention Initiatives
-
Dear Tribal Leader Letter issued June 22, 2015 to provide an update on how IHS will move forward
with MSPI and DVPI over the next five years.
o Funding formula will not change for either
o Overall amount will be decreased for MSPI and DVPI
o MSPI
 $13.6 to $12.5 million
 $1.88 million to $1 million available to Urbans
o DVPI
 There was a little increase that did not set off the MSPI decreases.
 $600,000 available for future grantees
-
-
-
-
Page 7
In response to National Tribal Advisory Committee on Behavioral Health recommendations,
change to Regional Project Officers and Evaluators
o 7 area offices will have regional project officers
o 5 others will stay at HQ
o Will be available for all ITUs who are awarded MSPI/DVPI funding
o Recipients will longer be required to use up to 20% of the budget for local evaluation
IHS facilities will receive funding through program awards
Application Process: all ITUs will submit the same application and undergo the same eligibility and
selection criteria.
MSPI will have four purpose areas for eligible applicants to apply:
o Community and Organizational Needs Assessment and Strategic Planning/Data Sharing
Systems
o Suicide Prevention, Intervention, and Postvention Services
o Meth Prevention, Treatment, and Aftercare Services.
o Native Youth Focused – Generation Indigenous Initiative Support
DVPI Program Components
o Domestic and Sexual Violence Prevention, Advocacy, and Coordinated Community
Responses
o Forensic Healthcare Treatment Services
No new data will be used in funding distribution
Generation Indigenous (Gen I)
-
-
-
-
-
Youth Engagement
o Native youth network
o Native youth challenge
o Cabinet secretary youth listening tour
o White House Tribal Youth Gathering (July 9)
o White House Tribal Youth Convening at 2015 Tribal Nations Summit
IHS Gen I Activities
o Development of Youth Steering Committees
o Pathways Internship Program
IHS Gen I Funding Opportunities
o MSPI
o DVPI
o SDPI
Future Plans: FY16 budget request includes an additional $25m
o Expand Let’s Move Indian Country
o Increase direct youth engagement by incorporating Gen I Activities
o Tribal Behavioral Health Initiative
Tribal Action Plans: conducted several trainings and created a learning community to assist Tribes
in developing a Tribal Action Plan
Learning Portal is available through Bureau of Justice Affairs (DOJ)
- Grant Funding
o Area offices are hiring new 7 FTEs to monitor and evaluate the MSPI/DVPI, TSGAC is
concerned that IHS is transferring money that could be spent at the tribal level to
increase the administration.
- Recent Program Decisions
o IHS has been really good about following up on comments from Tribes that summarize
the comments and provide action items based on comments.
Page 8
o IHS commits to respond to the comments provided on the MPA and Joinder Agreement.
SDPI Grant
o IHS will review the concerns regarding the effect on Tribes on other fiscal years.
- OEH&E
o Mr. McSwain agreed with TSGACs request to make the office and their funding more
transparent so the Tribes can follow the appropriations.
- Contract Support Costs
o TSGAC would like the workgroup to commit to two calls before the August in-person
meeting, and Mr. McSwain agreed to ask that the workgroup conduct two calls.
o TSGAC will develop a proposed workplan for the workgroup and submit it for review.
o TSGAC also would like the group to continue its work on multi-year funding
agreements.
- FQHC Designation and MOU
o McSwain is working with the CMS Acting Administrator to make sure the rule will correct
and grandfather provider-based ITUs appropriately.
o TSGAC suggests that IHS encourage CMS Acting Administrator to tour in Indian
Country so he can understand the system better.
o CMS’ actions on this rule may indicate the Tribal consultation reminders are necessary.
- TSGAC would like IHS support during the waiver CMS processes where Tribes are involved.
- Joint Venture Feedback
o TSGAC has requested that IHS provide feedback on the Joint Venture Applications.
o Mr. McSwain committed to follow-up on feedback.
- Employee Settlement
o IHS will make the first series of payments in August.
o IHS is evaluating the effect the loss of funds, however they won’t know until after
August 14th
o TSGAC Discussion:
 Why hasn’t there been any significant change to the system?
 There is mandatory training going on for supervisors
 IHS is also reviewing an option called “premium pay” which allows IHS to
pay a percentage over their salary to work overtime.
 Does this affect Tribal facilities?
 No because their right to bargain is extinguished when the Tribe takes
over the facility.
Closing Remarks
Robert McSwain, Deputy Director, Indian Health Service
-
Wednesday, July 22, 2015 (8:30 am – 1:30 pm)
Meeting of TSGAC and Technical Workgroup
Welcome – Call to Order at 8:35 AM Eastern
Roll Call
Alaska:
Billings:
California:
Nashville:
Jerry Moses, Senior Director, Intergovernmental Affairs, Alaska Native Tribal Health
Consortium
Beau Mitchell, Council Member, Chippewa Cree Tribe
Shane McCullough, Councilman, Hoopa Valley Tribe
Marilynn “Lynn” Malerba, Chief, Mohegan Tribe
Page 9
Tobias Vanderhoop, Chairman, Wampanoag Tribe of Gay Head (Aquinnah)
Stephanie White, Treasurer, Wampanoag Tribe of Gay Head (Aquinnah)
Navajo:
Carolyn Drouin, Proxy for Vice President Nez
Oklahoma 1: Rhonda Butcher, Proxy for Chairman Baker
George Thurman, Principal Chief, Sac and Fox Nation
Oklahoma 2: Mickey Peercy, Proxy for Chief Batton, Choctaw Nation
Vickey Hanvey, Proxy for Principal Chief Baker
Phoenix:
Lindsay Manning, Chairman, Shoshone-Paiute Tribes of the Duck Valley Indian
Reservation
Portland:
W. Ron Allen, Chairman, Jamestown S’Klallam Tribe
Tyson Johnston, Vice President, Quinault Indian Nation
Julie Finkbonner, Councilwoman, Lummi Indian Nation
Aliza Brown, 3rd Councilwoman, Quinault Indian Nation
Albuquerque: Raymond Loretto, DVM, Governor, Pueblo of Jemez
Shawn Duran, Tribal Administrator, Taos Pueblo
Opening Remarks
TSGAC Committee Business
 Approval of Meeting Summary (March 2015)
o MOTION
 Citizen Potawatomi Nation made a motion to approve the March meeting summary.
 Taos Pueblo seconded the main motion.
 Motion passed with one abstention.
 Approval of 2016 Quarterly Meeting Calendar
o MOTION
 Taos Pueblo recommended a correction to the Strategy Session year in 2016
 Choctaw Nation made a motion to accept the 2016 Calendar with proposed
corrections.
 Taos Pueblo seconded the motion.
 Motion passed without objection.
 Approval of Representatives
o Navajo Nation Representatives
 Primary: Jonathan Nez, Vice President, Navajo Nation
 Alternate: Nathaniel Brown, Honorable Delegate of the 23rd Navajo Nation Council
o Albuquerque Representative
 Alternate: Raymond Loretto, DVM, Governor, Pueblo of Jemez
o Phoenix Representative:
 Primary: Lindsay Manning, Chairman, Shoshone-Paiute Tribes of the Duck Valley
Indian Reservation
o Billings Representative:
 Primary: Beau Mitchell, Council Member, Chippewa Cree Tribe
o Nashville Technical Representative:
 Hillary Andrews, Policy Analyst, United South and Eastern Tribes
o MOTION
 Choctaw Nation made a motion to approve all the representatives.
 Taos Pueblo seconded the motion.
 The motion was approved without objections.
Page 10
ISAC Representative
 Chief Malerba reiterated how important it is to engage with the ISAC and that without Carolyn
Crowder we haven’t had a representative on ISAC.
 Self-Governance representation is important because of the ICD-10 catalogue roll out in FY 2017.
 Floyd Thompson
o ISAC has representation from a diverse backgrounds.
o You do not necessarily need a technical background to participate in ISAC.
 OIT committed to host a webinar to learn more about ISAC and help recruit a qualified candidate.
Centers for Medicare & Medicaid Services (CMS) Tribal Technical Advisory Group (TTAG) Update
Chief Marilynn (Lynn) Malerba, Mohegan Tribe of Indians of Connecticut and Chairwoman, Indian Health
Service (IHS) Tribal Self-Governance Advisory Committee (TSGAC)
 Thirty-seven States have expanded Medicaid. However, several states with large Indian
populations have not expanded, for example Oklahoma and South Dakota.
 Choosing not to expand is becoming an equity issue.
 Failure to expand also leaves out care for young men.
 Options that Tribes are pursuing in place of expansion include the waiver process, which TSGAC
has requested IHS support.
Mim Dixon Consultant, Tribal Self-Governance Advisory Committee
 Proposed Rule for Medicaid Managed Care
o Important because more than half of the states use managed care.
o Any changes will affect the interest of tribal patients and tribal facilities.
o However, there are some coordination issues that TSGAC is concerned about and
technical advisors are working on comments to CMS to address these concerns.
o Comments are due on the 27th of this month and will be distributed to TSGAC beforehand
so Tribes can submit their own comments.
o There are particular states where this comment is more important than others because of
their managed care rules.
o TSGAC will send a letter to support TTAG comments.
o Rural and Urban definition in the rule will make more folks eligible.
Kitty Marx, Director, Tribal Affairs Group, Office of External Affairs, CMS
 CMS is working on rules to address several issues important to Tribes:
o Managed Care
o Across State Borders Issue
o Eligibility Regulations
 Give Tribes more leverage to make decisions
 Reorganization to move the Tribal Affairs Division to the Medicaid Center
o This move enables the Division to comment earlier on policies CMS is proposing.
 CMS Tribal Consultation Policy
o In 2011 Tribal Consultation Policy was signed by Dr. Burwick, and the policy has
empowered the Tribal Affairs Division to educate CMS office and divisions.
o One issue that came up in TTAG was a balance between administrative regulatory rules
and the Tribal consultation executive order.
o TTAG has two smaller workgroups to assist Tribal comments on two proposed rules
 Managed Care Proposed Rule
o This rule hasn’t been updated in over two decades. It needed to be updated to match the
current system of delivery under the Affordable Care Act.
o



Page 11
If AI/AN patients are enrolled in a Medicaid Managed Care plan, the provider recieves a
supplemental payment from the state to make up any difference between the provider rate
and the state Medicaid available rate.
o If you are out-of-network, and the Tribal patient is referred, where are they referred? Do
they have to go back to the MCO or can the I/T/U provider refer directly to the specialist?
 Comments are needed to respond to this question.
o The addendum needs feedback as well.
o Comments are due July 27, 2015 on the proposed rule.
o The regulations are on a fast track to be concluded before the Administration transitions.
New Mexico audit issues.
o The issues found during the audits in New Mexico was never shared with Tribes.
o The organizations were all driven out of business; not many repayments were available.
o Tribes are interested in the results.
Medicare Provider Based Clinics Proposed Rule
o Last regulations were issued in 2007.
o The rule limited the mile radius to 35 miles to keep providers outside the area from billing
Medicaid under the hospital. However, IHS worked with CMS to grandfather the clinics
under the hospital to make an exemption for rural areas.
o Only a small number of tribal clinics are currently affected by this rule (3 nationwide). It
applies to clinics that were billing as a provider-based department of a hospital in 2000
when the regulations were first changed and are in the situation where the hospital and the
clinic have a split operation between IHS and tribal operation (i.e. where a Tribe has
assumed operation of a clinic that previously billed as provider-based).
o CMS is proposing to grandfather IHS clinics, so they can keep their Medicaid rate.
o The greatest concern is when a Tribal facility bills under an IHS hospital.
o There should not be any issues for those facilities that are governed solely by the Tribe.
o Comments on the rule are due on September 8, 2015. Sample comments are being
developed by TTAG.
o Tribal Discussion:
 If you are an FQHC you don’t get paid full amount sometimes for three years after
the initial billing? Will this rule work to improve the process?
 Will the rule make sure the co-payment is paid?
 Kitty is unsure if the rule addresses either of these concerns, however she will make
sure both answers are available during the All Tribes’ Call next week.
Medicaid Expansion
o CMS is currently considering three concept proposals
 Waiver from Oklahoma
 The state is opposed to add a third option to extend Medicaid eligibility to
200% of FPL to allow ITUs to pay sponsorships from Tribes
 Proposal under review; CMS has hosted a session to hear from OK Tribes.
 SD Proposals (x2)
 Expanding how 100% FMAP is applied to areas such as telehealth.
 Extending 100% FMAP to some CHR services (e.g. non-emergency
transportation, well baby visits).
 Alaska Waiver
o CMS is interested in looking at innovative ways to use 100% FMAP to benefit AI/AN
communities. Not looking to restrict or pull back.
Adjourn TSGAC Meeting
Technical Workgroup
Assignment Matrix – July 2015 Quarterly Meeting
Updated: September 16, 2015
Technical Workgroup Co-Chairs:
Melanie Fourkiller, Tribal Co-Chair
Jennifer Cooper, Federal Co-Chair
1.
2.
3.
Assignment
Person(s)
Responsible
Date Task
Originated
Status
All correspondence with Secretary:
discuss impact, relationships, and
teamwork (refer to TSGAC summary
7/30/14). If the TSGAC specifically
desires a response from the Sec’y, the
letter should state so.
Continue to gather data from all Areas
about impact of CR/shutdown. Specific
programmatic impact, such as layoffs,
closed programs, PRC, bad patient
outcomes, etc. Reach out to the Health
Directors in each Area.
Develop and include in IHS SelfGovernance Policy protocols for selfgovernance negotiations, including but not
limited to expectations for information and
document sharing and protocol for proper
communication with Tribal leadership.
Review with TSGAC. (see April 10, 1997
letter to TSGAC from previous IHS
Director).
All
July 31, 2014
INFORMATIONAL ONLY.
Consider when drafting
correspondence to HHS
Secretary.
Terra Branson
July 31, 2014
Ongoing – SGCE requested
additional data and stories at
the Strategy Session hosted
recently
Ben Smith
OTSG
July 10, 2013
In progress. Include on
future TSGAC agenda.
Mickey Peercy
Rhonda Farrimond
Melanie Fourkiller
Cyndi Ferguson
Jennifer LaMere
Small working team
developed to assemble
recommendations on
formalizing IHS delegations,
decision memos and letters
from implementation of SG.
They will host a meeting on
Monday, October 5, 2015 at
1:00 PM Eastern in Embassy
Suites Capital D.
1997 IHS Director
Letter
4.
5.
[SG Negotiations issue – whether IHS
ALNs should accept provisions (at Tribal
option) that have been previously
negotiated in other Compacts/FAs, to the
extent applicable to that Tribe.]
Set up meeting with OMB (Julian Harris)
through Reina Thiele, White House, re:
Tribal 3rd party data being requested and
effects of CRs (alternatives to Advanced
Appropriations).
Appropriations “Think Tank” -- Develop
ideas/options for: (1) Potential solutions to
CRs (alternatives to Advanced
Appropriations, such as an entire year CR
with a “true up”, etc; and (2) Long term ‘fix’
for Contract Support Cost appropriations
(alternatives to Mandatory Appropriations).
W. Ron Allen
Jennifer McLaughlin
July 31, 2014
Hold and monitor for any
future action needed.
White paper developed.
Carolyn Crowder
(Lead)
Brandon Biddle
Caitrin Shuy
Liz Malerba
Lloyd Miller
July 31, 2014
Ongoing – Submitted LongTerm CSC recommendations
on August 28, 2014;
Requested an “anomaly”
from OMB for CSC funding
on September 5, 2014; held
Budget Summit on Oct 1314, 2014.
TTAG sent a letter received
negative response. Might still
require TSGAC action.
TSGAC Survey underway of
I/T/U sites.
There have been several
6.
Letter to CMS requesting timely contract
provider data and collection of future data.
Mim Dixon
January 28, 2015
7.
Follow up regarding employer mandate in
Mim Dixon
January 28, 2015
1
the ACA.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
Letter to IHS Director regarding
transparency in funding tables for Facilities
Acct, timeliness of fund distribution,
application of formulas to OEHE funds,
and funding for Small Ambulatory Grants
and Dental Health Stations
Confer with TSGAC Co-Chairs regarding
HHS SG Expansion to “bring people back
to the table, have a conversation, and
reorient the initiative from barriers to
solutions.”
Develop metrics to evaluate effectiveness
of MLR after implementation.
Letter to IHS Acting Director reaffirming
his commitment to provide a response
within 30 days regarding application of
CSC to the MSPI/DVPI programs, and
thanking him in advance for the response.
Attend the IHS Budget Formulation
evaluation meeting at the Annual SG
Consultation Conference. Provide
feedback to the TSGAC as necessary.
Send welcome and congratulation letters
to the three new SG Tribes, invite to
TSGAC and provide a packet of
information
Send follow up letter from SGCE to
Senator McCain regarding OIG alert.
Develop a recommended draft of language
for CSC Mandatory Appropriations
Schedule TSGAC conference call on CSC
Mandatory Appropriations Language after
completion of item 22.
Letter to Acting IHS Director
recommending setting CSC Workgroup
meeting as soon as practicable.
Analyze the impacts and make
recommendations for the CMS Rule on
Provider Based Status
Develop recommended results and
outcomes for the August 24-25 CSC
Meeting, track discussion, resolution and
follow up assignments with dates for
August 24-25 meeting.
Write a letter to Deputy Director on OEHE
issues regarding transparency and
consultation on funding distribution
methodologies for projects
Write TSGAC letter to the Deputy Director
regarding 5th quarter funding issues on
SDPI
A letter of endorsement for TTAG
comments on Manage Care Rule.
Invite IRS to the next TSGAC meeting to
reengage the discussion on the Employer
Mandate Exemption
Write a letter requesting that IHS conduct
an analysis to compare GPRA
requirements to CMS proposed
Medicare/Medicaid Payment Reforms.
Generate some examples of anti kickback
meetings between Tribal
leaders and technical
advisors and the White
House. Discussion will
continue at the TSGAC
Meeting in October.
March 25, 2015
March 25, 2015
Mickey Peercy (PRC
Workgroup)
Doneg McDonough
Dave Mather
April 13, 2015
March 25, 2015
Completed.
Clyde Romero
March 25, 2015
Completed.
SGCE
March 25, 2015
Completed.
Terra Branson
Jennifer McLaughlin
Geoff Strommer
Lloyd Miller
SGCE
March 25, 2015
Completed.
March 25, 2015
Completed.
March 25, 2015
Completed.
Melanie Fourkiller
April 13, 2015
Completed.
Melissa Gower
Melanie Fourkiller
July 22, 2015
Rhonda Butcher
Dave Mather
July 22, 2015
Melanie Fourkiller
Melissa Gower
July 22, 2015
Rhonda Butcher
July 22, 2015
Mim Dixon
Cyndi Ferguson
Mim Dixon
July 22, 2015
A letter was not needed, but
issues was resolved based
on TSGAC
recommendations??
Completed
July 22, 2015
Completed
Mim Dixon
Melissa Gower
July 22, 2015
Completed.
Mim Dixon
July 22, 2015
2
Completed.
statutes are or could potentially inhibit
Tribes regarding health care reform.
26.
27.
Letter to Commander Rives to request
additional information regarding ISAC
participation and expertise
Letter to IHS requesting comments back to
Tribes about JV projects that were not
funded.
Melissa Gower
Melanie Fourkiller
Dave Mather
Myra Munson
SGCE to coordinate
Melissa Gower
Terra
July 22, 2015
Melissa Gower
July 22, 2015
3
Completed.
Summary of IHS Tribal Self-Governance Advisory Committee (TSGAC) Correspondence
Year: 2015
Updated: September 4, 2015
Ref.
#
1.
Date Sent/
Received
8/28/15
Addressed To
Topic/Issue
Action(s) Needed
Mr. Robert G. McSwain,
Principal Deputy Director
Fiscal Year 2014 Report to
Congress on the
Administration of the Tribal
Self-Governance Program
TSGAC input on report in response
to IHS request for comments.
Indian Health Service
2.
8/4/15
Dr. Elaine Buckberg
Deputy Assistant
Secretary for Policy
Office of Economic
Policy
Department of Treasury
Exemption of Tribes from
the ACA Employer Mandate
Invitation to October 2015 TSGAC
Quarterly meeting to discuss topic.
3.
8/4/15
Quality Reporting Measures
Request that IHS conduct an
analysis and comparison of the
GPRA and Clinical Quality
Management approaches.
4.
8/4/15
Centers for Medicare
and Medicaid Services
Department of Health
and Human Services
Attn: CMS-10561
Comments on CMS-10561,
ECP Data Collection to
Support Qualified Health
Plan
(QHP) Certification for PY
2017
TSGAC Official Comments
5.
7/28/15
Geoffrey M. Standing
Bear
Principal Chief
Osage Nation
Welcome to SelfGovernance
Page 1 – Updated September 2, 2015
Response Received
Confirmed attendance for Oct 7, 2015 at 10:30 am.
Pre-briefing scheduled for Oct 2.
Summary of IHS Tribal Self-Governance Advisory Committee (TSGAC) Correspondence – 2015
Ref.
#
6.
Date Sent/
Received
7/27/15
Addressed To
Topic/Issue
Multi-Purpose Agreement
(MPA) and Joinder
Agreement & ISAC
Presentation
Address Tribal comments on MPA;
and follow up with OIT to host
Webinar regarding ISAC.
Comments on CMS-2390-P,
“Medicaid and Children’s
Health Insurance Program
(CHIP) Programs; Medicaid
Managed Care, CHIP
Delivered in Managed Care,
Medicaid and CHIP
Comprehensive Quality
Strategies, and Revisions
Related to Third Party
Liability: Proposed Rules
TSGAC provided a series of
substantive comments (26 pages);
along with accompanying
attachments. The TSGAC
comments mirror the model
template developed by a team of
health care experts from the
MMPC/NIHB.
7.
7/27/15
Centers for Medicare
and Medicaid Services
8.
7/10/15
Carolina Manzano
Chief Executive Officer
Southern Indian Health
Council, Inc.
9.
7/10/15
Vincent Armenta
Tribal Chairman
Santa Ynez Band of
Chumash Indians
Dan Courtney
Chairman
Cow Creek Band of
Umpqua Tribe of Indians
10. 7/10/15
Action(s) Needed
Response Received
Ref.
#
Date Sent/
Received
11. 6/29/15
Addressed To
Topic/Issue
Action(s) Needed
Acting Director
Determination of Contract
Support Cost Requirements
Mr. P. Benjamin Smith,
Director, Office of Tribal
Self-Governance, Indian
Tribal Leadership Priorities
for “Self-Governance
National Indian Health
Outreach and Education”
TSGAC comments in response to
IHS’s position that the amount of
contract support costs (CSC) owed
under its contracts and compacts
with Tribes and Tribal organizations
under the Indian Self-Determination
Act (ISDA) is determined based on
“incurred costs.”
The TSGAC reaffirms the
commitment to empower Tribal
communities with the knowledge
and tools needed to successfully
manage and implement the Patient
Protection and Affordable Care
Act/Indian Health Care Improvement
Act (ACA/IHCIA) provisions
concerning health care insurance
coverage options to improve the
quality and access to care for Tribal
citizens and Indian communities.
12. 6/12/15
Health Service
TSGAC urges OTSG to amend the
Agreement to renew and fund the
“Self-Governance National Indian
Health Outreach and Education”
contract for FY2016
Response Received
Ref.
#
Date Sent/
Received
13. 6/9/15
Addressed To
Acting Director
Topic/Issue
Payment of IHS Employee
Settlements.
Action(s) Needed
Response Received
TSGAC provided comments to the
May 22, 2015 IHS Dear Tribal
Leader Letter (DTLL) on the
Payment of Employee Settlements.
IHS Deputy Director provided a response back to
Tribal Leaders on July 29, 2015. The letter
addresses three questions about the settlement
that have been raised frequently in various
forums since then.
For the current settlement described
in the DTLL, and for any future
settlements, the TSGAC strongly
urges the IHS to reject the flawed
plan to cut health care services and
consider one or both alternatives
proposed.
TSGAC Comments in Request to
Notice from IRS.
14. 5/15/15
Internal Revenue Service
Notice 2015-16 on Section
4980I — Excise Tax on High
Cost Employer-Sponsored
Health Coverage
15. 4/27/15
Acting Director
Healing our Spirits
Worldwide Gathering
Request of IHS support in this effort
and the participation of P. Ben
Smith, Director, Office of Tribal SelfGovernance (OTSG).
IHS Responded on August 29, 2015 to the TSGAC and
stated that Mr. Smith is confirmed to attend and
participate in the HOSW gathering.
Acting Director
Detail of OTSG Deputy
Director
TSGAC request to Director to reevaluate the detail and assign other
staff to OUIHP as soon as
practicable.
IHS Responded on August 29, 2015 to the TSGAC and
stated that OTSG Deputy Director has officially
returned to her position as of 7/27/15.
Acting Director
Special Diabetes Program
for Indians (SDPI)
TSGAC comments in response to
the DTLL request for
comments/consultation on the SDPI
programs.
16. 4/23/15
17. 4/21/15
Ref.
#
Date Sent/
Received
Addressed To
Topic/Issue
Action(s) Needed
18. 4/20/15
Mr. Robert G. McSwain
Mr. Ben Smith
Mr. Carl Harper
Transmittal of SelfGovernance National ACA
Education and Outreach
Report
No action needed. Transmittal of 6month report for the time period
October 1, 2014 through March 31,
2015.
19. 4/8/15
Acting Director
Payment of Contract
Support Costs for MSPI and
DVPI funding
Request that the agency review this
issue and that, as committed during
3/24/15 TSGAC meeting, provide a
final decision to Tribes on the
eligibility of MSPI/DVPI for additional
CSC funds within 30 days.
20. 4/8/15
Acting Director
Thank you on Rates of CSC
Settlement and Claim
Resolutions
Continue timely resolution of
outstanding claims and consistent
full funding of CSC.
21. 4/3/15
Mr. Gregory E. Demske,
Chief Counsel to the
Inspector General
Ms. Melinda Golub,
Senior Counsel
Mr. Amitava “Jay”
Mazumdar, Senior
Counsel
Office of Counsel to the
Inspector General
Thank you for participating
in the Tribal SelfGovernance Advisory
Committee Quarterly
Meeting,
March 24, 2015
Further dialogue to occur during the
Thursday, April 30th Breakout
Session A7, Pursuing and
Reinvesting Third Party
Revenue, at the upcoming 2015
Annual Tribal Self-Governance
Consultation Conference in Reno,
NV
Response Received
A Dear Tribal Leader was sent out from IHS Acting
Director McSwain on 6/22/15 with an update on how
the IHS will move forward with MSPI and DVPI over
the next five years.
Response received from IHS Acting Director McSwain
on 5/18/15. Letter stated the IHS is not required to
provide additional funds beyond what is included in
the project budgets.
Ref.
#
Date Sent/
Received
Addressed To
Topic/Issue
Action(s) Needed
22. 2/26/15
The Honorable Derek
Kilmer
Self-Governance Tribes
2015 Appropriations
Requests for the Bureau of
Indian Affairs
Joint letter from TSGAC/SGAC
23. 2/10/15
The Honorable Derek
Kilmer
Self-Governance Tribes
2015 Appropriations
Requests for Indian Health
Service
Joint letter from TSGAC/SGAC
24. 2/9/15
Chief Marilynn Malerba,
Chairwoman
TSGAC
Agency response to
information requested QHPs
to IHCPs in specific regions
CMS staff are available to address
specific QHP problems and provide
further assistance in the process
25. 1/31/15
Chairwoman
TSGAC
Agency response to the
ongoing and unprecedented
international Ebola crisis
26. 2/5/15
IHS Director,Dr. Y.
Roubideaux
Mandatory Appropriations
for Contract Support Coasts
Appreciated partnership and looking
forward to working to advance longterm solutions for funding CSC
27. 2/4/15
Betty Gould, Regulations
Officer, IHS and Carl
Harper, Director
ORAP,IHS
Submit via
regulations.gov
Comments on IHS Proposed
Rule entitled “Payment for
Physician and Other Health
Care Professional Services
Purchased by Indian Health
Programs and Medical
Charges Associated with
Being able to engage in Tribal
Consultation on the proposal
Response Received
Response from Marilyn Tavenner, CMMS 2/2/15 to
letter dated 12/19/14
Response from Dr. Y.Roubideaux, IHS Director,
1/31/15 to letter dated 10-17-14
Ref.
#
Date Sent/
Received
Addressed To
Topic/Issue
Action(s) Needed
Response Received
Non-Hospital-Base Care
28. 1/20/15
Chairwoman
TSGAC
Concerns regarding
procedural consistency and
information sharing during
CSC negotiations on
Disputed claims
29. 1/14/15
Ms Tracy Parker Warren
Office of Public and
Intergovernmental Affairs
OTGR(075F)-VA
Comments Submitted
Response to Notice of TC:
Sec 102 © of the Veterans
Access, Choice and
Accountability Act of 2014
Urge the Reports enter into
agreements for reimbursement also
current agreements be used and
expanded where possible to speed
up implementation to eligible
veterans
30. 1/12/15
CCIIO-CMS-DHHS
Comments on Draft 2016
Letter to Issuers in the
Federally-Facilitated
Marketplace
We are available to discuss any of
the recommendations contained in
the correspondence and attachment
on CMS-9944-P
31. 1/8/15
IHS Director,Dr. Y.
Roubideaux
2015 TGSAC Quarterly
Meetings and Tribal SelfGovernance Annual
Conference Information
Adjustment to your schedule due to
changes for the January Qrtly
meetings
Response from Dr. Y. Roubideaux, IHS Director,
1/20/15 to letter dated 12-2-14
Response from Dr. Y.Roubideaux, IHS Director,
1/15/15 re: She will be in attendance Jan 28 also
attendance at March Mtg on the 24th
Tab3 front
Tab 3 Back
IHS ADVANCE APPROPRIATIONS
Summary of Issue:
Since Fiscal Year (FY) 1998 there has been only one year (FY 2006) when the Interior, Environment
and Related Agencies budget, which contains the funding for Indian Health Service (IHS), has been
enacted by the beginning of the fiscal year. Late funding provides significant challenges to Tribes and
IHS provider budgeting, recruitment, retention, provision of services, facility maintenance and
construction efforts. Providing sufficient, timely, and predictable funding is needed to ensure the federal
government meets its obligation to provide health care for American Indian and Alaska Native people.
An advance appropriation is funding that becomes available one year or more after the year of the
appropriations act in which it is contained. For instance, if FY 2017 advance appropriations for the IHS
were included in the FY 2016 Interior, Environment and Related Agencies Appropriations Act, those
advance appropriations would not be counted against the FY 2016 Interior Appropriations
Subcommittee’s funding allocation but rather would be counted against its FY 2016 allocation. It would
also be counted against the ceiling in the FY 2017 Budget Resolution, not the FY 2016 Budget
Resolution.1
Representative Young (R-AK) introduced HR 395, Indian Health Service Advance Appropriations Act
of 2015, on January 14, 2015. However, a companion bill has not been introduced in the Senate.
Objectives/Goals:
To begin an advanced appropriations cycle there must be an initial transition appropriation which
contains (1) an appropriation for the year in which the bill was enacted (for instance, FY 2017) and (2)
an advance appropriation for the following year (FY 2014). Thereafter, Congress can revert to
appropriations containing only one year advance funding. If IHS funding was on an advance
appropriations cycle, tribal health care providers, as well as the IHS, would know the funding a year
earlier than is currently the case and would not be subject to Continuing Resolutions.
With strong, positive steps during the last Congress, including introduction of two pieces of legislation
and an amendment offered by Senator Lisa Murkowski (R-AK) in the budget resolution, this year, we
intend to build on that momentum. The first step will be seeking re-introduction of the legislation from
the last Congress and continuing to build support among other members of Congress and the
Administration.
Strategy & Actions:
1. Outreach to Congressional offices in support of advance appropriations for IHS
The more support we are able to build early in the process, the better chance advance appropriations will
have of moving forward this year. This means, working with your own representatives and senators to
1
A Budget Resolution includes, among other things, spending limits for discretionary spending for the upcoming fiscal year
and at least five ensuing fiscal years. It does not have the effect of law but its aggregate spending allocations, including
limitations on the amount of advance appropriations, are enforceable through points of order and other procedural
mechanisms.
build support by providing examples of how continuing resolutions and delayed funding impact the
delivery of health care in your community will be vital.
Achieving IHS advanced appropriations would require new legislative language for the Interior,
Environment and Related Appropriations Act providing for advance appropriations for the Indian Health
Services and the Indian Health Facilities accounts.
It is important that we continue to educate specifically members of key Congressional Committees.
These committees include:
 House and Senate Appropriations Committees
 House and Senate Budget Committees
 Senate Committee on Indian Affairs
 House Natural Resources Committee
 House Energy and Commerce Committee
2. Budget Committee: Inclusion of IHS Advance Appropriations in a Budget Resolution
House and Senate budget resolutions, which are under the jurisdiction of the Budget Committees, are
not signed into law but rather express the views of the House and Senate on overall spending, revenue,
deficits and debt. Of significance is that in most years since 2003, the Budget Resolution limits how
much—and for what purpose—advance appropriations may be made. Because the Budget Resolution
often sets a cap on advance appropriations it is important to include the Indian Health Services and the
Indian Health Facilities appropriations accounts in the list of advance appropriations which are
authorized by the Budget Resolution. Otherwise, advance appropriations would be subject to a point of
order objection.
We want language added to include the IHS advance appropriations in this list of exceptions. This
means strong advocacy by Tribes and their supporters early in 2015 will be needed to achieve this goal
3. Advocacy with the Administration to Earn Support for the Initiative
In 2014 Tribes made significant progress on advance appropriations including having legislative
hearings in both the House and Senate on the issue. However, our congressional allies told us that it
would be difficult to actually achieve advance appropriations for IHS without explicit support from the
Administration. The Department of Health and Human Services (HHS) has not issued an opinion on the
matter despite repeated requests from Congress and Tribal advisory committees.
It will be critical to continue to request the administration support this specific legislative change in their
FY 2016 or other future budgets. The Administration has already supported advance appropriations for
the VA. On April 9, 2009, President Obama said: “Now, the care that our veterans receive should
never be hindered by budget delays. I've shared this concern with Secretary Shinseki, and we have
worked together to support advanced funding for veterans' medical care. What that means is a timely
and predictable flow of funding from year to year, but more importantly, that means better care for our
veterans.”
TITLE VI: EXPANSION OF SELF-GOVERNANCE WITHIN THE DEPARTMENT OF HEALTH
AND HUMAN SERVICES
Summary of Issue:
Title VI of the Indian Self-Determination and Education Assistance Act (ISDEAA)
required the Department of Health and Human Services (HHS) to determine the feasibility of a demonstration
project extending Tribal Self-Governance to HHS agencies other than the Indian Health Service (IHS). In 2003,
HHS submitted a report to the Senate Committee on Indian Affairs and the House Natural Resources
Committee that a Self-Governance demonstration project was feasible. In 2011, HHS revived the effort and
established the Self-Governance Tribal-Federal Workgroup (SGTFW) and issued a Final Report in September
2014. The Report concluded that there is no existing authority that would permit a demonstration project of the
sort proposed by the 2003 feasibility study which could be carried out under Title VI of the ISDEAA without
specific legislative authority from Congress. In order to continue the momentum and dialogue between Tribes
and HHS, the Tribal Self-Governance Title VI Task Force requested that both Secretaries Kathleen Sebelius and
Sylvia Burwell designate appropriate HHS officials with decision-making authority to engage in dialogue with
Tribal representatives over concrete legislative proposals to establish a Self-Governance demonstration project.
Both Secretaries responded that the Tribal representatives should contact the heads of the Operating Divisions
“to discuss flexibilities that exist in statute and regulations for those programs that may aid the Tribes in
meeting their needs”. The last correspondence to Secretary Burwell on this issue was sent January 15, 2015 and
there has been no subsequent response.
Objective/Goals:
The goal is to resume discussions with HHS to explore flexibilities that exist in statute and regulations for those
agencies identified by Secretary Kathleen Sebelius in her February 7, 2014 correspondence:
1. Agencies:
a. Administration for Children and Families
b. Administration for Community Living
c. Substance Abuse and Mental Health Services Administration
2. Identify allies from Congress, the Administration and private entities who support Tribal empowerment,
Self-Determination and Self-Governance who will openly support the expansion of Self-Governance;
3. Identify Members of Congress to introduce and support the legislation;
4. Collaborate with all of our Federal partners to initiate dialogue with colleagues, show support and
increase awareness about the benefits, efficiencies and administrative improvements under
Self-Governance;
5. Develop a mobile outreach campaign to share success stories and expand communication and education
outreach that Self-Governance Works on a National and Regional scale; and,
6. Encourage all Self-Governance Tribes to participate in the process rather than an observer and watch
from the sidelines.
Strategy & Actions:
1) Develop an educational process designed for the three Operating Division on how Tribal SelfGovernance will be implemented and how it will improve program implementation;
2) Identify Tribes and programs to pursue flexibilities that exist in statute and regulations to implement
demonstration programs within three agencies;
3) Individual Self-Governance Tribes should utilize the HHS Tribal Consultation forums and include “the
expansion of Self-Governance in HHS” in all testimony submitted;
Self-Governance Advocacy Plan – 2015
Title VI Self-Governance Expansion in HHS to other than IHS
Page 2
4) Utilize “Tribal Advisory Committees” (TAC’s) to promote Self-Governance Expansion by interacting
with HHS staff on specific programmatic and technical issues illuminating the advantages of SelfGovernance and by making specific official requests as members of those TAC’s;
5) Identify specific programmatic and technical barriers that could be mediated by a policy decision from a
senior level Administration representative;
6) Develop an educational process to present to Direct Service Tribes and other interested parties about the
collaboration with three agencies to provide transparency and seek support during the deliberations with
HHS; and,
7) Approach interested members of Congress to introduce and support legislation.
For updates on the Tribal Self-Governance Title VI Task Force activities, contact:
Chairman W. Ron Allen
Task Force Chairman
Telephone: (360) 681-4621
C. Juliet Pittman
Task Force Technical Workgroup
Telephone: (202) 628-1151
AFFORDABLE CARE ACT (ACA) IMPLEMENTATION
What Has Been Accomplished
Key issues from the 2014-15 Strategy Plan that have been completed:
1. TSGAC conducted research on Qualified Health Provider (QHP) networks to identify problems
and sent a report with recommendations to the Centers for Medicare and Medicaid Services
(CMS).
2. CMS has provided written clarification that people with Indian status who are below 100 percent
of the federal poverty level qualify for limited cost sharing plans purchased through the
marketplace and CMS is revising its training materials.
3. TSGAC has created guidance documents for and handouts and press releases about Tribes and
Tribal Organizations that have successfully implemented Tribal Sponsorship programs and the
subsequent positive impacts on Tribal members.
Other accomplishments in 2014-2015 related to ACA implementation that will be continued in 20152016:
1. CCIIO formed a Tribal Workgroup as requested by the Tribal Technical Advisory Group to
CMS.
2. TSGAC has continued to provide policy support, outreach, education, training and technical
assistance for Tribes related to ACA.
3. TSGAC has assisted some direct service Tribes that are considering agreements for Tribal
Sponsorship programs.
Issues that had substantial progress in 2014-2015, but have not been completed:
1. CMS is currently holding Tribal Consultation on referral forms for limited cost sharing plans
offered through the Marketplaces. Tribal representatives have provided input, but CMS has not
yet released additional guidance.
2. CMS issued a regulation regarding Summary of Benefits and Coverage in Marketplace plans, but
Tribes have asked to review and provide input into standard language for the Indian-specific costsharing protections and this has not yet happened.
3. TSGAC is continuing to work with CMS to ensure eligibility criteria for Indian-specific costsharing protections are applied correctly when making Marketplace eligibility determinations.
4. TSGAC commented on proposed Medicaid Managed Care regulations in July 2015, but CMS has
not yet published the final regulations.
5. CMS committed to provide data on American Indian/Alaska Native (AI/AN) and I/T/U
participation in Marketplaces, but only one report has been produced and additional data have been
requested.
6. Tribes requested that the Office of Inspector General (OIG) rule on safe harbors that would protect
Tribes and Tribal Organization from anti-kickback allegations. Meetings are continuing.
7. Proposed solution to Across State Borders – children can have Medicaid in two states, and
Boarding Schools and Treatment Centers can apply on their behalf –has not yet been published in
written guidance from CMS.
8. Medicaid Expansion is moving forward in several states, including AK, MT, and UT.
2015 Tribal Self-Governance Strategy Session (September 9-10, 2015)
Summary of Key Issue: ACA Implementation
Page 2 of 4
New and Continuing Objectives and Strategies for 2015/2016:
1. Advocate for legislative changes in the Affordable Care Act and related legislation
Objective: Change legislation to assure that AI/AN and Tribes benefit from the ACA.
Why this is important: The Administration has determined that a legislative fix is needed for
some issues that cannot be addressed through regulation. In addition, some regulation and
guidance issued through the CMS and IHS can be changed by future administrations unless it is
put into legislation.
Priorities:
1. Change the definition of Indian in ACA to be consistent with the definition of Indian for
Medicaid and CHIP, which is the same as IHS eligibility.
2. Create an exemption from the ACA employer mandate for Tribes.
3. Make Medicare-like rates for Purchased and Referred Care a condition of participation in
Medicare.
Strategy:
1. Monitor legislation that is proposed in Congress for opportunities to attach priority
provisions related to Indian health.
2. Collaborate with other groups that are seeking or endorsing similar legislation, such as
NAIC and State Medicaid Directors.
3. Use existing networks to mobilize Tribal advocacy for legislation.
2. Further Development of Regulations and Guidance for the CMS
Objective: Participate in the development of additional regulations and guidance related to the
CMS.
Why this is important: During the development of the initial regulations for ACA, many issues
of significance to AI/ANs were deferred to a later time. Other issues have emerged during
implementation of ACA. Self-Governance Tribes must continue to track these issues and
advocate for them.
Priorities:
1. Ensure CMS and health plans are applying the limited cost-sharing plan variation
accurately in the FFM and State-based Marketplaces.
2. Simplify family plan provisions for AI/AN so that family members who are eligible for
IHS can have the same cost sharing reduction as those who have Indian status under
ACA.
3. In Federally-Facilitated Marketplace (FFM) states, CMS should modify its regulation
on network adequacy to increase the number of I/T/Us that are included as in-network
providers in QHP plan networks.
4. For non-FFM states, CMS should extend requirements that apply in FFM states (i.e.,
contracts must be offered to all I/T/Us and the offer must meet minimum requirements)
to QHPs in State-based Marketplaces as well as to the FFM.
Page 3 of 4
Strategies:
1. TSGAC, Self-Governance Leaders and technical representatives, alternate and
technical advisors to TTAG will provide analysis and advocacy to urge CMS, IRS, IHS
and others to address problems that limit AI/AN from benefitting from ACA.
3. Implementation of CMS AI/AN Strategic Plan, 2013-2018
Objective: Create support and pressure for CMS to implement the current CMS AI/AN Strategic
Plan, and assist in the revisions to the Plan that are expected in 2015-2016.
Why this is important: Tribes have participated in drafting the CMS AI/AN Strategic Plan,
2013-2018, which was adopted by the Tribal Technical Advisory Group (TTAG) to CMS at their
meeting on November 14, 2012 and further amended in February 2014. The plan includes 7
major goals and numerous objectives designed to implement ACA, improve AI/AN access to
care, and increase revenues for the I/T/U.
Priorities:
A few of the priority objectives in the Plan include:
1. CMS will work assure that Marketplace plans make accurate and timely payments to the
I/T/U for services that are provided to people enrolled in Marketplace plans, and that the
cost sharing reductions for AI/AN are handled properly at the time of service; and,
2. On a regular basis, review metrics that provide indicators of AI/AN participation in
Marketplace plans and I/T/U participation a network providers in the Marketplace.
Strategy: TSGAC, Self-Governance Leaders and representatives, alternate and technical
advisors to TTAG will monitor implementation of the CMS AI/AN Strategic Plan and alert
TSGAC if there are problems that require their attention and action.
4. Enforcement of Section 206 of IHCIA to assure I/T/U are paid for delivering health services to
AI/AN as an out-of-network provider
Objective: Every covered service provided by the I/T/U to an AI/AN with health insurance
should be compensated by the insurance company.
Why this is important: The trend for all federally-funded health programs, including Medicaid,
Medicaid Expansion, Child Health Insurance Programs, and Health Insurance Exchanges, is to
deliver services through managed care networks. Even if the I/T/U is not part of those networks,
IHCIA provides that they will nonetheless be paid. Many I/T/U facilities have had difficulty
getting their bills to managed care plans paid. The IHS and CMS attorneys need to take on these
cases to assure payments are made, and thereby encourage health plans to include I/T/U in their
networks.
Strategy:
1. Incorporate references to IHCIA section 206, where appropriate, in regulations and
guidance materials issued by CMS.
2. Gather data on non-compliance with section 206 and report the findings to IHS and CMS.
3. Facilitate efforts across I/T/Us to share information and strategize on successful
approaches to obtaining payment.
Page 4 of 4
4. Ask IHS and CMS to designate legal resources to enforce Section 206 of IHCIA.
5. Let the I/T/U know that these legal resources are available.
6. Track outcomes and publicize them with Association of Health Insurance Commissioners
and Association of Health Plans.
5. Medicaid Expansion
Objective: Increase I/T/U funding by accessing Medicaid Expansion revenue.
Why this is important: Additional Medicaid Adult Expansion Option demonstration proposals
are expected in 2015.
Strategy: Continue to monitor and track additional demonstration proposals to ensure the Indianspecific protections and benefits in law and CMS regulations are applied to the Medicaid Adult
Expansion Option.
6.
Quality Assessment and Payment Reform
Objective: Assure that Tribal Health Organizations do not have their funding reduced as a result
of payment reforms that penalize health care providers as a result of quality assessment.
Strategy:
1. Work with IHS to evaluate whether GPRA requirements duplicate the quality assessment
requirements under Medicare and proposed Medicaid Managed Care regulations, and make
recommendations to eliminate any costs of duplication or better align the quality
measurements.
2. Advocate with CMS for methodologies that do not penalize Tribes due to small sample size,
budget limitations imposed by Congress, and other factors out of their control.
3. Provide training and technical assistance to Tribal Health Organizations.
4. Develop strategies to monitor financial impacts on Tribal Health Organizations.
5. Cooperate with the NIHB Payment Reform Workgroup to comment on proposed regulations
and guidance.
7. Medicaid Estate Recovery
Objective: Eliminate Estate Recovery for AI/AN receiving Medicaid.
Strategy: Continue to work through TTAG and STAC to address this issue.
tab 4 front
tab 4 back
Sent electronically [email protected] and [email protected]
Original sent via USPS
August 28, 2015
Robert G. McSwain
U.S. Department of Health and Human Services
801 Thompson Avenue, Suite 440
Rockville, MD 20852
RE: Fiscal Year 2014 Report to Congress on the Administration of the Tribal SelfGovernance Program
Dear Deputy Director McSwain:
Thank you for this opportunity to provide comments on the Fiscal Year 2014 Report to
Congress on the Administration of the Tribal Self-Governance Program. This Report is
required by Congress under Section 458aaa-13 of the Indian Self-Determination and
Education Assistance Act (ISDEAA), Public Law 93-638, as amended and offers us the
opportunity to share successes of Tribally-operated and administered health programs
on an annual basis. In response to your request for comments on the “draft” Report, the
Indian Health Service Tribal Self-Governance Advisory Committee (IHS-TSGAC) would like
to offer these comments to emphasize and document the ongoing knowledge gained
and the IHS/Tribal experience implementing the Self-Governance statute:
•
Include additional examples of Self-Governance benefits. Self-Governance Tribes
have reduced Federal administration of health care in Tribal communities while
providing culturally competent care, expanding local services and strengthening
Tribal economies. The limited benefits cited in the Report do not adequately
represent the ability of Self-Governance Tribes to leverage other Federal resources
to expand services, to create Tribal-private partnerships to improve the quality
and quantity of care, or demonstrate our capacity to create and implement
innovative health care systems to benefit our communities and Tribal citizens, as
well as the entire IHS system.
•
Provide year-to-year data comparisons to support decreases in Federal
bureaucracy. Self-Governance has successfully reduced Federal bureaucracy,
while increasing health services in our Tribal communities. When comparing the
Fiscal Year (FY) 2013 report to the proposed FY 2014 report, there is support to
show reductions in Federal bureaucracy. Between FY 2013 and FY 2014 funding to
the Office of Tribal Self-Governance (OTSG) and IHS Headquarters residual
amounts decreased, while Self-Governance Tribes transferred more funding from
the Agency. A more detailed description and year-to-year comparison may be a
better way to measure reductions in Federal bureaucracy and further illustrate
Self-Governance Tribal successes.
Letter to Robert G. McSwain, Deputy Director, IHS
Re: Comments on Draft Self-Governance Report to Congress
Page 2
August 28, 2015
•
Clarify Inherent Federal Functions (IFF) by type and location. The Report requires
that IHS include the “amounts expended in the preceding fiscal year to carry out
inherent federal functions by type and location.” Despite sharing the residuals
total, it is not clear what functions the IHS continues to provide to Self-Governance
Tribes using the IHS Headquarters residual amount, nor is the report specific about
how the “IHS Headquarters residual amount” is determined annually.
•
Use of “Purchased/Referred Care”. The Agency, upon the advice of SelfGovernance Tribes, changed their nomenclature from “Contract Health Services”
to “Purchased/Referred Care” to better identify purchased referral care.
However, the Report uses both phrases in the same section. The program title
should be updated throughout the Report to correspond with the new title in the
Federal appropriations law.
•
Clarify Contract Support Costs Funds Transferred. The note included in Sections E
and F about transferred funds is unclear. Self-Governance Tribes agree that
Contract Support Costs should not be included in this report and want to make
sure the included note is clear.
We understand that there are Department and Agency protocols relative to the
submittal of Reports to Congress. However, as Self-Governance Tribes continue to wade
through the challenges of administering these programs, it is invaluable that we are able
to document what is working and our successes. As partners for more than 20 years, it is
imperative that the Indian Health Service continues to communicate to Congress that
the Self-Governance Tribal-Federal policy is the most successful to ever exist in the history
of this Country and how it has and continues to benefit all of the partners and the United
States.
Thank you again for allowing Self-Governance Tribal input on this very important Report
to Congress. The TSGAC looks forward to the final report and our continued partnership
to strengthen and support Tribes’ authority to administer their own health programs. If you
would like to discuss these comments or have questions, I can be reached
[email protected] or (860) 862-6192.
Sincerely,
Marilynn “Lynn” Malerba
Chief, Mohegan Tribe
Chairwoman, TSGAC
cc:
P. Benjamin Smith, Director, Office of Tribal Self-Governance
TSGAC Members and Technical Advisory Workgroup
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CONTRACT SUPPORT COSTS
Summary of Issue:
For decades the Bureau of Indian Affairs (BIA) and the Indian Health Service (IHS) underpaid the
amount of contract support costs (CSC) due to Tribes and Tribal organizations that contract to operate
IHS clinics and hospitals and BIA law enforcement, realty, housing and other government programs
under the Indian Self-Determination and Education Assistance Act (ISDEAA). The result has been
severe offsetting reductions in patient care and in other essential governmental services for the most
underserved populations in America—American Indians and Alaska Natives—who already receive
fewer health services than even federal prisoners. The compounding impact of Tribal contract
underpayments on the quality and quantity of health care services available in Indian Country, as well as
on the effectiveness of security, educational, housing and infrastructure initiatives across Indian country,
has led to considerable litigation.
In June 2012 the Supreme Court—for the second time—held the government liable for these contract
underpayments. The Court's ruling came in a Tribal lawsuit against the BIA, Salazar v. Ramah Navajo
School Board, and it built upon an earlier, unanimous Supreme Court decision in a Tribal lawsuit against
IHS, Cherokee v. Leavitt, decided in 2005. After the Ramah decision, the Supreme Court and Federal
Circuit extended the ruling to IHS in a case known as Arctic Slope Native Association v. Sebelius.
Securing full funding for Contract Support Costs has long been a top priority of Self-Governance Tribes.
Though the Administration committed to fully funding CSC in FY 2014 and has done the same for FY
2015, the remaining challenges fall into two main categories: (1) obtain fair compensation for all past
CSC shortfalls; and (2) work with the Administration and Congress to secure long-term solutions moving
forward, including establishing full CSC funding on a mandatory basis.
Objective/Goals:
1. Obtain fair compensation for all past CSC shortfalls
Both the BIA and the IHS acknowledge liability for CSC shortfalls in years past, as they must under
the Supreme Court's decisions in Cherokee and Ramah. However, settlement of claims for past CSC
underpayments is still not complete. Both the BIA and the IHS must continue to work to achieve
fair and speedy settlement of all claims.
The BIA. On the BIA side, settlement is being pursued through the Ramah class action. Attorneys
and financial experts for both sides are working to come to an agreement on a settlement figure and
how to allocate it. Direct participation by Self-Governance Tribes in the settlement discussions is
limited by the nature of the class action representation and the confidentiality of the settlement
negotiations. Nonetheless, the Tribes have the right to be heard by the Administration, just as Tribes
voiced their concerns with the slow pace of the Cobell litigation. The Supreme Court has spoken,
and it is time to wind up what is already a 25 year old case.
The IHS. CSC claims against the IHS are not being handled as a class action, but must be pursued
individually by each tribal contractor. Some of these claims, especially claims for later claim years,
are still in the first stage of the claims process established under the Contract Disputes Act and are
pending before an agency contracting officer who is advised by agency attorneys. Others have been
appealed to the Civilian Board of Contract Appeals (where they are defended by IHS attorneys) or to
federal courts (where they are handled by the Department of Justice).
This spring, IHS posted an update on the settlement of past-year claims. According to IHS, as of
May 22, 2015,
•
•
1,249 settlement offers on claims had been extended; and
947 claims had been settled, for a total value of approximately $705.5 million.
While this represents significant progress, 1 many more claims remain unresolved. The IHS has
insisted on using a "costs incurred" model to calculate the amount of damages owed, while Tribes
have insisted that the annual shortfall reports submitted to Congress are the appropriate starting point
for determining damages. Nevertheless, over the past two years the IHS has established a pattern of
extending mostly fair and reasonable settlement offers, in most cases in a timely manner. The IHS's
progress is commendable, as the settlement process got off to a rocky start. The IHS should be
urged to continue its efforts to fairly and quickly settle all outstanding CSC claims as Tribes
continue to file their more recent claim years.
Although the Ramah and Arctic Slope decisions confirm the government's liability for past CSC
shortfalls, the lack of an approved class action against IHS and the need to file individual IHS claims
has left older claims vulnerable to a statute of limitations defense. Recognizing the inequity of
denying Tribal recoveries on a technicality, both the House and the Senate have in the past
introduced bills that would essentially waive the statute of limitations on certain CSC claims,
including S. 2389 and H.R. 4031 in the 112th Congress and S. 385 in the 113th Congress. To date, no
such bill has been passed into law, and courts have split on whether equitable tolling of the statute of
limitations should apply.
2.
Work with the Administration and Congress to secure long-term solutions moving forward,
including establishing full CSC funding on a mandatory basis
As the Ramah decision affirms, the ISDEAA requires full payment of CSC. If Congress does not
appropriate enough to fully pay every Tribal contractor or compactor its full requirement, those with
shortfalls are authorized by law to pursue claims and recover damages, which are then paid from the
Permanent and Indefinite Judgment Fund. Initially, after the Ramah decision, the Administration
proposed to cap CSC payments at the individual contractor level in the FY 2014 appropriations act,
to try to prevent tribal contractors from recovering unpaid amounts in the courts. Tribes came out
overwhelmingly against that proposal, however, and Congress rejected it. Congress removed the
longstanding total CSC spending “caps,” and the Administration committed to fully funding CSC in
FY 2014. However, the amount set aside by IHS for CSC based on its estimate of need early in the
fiscal year proved insufficient, and full funding required a last-minute reprogramming of $25.1
million, much of it from direct services. In FY 2015, Congress again declined to cap CSC payments
and expressed its intent, in the Managers' Statement accompanying the bill, to provide sufficient
funding to fully fund CSC as well as repay funds that were reprogrammed to cover the FY 2014 IHS
1
For comparison, IHS reported in a letter to Senator Begich dated April 24, 2014, that 105 settlements had been accepted for
a total of $273,000,000.
need. As long as CSC is funded from the agencies' lump sum appropriations and is not capped,
however, the need for reprogramming will remain a possibility.
When Congress rejected the Administration's proposal in the FY 2014 Consolidated Appropriations
Act, it directed the agencies to consult with tribes and to work with Congress and the Office of
Management and Budget to come up with a long-term solution to CSC funding. Congress directed
the agencies to develop and submit a consultation plan within 120 days of enactment of the
Consolidated Appropriations Act, and both agencies conducted consultations as outlined in those
plans in 2014. Over the course of the consultation broad consensus developed among tribes and
tribal organizations that the long-term solution must involve a permanent assurance of full funding
for CSC, which must not be paid for by cuts to Indian programs. To that end, tribes have proposed
legislation to establish CSC as a permanent, indefinite appropriation like other legal entitlements.
NIHB, NCAI and a number of regional health boards have adopted resolutions in support of this
approach.
Following consultation, the Administration came out with its own proposal to move CSC to a
mandatory appropriation. In the President’s FY 2016 Budget, the Administration proposed to make
CSC appropriations for both IHS and DOI mandatory, but only for three years starting in FY 2017.
The proposal also included a set aside of “up to 2%” of the amounts appropriated for CSC to be used
for “administrative capacity and program management.” Tribes across the country have submitted
comments on this proposal, both directly to the agencies and in testimony for congressional hearings.
Tribes overwhelmingly support the concept of moving CSC to a mandatory appropriation, but they
have generally preferred a permanent provision and have generally opposed the 2% set-aside for
program administration. That said, Tribes are now working collaboratively with Congress and the
Administration to secure a mandatory appropriation, whether it be permanent or short-term to start.
So far, the reaction from Congress has been that that the creation of new mandatory funding is
disfavored and would be politically quite difficult. For FY 2016, Congressional staff proposed an
alternative approach, which was reflected in the Senate appropriations bill. That approach would
create separate accounts for BIA and IHS CSC within the discretionary budget, and would
appropriate an indefinite amount—"such sums as may be necessary"—in order to fund the full
amount of CSC need. This approach, while not permanent, would address the two primary goals of
mandatory funding—protection of program funding and full funding of CSC—and would provide a
good precedent for a later indefinite mandatory appropriation. Unfortunately, it appears that
Congress will fail to enact a FY 2016 budget before the start of the fiscal year, so a continuing
resolution maintaining the current funding levels is likely for at least part of FY 2016.
As IHS and BIA work with Congress to craft long-term solutions, including proposed legislative
language or revisions to their CSC policies, they must ensure a transparent process that makes use of
tribal as well as agency expertise. Any proposed solutions must be fully vetted by the agencies’
respective CSC Workgroups. For example, the IHS CSC Workgroup proved instrumental in helping
IHS develop an efficient payout process to implement the full-funding policy in FY 2014. Finally,
IHS should release CSC distribution data for fiscal years 2012 and 2013 that it has so far refused to
share with Tribes, even though the statutory due dates for submission of this information to Congress
have long passed. Representative Young’s bill, H.R. 5092, would have required the CSC shortfall
(or “deficiency”) reports to be available to the public on May 1 of each year.
The following documents are attached for your reference:
• May 22, 2015 “Dear Tribal Leader” letter from IHS re: past-year CSC claims, FY 2014
and 2015 payment and reconciliation activities, the President's FY 2016 mandatory
funding proposal, and other CSC updates;
• Draft legislative language to implement a permanent mandatory CSC appropriation (2
proposals)
• House and Senate appropriations bills CSC language for FY 2016
Strategy & Actions:
1. Obtain fair compensation for all past CSC shortfalls in a fair and expedient manner.
Implement this objective through the following measures:
•
•
•
•
Closely monitor Ramah class action settlement negotiations and urge the Administration
to expedite the settlement process.
Urge the Administration to continue to streamline the process to settle all outstanding
IHS claims as soon as possible, in a fair and consistent manner.
Support legislation to waive the statute of limitations as to certain CSC claims and give
Tribes the opportunity to make their cases on the merits.
Demand that IHS and BIA provide detailed and written quarterly reports to the
Secretaries and to the Tribes setting forth the progress they are making on CSC
settlements.
2. Work with the Administration and Congress to secure long-term solutions moving forward,
including establishing full CSC funding on a mandatory basis. Implement this objective through
the following measures:
•
•
•
•
•
•
•
Show support for the Administration's proposal to create a mandatory appropriation for
CSC, and if feasible support modifying and expanding the proposal to create a
permanent, indefinite CSC appropriation rather than a capped, three-year appropriation.
In the meantime, support the FY 2016 Senate appropriations bill approach to create
separate accounts for BIA and IHS CSC and to appropriate to those accounts such sums
as may be necessary to fully fund CSC.
Demand that Tribes be involved and consulted as the Administration works with
Congress toward a long-term solution for CSC funding.
Resist agency attempts to codify the IHS's "costs incurred" approach to determining CSC
need through appropriations or language.
Resist agency attempts to unilaterally declare certain programs or services ineligible for
contract support, as IHS has tried to do with the MSPI and DVPI programs.
Demand that all agency proposals concerning adjustments to CSC practices and
procedures be fully deliberated through each agency's Contract Support Cost Work
Group.
Demand that IHS share 2012 and 2013 CSC shortfall data with all Tribes so that Tribes
and the CSCWG can validate IHS's data calculations. Without access to this data, Tribes
cannot know whether the information IHS provides to Congress is accurate and Tribal
efforts to advocate in Congress are hindered.
DEPARTMENT OF HEALTH & HUMAN SERVICES
Public Health Service
Rockville MD 20852
MAY 22 2015
Dear Tribal Leader:
I am writing to provide an update on Contract Support Costs (CSC). The Indian Health Service
(IHS) continues to make CSC a priority. This letter is intended to provide an update on the
following areas related to CSC: 1) status of resolving past year claims for unpaid CSC; 2) fiscal
years (FY) 2014 and 2015 CSC payment and reconciliation activities; 3) implementation of an
Annual CSC Calculation (ACC) Estimation Tool; 4) negotiation of direct CSC; 5) the FY 2016
President’s Budget proposal to make CSC a mandatory appropriation beginning in FY 2017; and
6) IHS CSC Workgroup activities.
Status of Resolving Past Year Claims for Unpaid CSC
IHS continues to make progress on resolving past year claims presented under the Contract
Disputes Act for unpaid CSC. As of May 8, IHS has extended settlement offers on 1,249 claims
and has settled 947 claims in the amount of approximately $705.5 million. IHS remains focused
on resolving the remaining claims, with a goal of extending offers on all claims received by
January 1, 2015, by the end of the calendar year. The continued success of our efforts to resolve
past claims is due in part to the working relationship with Tribes. Please direct any questions
regarding the status of your claim to your IHS Area Director. In addition, you may ask your
attorney to contact the Office of the General Counsel.
FY 2014 CSC Payment and Reconciliation Activities
The FY 2014 Consolidated Appropriations Act did not specify a limit on the total funds available
for payment of CSC; therefore, IHS’s goal is to pay full CSC, as defined by the Indian SelfDetermination and Education Assistance Act (ISDEAA), for FY 2014. To ensure the Agency
met its goal to pay full CSC need in FY 2014, IHS developed a more detailed and consistent
reconciliation process to fully fund the estimated CSC need and to account for the variables that
can change the estimated CSC need throughout the year. For FY 2014, IHS reconciled and paid
CSC in April, September, and December 2014 and April 2015. IHS has worked to improve
communication with each Tribe to ensure that IHS and Tribes use the most current data
necessary to accurately estimate each Tribe’s full CSC need.
The following are the steps used for data and funding reconciliation:


IHS reviews and updates CSC data on a monthly basis, with a primary focus on updating
any changes in the variables that can change the CSC estimated need (i.e., paid funding
amount, changes in the Tribe’s indirect cost rate, and changes in pass-throughs and
exclusions associated with the Tribe’s indirect cost rate).
Based on the monthly data reconciliation findings, the IHS initiates a payment
reconciliation.
Page 2 – Tribal Leader



IHS notifies Tribes when there are changes in the estimated CSC need based on the best
available data, using an Annual CSC Calculation (ACC) Estimation Tool described
below.
IHS will work with the Tribe to modify a Tribe’s Title I annual funding agreement (AFA)
or amend a Tribe’s Title V funding agreement (FA) to pay any additional CSC need.
In cases where a Tribe has received a CSC overpayment, the IHS will work with the
Tribe to recover the overpayment funds and modify the Tribe’s Title I AFA or amend the
Tribe’s Title V FA to update full estimated CSC amounts in the ISDEAA agreement with
the IHS.
IHS interprets the ISDEAA to authorize CSC funding for those actual costs that Tribes incur that
meet the definition of CSC as described in the ISDEAA at 25 U.S.C. § 450j-1(a). IHS relies, in
part, on the Tribe’s final audited costs and, in most cases, the applicable indirect cost rate
negotiated with Tribes’ cognizant federal agencies. To accurately calculate a Tribe’s full
estimated CSC need, the IHS also reviews costs for reasonableness and duplication. For
example, for FY 2014, if the Tribe chose to use an indirect cost rate to estimate its CSC need,
IHS expects that the final costs could be determined in FY 2016 once the Tribe receives its FY
2014 indirect cost rate, or later. Therefore, FY 2014 CSC reconciliation will be open until final
costs are determined.
FY 2015 CSC Payment and Reconciliation Activities
Similar to FY 2014 payment and reconciliation activities, the IHS is in the process of
completing its first FY 2015 reconciliation. We expect to make payments to Tribes no later than
May 30, 2015. Payments will be based on: funds paid to date; a Tribe’s most current indirect
cost rate, where applicable; and applicable pass-through and exclusions as negotiated by the
Tribe in the Tribe’s negotiated indirect cost rate agreement. In addition, the IHS will assess the
reasonableness of costs and duplication, consistent with the ISDEAA and the IHS CSC Policy.
IHS will modify Title I AFAs or amend Title V FAs for any additional payments based on
reconciled data used to estimate full CSC.
Implementation of an Annual CSC Calculation (ACC) Estimation Tool
In January 2015, IHS implemented the ACC Estimation Tool, which will be used by IHS to
assure that full estimated CSC need is calculated in a consistent manner using the best and most
current information. The ACC Estimation tool supports a transparent means to calculate each
Tribe’s full estimated CSC need at any given time. IHS intends to share a completed ACC
Estimation tool in advance of CSC negotiations to support full and open discussion. The IHS
looks forward to sharing the ACC Estimation tool at IHS Area Tribal meetings and providing
additional training on the information necessary to estimate CSC need. Please contact your
Area Director for information related to upcoming trainings in your Area.
Negotiation of Direct CSC
When a Tribe negotiates and enters into a contractual agreement with the IHS under the
ISDEAA, the Tribe receives the amount of funding the Secretary would have otherwise provided
for the operation of the program, function, service, or activity (PFSA) or portion thereof,
typically referred to as the “Secretarial amount.” The ISDEAA authorizes an additional amount
for CSC, which consists of the reasonable costs for activities which must be carried out by the
Tribe or Tribal organization as a contractor to ensure compliance with the terms of the contract
and prudent management, but which are activities not normally carried out by IHS in its direct
operation of the programs, or are provided by the Secretary in support of the contracted program
from resources other than those under the contract. Eligible CSC includes the costs of
reimbursing each Tribal contractor for the reasonable and allowable costs for direct program
expenses and additional administrative expenses related to the overhead incurred by the Tribal
contractor in connection with the operation of the PFSA pursuant to the contract, except that
CSC cannot be duplicative; i.e., CSC cannot be paid for activities that are already funded in the
amount transferred by the Secretary.
The majority of direct CSC need typically consists of fringe costs that are not already funded as
part of the Secretarial amount. In the IHS CSC Policy, fringe costs are a group of five items,
including Federal Insurance Contributions Act (FICA); life, health, and disability insurance;
retirement; workers’ compensation insurance; and unemployment insurance. In accordance with
the IHS CSC Policy, IHS has historically agreed, as to this group of fringe benefit costs, to total
the amounts already provided in the Secretarial amount for FICA, retirement, and life, health and
disability insurance, and compare these amounts to the reasonable and necessary fringe benefit
costs of the Tribe (which also include additional costs for workers’ compensation and
unemployment insurance) for the transferred PFSAs. Consistent with IHS CSC Policy, the IHS
calculates direct CSC utilizing the most current actual cost data. In FY 2014, IHS reviewed data
across the Agency to determine the fringe costs for the three items already provided to a Tribe in
its Secretarial amount, as required by the IHS CSC Policy. For FY 2015 direct CSC
negotiations, IHS will use the Agency’s final actual fringe costs for those three items for FY
2014, to determine those costs already transferred to a Tribe in its Secretarial amount. IHS will
consider proposals for other eligible direct CSC costs as detailed in the IHS CSC Policy.
Consistent with the IHS CSC Policy, the IHS applies the Office of Management and Budget
(OMB) non-medical inflation rate to a Tribe’s estimated direct CSC need each year that the
Tribe chooses not to renegotiate its need. To simplify this process, the IHS will apply the final
OMB non-medical inflation rate from the previous year to the previous year’s negotiated direct
CSC need to arrive at the current year estimated need. For example, the final rate for FY 2014,
1.6%, will be applied to arrive at the updated direct CSC need for FY 2015.
The FY 2016 President’s Budget Proposal to make CSC a Mandatory Appropriation
On February 9, IHS announced Tribal Consultation to invite input on the FY 2016 President’s
Budget proposal to make CSC funding mandatory starting with the FY 2017 appropriation. The
proposal seeks to reclassify CSC as mandatory funding, rather than discretionary funding. The
proposal has four components:
1) A three-year mandatory appropriation, which provides a specific amount for each year to
fully fund CSC;
2) No-year funding that allows funding to be available to IHS to carry over in future years;
3) New CSC estimates will be provided as a part of the reauthorization process every three
years; and;
4) In addition to the current amount, up to 2% of CSC totals can be used for administrative
capacity and program management.
IHS has received a number of responses from Tribes with overwhelming support for the proposal
to reclassify CSC as mandatory funding. IHS will continue to provide updates regarding the
status of the mandatory funding proposal at national and regional listening sessions. For
additional information on how the proposal will interact with the discretionary caps and how it is
scored under the Statutory Pay-As-You-Go Act of 2010 (PAYGO), IHS defers to OMB.
IHS CSC Workgroup Activities
The IHS CSC Workgroup continues to hold face-to-face meetings and telephone or video
conference calls. A majority of the Workgroup’s focus is discussion of options that would
simplify and streamline the work to negotiate full CSC need. The CSC Workgroup played an
instrumental role in the development of the ACC Estimation Tool. I appreciate the valuable
work of the CSC Workgroup and will continue to share their recommendations and outcomes.
We appreciate your input and remain committed to work with Tribes on solutions to this very
important issue. Thank you for your ongoing support and partnership, which has been critical in
achieving progress on CSC-related issues. We welcome your comments, suggestions, and
recommendations on any of the topics in this update. Please send your input to
[email protected].
Sincerely,
/Robert G. McSwain/
Robert G. McSwain
Acting Director
OPTIONS FOR IMPLEMENTING MANDATORY CONTRACT SUPPORT
COST APPROPRIATION VIA H.R. 2 (‘DOC FIX’ BILL)
Note: The mandatory funding options below are designed to fit in the ‘Doc
Fix’ SGR bill (H.R. 2). They create a permanent, indefinite appropriation. If
the CBO score for such an appropriation is too high, they could be modified
to reflect the Administration's capped, three-year proposal.
Option 1 [using a Fund]:
SEC. ____. CONTRACT SUPPORT COSTS.
Subpart I of part D of title III of the Public Health Service Act (42 U.S.C. § 254b
et seq.), as amended, is further amended by adding at the end the following
section:
“SEC. ___. CONTRACT SUPPORT COSTS.
“(a) PURPOSE.—It is the purpose of this section to establish a Contract Support
Cost Fund (referred to in this section as the “CSC Fund”) to be administered by
the Secretary of the Department of Health and Human Services and the Secretary
of the Interior, to be used for the purposes of making payments required by
Subsections 106(a)(2), (3), and (5) of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. § 450j-1(a)(2), (3), and (5)) to Indian tribes
and tribal organizations for contract support costs arising out of self-determination
or self-governance contracts, grants, compacts, or annual funding agreements
entered into pursuant to that Act.
“(b) FUNDING—For the purpose of making payments under this section, there is
appropriated to the CSC Fund, out of any monies in the Treasury not otherwise
appropriated, such amounts as may be necessary.”
Option 2 [without using a Fund]:
SEC. ____. CONTRACT SUPPORT COSTS.
Subpart I of part D of title III of the Public Health Service Act (42 U.S.C. § 254b
et seq.), as amended, is further amended by adding at the end the following:
“SEC. ___. CONTRACT SUPPORT COSTS.
“(a) PURPOSE.— (a) It is the purpose of this section to provide for payments by
the Secretary of Health and Human Services and the Secretary of the Interior, as
required by subsections 106(a)(2), (3), and (5) of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. § 450j-1(a)(2), (3), and (5)), to Indian
tribes and tribal organizations for contract support costs arising out of selfdetermination or self-governance contracts, grants, compacts, or annual funding
agreements entered into pursuant to that Act.
“(b) FUNDING—For the purpose of making payments under this section, there is
appropriated, out of any monies in the Treasury not otherwise appropriated, such
amounts as may be necessary.”
OPTIONS FOR IMPLEMENTING MANDATORY CONTRACT SUPPORT COST
APPROPRIATION VIA APPROPRIATIONS ACT PROVISION
Option 1 (permanent):
“(a) For the purpose of making payments to Indian tribes and tribal organizations
under subsections 106(a)(2), (3), and (5) of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. § 450j-1(a)(2), (3), and (5)), there is
appropriated, out of any monies in the Treasury not otherwise appropriated, such
amounts as may be necessary.”
Option 2 (three years):
Note: this option reflects the Administration's proposal and assumes that FY
2016 CSC will be fully funded from the agencies' discretionary
appropriations at the proposed amounts.
“(a) For the purpose of making payments to Indian tribes and tribal organizations
under subsections 106(a)(2), (3), and (5) of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. § 450j-1(a)(2), (3), and (5)), there is
appropriated, out of any monies in the Treasury not otherwise appropriated,
$1,107,000 for fiscal year 2017, $1,247,000 for fiscal year 2018, and $1,438,000
for fiscal year 2019. Amounts appropriated pursuant to this paragraph shall
remain available until expended.”
Contract Support Costs (CSC) Quoted Language from the Pending
FY 2016 House and Senate Appropriations Bills and Reports
June 19, 2015
House Bill, HR 2822, p. 92:
Provided further, That $717,970,000 shall be for payments to Indian tribes and tribal
organizations for contract support costs associated with contracts, grants, self-governance
compacts, or annual funding agreements between the Indian Health Service and an Indian tribe
or tribal organization pursuant to the Indian Self-Determination and Education Assistance Act
(25 U.S.C. 450 et seq.) prior to or during fiscal year 2016, and shall remain available until
expended."
House Appropriations Committee Report, H. Rpt. 114-170, p. 76:
Contract Support Costs.- The recommendation includes $717,970,000 as requested for full
funding of estimated contract support costs. Bill language has been added making these funds
available until expanded and protecting against the use of other appropriations to meet
unanticipated shortfalls. The Service is directed to work with Tribes and tribal organizations to
ensure that budget estimates continue to be as accurate as possible.
Senate Bill (CSC is its own account):
For payments to tribes and tribal organizations for contract support costs associated with Indian
Self-Determination and Education Assistance Act agreements with the Indian Health Service for
fiscal year 2016, such sums as may be necessary: Provided, that amounts obligated but not
expended by a tribe or tribal organization for contract support cost for such agreements for the
current fiscal year shall be applied to contract support costs otherwise due for such agreements
for subsequent fiscal years: Provided further, that, notwithstanding any other provision of law,
no amounts made available under this heading shall be available for transfer to another budget
account.
Senate Appropriations Committee Report:
The Committee has included new language establishing an indefinite appropriation for contract
support costs estimated to be $717,970,000, which is an increase of $55,000,000 above the fiscal
year 2015 level. The budget request proposed to fund this program within the "Indian Health
Services" account. Under this heading the Committee has provided the full amount of the
request for contract support costs. By virtue of the indefinite appropriation, additional funds may
be provided by the agency if its budget estimate proves to be lower than necessary to meet the
legal obligation to pay the full amount due to tribes. This account is solely for the purposes of
paying contract support costs and no transfer from this account are permitted for other purposes.
Bureau of Indian Affairs
House Bill, HR 2822, p. 28 (is under Operation of Indian Programs):
Provided further, That $272,000,000 shall be for payments to Indian tribes and tribal
organization for contract support costs associated with contracts, grants, self-governance
compacts, or annual funding agreements between the Bureau and an Indian tribe or tribal
organization pursuant to the Indian Self-Determination and Education Assistance Act (25 U.S.C.
450 et. seq.) prior to or during fiscal year 2016, and shall remain available until expanded.
House Appropriations Committee Report, H. Rpt. 114-170, p. 37:
Contract Support Costs.- The recommendation includes $272,000,000 as requested for full
funding of estimated contract support costs. Bill language has been added making these funds
available until expanded and protecting against the use of other appropriations to meet
unanticipated shortfalls. The Bureau is directed to work with Tribes and tribal organizations to
ensure that budget estimates continue to be as accurate as possible.
Senate Bill (CSC its own account):
For payments to tribes and tribal organizations for contract support costs associated with Indian
Self-Determination and Education Assistance Act agreements with the Bureau of Indian Affairs
for fiscal year 2016, such sums as may be necessary, which shall be available for obligation
through September 30, 2017: Provided, that amounts obligated but not expended by a tribe or
tribal organization for contract support cost for such agreements for the current fiscal year shall
be applied to contract support costs otherwise due for such agreements for subsequent fiscal
years: Provided further, that, notwithstanding any other provision of law, no amounts made
available under this heading shall be available for transfer to another budget account.
Senate Appropriations Committee Report:
Contract Support Costs.- The Committee has included new language establishing an indefinite
appropriation for contract support costs estimated to be $277,000,000, which is an increase of
$26,000,000 above the fiscal year 2015 level. The budget request proposed to fund these costs
within the "Operation of Indian Programs" account through Contract Support and the Indian Self
Determination fund budget lines. Under the Committee's new budget structure, the full amount
tribes are entitled to will be paid and other programs will not be reduced in cases where the
agency may have underestimated these payments when submitting its budget. Additional funds
may be provided by the agency if its budget estimate proves to be lower than necessary to meet
the legal obligation to pay the full amount due to tribes, but this account is solely for the
purposes of paying contract support costs and no transfer from this account are permitted for
other purposes. Similar to the President's requests for calculating contract support costs, this
provision also applies to new and expanded Indian Self-Determination and Education Assistance
Act agreements funded through the Indian Self-Determination Fund activity.
From the OMB Letter on the House Interior Appropriations Bill
The Subcommittee bill also contains problematic language related to tribal Contract Support
Costs (CSC) for BIA and IHS. Specifically, the bill contains a limitation on funding for CSC that
could perpetuate the funding issues described in the Supreme Court's Salazar v. Ramah Navajo
Chapter decision. The Congress should pursue a longterm solution for CSC appropriations,
providing an increase in funding in FY 2016 as part of a transition to a new three-year mandatory
funding stream in FY 2017, as proposed in the President's Budget.
Tab 6 Front
Tab 6 back
IHS BUDGET RECOMMENDATIONS
Summary of Issue:
After requests from Tribes for several years, Tribal leaders and representatives, policy experts, and
federal partners met to discuss the current Indian Health Service (IHS) budget formulation process,
budget climate, and budget priorities in an effort to identify new ideas and recommendations to improve
the Indian health system. During the Indian Health Service Budget Summit held on October 14, 2014,
more than 100 attendees participated in a World Café Session to identify areas of need and to develop
recommendations for legislative, administrative, and advocacy action. A summary of all the
recommendations developed during the Summit are included below and supplemental information is
available in the appendix.
Objectives/Goals:
1. Promote recommendations from the Indian Health Service with the Administration and
Congress.
2. Engage Tribal leadership and employees to improve information sharing, including local data
and best practices, Congressional visits, and personal stories
3. Strengthen partnerships with educational institutions, research experts, Tribal and non-Tribal
businesses, and foundations to support changes in policy and legislation that improve the Indian
health system.
Strategy & Actions:
Legislative Recommendations
Many of the recommendations made during the IHS Budget Summit were priorities that SelfGovernance Tribes already support. The top five recommendations include:
1. Advanced appropriations for IHS
2. Mandatory funding for IHS
3. Remove Contract Support Costs from base service funding
4. Create a 51st Sate for Medicaid for Indian Country
5. Directly fund block grants to Tribes.
Administrative Recommendations
Administrative recommendations were drafted to provide the IHS Director items to streamline the
budget formulations process, gather and share data, improve internal processes, and encourage Tribal
and Federal collaboration. The top recommendations include:
1. Improve the IHS National Budget Formulation Process
 Self-Governance Tribes should request annual budget analysis and data necessary to ensure
rational decision-making during the budget formulation process.
 Additional transparency is needed to improve decision-making, including access to pass-back
information, identification of policies, procedures and issues that hinder IHS staff, and open
forums with agency staff.

2.
3.
4.
5.
Request additional agency staff and funding support for outside expertise to analyze data,
write and publish information, and maximize capture of alternative resources.
Assign a high level I/T/U Task Force to provide recommendations to redesign the IHS.
 Conduct an analysis of alternative business models, including funding designations, mission,
formal partnership, and organizational structure.
 Streamline and eliminate unnecessary, bureaucratic processes to improve health care
delivery.
 Maximize third party revenue or support access to other revenue sources.
 Develop a workforce development plan.
Develop an annual report that evaluates the federal government’s obligation to Tribes
Commission a Task Force to re-evaluate and update budget lines items and funding allocation
and formulas to reflect business operations today.
Request the Department of Health and Human Services and Department of the Interior each
develop a health policy to include determinants of health and outcomes.
Advocacy Recommendations
1. Organize Tribal leaders and Congressional campaign.
 Develop an organized Congressional campaign and messaging.
 Hold a Hill Action Day.
 Use Social media.
 Leverage partnerships to increase participation and Congressional visits.
2. Educate Administration and Congress.
 Set up meetings with key administration officials.
 Invites Congressional members and staff to Indian Country.
 Advocate for parity in funding for IHS.
3. Tell Indian Country’s story better.
 Develop an education and orientation program to educate Congress, public and new Tribal
leaders on all aspects of Indian history, trust obligations, services, disparities, and legislation.
 Provide personal stories and local data.
 Prepare visuals.
4. Strengthen Partnerships.
 Leverage relationship with institution in and out of Indian Country to support advocacy
efforts.
IHCIA Unfunded Provisions as of July 2011
Citation
Sec. 112
(25 U.S.C § 1616p)
Sec. 123
(25 U.S.C § 1621c)
Sec. 124
(25 U.S.C § 1621d)
Sec. 127
(25 U.S.C § 1621
h(d))
Sec. 132
(25 U.S.C § 1621p)
Sec. 136
(25 U.S.C § 1621v)
Sec. 143
(25 U.S.C § 1637)
Sec. 146
(25 U.S.C § 1638f)
Sec. 147
(25 U.S.C § 1638g)
Sec. 153
(25 U.S.C § 1644)
Sec. 161
(25 U.S.C § 1659)
Sec. 164
(25 U.S.C § 1660e)
Sec. 165
(25 U.S.C § 1660f)
Sec. 173
(25 U.S.C § 1663a)
Sec. 702
(25 U.S.C § 1665)
Sec. 705
(25 U.S.C § 1665d)
Program/Section Name
Health professional chronic shortage
demonstration program
Diabetes Prevention, Treatment and Control
Authorized Funding Amount
Long term services. Authority for provision of
services such as hospice care, assisted living,
long-term care, home-and community-based
care, and “Convenient Care Services” and
sharing staff or other services between
facilities
Behavioral Health Training and Community
Education Programs
American Indians Into Psychology Program
Note: three sites already funded, but they’re
authorized to grant to 9 sites
Office of Indian Men’s and Indian Women’s
Health
Note: they have to report on this activity
within two years of enactment
Indian Health Care Delivery Demonstration
Projects
Indian Country Modular Component Facilities
Demonstration Program
Mobile Health Stations Demonstration
Program
Grants to and Contracts with the Service,
Indian tribes, tribal organizations, and urban
Indian organizations to Facilitate Outreach,
Enrollment, and Coverage of Indians under
Social Security Act Health Benefits Programs
Facilities Renovation
Expanded Program Authority for urban Indian
organizations to receive grants for additional
health related activities
Community Health Representative programs
and urban organizations
Nevada Area Office
Behavioral Health Prevention and Treatment
Services
Mental Health Technician Program
$2,700,000
$50,000,000 for five years
$5,000,000/yr for five years
Sec. 707
(25 U.S.C § 1665f)
Sec. 710
(25 U.S.C § 1665i)
Sec. 711
(25 U.S.C § 1665j)
Sec. 712
(25 U.S.C § 1665k)
Sec. 713
(25 U.S.C § 1665l)
Sec. 715
(25 U.S.C § 1665n)
Sec. 723
(25 U.S.C § 1667b)
Indian Women Treatment Programs
Training and Community Education (on
behavioral health issues)
Behavioral Health Program (grants for Indian
health programs)
Fetal Alcohol Spectrum Disorders Programs (to
train providers to identify and treat pregnant
women)
Child Sexual Abuse and Prevention Treatment
Programs
Behavioral Health Research
Indian Youth Telemental Health Demonstration
Project
$1,500,000/year 2010-2013
Federal Poverty Levels for Medicaid and Marketplace Enrollment in 2016 1
September 28, 2015
This brief seeks to provide guidance to Tribes on the federal poverty levels (FPLs)
applied when determining eligibility for Medicaid and federal financial assistance
though the Marketplace during the open enrollment period for 2016, and during the
2016 coverage year.
FPL Levels Applicable to 2015 Coverage Year
On January 22, 2015, HHS issued the 2015 Federal Poverty Guidelines (2015 FPL). The
2015 FPL applies when determining Medicaid eligibility on or after January 22, 2015, until
HHS issues new guidelines in early 2016. In contrast, when determining eligibility for
premium tax credits (PTCs) and cost-sharing reductions (CSRs) through a Marketplace for
coverage in 2015, including eligibility determinations made during Monthly Special
Enrollment Periods for Indians and their families conducted throughout the year, the
2014 Federal Poverty Guidelines (2014 FPL) applies. Tables comparing the 2014 FPL and
2015 FPL appear below.
FPL Levels Applicable to 2016 Coverage Year, Including Open Enrollment Period for 2016
When determining eligibility for PTCs and CSRs through a Marketplace for the 2016
coverage year, the 2015 FPL will apply throughout the 2016 coverage year, including for
eligibility determinations made during the open enrollment period for 2016—November
1, 2015, through January 31, 2015. For Medicaid eligibility determinations, however, the
2015 FPL currently apply and will continue to apply until HHS issues the 2016 Federal
Poverty Guidelines (2016 FPL) in early 2016. After HHS issues the 2016 FPL early next
year, the 2016 FPL will apply when determining Medicaid eligibility through the
remainder of 2016.
Shown below in Table A are the figures applicable to the 48 contiguous states and the District of
Columbia.
Shown below in Table B are the figures applicable to the State of Alaska.
1
This brief is for informational purposes only and is not intended as legal advice. For questions on this brief, please contact Doneg
McDonough, TSGAC Technical Advisor, at [email protected].
Page 1 of 3
Shown below in Table A are the figures applicable to the 48 contiguous states and the District of
Columbia.
48 Contiguous States and the District of Columbia
TABLE A: HHS Poverty Guidelines for Use in Calendar Year 2015
2014 FPL
2015 FPL
Persons in
Household
Use with Marketplace (PTC/CSR) Eligibility
for All of 2015 Coverage Year
for All of 2016 Coverage Year AND
Use with Medicaid Eligibility as of
January 22, 2015, into Early 2016
Change
(2014 to
2015)
1
2
3
4
5
6
7
8
$11,670
$15,730
$19,790
$23,850
$27,910
$31,970
$36,030
$40,090
$11,770
$15,930
$20,090
$24,250
$28,410
$32,570
$36,730
$40,890
$100
0.9%
$200
1.3%
$300
1.5%
$400
1.7%
$500
1.8%
$600
1.9%
$700
1.9%
Each Additional
$4,060
$4,160
$800
$100
2.0%
2.5%
% Change
(2014 to
2015)
Source (2014 FPL): HHS/ASPE (Office of the Assistance Secretary for Planning and Evaluation) http://aspe.hhs.gov/poverty/14poverty.cfm
TABLE A.1: 2015 FPL for Use with Marketplace (PTC/CSR) Eligibility Determinations
for 2016 Coverage Year
2015 FPL Level (Effective for All of the 2016 Coverage Year)
Persons in
Household
1
2
3
4
5
6
7
8
100%
138%
250%
300%
400%
$11,770
$15,930
$20,090
$24,250
$28,410
$32,570
$36,730
$40,890
$16,243
$21,983
$27,724
$33,465
$39,206
$44,947
$50,687
$56,428
$29,425
$39,825
$50,225
$60,625
$71,025
$81,425
$91,825
$102,225
$35,310
$47,790
$60,270
$72,750
$85,230
$97,710
$110,190
$122,670
$47,080
$63,720
$80,360
$97,000
$113,640
$130,280
$146,920
$163,560
TABLE A.2: 2015 FPL for Use with Medicaid Eligibility Determinations in 2015 & Early 2016
2015 FPL Level (Effective January 22, 2015, Until New Guidelines Issued in Early 2016)
Persons in
Household
1
2
3
4
5
6
7
8
100%
138%
250%
300%
400%
$11,770
$15,930
$20,090
$24,250
$28,410
$32,570
$36,730
$40,890
$16,243
$21,983
$27,724
$33,465
$39,206
$44,947
$50,687
$56,428
$29,425
$39,825
$50,225
$60,625
$71,025
$81,425
$91,825
$102,225
$35,310
$47,790
$60,270
$72,750
$85,230
$97,710
$110,190
$122,670
$47,080
$63,720
$80,360
$97,000
$113,640
$130,280
$146,920
$163,560
September 28, 2015
Page 2 of 3
Shown below in Table B are the figures applicable to the State of Alaska.
State of Alaska
TABLE B: HHS Poverty Guidelines for Use in Calendar Year 2015
State of Alaska
2014 FPL
2015 FPL
Persons in
Household
for All of 2015 Coverage Year
for All of 2016 Coverage Year AND
Use with Medicaid Eligibility as of
January 22, 2015, into Early 2016
Change
(2014 to
2015)
% Change
(2014 to
2015)
1
2
3
4
5
6
7
8
14,580
19,660
24,740
29,820
34,900
39,980
45,060
50,140
$14,720
$19,920
$25,120
$30,320
$35,520
$40,720
$45,920
$51,120
$140
1.0%
$260
1.3%
$380
1.5%
$500
1.7%
$620
1.8%
$740
1.9%
$860
1.9%
Each Additional
$5,080
$5,200
$980
$120
2.0%
2.4%
TABLE B.1: 2015 FPL for Use with Marketplace (PTC/CSR) Eligibility Determinations
for 2016 Coverage Year
State of Alaska
2015 FPL Level (Effective for All of the 2016 Coverage Year)
Persons in
Household
1
2
3
4
5
6
7
8
100%
138%
250%
300%
400%
$14,720
$19,920
$25,120
$30,320
$35,520
$40,720
$45,920
$51,120
$20,314
$27,490
$34,666
$41,842
$49,018
$56,194
$63,370
$70,546
$36,800
$49,800
$62,800
$75,800
$88,800
$101,800
$114,800
$127,800
$44,160
$59,760
$75,360
$90,960
$106,560
$122,160
$137,760
$153,360
$58,880
$79,680
$100,480
$121,280
$142,080
$162,880
$183,680
$204,480
TABLE B.2: 2015 FPL for Use with Medicaid Eligibility Determinations in 2015 & Early 2016
State of Alaska
2015 FPL Level (Effective January 22, 2015, Until New Guidelines Issued in Early 2016)
Persons in
Household
1
2
3
4
5
6
7
8
100%
138%
250%
300%
400%
$14,720
$19,920
$25,120
$30,320
$35,520
$40,720
$45,920
$51,120
$20,314
$27,490
$34,666
$41,842
$49,018
$56,194
$63,370
$70,546
$36,800
$49,800
$62,800
$75,800
$88,800
$101,800
$114,800
$127,800
$44,160
$59,760
$75,360
$90,960
$106,560
$122,160
$137,760
$153,360
$58,880
$79,680
$100,480
$121,280
$142,080
$162,880
$183,680
$204,480
September 28, 2015
Page 3 of 3
Indexing Adjustments Related to Certain Affordable Care Act Provisions
for 2015 and 2016 1
September 29, 2015
This brief seeks to provide guidance to Tribes on indexing adjustments associated with the Patient
Protection and Affordable Care Act (ACA) provisions for calculating the amount of premium tax credit
(PTCs), determining whether individuals qualify for an income-based exemption from the shared
responsibility payment, and determining whether employer-sponsored health insurance is considered
affordable.
Applicable Percentage Contribution (for Premium Tax Credit Calculations)
Under ACA, individuals who have an income between 100 percent and 400 percent of the federal poverty
level (FPL) and meet other requirements can obtain PTCs to help pay for Marketplace coverage.
Section 36B of the Internal Revenue Code (Code) (as added by ACA) set the required household income
contribution percentages for 2014 and authorized IRS to adjust these percentages annually to reflect the
excess of the rate of premium growth for the preceding calendar year 2 over the rate of income growth for
the preceding calendar year. In 2014, IRS released guidance updating the applicable contribution
percentages for CY 2015 3 and CY 2016 4 (see Table 1 below). 5
Table 1: Applicable Percentage Contribution for CY 2014 Through CY 2016
2014
2015
Household Income (as a Low End of Top End of Low End of Top End of
Percentage of FPL)
Range
Range
Range
Range
Less than 133%
2.0%
2.0%
2.01%
2.01%
133% to 150%
3.0%
4.0%
3.02%
4.02%
150% to 200%
4.0%
6.3%
4.02%
6.34%
200% to 250%
6.3%
8.05%
6.34%
8.10%
250% to 300%
8.05%
9.5%
8.10%
9.56%
300% to 400%
9.5%
9.5%
9.56%
9.56%
2016
Low End of Top End of
Range
Range
2.03%
2.03%
3.05%
4.07%
4.07%
6.41%
6.41%
8.18%
8.18%
9.66%
9.66%
9.66%
Source: IRS, Rev. Proc. 2014-37 and Rev. Proc. 2014-62
1 This brief is for informational purposes only and is not intended as legal advice. For questions on this brief, please contact Doneg
McDonough, TSGAC Technical Advisor, at [email protected].
2 “Premium growth for the preceding calendar year” for this and the other measures refers to the quotient determined by dividing the
projected per enrollee spending for employer-sponsored private health insurance for the preceding calendar year by the projected per
enrollee spending for employer-sponsored private health insurance for the calendar year two years prior. The projections are the
National Health Expenditure Projections published by the CMS Office of the Actuary.
3 See Rev. Proc. 2014-37 at http://www.irs.gov/pub/irs-drop/rp-14-37.pdf.
4 See Rev. Proc. 2014-62 at http://www.irs.gov/pub/irs-drop/rp-14-62.pdf.
5 IRS (and HHS) may decide to revise these (and other) percentages at a later date.
Affordability Percentage (Required Contribution Percentage for Affordability Determinations)
Starting in 2014, § 5000A of the Code (as added by ACA), requires individuals of all ages to make a shared
responsibility payment when filing their federal income tax return if they do not have qualifying health
insurance (minimum essential coverage) for each month or do not qualify for an exemption. American
Indians and Alaska Natives are able to file for an exemption from this payment on their federal income tax
filings. Other individuals and families who cannot afford coverage because their premiums would exceed a
certain percentage of household income, i.e. the affordability percentage, qualify for an income-based
exemption. Section § 5000A of the Code set the affordability percentage at 8 percent for 2014 and
authorized HHS to adjust this percentage annually to reflect the excess of the rate of premium growth for
the preceding calendar year over the rate of income growth for the preceding calendar year. In 2014 and
early 2015, HHS issued regulations updating the affordability percentage for CY 2015 6 and CY 2016 7 (see
Table 2 below).
Table 2: Affordability Percentage for CY 2014 Through CY 2016
2014
Affordability Percentage
8.0%
2015
8.05%
2016
8.13%
Source: CMS, CMS-9949-F and CMS-9944-F
Required Contribution Percentage (for Calculating Affordability of Employer Offer of Coverage)
Under section 4980H of the Code, as added by ACA, applicable large employers (ALEs)--those with at least a
certain number of employees (generally 50 full-time employees or a combination of full-time and part-time
employees equivalent to 50 full-time employees)--might have to make a shared responsibility payment if
they do not offer affordable health insurance to their full-time employees. The required contribution
percentage, i.e. the percentage of household income an employee must contribute for self-only coverage, is
used to determine whether employer-sponsored insurance is considered affordable. Section § 36B of the
Code set the affordability percentage at 9.5 percent for 2014 and authorized IRS to adjust this percentage
annually to reflect the excess of the rate of premium growth for the preceding calendar year over the rate of
income growth for the preceding calendar year. In 2014, IRS released guidance updating the required
contribution percentages for CY 2015 8 and CY 2016 9 (see Table 3 below).
Table 3: Required Contribution Percentage for CY 2014 Through CY 2016
2014
2015
Required Contribution Percentage
9.5%
9.56%
2016
9.66%
Source: IRS, Rev. Proc. 2014-37 and Rev. Proc. 2014-62
6 See CMS-9949-F, “Patient Protection and Affordable Care Act; Exchange and Insurance Market Standards for 2015 and Beyond,” at
http://www.gpo.gov/fdsys/pkg/FR-2014-05-27/pdf/2014-11657.pdf.
7 See CMS-9944-F, “Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2016,” at
http://www.gpo.gov/fdsys/pkg/FR-2015-02-27/pdf/2015-03751.pdf.
8 See Rev. Proc. 2014-37.
9 See Rev. Proc. 2014-62.
September 29, 2015
Page 2 of 2
RE:
Notice 2015-16 on Section 4980I
May 15, 2015
May 15, 2015
CC:PA:LPD:PR (Notice 2015-16)
Internal Revenue Service
Room 5203
Ben Franklin Station, P.O. Box 7604
Washington, D.C. 20044
RE:
Notice 2015-16 on Section 4980I — Excise Tax on High Cost EmployerSponsored Health Coverage
I.
INTRODUCTION.
I write to the Internal Revenue Service (IRS) on behalf of the National Indian Health Board
(NIHB)1 in response to IRS Notice 2015-16 (the Notice), in which the IRS solicited
comments on potential regulatory approaches for implementing Section 4980I of the Tax
Code.2 Section 4980I establishes an excise tax on certain employer-sponsored health
benefits under which coverage providers, including health insurance issuers and employers
who administer self-funded plans, must pay a tax on employee plans that exceed certain
statutory cost thresholds.3 Thank you for the opportunity to comment on the Notice.
We believe that the plain language of Section 4980I exempts Indian Tribal employers who
administer self-funded plans from the excise tax altogether.4 This interpretation is further
1
Established in 1972, the NIHB is an inter-Tribal organization that advocates on behalf of Tribal governments
for the provision of quality health care to all American Indians and Alaska Natives (AI/ANs). The NIHB is
governed by a Board of Directors consisting of a representative from each of the twelve Indian Health Service
(IHS) Areas. Each Area Health Board elects a representative to sit on the NIHB Board of Directors. In areas
where there is no Area Health Board, Tribal governments choose a representative who communicates policy
information and concerns of the Tribes in that area with the NIHB. Whether Tribes operate their entire health
care program through contracts or compacts with IHS under Public Law 93-638, the Indian Self-Determination
and Education Assistance Act (ISDEAA), or continue to also rely on IHS for delivery of some, or even most, of
their health care, the NIHB is their advocate.
2
See Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 9001, 124 Stat. 119, 793 (2010),
codified as amended at 26 U.S.C. § 4980I. Unless otherwise noted, references to “Sections” of statutes within
this comment refer to sections of the Tax Code in chapter 26 of the United States Code.
3
The thresholds are $10,200 for self-only coverage and $27,500 for non-self-only coverage, subject to certain
adjustments specified in the statute. 26 U.S.C. § 4980I(b)(3)(C).
4
Tribal employers who purchase group health insurance for their employees would not be liable for the tax, as
liability for the tax is limited to “coverage providers,” which in those cases would be the health insurance issuer
rather than the employer itself. 26 U.S.C. § 4980I(c). Any reference to Tribal employers in this comment is
therefore limited to those employers administering self-funded plans.
1
RE:
May 15, 2015
supported as a matter of policy, as applying the excise tax to Tribal employers can
significantly burden their ability to provide adequate health benefits to Tribal members and
to recruit and retain employees. We therefore urge the IRS to recognize the statutorily
mandated Tribal exemption in any eventual implementing regulations.
To the extent that the IRS ultimately construes Section 4980I as applying to Tribal
employers, notwithstanding the statutory provisions discussed below, the NIHB believes that
the regulations must recognize the unique nature of Tribal benefits and maximize employer
flexibility when structuring their plans. This would include distinguishing between Tribal
member employees and non-Tribal member employees, excluding various benefit types from
the scope of the tax, allowing employers to narrowly tailor their grouped employees when
calculating plan value, and clarifying the applicability of the controlled group rules to Tribal
entities. We elaborate on all of these points below.
II.
DISCUSSION.
a. Longstanding rules of statutory interpretation indicate that Section 4980I
excludes Indian Tribal employers from the excise tax.
Section 9001 of the Patient Protection and Affordable Care Act (ACA), which established
Tax Code section 4980I, applied the excise tax to excess benefits provided under “applicable
employer-sponsored coverage,” as defined in subsection 4980I(d)(l). That subsection
includes a provision specific to governmental employers, which states that “applicable
employer-sponsored coverage” includes “coverage under any group health plan established
and maintained primarily for its civilian employees by the Government of the United States,
by the government of any State or political subdivision thereof, or by any agency or
instrumentality of any such government.”5 This government plan provision does not mention
anything about plans administered by an Indian Tribe or Tribal organization, despite
specifically addressing state governments and the federal government.6
Under well-recognized rules of statutory interpretation, Congress’s exclusion of Tribal
governments from Section 4980I must be considered deliberate. First, statutes of general
applicability that interfere with rights of self-governance, such as the relationship between
Tribal governments and on-reservation Tribal businesses and their employees, require “a
clear and plain congressional intent” that they apply to Tribes before they will be so
5
26 U.S.C. § 4980I(d)(1)(E).
6
The IRS has recognized that the government-specific clause must be read as an integrated whole with the
introductory language in 26 U.S.C. § 4980I(d)(1)(A), noting that the fact that the government clause only
mentions “civilian” governmental plans implicitly means that Congress intended that military governmental
plans are not subject to the excise tax. Notice at 8. This interpretation, and the government clause generally,
would not make sense if Congress had intended that the excise tax apply to any government plans other than
those specified in paragraph (d)(1)(E). See, e.g., FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,
133 (2000) (courts must “interpret the statute ‘as a symmetrical and coherent regulatory scheme,’ and ‘fit, if
possible, all parts into a[ ] harmonious whole’”) (citation omitted).
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interpreted.7 Although Congress repeatedly referenced Indian Tribes in the ACA,8 and
specifically discussed governmental entities in Section 4980I, it did not include Tribes at all
in the statutory provision concerning the coverage of the excise tax. This indicates that the
Section 4980I does not apply of its own force to Tribal employers who administer their own
plans.9
Second, there are numerous provisions in the Tax Code that explicitly mention Tribal
governmental entities,10 include Tribally-sponsored benefits within the definition of
“governmental plans” in various contexts,11 or specifically note when Tribal governmental
entities are to be treated identically to State governments for the purposes of a given rule.12
These provisions almost all cite the definition of “Indian tribal government” set out in
Section 7701 of the Tax Code, a provision which the ACA repeatedly referenced and
amended.13 So, even though Congress applied numerous provisions in the ACA to Indian
7
E.E.O.C. v. Fond du Lac Heavy Equip. & Const. Co., Inc., 986 F.2d 246, 249 (8th Cir. 1993) (Age
Discrimination in Employment Act did not apply to employment discrimination action involving member of
Indian Tribe, Tribe as employer, and reservation employment); accord Snyder v. Navajo Nation, 382 F.3d 892,
896 (9th Cir. 2004) (Fair Labor Standards Act did not apply to dispute between Navajo and non-Navajo Tribal
police officers and Navajo Nation over “work [done] on the reservation to serve the interests of the tribe and
reservation governance”).
8
See, e.g., Section 1402(d)(2) (referring to health services provided by an Indian Tribe); Section 2901(b)
(referring to health programs operated by Indian Tribes); Section 2951(h)(2) (referring to Tribes carrying out
early childhood home visitation programs); Section 2953(c)(2)(A) (discussing Tribal eligibility to operate
personal responsibility education programs); Section 3503 (discussing Tribal eligibility for quality improvement
and technical assistance grant awards).
9
To whatever extent that there is uncertainty on this front, the Indian canons of statutory construction require
that statutes relating to Indians be “construed liberally in favor” of Tribes. Montana v. Blackfeet Tribe of
Indians, 471 U.S. 759, 766 (1985).
10
See, e.g., 26 U.S.C. § 54F(d)(4) (including “Indian tribal governments (as defined in [Tax Code] section
7701(a)(40))” as qualified bond issuers for certain projects); 26 U.S.C. § 401(k)(4)(B)(iii) (“An employer which
is an Indian tribal government (as defined in [Tax Code] section 7701(a)(40)), a subdivision of an Indian tribal
government (determined in accordance with section 7871(d)), an agency or instrumentality of an Indian tribal
government or subdivision thereof, or a corporation chartered under Federal, State, or tribal law which is owned
in whole or in part by any of the foregoing may include a qualified cash or deferred arrangement as part of a
plan maintained by the employer.”).
11
See, e.g., 26 U.S.C. § 414(d) (“The term ‘governmental plan’ includes a plan which is established and
maintained by an Indian tribal government (as defined in [Tax Code] section 7701(a)(40)), a subdivision of an
Indian tribal government (determined in accordance with section 7871(d)), or an agency or instrumentality of
either. . . .”).
12
See, e.g., 26 U.S.C. § 168(h)(2)(A)(i), (iv) (defining “tax-exempt entities” as including both “the United
States, any State or political subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing,” and “any Indian tribal government described in section 7701(a)(40),”
and then explicitly noting that “any Indian tribal government . . . shall be treated in the same manner as a
State”).
13
See ACA Section 9010(d)(2) (incorporating definitions from Section 7701); Section 1409(a) of the Health
Care and Education Reconciliation Act of 2010 (adding new subsection (o) to Section 7701).
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Tribes, clearly knows how to include Tribal governments or health plans within the scope of
a particular Tax Code provision,14 and in the ACA explicitly amended the Tax Code section
that includes a commonly-cited definition of “Tribal government,”15 it did not mention
Tribes in Section 4980I’s discussion of governmental entities. “[W]here Congress includes
particular language in one section of a statute but omits it in another section of the same Act,
it is generally presumed that Congress acts intentionally and purposeful in the disparate
inclusion or exclusion.”16 Section 4980I must be construed to exclude Tribal plans from the
excise tax.
b. Policy considerations support the statutory exclusion of Tribal employers
who administer their own plans from the excise tax.
Congress has recognized both that “[f]ederal health services to maintain and improve the
health of the Indians are consonant with and required by the Federal Government’s historical
and unique legal relationship with, and resulting responsibility to, the American Indian
people” and that it is a “major national goal . . . to provide the resources, processes, and
structure that will enable Indian tribes and tribal members to obtain the quantity and quality
of health care services and opportunities that will eradicate the health disparities between
Indians and the general population of the United States.”17 Applying the excise tax to Tribal
employers that administer their own plans, in addition to running counter to Section 4980I’s
statutory language, also undercuts Congress’s national policy towards Indian health.
Many areas with a high concentration of Tribal entities also have some of the steepest
insurance prices in the United States. For example, the United Benefits Advisors’ 2014
Health Insurance Cost Survey determined that the average cost of insurance in Alaska was
$12,584.00 per employee, far exceeding the $10,200 excise tax threshold.18 At least one
14
See, e.g., City of Milwaukee v. Illinois & Michigan, 451 U.S. 304, 329 n.22 (1981) (“The dissent refers to our
reading as ‘extremely strained,’ but the dissent, in relying on § 505(e) as evidence of Congress’ intent to
preserve the federal common-law nuisance remedy, must read ‘nothing in this section’ to mean ‘nothing in this
Act.’ We prefer to read the statute as written. Congress knows how to say ‘nothing in this Act’ when it means
to see, e. g., Pub.L. 96–510, § 114(a), 94 Stat. 2795.”); accord Arcia v. Fla. Sec’y of State, 772 F.3d 1335, 1348
(11th Cir. 2014) (“[W]here Congress knows how to say something but chooses not to, its silence is
controlling.”) (citations omitted).
15
See, e.g., Indian Self-Determination and Education Assistance Act, Pub. L. No. 93-638, § 105, 88 Stat. 2203,
2208-09 (1975) (codified as amended at 42 U.S.C. § 215(d), 42 U.S.C. § 2004b) (federal law required to
explicitly include Indian Tribes within the scope of statutory benefits previously limited to state and local
governments).
16
Dean v. United States, 556 U.S. 568, 573 (2009).
17
25 U.S.C. § 1601(1)-(2). We note that the federal government’s budgeting and expenditures do not come
close to meeting the requirements of the trust responsibility: IHS is only funded at approximately 56% of need,
and a recent contract support cost shortfall was estimated at $90 million. NATIONAL TRIBAL BUDGET
FORMULATION WORKGROUP’S RECOMMENDATIONS ON THE INDIAN HEALTH SERVICE FISCAL YEAR 2015
BUDGET 3, 6 (2013).
18
Peter Freska, United Benefits Advisors, The State of Healthcare Insurance – The Top Five Highest and
Lowest Costs of Health Insurance (May 7, 2015),
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Tribal employer in Alaska has examined its own benefits packages and determined that
current costs are $11,880.84 per employee for self-only coverage ($1,680.84 over the
statutory threshold) and $36,236.64 for family coverage ($8,736.64 over the statutory
threshold). These costs do not mean that the Tribe is encouraging irresponsible overuse of
health care by offering “Cadillac” plans to their employees. Rather, the high expenses are
driven by the necessity of employee recruitment in rural areas and the market forces
associated with providing coverage in remote portions of Alaska, factors over which Tribal
employers have little control.
Rather than fulfilling the government’s trust responsibility towards Indian health, applying
the excise tax to Tribal employers would force the employers into one of the following
scenarios:

Option 1: Pay the tax. Tribes must then divert their limited and finite
funding away from necessary services such as law enforcement, health
care, and other governmental requirements in order to “pay” the IRS. This
circuitous process will essentially result in the Tribe receiving federal
funding to provide member services and then paying it back to the United
States in the form of the excise tax. The Tribe might then be forced to
increase employee contribution amounts or cost-sharing in its self-funded
plan to make up a portion of the difference.19

Option 2: Replace its existing plan, which has been carefully tailored
according to the needs of the Tribal workforce and the realities of market
pressures, with lower-cost insurance. The replacement coverage may be
less comprehensive, include fewer in-network providers, or have higher
costs for the individual employee. This will result in dissatisfaction and
potentially lower health outcomes for the employee and difficulties for the
Tribe in employee recruitment and retention.

Option 3: Eliminate employer-sponsored coverage altogether. The Tribe
will then become potentially liable for the ACA’s employer mandate
penalty, which would again force the Tribe to divert funding back to the
federal government. The Tribe will also be placed at a significant
disadvantage from a human resources standpoint.
None of these options respect either the trust responsibility or the fact that Tribal design of
employee benefits packages is itself an exercise in sovereignty. The NIHB believes that
http://rss.ubabenefits.com/tabid/2835/Default.aspx?art=prOFd2v2yq4%3D&mfid=ybBRLsooTzo%3D
(calculating the average total amount that an employer can expect to pay to provide insurance for a given
employee in a given state or profession, across plan variations and coverage types).
19
Such an increase could potentially eliminate the Tribal plan’s grandfathered status under the ACA, if
applicable. See 45 C.F.R. § 147.140(g)(1).
5
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these policy considerations strongly support the statutory exclusion of Tribes from the excise
tax, and we request that the IRS acknowledge that fact in any ultimate regulations.
c. Even if it does not construe the statute as entirely excluding Tribal plans,
the IRS should exclude coverage provided to Tribal member employees
from the definition of “applicable employer-sponsored coverage.”
In the event that the IRS construes Section 4980I as applying to Tribal employers who
administer their own plans,20 we note that the tax applies to the excess benefit provided to
any employee covered under any “applicable employer-sponsored coverage.” The term
“applicable employer-sponsored coverage” means coverage “under any group health plan
made available to the employee by an employer which is excludable from the employee’s
gross income under section 106 [of the Tax Code], or would be so excludable if it were
employer-provided coverage (within the meaning of such section 106).”21 With certain
exceptions, Section 106 generally excludes the value of “employer-provided coverage under
an accident or health plan” from an employee’s gross income.22
Coverage for Tribal member employees, however, is not excluded from income pursuant to
Section 106, but rather by virtue of Section 139D, which excludes from an individual’s gross
income the value of:

Any health service or benefit provided or purchased, directly or indirectly,
by IHS through a grant to or a contract or compact with a Tribe or Tribal
organization, or through a third-party program funded by IHS;

Medical care provided, purchased, or reimbursed by a Tribe or Tribal
organization for, or to, a Tribal member (including the member’s spouse
or dependent);

Coverage under accident or health insurance (or an arrangement or plan
having the effect of accident or health insurance) provided by a Tribe or
Tribal organization for a Tribal member (including the member’s spouse
or dependent); and

Any other medical care provided by a Tribe or Tribal organization that
supplements, replaces, or substitutes for a program or service relating to
medical care provided by the federal government to Tribes or Tribal
members.23
20
For the remainder of this comment, we will assume arguendo that the excise tax rules will apply to Tribal
employers who administer their own plans. Tribal employers who purchase coverage for their employees from
a plan issuer would not be liable for the tax.
21
26 U.S.C. § 4980I(d)(1)(A).
22
26 U.S.C. § 106(a).
23
26 U.S.C. § 139D(b). This Tax Code provision was implemented pursuant to Section 9021 of the ACA.
6
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Because coverage for Tribal member employees is excludable under Section 139D rather
than section 106, it is not included in the definition of “applicable employer sponsored
coverage” for purposes of Section 4980I. This is an important distinction, as Tribes may
provide members with health insurance as an extension of or in association with an employee
plan (whether as a group plan, through premium sponsorship in an ACA Marketplace, etc.).
While these benefits might at first glance seem to “mimic” a Section 106 plan to which the
excise tax would apply, the coverage would instead be exempt under Section 139D and
remain outside the scope of the tax. Any proposed rule issued by the IRS should clarify this
fact as a definitional matter in order to ensure that the tax is not levied against benefits
provided by a Tribal employer to a Tribal member employee.24 We request that the IRS
consult with the NIHB and the Tribal Technical Advisory Group (TTAG)25 concerning
specific approaches and language for reconciling any overlap between Section 4980I and
Section 139D, and to generally address the application of the excise tax to Tribes.
d. The NIHB supports the IRS’s proposed benefit exclusions from the
definition of “applicable employer-sponsored coverage.”
The Notice seeks comment on whether or not the IRS should exclude the following benefits
when calculating the value of an employee’s total compensation package: (1) certain types of
on-site medical coverage; (2) Employee Assistance Program (EAP) benefits;26 and (3) selfinsured dental and vision coverage.27 The NIHB supports the exclusion of all three sets of
benefits from the tax.
With regard to on-site medical services, the IRS states that it already plans on excluding such
services from the excise tax so long as they (1) are provided at a facility that is located on the
premises of an employer or employee organization; (2) consist primarily of first aid that is
provided during the employer’s working hours for treatment of a health condition, illness, or
injury that occurs during those working hours; (3) are available only to current employees,
24
In addition, we believe that the regulations should recognize that applying the excise tax to Tribal member
plans will frustrate one of the key goals in enacting Section 139D, as Tribes will be less likely to provide such
tax-exempt benefits to their members (employee or otherwise) if they are concerned that doing so could subject
the Tribal fisc to liability under Section 4980I.
25
The TTAG advises CMS and other federal agencies on Indian health policy issues involving Medicare,
Medicaid, the Children’s Health Insurance Program, and any other health care program funded (in whole or in
part) by CMS. In particular, the TTAG focuses on providing policy advice regarding improving the availability
of health care services to AI/ANs under federal health care programs.
26
Generally, EAPs offer free and confidential assessments, counseling, referrals, and follow-up services to
employees who have personal and/or work-related issues affecting mental and emotional well-being, such as
alcohol and other substance abuse, stress, grief, family problems, marital distress, workplace issues, and
psychological disorders.
27
Fully-insured dental and vision coverage are statutorily excluded from the calculation.
4980I(d)(1)(B)(ii).
7
26 U.S.C. §
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and not retirees or dependents; and (4) are provided with no charge to the employee. 28 The
IRS is seeking comment on whether it should also exclude more complex benefits from the
tax.29
As an initial matter, we note that Section 139D exempts medical care provided by a Tribe to
its members and their spouses and dependents from taxable income. It would be
incongruous, to say the least, to implement Section 4980I in a manner that would count the
value of such services towards an employee’s total compensation package. This is
particularly true given that Section 139D, which was enacted to implement federal trust
responsibility, is designed to confirm that when a Tribe provides IHS-funded health service
to their members, spouses and dependents under the ISDEAA, the value of such services is
not considered income to the receiving individual. Section 4980I should not be interpreted in
a manner that would nonetheless penalize a Tribe for providing ISDEAA-mandated health
care to its members simply because those members are employees covered under a selffunded plan.
In addition, we believe that the IRS should exempt from the excise tax any medical services
provided to any employee by an I/T/U program for workplace-related health issues, and
should expand the exemption even to services provided at the nearest appropriate Tribal
health program (whether or not on-site). First, with regard to the on-site requirement,
employees in urban areas may have fairly easy access to urgent care centers, hospitals, or
other health facilities should they not want to obtain services at an on-site clinic. By
comparison, the remote location of many Tribal businesses means that the local Indian health
program, regardless of where it is specifically situated, might be the only geographically
viable option for treating work-related injury or illness or for providing other necessary care
during the workday. Requiring that the facility be located on-site ignores this reality and
might automatically exclude Tribal employers that (rightfully) rely on an Indian health
facility to treat employee conditions. The IRS should accordingly extend the workplace
exception to care provided to employees at the nearest appropriate facility, even if it is
technically not on the employer’s campus.30
Second, and as discussed above, Section 139D encourages Indian health programs to provide
health services to Tribal members by excluding the value of such services from the
individual’s gross income. If the cost of this care is then counted towards the excise tax,
Tribes (especially those with large populations of employee-members) may be forced to
reconsider the scope of certain services they can afford to provide to their memberemployees as a tax-exempt workplace benefit. This will run counter to congressional intent
by “punishing” the Tribe for seeking to provide quality care and benefits to its employees.
Again, we believe that the IRS should consult with the NIHB and the TTAG concerning the
28
Notice at 8-9.
29
Id. at 9.
30
In the alternative, the IRS could designate any facility located within the boundaries of a current or former
Indian reservation or Alaska Native Village, or otherwise located on Tribal trust land, as being “on-site” for any
associated Tribal employer.
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potential scope of an Indian-specific exclusion with regard to the treatment of workplace
health issues.
We similarly believe that EAP benefits should not count towards the excise tax. AI/ANs
suffer from a disproportionate level of substance abuse,31 violence against women,32 and
suicide,33 and have one of the highest rates of unemployment of any ethnic group. 34 These
are precisely the types of issues that EAPs seek to address, with benefits extending to the
individual employee, his or her family, the Tribal workplace, and the community at large.35
Tribal employers can also tailor their EAPs to provide culturally-appropriate services, which
may be an employee’s only opportunity to receive such benefits and the difference between
whether or not an employee ultimately seeks EAP assistance. Subjecting EAP benefits to the
excise tax will discourage Tribal employers from continuing to offer such programs and will
disproportionately disadvantage AI/AN communities.36
Finally, we support the IRS’s proposal to exclude self-insured dental and vision plans from
the excise tax.37 This will assist the ability of Tribal employers to provide quality coverage
to their employees without incurring additional costs under Section 4980I.
e. The NIHB supports flexible disaggregation rules.
In most cases, the IRS will determine the value of a health care plan for the purposes of the
excise tax by evaluating the average plan cost among all “similarly situated beneficiaries.”38
While Section 4980I requires that employers group self-only coverage enrollees separately
from non-self-only coverage when determining which beneficiaries are “similarly situated,”39
31
U.S. SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES ADMINISTRATION, THE TEDS REPORT: AMERICAN
INDIAN AND ALASKA NATIVE SUBSTANCE ABUSE TREATMENT ADMISSIONS ARE MORE LIKELY THAN OTHER
ADMISSIONS TO REPORT ALCOHOL ABUSE 1 (NOV. 18, 2014).
32
NATIONAL CONGRESS OF AMERICAN INDIANS, NCAI POLICY RESEARCH CENTER, POLICY INSIGHTS BRIEF:
STATISTICS ON VIOLENCE AGAINST NATIVE WOMEN 2-3 (FEB. 2013).
33
SUICIDE PREVENTION RESOURCE CENTER, SUICIDE AMONG RACIAL/ETHNIC POPULATIONS IN THE U.S.:
AMERICAN INDIANS/ALASKA NATIVES 1 (2013).
34
Jens Manuel Krogstad, One-in-four Native Americans and Alaska Natives are Living in Poverty, PEW
RESEARCH CENTER (June 13, 2014), http://www.pewresearch.org/fact-tank/2014/06/13/1-in-4-nativeamericans-and-alaska-natives-are-living-in-poverty/.
35
While this is particularly notable in the Tribal context, this is also generally true among workplaces
nationwide.
36
In the alternative, if the IRS ultimately includes EAP benefits within the scope of the excise tax, the NIHB
requests that such programs be exempt if offered by a Tribe or Tribal organization.
37
Notice at 9-10.
38
Id. at 4.
39
26 U.S.C. § 4980I(d)(2)(A).
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the IRS has broad discretion to consider other methods of permissible employee groupings.40
The IRS is accordingly considering whether to promulgate “permissive disaggregation” rules
under which employers would be able to designate plan beneficiaries as “similarly situated”
based on either “a broad standard (such as limiting permissive disaggregation to bona fide
employment-related criteria, including, for example, nature of compensation, specified job
categories, collective bargaining status, etc.) while prohibiting the use of any criterion related
to an individual’s health),” or else a “more specific standard (such as a specified list of
limited specific categories for which permissive disaggregation is allowed),” including
current and former employees or bona fide geographic distinctions.41
The NIHB urges the IRS to adopt broad permissive disaggregation rules that maximize
employer flexibility to group plan beneficiaries according to the unique needs of the
employer’s workforce.42 Determining who is “similarly situated” with respect to the cost of
health care will require a nuanced understanding of the nature of the employer’s business, the
specific needs of the employee population, geographic considerations concerning cost of
care, etc. Forcing employees into very general categories may artificially skew the actual
cost of coverage to the disadvantage of employers.
This is particularly apparent in the case of Tribal government employers. Tribes employ
individuals to perform a broad spectrum of commercial and governmental functions, and
might simultaneously be insuring physicians, timber cutters, office employees, policemen,
and sanitation workers, all of whom might have position-specific needs in a health plan. In
addition, insurance plans in frequently-remote Tribal areas tend to be expensive, have high
cost-sharing amounts, or be less comprehensive than plans available in urban settings.43
Requiring a Tribal employer to institute a “one size fits all” approach would not work well in
these circumstances, and the excise tax rules may be better and more rationally applied if
Tribes (and other employers with diverse workforces) have the flexibility to treat disparate
groups of employees as covered by different plans.
f. The NIHB supports a flexible application of the past cost methodology for
calculating plan value.
An additional area in which the IRS seeks comment is the manner in which self-insured plans
would calculate plan values to compare against the statutory threshold. The agency has
40
Section 4980I merely requires that the IRS establish rules “similar” to those governing employee aggregation
when determining COBRA premiums. 26 U.S.C. § 4980I(d)(2)(A) (referring to the Consolidated Omnibus
Budget Reconciliation Act of 1985, Pub. L. No. 99-272 (1986)).
41
Notice at 14.
42
Congress has equally recognized the necessity for adjusting patient pools by including specific statutory
considerations based on age and gender, retirement status, and plan costs for individuals engaged in high-risk
professions. See 26 U.S.C. § 4980I(b)(3)(C)(iii), (f).
43
See, e.g., Letter from Monica J. Linden, Commissioner, Montana Department of Securities and Insurance, to
Kathleen Sebelius, Secretary, U.S. Department of Health and Human Services (Mar. 10, 2014) (recognizing
practical difficulties for Tribal employers in finding and offering adequate employee coverage).
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proposed three primary options: the actuarial method, under which the cost of applicable
coverage for a given determination period would be calculated using “reasonable actuarial
principles and practices,” the past cost method, under which the cost of coverage would be
equal to the cost to the plan for similarly situated beneficiaries for the preceding
determination period (adjusted for inflation), or the actual cost method, under which the cost
of coverage would be equal to the actual costs paid by the plan to provide health coverage for
the preceding determination period.44
With the caveat that the NIHB supports whichever methodology that maximizes flexibility
for Tribal employers, we believe that some version of the past cost methodology will
ultimately prove preferable. Compliance with an actuarial methodology (currently an
undefined term) may require Tribes to expend significant resources on accountants, benefits
administrators, or similar expert services in order to comply with the specifics of the
methodology. By comparison, a past cost methodology is more likely to correspond with
existing Tribal budgeting practices and will result in less disruption to their business. We
agree, though, with the IRS’s recognition that the specifics of determining plan costs under
any such methodology are complex enough to warrant further attention at a later date,45 and
request that the IRS consult with the NIHB and the TTAG in the interim for a more in-depth
examination of methods that would prove most conducive for Tribal employers.
We also wish to respond to the IRS’s request for comment as to whether various individual
costs should or should not be included in the overall value of employee plans when using the
past cost methodology.46 Specifically, the IRS should not include overhead expenses, which
it defines as “salary, rent, supplies, and utilities . . . being ratably allocated to the cost of
administering the employer’s health plans” within the calculation.47 We believe that this may
disproportionately yield higher costs for Tribal employers, which frequently have increased
overhead associated with attempts to retain employees and do business in remote locations
(particularly in Alaska, which has far higher costs of living and conducting business than in
most of the lower 48 states).48 Limiting the calculation to direct costs would be a fairer and
better-grounded approach from a Tribal perspective.
g. The IRS should acknowledge the good faith standard applicable to
government entities when implementing controlled group rules.
Section 4980I states that for the purposes of calculating benefit plan costs, “[a]ll employers
treated as a single employer under subsection (b), (c), (m), or (o) of section 414 [of the Tax
44
Notice at 15-20.
45
Id. at 20.
46
Id. at 17.
47
Id.
48
This does not even consider the practical difficulty, if not impossibility, of determining what proportion of
general employer overhead applies to health plan administration.
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Code] shall be treated as a single employer.”49 These provisions, known as the “controlled
group rules,” are part of the Employee Retirement Income Security Act of 1974 (ERISA) and
generally govern circumstances in which employees of commonly controlled corporations,
trades, or businesses will be treated as employees of a single, common entity.
However, the IRS has explicitly reserved application of the controlled group rules to
governmental employers and has stated that government entities may “apply a reasonable,
good faith interpretation” of the rules in other ACA-related contexts, such as the employer
mandate.50 The NIHB requests that the IRS recognize either in subsequent Notices or
regulations that a Tribe’s good faith interpretation of the controlled group rules applies for
the purposes of both the employer mandate and the excise tax, and that satisfying the
standard in one context will equally satisfy the standard in the other. If not, Tribes will be
forced to treat its enterprises differently under related ACA compliance requirements, which
will be costly, administratively burdensome, and increase the risk of accidental errors in
calculating excise tax or employer mandate liability.
III.
CONCLUSION.
Section 4980I has the potential to seriously affect Tribes’ ability to structure employee
benefit packages in accordance with Tribal-specific needs. Because the statute excludes
Tribes from the list of covered governmental entities, and in light of the numerous other
places in which the Tax Code explicitly applies to Tribes, the NIHB does not believe that
Tribal employers who administer their own plans should be subject to the excise tax (both as
a matter of law and policy). Should the IRS disagree on this point, however, it should at least
recognize the distinctions between member and non-member employees as required by
Section 139D, and should implement regulations maximizing employer flexibility in plan
design. The NIHB also requests Tribal consultation with the IRS in order to ensure that the
excise tax regulations properly reflect these concerns.
Thank you for the opportunity to engage with the IRS on this matter. The NIHB stands ready
to work with the IRS on any necessary follow up issues and looks forward to a continued
open dialogue on the ACA excise tax.
Sincerely,
Lester Secatero, Chair
National Indian Health Board
49
26 U.S.C. § 4980I(f)(9).
50
Information Reporting by Applicable Large Employers on Health Insurance Coverage Offered Under
Employer-Sponsored Plans, 79 Fed. Reg. 13,231, 13,234 n.3 (Mar. 10, 2014). To our knowledge, the IRS has
not provided any additional guidance on this point.
12
Section 4980I — Excise Tax on High Cost Employer-Sponsored Health Coverage
Notice 2015-52
I.
PURPOSE AND OVERVIEW
This notice is intended to continue the process of developing regulatory guidance
regarding the excise tax on high cost employer-sponsored health coverage under
§ 4980I of the Internal Revenue Code (Code). Section 4980I, which was added to the
Code by the Affordable Care Act, 1 applies to taxable years beginning after December
31, 2017. Under this provision, if the aggregate cost of applicable employer-sponsored
coverage (applicable coverage) provided to an employee exceeds a statutory dollar limit
(dollar limit), which is adjusted annually, the excess benefit is subject to a 40 percent
excise tax.
On February 23, 2015, the Department of the Treasury (Treasury) and the
Internal Revenue Service (IRS) issued Notice 2015-16, 2015-10 IRB 732, which
describes potential approaches regarding a number of issues under § 4980I that may
be incorporated into future regulations. Notice 2015-16 addresses issues primarily
relating to (1) the definition of applicable coverage, (2) the determination of the cost of
applicable coverage, and (3) the application of the dollar limit to the cost of applicable
coverage to determine any excess benefit subject to the excise tax. Treasury and IRS
invited comments on the issues addressed in that notice and on any other issues under
§ 4980I.
This notice is intended to supplement Notice 2015-16 by addressing additional
issues under § 4980I, including the identification of the taxpayers who may be liable for
the excise tax, employer aggregation, the allocation of the tax among the applicable
taxpayers, and the payment of the applicable tax. This notice also addresses further
issues regarding the cost of applicable coverage that were not addressed in Notice
2015-16. Treasury and IRS invite comments on these issues and any other issues
under § 4980I. After considering the comments on both notices, Treasury and IRS
intend to issue proposed regulations under § 4980I. The proposed regulations will
provide further opportunity for comment, including an opportunity to comment on the
issues addressed in the preceding notices.
1
The “Affordable Care Act” refers to the Patient Protection and Affordable Care Act (enacted March 23,
2010, Pub. L. No. 111-148), as amended by the Health Care and Education Reconciliation Act of 2010
(enacted March 30, 2010, Pub. L. No. 111-152), and as further amended by the Department of Defense
and Full-Year Continuing Appropriations Act, 2011 (enacted April 15, 2011, Pub. L. No. 112-10).
1
This notice includes the following sections:
Section I:
PURPOSE AND OVERVIEW
Section II:
BACKGROUND
Section III:
PERSONS LIABLE FOR THE § 4980I EXCISE TAX
Section IV:
EMPLOYER AGGREGATION
Section V:
COST OF APPLICABLE COVERAGE
Section VI:
AGE AND GENDER ADJUSTMENT TO THE DOLLAR LIMIT
Section VII:
NOTICE AND PAYMENT
Section VIII:
REQUEST FOR COMMENTS
Section IX:
RELIANCE
Section X:
DRAFTING INFORMATION
II.
BACKGROUND
Section 4980I(a) imposes a 40 percent excise tax on any “excess benefit”
provided to an employee, and § 4980I(b) provides that an excess benefit is the excess,
if any, of the aggregate cost of applicable coverage of the employee for the month over
the applicable dollar limit for the employee for the month. 2
Section 4980I(c)(1) provides that each coverage provider must pay the excise tax
on its applicable share of the excess benefit with respect to an employee for any taxable
period.
Section 4980I(c)(2) defines the “coverage provider” as (A) the health insurance
issuer, in the case of applicable coverage under a group health plan that provides
health insurance coverage, (B) the employer, in the case of applicable coverage under
an arrangement in which the employer makes contributions described in § 106(b) or (d)
(health savings accounts (HSAs) and Archer medical savings accounts (Archer MSAs)),
and (C) the person that administers the plan benefits, in the case of any other
applicable coverage. Section 4980I(f)(6) provides that the term “person that administers
the plan benefits” includes the plan sponsor if the plan sponsor administers benefits
under the plan. Section 4980I(f)(7) provides that the term “plan sponsor” has the
meaning given such term in § 3(16)(B) of the Employee Retirement Income Security Act
of 1974 (ERISA).
2
See sections III and IV of Notice 2015-16 for background on the provisions of § 4980I related to the
definition of applicable coverage and the calculation of the excess benefit (including the calculation of the
aggregate cost of the applicable coverage and determination of the applicable dollar limit).
2
Section 4980I(c)(3) defines a coverage provider’s applicable share of an excess
benefit for any taxable period as the amount which bears the same ratio to the amount
of such excess benefit as (A) the cost of applicable coverage provided by the provider
to the employee during that period, bears to (B) the aggregate cost of all applicable
coverage provided to the employee by all coverage providers during that period.
Section 4980I(c)(4)(A) provides that each employer must calculate for each
taxable period the amount of the excess benefit subject to the excise tax and the
applicable share of such excess benefit for each coverage provider. Section
4980I(c)(4)(A) further provides that each employer must notify, at such time and in such
manner as the Secretary may prescribe, the Secretary and each coverage provider of
the amount so determined for the provider.
Section 4980I(c)(4)(B) provides a special rule for multiemployer plans under
which the plan sponsor of the multiemployer plan (as defined in § 414(f)) is responsible
for making the calculations and for providing the notice.
Section 4980I(f)(8) provides that the term “taxable period” means the calendar
year or such shorter period as the Secretary may prescribe. Section 4980I(f)(8) further
provides that the Secretary may prescribe different taxable periods for employers of
varying sizes.
Section 4980I(f)(9) provides that all employers treated as a single employer
under subsection (b), (c), (m), or (o) of § 414 are treated as a single employer.
Section 4980I(f)(10) provides a cross-reference to § 275(a)(6) for the denial of a
deduction for the tax imposed by § 4980I. Section 275(a)(6) provides that no deduction
is allowed for the taxes imposed by chapters 41, 42, 43, 44, 45, 46 and 54 of the Code.
Section 4980I is located in chapter 43 of the Code, and therefore no deduction is
allowed for the payment of tax under § 4980I.
III.
PERSONS LIABLE FOR THE § 4980I EXCISE TAX
A. Coverage Provider
Section 4980I(c)(1) provides that the coverage provider is liable for any
applicable excise tax. The identity of the coverage provider depends on the type of
coverage provided. Under the statute, in the case of applicable coverage provided
under an insured group health plan, the coverage provider is the health insurance
issuer. With respect to coverage under an HSA or an Archer MSA, the coverage
provider is the employer. For all other applicable coverage, the coverage provider is
“the person that administers the plan benefits.”
B. Person That Administers the Plan Benefits
Section 4980I does not define the term “person that administers the plan
benefits.” Section 4980I(f)(6) provides that the term “person that administers the plan
benefits” includes the plan sponsor if the plan sponsor administers benefits under the
3
plan, which indicates that the plan sponsor of a self-insured arrangement may be, but is
not always, the person that administers benefits under the plan. The term, “person that
administers the plan benefits,” is not used elsewhere in the Code, nor is it used
elsewhere in the Affordable Care Act or in ERISA or the Public Health Service Act, both
of which were amended by the Affordable Care Act. Because the term “person that
administers the plan benefits” is not used in other statutory contexts, Treasury and IRS
are considering two alternative approaches to determining the identity of the person that
administers the plan benefits. 3 Under either approach, it is anticipated that the person
that administers the plan benefits will generally be an entity, rather than an individual,
but for purposes of the discussion below, the relevant entity or individual is referred to
as a “person.”
Under one approach, the person that administers the plan benefits would be the
person responsible for performing the day-to-day functions that constitute the
administration of plan benefits, such as receiving and processing claims for benefits,
responding to inquiries, or providing a technology platform for benefits information.
Treasury and IRS anticipate that this person generally would be a third-party
administrator for benefits that are self-insured, except in the rare circumstance in which
the employer or plan sponsor performs these functions, or owns the person that
performs these functions. Comments are requested on the types of administrative
functions that should be considered under this approach when determining the person
that administers the plan benefits. Comments are also requested on whether the
person that administers the plan benefits could be easily identified in most instances
under this approach, or whether the identity of the person that administers the plan
benefits would often be unclear because, for example, multiple parties (such as a
pharmacy benefit administrator and a medical claims benefit administrator) perform the
relevant functions with respect to a benefit package for which a single cost of applicable
coverage will be determined as discussed in section IV.C of Notice 2015-16 (concerning
potential approaches for determining the cost of applicable coverage). In addition,
Treasury and IRS request comments on any other concerns this approach would raise.
Under the second approach that Treasury and IRS are considering, the person
that administers the plan benefits would be the person that has the ultimate authority or
responsibility under the plan or arrangement with respect to the administration of the
plan benefits (including final decisions on administrative matters), regardless of whether
that person routinely exercises that authority or responsibility. For purposes of this
second approach, the relevant types of administrative matters over which the person
3
The Department of Health and Human Services (HHS) recently issued regulations defining a category of
self-administered, self-insured plans for purposes of applicability of the fee, imposed by § 1341 of the
Affordable Care Act, which funds the Transitional Reinsurance Program. The definition in these HHS
regulations focuses on the party directly responsible for claims administration and plan enrollment. See
Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2015;
Final Rule, 79 Fed. Reg. 13744, 13772-75 (March 11, 2014). Section 4980I of the Code and § 1341 of
the Affordable Care Act are provisions with no common statutory language. Accordingly, it is not
anticipated that the definition of the person that administers the plan benefits for § 4980I purposes will
align with the definition for self-insured self-administered plans in the HHS regulations.
4
that administers plan benefits would have ultimate authority or responsibility could
include eligibility determinations, claims administration, and arrangements with service
providers (including the authority to terminate service provider contracts). Treasury and
IRS anticipate that the person with such ultimate administrative authority or
responsibility under the plan or arrangement would be identifiable based on the terms of
the plan documents and often would not be the person that performs the day-to-day
routine administrative functions under the plan. Comments are requested on whether
the person that administers the plan benefits would be easy to identify under this
second approach in most circumstances or whether multiple parties have ultimate
authority or responsibility for the different relevant administrative matters with respect to
the same benefit package, and whether in most instances this approach would identify
an appropriate person as the person that administers the plan benefits. Comments are
requested on any other issues this approach would raise.
Comments are invited on the application of these approaches to collectively
bargained multiemployer health plans.
IV.
EMPLOYER AGGREGATION
Section 4980I(f)(9) provides generally that, for purposes of § 4980I, all employers
treated as a single employer under subsections (b), (c), (m), or (o) of § 414 are treated
as a single employer. Treasury and IRS invite comments on the practical challenges
presented by the application of those aggregation rules to § 4980I. In particular,
Treasury and IRS request comments on the application of these employer aggregation
rules to the: (1) identification of the applicable coverage taken into account as made
available by an employer (§ 4980I(d)(1)(A)); (2) identification of the employees taken
into account for the age and gender adjustment (§ 4980I(b)(3)(C)(iii)), and the
adjustment for employees in high risk professions or who repair and install electrical or
telecommunications lines (§ 4980I(b)(3)(C)(iv)); (3) identification of the taxpayer
responsible for calculating and reporting the excess benefit (§ 4980I(c)(4)(A)); and
(4) identification of the employer liable for any penalty for failure to properly calculate
the tax imposed under § 4980I (§ 4980I(e)(1)(B)).
V.
COST OF APPLICABLE COVERAGE
A. Taxable Period
Taxable period is defined under § 4980I(f)(8) to mean the calendar year or such
shorter period as the Secretary may prescribe. The section provides that the Secretary
may have different taxable periods for employers of varying sizes. Treasury and IRS
anticipate that the taxable period will be the calendar year for all taxpayers.
B. Determination Period
To calculate the amount of any excise tax that a coverage provider may owe
under § 4980I for a taxable period, an employer must determine the extent, if any, to
which the cost of applicable coverage provided to an employee during any month of the
taxable period exceeds the dollar limit. The employer then must notify both IRS and the
5
coverage provider of the amount of the excess benefit, and the tax must be paid by the
coverage provider. Accordingly, Treasury and IRS anticipate that employers will be
required to determine the cost of applicable coverage provided during a taxable year
sufficiently soon after the end of that taxable year to enable coverage providers to pay
any applicable tax in a reasonably timely manner.
Section 4980I(d)(2)(A) provides that the cost of applicable coverage is to be
determined using rules “similar to the rules of section 4980B(f)(4)” regarding the
determination of the COBRA applicable premium. Section IV.C of Notice 2015-16
invited comments on potential approaches to determining the cost of applicable
coverage. Treasury and IRS now invite further comments on any issues raised by the
anticipated need to determine the cost of applicable coverage for a taxable period
reasonably soon after the end of that taxable period.
Treasury and IRS anticipate that the potential timing issues are likely to be
different for insured plans and self-insured plans, and will also be different for HSAs,
Archer MSAs, health flexible spending arrangements (FSAs), 4 and health
reimbursement arrangements (HRAs). In the case of self-insured plans, for example, if
the cost of applicable coverage is determined based on a period ending at or before the
beginning of the applicable calendar year, then the necessary information should be
available to the employer relatively soon after the applicable calendar year ends to
permit it to calculate any excess benefit for each employee and allocate any excess
benefit among coverage providers. In contrast, if the cost of applicable coverage is
determined based on a period ending during or at the end of the applicable calendar
year, the cost may be determinable only after the end of both the applicable calendar
year and a subsequent run-out period during which employees may submit claims for
reimbursement. In that case, an employer will need additional time to compute the cost
of applicable coverage before it can calculate any excess benefit for each employee
and allocate any excess benefit among coverage providers.
In addition, experience-rated arrangements may provide for payments to be
made to or from an insurance company after the end of a coverage period that relate to
the coverage provided during that coverage period. In other instances, the equivalent of
those types of payments may be made through a premium discount for the next
coverage period. Comments are requested on how those payments or discounts may
be reflected in the cost of applicable coverage, including comments on any
administrative issues that might arise if, for purposes of determining the cost of
applicable coverage, the payments or discounts are attributed back to the original
period of coverage (for which the taxable year might have ended) rather than accounted
for during the period of coverage in which the amounts are paid or the discount applied.
In addition, comments are requested on how employers are addressing these payments
or discounts currently for purposes of determining COBRA applicable premiums.
Taking into account the potential approaches to the determination of the cost of
4
All references in this notice to flexible spending arrangements refer only to health flexible spending
arrangements.
6
applicable coverage outlined in Notice 2015-16, as well as other issues with timing
implications, Treasury and IRS request comments on the processes expected to be
involved in calculating and allocating any excess benefit and the time period necessary
to complete these processes.
C. Exclusion from Cost of Applicable Coverage of Amounts
Attributable to the Excise Tax
As discussed in section III of this notice, the excise tax will be paid by the health
insurance issuer for insured coverage and by the “person that administers the plan
benefits” (which may, in some instances, be the employer) in the case of self-insured
coverage. It is expected that, if a person other than the employer is the coverage
provider liable for the excise tax, that person may pass through all or part of the amount
of the excise tax to the employer in some instances. If the coverage provider does pass
through the excise tax and receives reimbursement for the tax (the excise tax
reimbursement), the excise tax reimbursement will be additional taxable income to the
coverage provider. Because § 4980I(f)(10) provides that the excise tax is not
deductible, the coverage provider will experience an increase in taxable income (that is
not offset by a deduction) by reason of the receipt of the excise tax reimbursement. As
a result, it is anticipated that the amount the coverage provider passes through to the
employer may include not only the excise tax reimbursement, but also an amount to
account for the additional income tax the coverage provider will incur (the income tax
reimbursement).
In determining the cost of applicable coverage subject to the excise tax,
§ 4980I(d)(2)(A) provides that “any portion of the cost of such coverage which is
attributable to the tax imposed under this section shall not be taken into account.” This
indicates that the excise tax reimbursement should be excluded from the cost of
applicable coverage, and it is anticipated that future regulations will reflect this
interpretation.
Treasury and IRS are also considering whether some or all of the income tax
reimbursement could be excluded from the cost of applicable coverage. However,
Treasury and IRS are concerned that a methodology for excluding an income tax
reimbursement may not be administrable, given the potential variability of tax rates and
other factors among different coverage providers and potential difficulties in determining
and excluding the reimbursement amount. Nonetheless, comments are requested on
administrable methods for exclusion of the income tax reimbursement.
Because it may not be feasible to exclude amounts that are not separately billed,
Treasury and IRS anticipate that coverage providers would be permitted to exclude the
amount of any excise tax reimbursement or income tax reimbursement only if it is
separately billed and identified as attributable to the cost of the excise tax. Separately
billed amounts in excess of the excise tax reimbursement or the income tax
reimbursement (as determined in the manner discussed in section V.D below) could not
be excluded from the cost of applicable coverage (and, therefore, would be treated as
part of the cost of applicable coverage). Comments are requested on any practical
7
issues or legal barriers to passing through any or all of these amounts or to separately
identifying these amounts, such as federal rating rules or state insurance law.
Coverage providers generally will not know the amount of any excise tax due
with respect to applicable coverage provided for a taxable period (discussed in section
V.A above) until after the end of the taxable period. As a result, Treasury and IRS
expect that, as a practical matter, the coverage provider generally will be unable to bill
for the excise tax reimbursement or the income tax reimbursement until the excise tax is
paid by the coverage provider. However, comments are requested on whether there
are alternative approaches that might allow for earlier billing of the amount but that
would not give rise to undue administrative complexity or difficulty.
D. Income Tax Reimbursement Formula
If Treasury and IRS conclude that an income tax reimbursement can be excluded
from the cost of coverage, it is anticipated that the amount of the income tax
reimbursement would be determined using a formula commonly used to calculate “tax
gross-ups.” As mentioned previously, a coverage provider that passes the excise tax
through to another party will have additional taxable income as a result of receipt of the
excise tax reimbursement. If a coverage provider then also passes through the amount
of the income tax due on the excise tax reimbursement, the reimbursement of that
additional amount will further increase the taxable income of the coverage provider, and
the coverage provider will owe additional income tax due to that reimbursement as well.
The formula would take these additional taxes into account in determining the amount of
the income tax reimbursement. Under the formula, the amount of the income tax
reimbursement that would be excludable from the cost of applicable coverage would be:
[amount of tax]
Income Tax Reimbursement =
- [amount of tax]
(1 – [marginal tax rate])
In this formula, the “amount of tax” is the excise tax rate multiplied by the initial
excess benefit calculated without regard to any portion of the cost of applicable
coverage that the coverage provider identifies as arising from an excise tax
reimbursement or an income tax reimbursement. For example, if the cost of applicable
coverage without regard to the tax is $2,500 in excess of the dollar limit, a coverage
provider would owe $1,000 as a § 4980I excise tax ($2,500 times the 40 percent rate).
If the coverage provider’s marginal tax rate is 20 percent, 5 the formula would divide
$1,000 (the amount of the excise tax) by .8 (1-0.2), which equals $1,250; and then
subtract $1,000 (the amount of the excise tax), which equals $250 ($1,250 - $1,000).
5
If the coverage provider were not subject to income tax on the excise tax reimbursement (for example,
because it is a tax-exempt organization described in § 501(c) that is not subject to unrelated business
income tax on the reimbursement under § 511), its marginal tax rate on the reimbursement would be
zero, producing an income tax reimbursement amount of zero under the formula.
8
Accordingly, the income tax reimbursement on an excise tax of $1,000 paid by a
coverage provider with a marginal tax rate of 20 percent would be $250.
If it is determined that an income tax reimbursement can be excluded from the
cost of applicable coverage, Treasury and IRS are considering two possible approaches
for applying the formula described above. The first approach would use the coverage
provider’s actual marginal tax rate in the formula. This approach could provide greater
flexibility to taxpayers, but also could create administrative difficulties for IRS, coverage
providers, and employers due to the extended time needed to determine a taxpayer’s
marginal tax rate for any year, changes in a coverage provider’s marginal tax rate from
year to year (including potential retroactive changes due to amended returns, audits, or
other circumstances), and the fact that a coverage provider’s marginal tax rate is
generally determined for its fiscal year, which may not be the same as the calendar year
taxable period for which the cost of applicable coverage is determined. This approach
could also create an additional administrative burden in cases in which multiple
coverage providers are liable for tax for coverage offered by a given employer.
Comments are requested on whether there are workable solutions to these
administrative challenges that would permit Treasury and IRS to implement such an
approach.
The second approach would prescribe, for purposes of applying the income tax
reimbursement formula in a manner that is administrable, a standard marginal tax rate 6
based on typical marginal tax rates applicable to different types of health insurance
issuers. It is anticipated that the prescribed rates would reflect an approximately
representative marginal rate that would be less than the statutory maximum rate. The
prescribed rate for an insurer would be used in the income tax reimbursement formula
rather than the coverage provider’s actual marginal tax rate. While more administrable,
this approach may not permit some taxpayers to exclude from the cost of applicable
coverage the total income tax reimbursement, but would permit other taxpayers to
exclude from the cost of applicable coverage more than the total income tax
reimbursement. Comments are requested on how these standard marginal tax rates
might be determined, how many such rates might apply (for example, one for each of
two or three categories of insurers) and for what types of insurers, and how this
approach would affect particular segments of taxpayers.
E. Allocation of Contributions to HSAs, Archer MSAs, FSAs, HRAs
Applicable coverage under § 4980I(d)(1)(A) is “coverage under any group health
plan made available to the employee by an employer which is excludable from the
employee’s gross income under section 106, or would be so excludable if it were
employer-provided coverage (within the meaning of such section 106).” Applicable
coverage includes coverage under certain HSAs, Archer MSAs, FSAs, or HRAs.
6
If an approach using a standard marginal tax rate were adopted, the standard marginal tax rate would
not be available to coverage providers that are not subject to income tax on the excise tax
reimbursement.
9
Section 4980I(a) imposes an excise tax equal to 40 percent of the excess benefit
if an employee is covered under any applicable coverage of an employer at any time
during a taxable period and there is any excess benefit with respect to the coverage.
Under § 4980I(b)(1), an excess benefit means, with respect to any applicable coverage
made available by an employer to an employee during any taxable period, the sum of
the excess amounts determined for months during the taxable period. Under
§ 4980I(b)(2), the excess amount determined for any month is the excess (if any) of
(A) the aggregate cost of the applicable coverage of the employee for the month over
(B) an amount equal to 1/12 of the dollar limit for the calendar year in which the month
occurs.
Section 4980I(d)(2)(D) provides that if the cost of applicable coverage is
determined on other than a monthly basis, the cost is allocated to months in a taxable
period on such basis as the Secretary may prescribe.
Treasury and IRS are considering an approach under which contributions to
account-based plans would be allocated on a pro-rata basis over the period to which the
contribution relates (generally, the plan year), regardless of the timing of the
contributions during the period. Treasury and IRS anticipate that this allocation rule
would apply to HSAs, Archer MSAs, FSAs, and HRAs that are applicable coverage. For
example, if an employer contributes an amount to an HSA for an employee for a plan
year, that contribution would be allocated ratably to each calendar month of the plan
year, regardless of when the employer actually contributes the amount to the HSA.
Similarly, if an employee elects to contribute to an FSA for a plan year, the employee’s
total contributions would be allocated ratably to each calendar month of the plan year,
even though the entire amount contributed for the plan year would be available to
reimburse qualified medical expenses on the first day of the plan year. Comments are
requested on this approach as well as alternative approaches.
F. Cost of Applicable Coverage under FSAs with Employer Flex
Credits
Section 4980I(d)(2)(B) provides that in the case of applicable coverage
consisting of coverage under an FSA, the cost of applicable coverage is equal to the
sum of (i) the amount of any contributions made under a salary reduction election, plus
(ii) the cost of applicable coverage under the generally applicable rules for determining
the cost of applicable coverage with respect to any reimbursement under the
arrangement in excess of the contributions made under the salary reduction agreement.
Thus, the cost of applicable coverage of an FSA for any plan year would be the greater
of the amount of an employee’s salary reduction or the total reimbursements under the
FSA.
Under this general rule, in determining the portion of the cost of applicable
coverage attributable to non-elective flex credits contributed to an FSA by an employer
(either in combination with employee salary reduction contributions or without), the cost
of the non-elective flex credit would be the amount that is actually reimbursed in excess
of the employee’s salary reduction election for that plan year. For example, if an
10
employee elects to make a salary reduction contribution to an FSA in the amount of
$1,000 for a plan year and the employer makes a non-elective flex credit in the amount
of $500 available to the employee under the FSA for that plan year, but the employee
only has $1,200 in medical expenses reimbursed under the FSA for that plan year, the
cost of applicable coverage for the FSA for the plan year would be $1,200 (comprised of
the $1,000 salary reduction plus the additional $200 in reimbursements attributable to
the non-elective flex credit provided by the employer) rather than the full $1,500 elected
or available for the FSA for the plan year.
Under this rule, the cost of applicable coverage of the FSA would not be known
until some point in time after the end of the taxable year. With respect to amounts
carried over to a subsequent year, this rule would take such amounts into account in a
later year if the reimbursements in the subsequent year exceeded the amount of
employee salary reduction in the subsequent year.
To avoid the double counting associated with taking salary deferral amounts that
are carried over from one year to another year into account in determining the cost of
coverage in both the year of contribution and the subsequent year, which would be the
result under the general rule outlined above, Treasury and IRS are considering
providing a safe harbor. Under this safe harbor, the cost of applicable coverage for the
plan year would be the amount of an employee’s salary reduction without regard to
carry-over amounts. Unused amounts that are carried forward would be taken into
account when initially funded by salary reduction but would be disregarded when used
to reimburse expenses in a later year. For example, if an employee elected to reduce
his salary by $1,200 to contribute to an FSA in a given year, the FSA’s cost of
applicable coverage in that year would be $1,200 even if some or all of the $1,200 was
not used to reimburse expenses in that year. Accordingly, if that same employee
carried over $500 of unused funds that were used to reimburse expenses in the second
year, and elected no new salary reduction for the second year, the FSA’s cost of
applicable coverage in the second year would be $0.
The possible safe harbor described above would be limited to cases in which
non-elective flex credits are not available for use in the FSA. To address situations in
which non-elective flex credits are available under a cafeteria plan that includes an FSA,
Treasury and IRS are considering a variation on the safe harbor that would allow an
FSA with non-elective flex credits to be valued under the safe harbor described in the
preceding paragraph in certain situations.
Under some cafeteria plan arrangements, an employee may elect to defer
amounts to the cafeteria plan that exceed the § 125(i) limit for FSAs (for 2015, $2,550),
and the employer may offer additional non-elective flex credits. These amounts may be
allocated to pay for various benefits available under the cafeteria plan, such as
reimbursements under an FSA, dependent care assistance, and health insurance. The
possible variation on the safe harbor would provide that an FSA could be treated as
funded solely by salary reduction if the amount elected by the employee for the FSA
were less than or equal to the maximum amount permitted by § 125(i). For example, if
an employee with a $1,000 non-elective flex credit available reduces salary by an
11
additional $5,000 under a cafeteria plan and allocates $2,550 to the FSA, the FSA
would be treated as funded solely by salary reduction. As a result, the cost of
applicable coverage would be $2,550. Under the safe harbor proposal, the salary
reduction taken into account would be counted only in the year an amount was elected
for the FSA and, therefore, would be disregarded in later years if amounts were carried
over. Comments are requested on the allocation of FSA amounts between non-elective
flex credits and salary reduction when the total election for the FSA exceeds the
maximum salary reduction amount permitted by § 125(i).
Treasury and IRS request comments concerning whether these potential
approaches are administrable. In addition, comments are requested generally on the
potential safe harbors described above and on any other issues arising from the
valuation of FSAs.
G. Inclusion in Applicable Coverage of Self-Insured Coverage
Includible in Income under § 105(h)
Section 4980I(d)(1)(A) defines applicable coverage to include coverage under
any group health plan made available to the employee by an employer that is
excludable from the employee’s gross income under § 106 (or would be so excludable if
it were employer-sponsored coverage).
Section 106 excludes employer-provided coverage under an accident or health
plan from an employee’s gross income. For an employee who then receives
reimbursement for medical expenses of the employee or his family under an employerprovided accident or health plan, § 105 further excludes those reimbursement amounts
from the employee’s income. In the case of reimbursements paid to a highlycompensated individual under a self-insured plan that discriminates in favor of highly
compensated individuals, however, § 105(h) provides that the exclusion does not apply
to the extent that the amounts constitute an “excess reimbursement.” The amount of
the excess reimbursement is included in the gross income of the highly compensated
individuals.
Section 6051(a)(14) requires employers to report on the Form W-2, Wage and
Tax Statement (Form W-2), the aggregate cost of applicable coverage as defined in
§ 4980I(d)(1). Notice 2012-9, 2012-4 IRB 315, currently permits employers to reduce
the amount reported on the Form W-2 by any excess reimbursement included in gross
income by application of § 105(h).
Although excess reimbursements currently can be excluded from the cost
reported on the Form W-2, Treasury and IRS do not believe such amounts reduce the
cost of applicable coverage subject to tax under § 4980I. It is the coverage (excludable
from income under § 106), and not the resulting benefit (excludable from income under
§ 105), that is applicable coverage under § 4980I, and it is the cost of that coverage that
is compared to the dollar limit to determine the amount of any excise tax under § 4980I.
Inclusion of excess reimbursements in an employee’s income does not reduce the cost
of applicable coverage subject to tax under § 4980I. Treasury and IRS anticipate that
12
Notice 2012-9 will be modified in the future to make excess reimbursements subject to
reporting under § 6051(a)(14) and that the forms and instructions will be modified to
reflect this change. Taxpayers should continue to follow Notice 2012-9 until
modification of that notice is issued.
VI.
AGE AND GENDER ADJUSTMENT TO THE DOLLAR LIMIT
Section 4980I(b)(3) provides two baseline per-employee dollar limits for 2018
($10,200 for self-only coverage and $27,500 for other than self-only coverage) but also
provides that various adjustments, discussed in section V.C of Notice 2015-16, will
apply to increase these amounts. As stated in Notice 2015-16, Treasury and IRS intend
to include rules regarding these adjustments in proposed regulations and have invited
comments on the application and adjustment of the dollar limits.
One of these adjustments, set forth at § 4980I(b)(3)(C)(iii), provides for an
increase in the dollar limits based on the age and gender characteristics of all
employees of an employer. In accordance with the statute, no downward adjustments
can occur (that is, the statute does not provide for any decrease in the dollar limits
based on age and gender). Specifically, the adjustment increases the dollar limit by an
amount equal to the excess of the premium cost of the Blue Cross/Blue Shield standard
benefit option under the Federal Employees Health Benefits Plan (FEHBP standard
option) if priced for the age and gender characteristics of all employees of an
individual’s employer (the employer’s premium cost), over the premium cost for
providing this coverage if priced for the age and gender characteristics of the national
workforce (the national premium cost). Section 4980I(b)(3)(C)(iii)(II)(aa) provides that
the adjustment is based on “the type of coverage provided such individual in such
taxable period.” In other words, the age and gender adjustment is determined
separately for self-only coverage and other than self-only coverage.
While rating based on age and gender in the individual and small group market is
subject to certain restrictions under the Affordable Care Act, the actual cost of
applicable coverage generally differs based on age and gender. On average, older
individuals have higher health costs than younger individuals, and, on average, younger
women have higher health costs than younger men. Consequently, some employers
may have higher health costs than other employers under identical benefit plans due to
the age and gender characteristics of their workforce. In determining the effect that the
age and gender characteristics of a workforce have on premium rates, it is not sufficient
to simply compare the average age and gender of an employer’s workforce to the
average age and gender of the national workforce. Rather, the premium rate depends
on the distribution of men and women in different age groups.
A. Determination of Age and Gender Distribution
To compare the employer’s premium cost with the national premium cost, it will
be necessary to establish the age and gender characteristics of the national workforce.
To determine the age and gender distribution of the national workforce, Treasury and
IRS are considering using the Current Population Survey as summarized in Table A-8a,
13
Employed Persons and Employment-Population Ratios by Age and Sex, Seasonally
Adjusted (Table A-8a), published annually by the Department of Labor Bureau of Labor
Statistics. This publication provides the number of individuals participating in the labor
force by five-year age-bands (up to age 75 and over) and the ratio of male to female
workers in each age-band. Treasury and IRS request comments on whether Table A8a and the Current Population Survey more generally is an appropriate source of data
for the age and gender characteristics of the national workforce for purposes of § 4980I
and whether other sources of data for the age and gender characteristics of the national
workforce should be considered.
To determine the age and gender characteristics of a particular employer’s
population, Treasury and IRS are considering a requirement that an employer use the
first day of the plan year as a snapshot date for determining the composition of its
employee population. In other words, an employer would be required to determine the
age and gender of each employee as of the first day of the plan year and that
distribution of age and gender characteristics would apply for purposes of the age and
gender adjustment. Comments are requested on the administrability of this approach,
whether it is likely to result in a representative age and gender distribution, and whether
employers should be permitted to choose a different date other than the first day of the
plan year to determine the age and gender characteristics of its employees. If
employers were permitted to choose a different date, it is anticipated that the employer
would not be permitted to vary the date from one taxable year to the next. To the extent
that commenters recommend that employers be permitted to use a date other than the
first day of the plan year, Treasury and IRS ask that the commenters address why
permitting the use of a different date will result in a more accurate representation of the
age and gender characteristics of an employer’s workforce, whether flexibility in
determining the snapshot date is susceptible to abuse, and any administrability issues
associated with requiring a specific date or permitting flexibility in the choice of date.
B. Development of Age and Gender Adjustment Tables
Treasury and IRS anticipate that IRS will formulate and publish adjustment tables
to facilitate and simplify the calculation of the age and gender adjustment. The following
approach is being considered for the development of these tables and the calculation of
the age and gender adjustment. All adjustments and calculations would be determined
separately for self-only coverage and for other than self-only coverage.
1. Determination of average cost for FEHPB coverage. The average cost of
applicable coverage under the FEHBP (FEHBP average cost) would be determined by
aggregating all claims expenses of the FEHBP standard option and dividing the total by
the number of coverage units. Each employee policyholder would be a coverage unit.
2. Determination of average cost for each age and gender group. Claims
expense data would be sorted into groups, separating the population into male and
female coverage units and further separating each gender population into multi-year
age-bands. For example, the dollar amount of claims for all male individuals between
the ages of 30 and 34 would be added together. The dollar amount of claims for each
14
group would then be divided by the number of coverage units in that age and gender
group to yield the average cost for that group (group average cost). A group average
cost would be calculated in this way for each of the age and gender groups.
3. Determination of group ratios. Each group average cost would be divided by
the FEHBP average cost to establish the ratio (group ratio) of the group average cost to
the FEHBP average cost. The group ratio would be expressed as a fraction or
percentage and would be determined periodically, but less frequently than annually.
4. Determination of group premium cost. The group ratio would be multiplied by
the most recent annual premium cost of the FEHBP standard option to determine the
annual premium cost for each age and gender group (group premium cost). The dollar
amounts representing each group premium cost would then be used to populate the
adjustment tables, to be published annually.
5. Determination of national premium cost. To determine the national premium
cost, each group premium cost would be multiplied by the fraction of employees in the
national workforce who are in that group. The product of each of these calculations
would be added together to yield the national premium cost, which would be a single
dollar amount that would be published annually.
6. Determination of the employer’s premium cost. Each employer would
determine the fraction of its employees who are in each age and gender group. The
employer would then multiply the group premium cost from the relevant adjustment
table by the fraction of its employees in each group. The product of each of these
calculations would be added together to yield the employer’s premium cost, which
would be a single dollar amount.
7. Determination of adjustment. The employer’s premium cost would then be
compared to the national premium cost. If the employer’s premium cost exceeds the
national premium cost, the excess dollar amount would be added to the dollar limit for
that employer for purposes of determining the amount of any excess benefit.
With respect to step one, two different approaches are under consideration. One
approach would rely on actual claims data from the FEHBP standard option. An
alternative approach would rely on national claims data reflecting plans with a design
similar to that of the FEHBP standard option. It is anticipated that only one approach
will be adopted and that it will be applied in a uniform manner.
Treasury and IRS seek comments on this approach to the age and gender
adjustment, including the alternative approaches to step one and whether the approach
to the age and gender adjustment should take into account the age rating scale adopted
in regulations for the individual and small group market.
15
VII.
NOTICE AND PAYMENT
A. Notice of Calculation of Applicable Share of Excess Benefit
Section 4980I(c)(4)(A) imposes a notification requirement on the employer.
Specifically, that section requires the employer to calculate for each taxable period the
amount of the excess benefit subject to the tax imposed by § 4980I(a) and the
applicable share of that excess benefit for each coverage provider, and to notify the
Secretary and each coverage provider of the amount so determined for each coverage
provider at the time and in the manner as the Secretary may prescribe.
Treasury and IRS are considering both the form in which that information must
be provided to the various coverage providers and IRS, and the time at which that
information must be provided. Comments are requested on the administrative and
other issues raised by this notice requirement, taking into account that this process may
be affected by the rules governing the period over which the cost of applicable coverage
is determined as discussed in section V.B of this notice.
Treasury and IRS anticipate that calculation errors that affect the cost of
applicable coverage may, in some instances, affect multiple coverage providers due to
the allocation of the tax. Comments are invited on how instances of reallocation might
be mitigated or avoided.
B. Payment of the § 4980I Excise Tax
Section 4980I(c)(1) provides that each coverage provider is liable for the excise
tax on its applicable share of the excess benefit with respect to an employee for any
taxable period, but does not specify the time and manner in which the excise tax is paid.
Treasury and IRS are considering designating the filing of Form 720, Quarterly Federal
Excise Tax Return, as the appropriate method for the payment of the tax. Although
Form 720 generally is filed quarterly, under this approach a particular quarter of the
calendar year would be designated for the use of Form 720 to pay the excise tax under
§ 4980I. 7
VIII.
REQUEST FOR COMMENTS
Treasury and IRS invite comments on the issues addressed in this notice and on
any other issues under § 4980I. This includes an invitation to submit further comments
on issues addressed in Notice 2015-16. For example, in response to Notice 2015-16,
some commenters expressed concern about coordination between the excise tax under
7
This procedure is used for payment of the fee imposed on issuers of specified health insurance policies
and plan sponsors of applicable self-insured health plans to help fund the Patient-Centered Outcomes
Research Institute. The fee is required to be reported only once a year on the second quarter Form 720
and paid by its due date, July 31. See Fees on Health Insurance Policies and Self-Insured Plans for the
Patient-Centered Outcomes Research Trust Fund, 77 Fed. Reg. 72721, 72726-27 (December 6, 2012)
and the Form 720 and accompanying instructions.
16
§ 4980I and the assessable payments under § 4980H. 8 Comments are invited on the
circumstances in which the interaction between the provisions of § 4980H and § 4980I
may raise concerns and on whether and how these provisions might be coordinated
consistent with the statutory requirements of these provisions and in a manner that is
administrable for employers and the IRS.
Although many comments submitted in response to Notice 2015-16 are not
reflected in this notice, those comments are under consideration. Those comments and
comments responding to this notice will be used to inform proposed regulations that will
be issued in the future for further public notice and comment.
Public comments should be submitted no later than October 1, 2015. Comments
should include a reference to Notice 2015-52. Send submissions to CC:PA:LPD:PR
(Notice 2015-52), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin
Station, Washington, DC 20044. Submissions may be hand delivered Monday through
Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (Notice 2015-52),
Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington,
DC 20044, or sent electronically, via the following e-mail address:
[email protected]. Please include “Notice 2015-52” in the subject
line of any electronic communication. All material submitted will be available for public
inspection and copying.
IX.
RELIANCE
This notice does not provide guidance under § 4980I upon which taxpayers may
rely. No inference should be drawn from any provision of this notice concerning any
provision of § 4980I other than those addressed in this notice or concerning any other
section of the Affordable Care Act.
X.
DRAFTING INFORMATION
The principal author of this notice is Karen Levin of the Office of Associate Chief
Counsel (Tax Exempt and Government Entities). For further information regarding this
notice contact Ms. Levin at (202) 317-5500 (not a toll-free call).
8
Generally, under § 4980H, an applicable large employer that fails to offer to its full-time employees
health coverage that is affordable and provides minimum value (as defined in § 36B(c)(2)(C)(ii)) may be
subject to an assessable payment if a full-time employee enrolls in a qualified health plan for which the
employee receives a premium tax credit. Commenters have noted that health coverage providing no
more than minimum value (or only slightly more than minimum value) may exceed the applicable dollar
limit under § 4980I in certain circumstances.
17
Request for Administrative Relief from Employer Mandate Tax Penalties
For Tribal Member Employees Who Are Exempt from the Individual Mandate
•
Tribal governments employ a significant number of Tribal members who are otherwise
exempt from the Individual Mandate. For many tribes, particularly those with few resources,
up to 75 percent of their workforce is made up of tribal member employees.
•
The IRS has interpreted the Employer Mandate to apply to all full time tribal employees,
even though tribal member employees are statutorily exempt from the Individual Mandate.
•
This interpretation requires tribes to either offer and pay for insurance coverage for their
tribal member employees, or pay a significant tax penalty to the IRS. Either way, Tribes are
being required to pay for health care for their tribal member employees, simply because they
work for the Tribe.
•
Requiring Tribes to pay for health coverage for their members is inconsistent with the federal
trust responsibility to provide health coverage to American Indians and Alaska Natives at no
cost to them, and inconsistent with Congressional intent to meet that trust responsibility by
exempting them from the Individual Mandate.
•
The ACA contains several provisions designed to encourage American Indian and Alaska
Native enrollment in the Marketplaces, including special cost-sharing exemptions. CCIIO
has worked to encourage American Indian and Alaska Native enrollment in the
Marketplaces. But the IRS’s interpretation works at cross purposes to encouraging
Marketplace enrollment, as an offer of coverage to a Tribal member employee disqualifies
that employee from the premium subsidies that are critical to facilitating Marketplace
enrollment.
•
Many Tribes have consistently offered coverage to their non-native employees for many
years, and will continue to do so. But Tribes are concerned that the current IRS interpretation
will require tribes to spend a significant portion of their IHS appropriation to either pay for
coverage or pay a penalty for their tribal member employees. And, under the current
regulations, if a Tribe wants to permit its Tribal member employees to access the full benefits
of Marketplace coverage (premium tax credits and comprehensive cost-sharing assistance),
the Tribe must stop offering coverage to all its employees.
•
The Northern Arapaho Tribe has brought a legal challenge to the IRS’s regulations, which
was denied at the District Court level and is now on appeal. Tribes would like to seek an
Administrative solution to the issue.
•
Tribes would like to meet jointly with the IRS and with CCIIO to encourage both agencies to
explore Administrative mechanisms that would (1) exempt Tribal employers from tax
penalties associated with not offering coverage to their American Indian and Alaska Native
employees who are exempt from the Individual Mandate, and (2) ensure that an offer of
coverage from Tribes who wish to continue offering coverage to all their employees does not
disqualify tribal member employees from accessing the benefits of premium assistance on the
Marketplaces.
2015-09-15b
Relief from the ACA’s Employer Mandate:
Consideration of Applying “Veteran’s Approach” to Tribal Governments
In the talking points on the ACA’s employer mandate relief developed for the most recent STAC meeting
(which occurred after the recent meeting of Tribal leaders and technical advisors with White House
officials), the following request was included:
Tribes would like to meet jointly with the IRS and with CCIIO to encourage both
agencies to explore Administrative mechanisms that would (1) exempt Tribal
employers from tax penalties associated with not offering coverage to their
American Indian and Alaska Native employees who are exempt from the
Individual Mandate, and (2) ensure that an offer of coverage from Tribes who
wish to continue offering coverage to all their employees does not disqualify
tribal member employees from accessing the benefits of premium assistance on
the Marketplaces.
The qualifier of the exemption applying to “American Indian and Alaska Native” employees (rather than
all employees) was added after the White House meeting, and subsequent discussion among TSGAC
leaders and advisors.
It is my understanding that the Administration is consider an additional option for (partial)
administrative relief from the mandate. I don’t know if this would be in addition to or instead of the
Tribal request above, but I believe we should be in a position to respond if it is proposed, and/or we may
wish to proactively indicate to the Administration whether we do – or do not – support this option.
The option is to apply the “veterans approach”. The veterans approach is to exclude employees who are
veterans from the calculation of Applicable Large Employer (ALE), or in this case exclude AI/AN or
“Indians” meeting the definition under the ACA.
The calculation used for determining which employer is an ALE is to: add up the number of full-time
employees (average of 30+ hours per week) and the number of “full time equivalents” (total hours for
part-time employees for the year divided by 52 weeks divided by 30 hours). If together there are 50 or
more FT and FTE employees, the employer is an ALE and subject to the employer coverage requirements
(and required to either (1) offer and pay for a portion of coverage for full-time employees or (2) pay
$2,000 per FT employee to the federal government).
The option under consideration to exclude AI/AN would eliminate from the FT count and the FTE hours
count AI/AN employees. For example, if an employer had 550 full-time employees (and no part-time
employees), and 501 employees are AI/AN, the employer would not be an ALE because the total FTE
employees is 49 (550 – 501). This employer would not be required to offer coverage to its employees.
Continuing with this scenario, if the employer later hired an additional (one) FT employee who was nonAI/AN (for a total of 50), the employer would be considered an ALE. In this instance, the employer
would be subject to the ACA’s coverage requirement and would be required to offer coverage to ALL
full-time employees. (Again, this is how the “veterans approach” works.)
For Tribes with virtually no non-AI/AN employees, this option would provide relief from the ACA’s
employer mandate. At a savings of $2,000 per FT employee, the relief provided could be very significant
for a Tribe. But for Tribes with 50 or more non-exempt employees (which might be most Tribes), this
option would not provide relief to the Tribe.
Even for the Tribes that might experience relief today because the Tribe has fewer than 50 non-AI/AN
employees, if the Tribe crosses the 50 FT employee threshold, they too will become subject to the
mandate for ALL FT employees.
A scenario whereby a Tribe currently would be exempt but subsequently might fall under the ALE
definition is if a Tribe advanced its self-governance and took over operation of a health clinic from IHS.
The clinic employee mix could very well cause a Tribe to exceed the 50 threshold for non-exempt
employees. Depending on the size of the Tribe’s overall employee base, the decision to advance selfgovernance on the part of the Tribe could result in the Tribe being subject to a $2,000 payment for each
of its employees ($1 million per year for each 500 FT employees).
In considering whether to support the Administration implementing this option (and do so without the
other relief options), there is concern that, if the Administration were to implement this provision, it
would—


create the impression that Tribes have been provided relief but only a limited number of Tribes
would experience relief from the mandate
create counter-productive incentives on Tribes to not pursue self-governance
Conversely, though, not implementing this provision would block providing relief to some number of
Tribes.
Example of Impact of Employer Mandate on a Tribe / Tribal Employees
IHS Appropriation for Health Services per Active User: Billings Area
Billings Area Active User Population:
Service Unit 1 (2015)
IHS Appropriation for Health Services: Billings Area
IHS Appropriation
for Health Services
Full-Time (FT) Tribal Employee
Active Users
$208,766,000
Allocation of IHS Appropriation to Service Unit 1 (%)
18.1%
Allocation of IHS Appropriation to Service Unit 1 ($)
$37,805,435
Total Service Unit Active User Population
14,000
Per Active User IHS Appropriation
for Health Services
$2,700
700
Impact of Employer Shared Responsibility Payments on Tribal Employees: Billings Area
Billings Area Active User Population:
Service Unit 1 (2015)
Per FT Tribal Employee
Active User
All FT Tribal Employee
Active Users
IHS Appropriation
$2,700
$1,890,272
Employer Shared Responsibility Payment
-$2,000
-$1,240,000
Net IHS Appropriation for Health Services
for FT Tribal Employee Active Users
$700
$650,272
Submitted via e-mail: [email protected]
[email protected]
February 2, 2015
Jodi A. Gillette
Senior Policy Advisor for Native American Affairs
The White House
1600 Pennsylvania Avenue NW
Raina D. Thiele
Associate Director of Intergovernmental Affairs and Public Engagement
The White House
Re:
Request for Tribal Relief from the Affordable Care Act Employer Mandate.
Dear Jodi Gillette and Raina Thiele:
On behalf of the National Indian Health Board (NIHB) and the United South and Eastern Tribes,
Inc. (USET), we write to request a meeting with you to discuss the need for relief for Tribes from
the Affordable Care Act’s employer shared responsibility rule (the “employer mandate”).
The Internal Revenue Service’s (IRS) employer shared responsibility rule is inconsistent with the
federal trust responsibility, denies many Tribal members the opportunity to take advantage of the
benefits and protections designed for them in the Marketplace, and chills Marketplace enrollment
for American Indians and Alaska Natives (AI/AN). It is cost-prohibitive for many Tribes and
will result in a diminution of Tribal services for Indian people. If fully implemented in Indian
Country, Tribes will be faced with having to choose between providing coverage, which will
result in reducing governmental services and disqualifying their Tribal member employees from
the benefits and protections for AI/AN in the marketplace, or using scarce federal resources to
pay the IRS substantial penalties if they do not comply. Neither outcome represents good federal
policy.
The employer shared responsibility rule is mandated by Section 4980H of the Tax Code, as
added by Section 1513 of the Patient Protection and Affordable Care Act (ACA) (as amended).1
1
See 26 U.S.C. § 4980h; 26 C.F.R. § 54.4980H–1 - .4980H-5.
RE: Request for Tribal Relief from the ACA Employer Mandate
February 2, 2015
Section 4980H of the Code does not specifically apply to Tribal governments, and Section
54.4980H-2(b)(4) of the employer shared responsibility regulations reserves application of
special rules for government entities.
As discussed below, Tribal workforces include a significant number of Tribal member
employees, who are otherwise exempt from the individual mandate. The ACA contains several
provisions designed to encourage AI/AN enrollment in the ACA Marketplaces, including special
cost-sharing exemptions for AI/ANs. The Center for Consumer Information and Insurance
Oversight (CCIIO) has been actively encouraging Tribes to encourage their members take
advantage of these provisions by enrolling in the Marketplaces, and Tribes have expended
considerable resources to take CCIIO up on that challenge.
But the IRS’s application of the employer mandate to Tribal governments works at cross
purposes to encouraging Marketplace enrollment, as an offer of coverage to a Tribal member
employee disqualifies that employee from the premium subsidies that are critical to facilitating
Marketplace enrollment. With the employer mandate in place, Tribes are placed in the untenable
position of either having to offer insurance at full price to their Tribal member employees, who
will then be unable to take advantage of Marketplace premium subsidies even if they do not
accept the employer-based coverage, or to forego offering coverage (or offer insufficient
coverage) to their Tribal member employees and pay substantial penalties to the IRS.2
These twin policies from IRS and CCIIO are inconsistent, and have combined to discourage
AI/AN Marketplace participation and significantly increase costs to Tribal governments.
Together, they create a federal policy that is both inconsistent with the right of AI/ANs to obtain
trust-obligated health care without charge to the individual at I/T/U facilities and that forces
many Tribal employers to purchase coverage for workforces largely comprised of Tribal
members who are (1) exempt from the ACA’s individual mandate to obtain coverage and (2)
eligible to obtain health care through the I/T/U system. Finally, application of the employer
mandate will be simply unaffordable to many Tribes and Tribal organizations and act as a barrier
to the provision of critical governmental services.
With the employer mandate deadline taking effect on January 1, 2015, we request consultation
on the need for Tribal relief from the rule as soon as possible.
I.
Background.
Congress has recognized that “[f]ederal health services to maintain and improve the health of the
Indians are consonant with and required by the Federal Government’s historical and unique legal
relationship with, and resulting responsibility to, the American Indian people.”3 The federal trust
responsibility and laws enacted pursuant thereto provide ample authority for the federal agencies
of the Executive Department to design, implement and tailor federal programs in a manner that
2
We illustrate these various scenarios in the examples below.
3
25 U.S.C. § 1601(1).
2
February 2, 2015
recognizes and supports the unique government to government relationship between sovereign
Tribal governments and the United States.4
Congress has also recognized that it is a “major national goal . . . to provide the resources,
processes, and structure that will enable Indian tribes and tribal members to obtain the quantity
and quality of health care services and opportunities that will eradicate the health disparities
between Indians and the general population of the United States.”5 In recognition of this federal
trust responsibility, AI/ANs are eligible to receive care through the Indian Health Service (IHS)
system without charge to the individual patient.6
In light of the federal government’s trust responsibility, many Tribal employers have not
historically offered health coverage to their employees. Not only are the majority of many Tribal
workforces eligible for IHS services, but the remote location of many I/T/U facilities creates
additional difficulties in locating plans that treat Tribal facilities as in-network or otherwise
preferred providers. This often leaves the I/T/U as the only viable health service option for the
employee population, regardless of coverage status. In addition, insurance plans in these remote
areas are frequently expensive, have high cost-sharing amounts, or are less comprehensive than
plans available in urban settings.7 Federal responsibility for the provision of health services
allows Tribal governments to expend scarce resources elsewhere rather than obtaining high cost,
low quality employee insurance.8
II.
Discussion.
With these unique circumstances in mind, the application of the employer mandate to Tribal
employers presents three primary problems: (1) it undercuts multiple ACA provisions designed
to encourage AI/AN enrollment in the Marketplaces; (2) it undercuts the federal government’s
trust responsibility by forcing AI/ANs to “pay” for health coverage (whether directly or by proxy
through their Tribal employer); and (3) compliance with the mandate requires a significant
diminution in Tribal governmental services. We discuss each issue in turn.
4
Additional background on the authority of federal agencies to tailor their programs to meet the unique needs of
federally-recognized tribes and American Indians and Alaska Natives is provided in Appendix B to the CMS TTAG
Strategic Plan, “Appendix B: Legal Basis for Special CMS Provisions for American Indians and Alaska Natives.”
A copy of Appendix B is appended to this letter.
5
25 U.S.C. § 1601(2).
6
42 C.F.R. §§ 136.11 and 136.12.
7
Kathleen Sebelius, Secretary, U.S. Department of Health and Human Services (Mar. 10, 2014) (recognizing practical
difficulties for Tribal employers in finding and offering adequate coverage and seeking Tribal exemption from
employer mandate).
We note that the federal government’s budgeting and expenditures do not come close to meeting the requirements
of the trust responsibility: IHS is only funded at approximately 56% of need, and the most recent contract support cost
shortfall was estimated at $90 million.
NATIONAL TRIBAL BUDGET FORMULATION WORKGROUP’S
RECOMMENDATIONS ON THE INDIAN HEALTH SERVICE FISCAL YEAR 2015 BUDGET 3, 6 (2013).
8
3
February 2, 2015
1. The Employer Mandate Undercuts the ACA’s Indian-Specific Protections.
Applying the employer mandate to Tribal employers directly undercuts the ACA’s Indianspecific protections in three ways. First, it punishes Tribes for assisting AI/AN enrollment in the
Marketplaces, despite the multiple ACA provisions designed specifically to encourage such
activities. Second, it can disqualify AI/ANs from eligibility for premium tax credits in
Marketplace plans, thus leaving them unaffordable. Third, it ignores the fact that AI/ANs are
exempt from the individual mandate and forces Tribal employers to pay for AI/AN insurance
plans as a proxy for the individual. None of these outcomes benefit Tribal employers, individual
AI/ANs, or the federal government.
The ACA contains several provisions designed to maximize AI/AN participation in Marketplace
plans: for example, Indian-specific cost-sharing protections that help defray the cost of health
coverage,9 special AI/AN enrollment periods,10 and the ability for Tribes to assist with
Marketplace plan premium payments for Tribal members.11 Many Tribes and Tribal
organizations have aggressively sought to facilitate AI/AN enrollment in Marketplace plans in
order to take advantage of these protections. However, the employer mandate actively
discourages AI/AN Marketplace participation, in direct contradiction to the provisions described
above.
First, Tribes may find it more affordable to offer Marketplace premium assistance to Tribal
member employees than it is to pay for employee-sponsored coverage. However, it is our
understanding that Tribal premium sponsorship for member employees does not satisfy the
employer mandate. Tribes will therefore be forced to either continue offering premium
assistance and pay the employer mandate penalty (thus diminishing the funding available for
premium assistance and AI/AN Marketplace enrollment) or else purchase employer coverage
and discontinue premium assistance (which may not be financially viable and which forecloses
Tribes from obtaining a benefit that Congress deliberately granted included in the ACA).
Second, even if a Tribe does offer employer coverage, AI/AN employees will almost certainly be
personally responsible for paying premium costs and (depending on the type of plan and location
of services) for deductibles, co-payments, and co-insurance. Recognizing that eligibility for IHS
services acts as a natural disincentive for AI/AN enrollment in any insurance plan (employersponsored or otherwise) that requires such expenditures, Congress further incentivized AI/AN
Marketplace participating through the availability of premium tax credits: various types of
Indian-specific income is excluded when calculating AI/AN eligibility for the tax credits, thus
leaving it comparatively easier for AI/ANs to qualify12 and making many individual Marketplace
9
42 U.S.C. § 18071(d).
10
42 U.S.C. § 18031(c)(6)(D).
11
25 U.S.C. §§ 1642, 1644.
12
See 26 U.S.C. § 36B(d) (tying tax credit eligibility to modified adjusted gross income); see also 43 U.S.C. § 1620;
25 U.S.C. § 1407; 25 U.S.C. § 171b(a) (exempting various AI/AN-specific income from modified adjusted gross
income calculation).
4
February 2, 2015
plans significantly more affordable or comprehensive to AI/ANs than employer-sponsored
coverage. However, employees are automatically disqualified from tax credit eligibility upon
receiving a qualifying offer of coverage from their employer.13 So, even if a Tribe provides
employer-based insurance that is less affordable or comprehensive than a plan available through
the individual Marketplace, the mere offer of coverage eliminates the ability of AI/ANs to obtain
the tax credits that make the individual plan affordable in the first instance.
Finally, Congress exempted AI/ANs from the ACA’s individual mandate out of recognition that
AI/ANs are entitled to federal health care benefits and therefore should not be forced to pay for
non-IHS coverage. Requiring Tribal employers to provide AI/ANs with such coverage anyway,
and penalizing them if they do not, functionally invalidates the AI/AN exemption from the
individual mandate by shifting the penalty from the individual to the Tribe itself. This also
leaves AI/AN employees with two choices: either accept the coverage and be personally
responsible for any applicable employee share of premiums or cost-sharing (again invalidating
the individual mandate) or else reject the coverage and lose eligibility for Marketplace tax
credits. Under either scenario, the individual AI/AN is “paying” for health coverage.
The following examples illustrate the various ways in which the employer mandate uniquely
disadvantages Tribal employers and AI/ANs:
1. The Tribal employer complies with the employer mandate and offers minimum
essential coverage to all employees.
a. Tribal employer offers minimum essential coverage to all of its employees,
the majority of which are Tribal members.
b. Due to extremely limited and zero sum nature of Tribal budgets, the Tribe is
forced to diminish basic governmental services to make up for the cost of
coverage.
c. In partnership with CCIIO, the Tribe is actively encouraging Tribal members
to enroll in the Marketplaces. Tribal members who are employees are
disqualified from Marketplace tax credits due to the offer of coverage.
d. By providing coverage to Tribal member employees, the Tribe is required by
proxy to comply with the individual mandate “on behalf” of AI/AN
employees, thus nullifying the AI/AN individual mandate exemption.
2. The Tribal employer does not offer health insurance to any employees, and
instead pays the “first” employer mandate penalty of $2,000 per employee per
year.14
13
26 U.S.C. § 36B(2)(B); 26 U.S.C. § 5000A(f)(1)(B), (f)(2).
14
This penalty applies when (1) an employer offers health coverage to less than 95% of its full-time employees and
their dependents in a calendar month, and (2) at least one of the full-time employees then enrolls in a QHP through a
Marketplace and receives an advance premium tax credit or cost sharing reduction. 26 U.S.C. § 4980H(a); 26 C.F.R.
§ 54.4980H–4(a). In such cases, the penalty amount for each applicable month is equal to the number of the
employer’s full-time employees for the month (subtracted by thirty), multiplied by 1/12 of $2,000. 26 U.S.C. §
4980H(c)(2)(D); 26 C.F.R. § 54.4980H–1(a)(41).
5
February 2, 2015
a. The Tribe does not offer coverage to its employees.
b. The Tribe must pay $2,000 per employee per year in penalties to the IRS. The
Tribe is forced to reduce government services in order to make up for the
penalty costs.
c. Tribal member employees do not have an offer of coverage and can take
advantage of premium assistance and AI/AN cost-sharing exemption on the
Marketplaces, but the Tribe must “pay” the IRS a penalty in order for those
AI/AN employees to qualify for those statutory rights.
d. Due to the zero sum funding of Tribal governments, the Tribe will be
receiving federal funding to provide services to their members and then
paying it back to the IRS in the form of an employer mandate penalty.
3. The Tribal employer offers employees a “low end” plan (high deductible, few
covered services, etc.) that satisfies the first employer mandate penalty but not
the “second” employer mandate penalty.15
a. The Tribe purposefully designs its coverage options to result in significantly
expensive plans for their employees. The Tribe is liable for payment of the
“second” employer mandate penalty if employees go onto the Marketplace
and obtain a premium tax credit or cost-sharing reduction.
b. Tribal member employees are not likely to accept that coverage, as it results in
high personal costs and they have a right to care through the IHS system.
c. Tribal member employees are also not likely to obtain coverage through the
Marketplaces, as they have a right to care through the IHS system, thus
foregoing their statutory benefits under the ACA.
d. In order to encourage members to take advantage of Marketplace premium
assistance and AI/AN cost-sharing exemptions, the Tribe will have to pay the
IRS a penalty of up to $3,000 per Tribal member employee that receives a tax
credit or cost-sharing reduction in order to ensure that those members qualify
for their statutory benefits.
e. Due to the zero sum funding of Tribal governments, the Tribe will be
f. The Tribe is still responsible for paying for coverage for employees (AI/AN or
otherwise) who do enroll in the employer-sponsored plan.
These scenarios underscore the employer mandate’s inherent incompatibility with both the
unique nature of the Tribal health system and the AI/AN-specific provisions of the ACA.
Applying the mandate in any circumstances results in either a significant diminution in Tribal
governmental services, a functional elimination of the AI/AN exemption from the individual
15
This penalty applies when an employer does offer health coverage to at least 95% of its full-time employees and
their dependents, but (1) at least one full-time employee receives a premium tax credit or cost sharing reduction to
help pay for coverage in a Marketplace because the coverage was either unaffordable or failed to provide minimum
essential coverage. 26 U.S.C. § 4980H(b)(1); 26 C.F.R. §§ 54.4980H–5(e)(1). In such cases, the penalty amount is
calculated by taking the number of full-time employees who receive a premium tax credit in a given month and
multiplying that amount by 1/12 of $3,000. 26 U.S.C. § 4980H(b)(1); 26 C.F.R. § 54.4980H–1(a)(41).
6
February 2, 2015
mandate, or a disqualification of AI/ANs from their statutorily-established Marketplace benefits
and protections. The end result is that the Tribe must either bear the burden of paying for
expensive and/or low-quality coverage or else subject itself to significant employer mandate
penalties, while the AI/AN employee must choose between accepting whatever coverage is
offered and losing tax credit eligibility, remaining uninsured, or having their Tribe “pay” the IRS
so that they can qualify for the benefits and protections in the Marketplace to which they are
legally entitled. This fundamentally undercuts congressional intent in crafting the ACA and
requires a Tribal exemption from the mandate.
2. The Employer Mandate Runs Counter to the Federal Government’s Trust
Responsibility by Requiring Tribes to Either Pay the Federal Government
Penalties or Subsidize Private Insurance Companies.
As noted above, the federal government owes a trust responsibility towards AI/ANs, through
which they are eligible to receive health care through the IHS system without cost to the
individual. However, IHS is chronically underfunded and AI/ANs continue to suffer the highest
health disparities of any ethnic group in the United States and are disproportionately likely to be
uninsured.16 The employer mandate forces Tribes to divert funding necessary to sustain Tribal
health programs, which by right should come from the federal government, and redirect it to the
purchase of employee health insurance.
This contradicts the trust responsibility by resulting in a redundant payment cycle in which (1)
Tribal employers use their own funding (most likely a combination of federal funding and
outside revenue) to purchase employee insurance; (2) many employees visit the local IHS health
program for services; and (3) the employee’s insurer then reimburses IHS. In the alternative, the
Tribal employer does not purchase insurance and instead simply pays penalties to the IRS,
another federal agency.
In these circumstances, the employer mandate essentially results in Tribes funding the federal
government: either they take their limited Tribal funding (some or all of which might be federal
funding anyway) and pay it to the IRS in the form of a tax penalty, or they purchase insurance
from private companies, which then pay IHS after keeping between 15-20% of the premium
payments off the top.17 Tribal subsidization of the United States does not respect either the trust
responsibility or the government-to-government relationship between Tribes and the United
States. It is also inefficient, as federal funds will be used to circuitously pay for the cost of
insurance premiums or for tax penalties rather than directly funding health care through the IHS
system. The trust responsibility neither envisions Tribes as middlemen for transactions between
private insurers and IHS nor Tribal “funding” of federal agencies through the payment of
penalties.
16
See generally SAMANTHA ARTIGA ET AL., HENRY J. KAISER FAMILY FOUNDATION, HEALTH COVERAGE AND CARE
AMERICAN INDIANS AND ALASKA NATIVES (2013), available at http://kff.org/disparities-policy/issuebrief/health-coverage-and-care-for-american-indians-and-alaska-natives/ (last visited July 18, 2014).
FOR
17
See 45 C.F.R. § 158.210 (establishing acceptable insurance medical-loss ratios in the large group, and individual
health markets).
7
February 2, 2015
3. The Employer Mandate Will Be Unaffordable for Tribal Governments.
Compliance with the employer mandate forces Tribes to either absorb the cost of employee
health insurance or else pay non-compliance penalties of up to $2,000 per year per full-time
employee.18 Not only is this potentially devastating for Tribes that are already faced with
significant financial hardships, but it fails to recognize the fundamental distinction between
Tribal employers and private businesses.
It is our understanding that the IRS views the application of the mandate to Tribal employers
similarly to that of non-governmental businesses: essentially as a revenue-driven cost-benefit
analysis. This is simply not the case in the Tribal context. Tribes are sovereign, governmental
entities that are directly responsible for the health and welfare of their people, and are often the
only major employers in Tribal territories. Forcing Tribes to pay millions of dollars in penalties
– or, alternatively, to purchase costly insurance for Tribal member employees who are otherwise
exempt from the individual mandate and eligible for IHS services – will not just affect Tribal
business decisions concerning hiring or expansion, but will directly limit their ability to provide
basic social, health, safety, and other governmental services on which their members and other
reservation residents rely. Tribes cannot “pass on” the costs of compliance by raising prices on
goods or services. Tribal governmental funding is a zero sum game, and any funding used to
either comply with the mandate or pay the penalties will necessarily come from coffers used to
provide what may be the only constituent services for hundreds of miles.
While it is true that all employers must account for insurance costs when making decisions
concerning expansion or hiring, the stakes are comparatively much higher when a Tribe might
have to choose between complying with the mandate and funding an adequate reservation police
force or other Tribal entity. If applied to Tribal governments, the mandate has the potential to
critically undercut Tribal governmental functions.
4. The Internal Revenue Service Should Issue a Regulatory Exemption from the
Employer Mandate.
The IRS has previously recognized the burden that the ACA’s employer-specific provisions
place on Tribal employers: for example, the IRS explicitly excludes “federally recognized Indian
tribal governments or . . . any tribally chartered corporation wholly owned by a federally
recognized Indian tribal government” from an otherwise-applicable requirement that employers
report the cost of coverage under an employer-sponsored group health plan on their employees’
W-2 forms.19 As discussed above, the IRS should similarly exempt Tribes and Tribal
organizations from the employer mandate.
18
See generally 26 C.F.R. §§ 54.4980H–4, H-5.
See Internal Revenue Service, “Employer-Provided Health Coverage Informational Reporting Requirements:
Questions and Answers,” available at http://www.irs.gov/uac/Employer-Provided-Health-Coverage-InformationalReporting-Requirements:-Questions-and-Answers (Dec. 19, 2013).
19
8
February 2, 2015
The IRS has the legal authority to issue such an exemption. The ACA’s definition of the
“applicable large employers” subject to the mandate does not explicitly include Indian Tribes. 20
Statutes of general applicability that interfere with exclusive issues of self-governance, such as
the relationship between Tribal employees and on-reservation businesses, generally require “a
interpreted.21 Although Congress repeatedly referenced Indian Tribes within the ACA,22 it did
not include any such reference in the employer mandate, therefore indicating that the mandate
does not apply of its own force to Tribal employers.23 Because the sole explicit application of
the employer mandate to Tribes is found in IRS regulations,24 the IRS may accordingly
promulgate the following standalone exemption in 26 C.F.R. § 54.4980H–2:
26 C.F.R. § 54.4980H–2 Applicable large employer and applicable large
employer member.
(a) In general. Section 4980H applies to an applicable large employer and to all
of the applicable large employer members that comprise that applicable large
employer.
(b) Determining applicable large employer status—
....
(5) Indian Tribes and Tribal Entities. For the purposes of any penalty or
assessment under 26 U.S.C. § 4980H or 26 C.F.R. § 54.4980H, the term
“applicable large employer” shall not include any Indian tribe, tribal health
program, tribal organization, or urban Indian organization (as defined in 25
U.S.C. § 1603).
See 26 U.S.C. § 4980H(c)(2)(A) (defining the term as “with respect to a calendar year, an employer who employed
an average of at least 50 full-time employees on business days during the preceding calendar year”).
20
21
E.E.O.C. v. Fond du Lac Heavy Equip. & Const. Co., Inc., 986 F.2d 246, 249 (8th Cir. 1993) (Age Discrimination
in Employment Act did not apply to employment discrimination action involving member of Indian Tribe, Tribe as
employer, and reservation employment); accord Snyder v. Navajo Nation, 382 F.3d 892, 896 (9th Cir. 2004) (Fair
Labor Standards Act did not apply to dispute between Navajo and non-Navajo Tribal police officers and Navajo
Nation over “work [done] on the reservation to serve the interests of the tribe and reservation governance”).
22
See, e.g., Section 1402(d)(2) (referring to health services provided by an Indian Tribe); Section 2901(b) (referring
to health programs operated by Indian Tribes); Section 2951(h)(2) (referring to Tribes carrying out early childhood
home visitation programs); Section 2953(c)(2)(A) (discussing Tribal eligibility to operate personal responsibility
education programs); Section 3503 (discussing Tribal eligibility for quality improvement and technical assistance
grant awards).
See, e.g., Dean v. United States, 556 U.S. 568, 573 (2009) (“[W]here Congress includes particular language in one
section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts
intentionally and purposeful in the disparate inclusion or exclusion.”).
23
24
Internal Revenue Service, Shared Responsibility for Employers Regarding Health Coverage; Final Rule, 79 Fed.
Reg. 8,544 (Feb. 12, 2014); 26 C.F.R. § 54.4980H–1(a)(23).
9
III.
February 2, 2015
Conclusion.
The ACA employer mandate creates an impossible choice for Tribal governments, forcing them
to either pay for the cost of insurance for Tribal member employees who are otherwise exempt
from having to obtain coverage, or pay a tax penalty in order to ensure that Tribal member
employees qualify for the benefits and protections to which they are entitled. The mandate
discourages Tribes from facilitating AI/AN Marketplace enrollment, requires Tribes to pay an
individual mandate penalty by proxy on behalf of its AI/AN employees, and precludes AI/AN
eligibility for tax credits. The mandate also acts as a federal directive that many AI/ANs pay for
their health care in circumvention of the trust responsibility. Finally, the mandate is unaffordable
for many Tribes, as Tribes will pay for both the penalties and the insurance payments with
already-scarce resources that would be far better allocated towards funding direct Tribal services
and programs. We therefore ask that the IRS exercise its legal authority to provide categorical
relief for Indian Tribes, Tribal organizations, and Urban Indian Organizations from the employer
mandate.
Thank you for the opportunity to engage with us on this matter. We stand ready to work with
you on any necessary follow up issues and look forward to a continued open dialogue on the
employer mandate.
Sincerely,
Lester Secatero, Chairman,
The National Indian Health Board
Brian Patterson, President
United South and Eastern Tribes, Inc.
10
[email protected]
June 29, 2015
Raina D. Thiele
The White House
Tracy L. Goodluck
Policy Advisor for Native American Affairs, White House Domestic Policy Council
The White House
Re:
Dear Ms. Thiele and Ms. Goodluck:
On behalf of the National Indian Health Board (NIHB), the National Congress of American
Indians (NCAI), the Tribal Self-Governance Advisory Committee (TSGAC), the Direct Service
Tribal Advisory Committee (DSTAC), the United South and Eastern Tribes, Inc. (USET), and
the Rocky Mountain Tribal Leaders Council (RMTLC), we write to you to again request a
meeting to discuss the need for relief for Tribes from the Patient Protection and Affordable Care
Act’s (ACA) employer shared responsibility rule (the “employer mandate”). We continue to
await response to our original letter submitted to the White House on February 2, 2015.
The Internal Revenue Service’s (IRS) Final Rule implementing the employer mandate is
inconsistent with the federal trust responsibility to Tribes, denies many Tribal members the
opportunity to take advantage of the benefits and protections designed for them in the
Marketplace, and chills Marketplace enrollment for American Indians and Alaska Natives
(AI/AN). It is cost-prohibitive for many Tribes and will result in a diminution of Tribal services
June 29, 2015
for Indian people. If fully implemented in Indian Country, Tribes will be faced with one of two
undesirable options: either providing expensive employee coverage, which will result in a
reduction of governmental services and the disqualification of Tribal member employees from
AI/AN-specific benefits and protections in the marketplace, or using scarce (and in all
likelihood, federal) resources to pay the IRS substantial employer mandate penalties. Neither
outcome represents good federal policy.
As discussed below, the ACA contains several provisions designed to encourage AI/AN
enrollment in the ACA Marketplaces, and the Center for Consumer Information and Insurance
purposes to encouraging Marketplace enrollment. Tribal workforces include a significant
number of Tribal member employees. The offer of employer-sponsored health coverage to a
Tribal member employee disqualifies that employee from the premium subsidies that are critical
to facilitating Marketplace enrollment. With the employer mandate in place, Tribes are placed in
the untenable position of either having to offer insurance at full price to their Tribal member
employees, who will then be unable to take advantage of Marketplace premium subsidies even if
they do not accept the employer-based coverage, or to forego offering coverage (or offer
insufficient coverage) to their Tribal member employees and pay substantial penalties to the
IRS.1
Together, they create a federal policy that is inconsistent with the right of AI/ANs to obtain
federally-funded, trust-obligated health care without charge to the individual at I/T/U facilities,
and which further forces many Tribal employers to purchase coverage for workforces largely
comprised of Tribal members who are (1) exempt from the ACA’s individual mandate to obtain
coverage and (2) eligible to obtain health care through the I/T/U system. And application of the
employer mandate will be simply unaffordable to many Tribes and Tribal organizations and act
as a barrier to the provision of critical governmental services.
Finally, neither the ACA nor its implementing regulations should be interpreted as applying to
Tribes in the first instance. The employer mandate is set out in Section 4980H of the Tax Code,
as added by Section 1513 of the ACA (as amended).2 Section 4980H of the Code does not
specifically include Tribal governments within the definition of a covered employer, and Section
1
2
See 26 U.S.C. § 4980h; 26 C.F.R. § 54.4980H–1 - .4980H-5.
2
June 29, 2015
With the employer mandate in effect as of January 1, 2015, we request consultation on the need
for Tribal relief from the rule as soon as possible. In addition, IRS Information Reporting
deadlines for employers subject to the mandate for the 2015 tax year are fast approaching (i.e.,
employers must issue 1095-C statements to full-time employees by January 31, 2016 and must
file 1094-C and 1095-C forms by February 29, 2016, or March 31, 2016, if filing electronically).
I.
Background.
Congress has recognized both that “[f]ederal health services to maintain and improve the health
of the Indians are consonant with and required by the Federal Government’s historical and
unique legal relationship with, and resulting responsibility to, the American Indian people”3 and
that it is a “major national goal . . . to provide the resources, processes, and structure that will
enable Indian tribes and tribal members to obtain the quantity and quality of health care services
and opportunities that will eradicate the health disparities between Indians and the general
population of the United States.”4 The federal trust responsibility and laws enacted pursuant
thereto provide ample authority for the federal agencies of the Executive Department to design,
implement and tailor federal programs in a manner that recognizes and supports the unique
government to government relationship between sovereign Tribal governments and the United
States.5 One manner in which the federal government partially fulfills its trust responsibility is
by making AI/ANs eligible to receive care through the Indian Health Service (IHS) system
without charge to the individual patient.6
3
25 U.S.C. § 1601(1).
4
25 U.S.C. § 1601(2).
5
6
42 C.F.R. §§ 136.11 and 136.12.
7
employer mandate).
3
June 29, 2015
II.
Discussion.
employers presents three primary problems: (1) it undercuts the federal government’s trust
responsibility by forcing AI/ANs to “pay” for health coverage (whether directly or by proxy
through their Tribal employer); (2) it undercuts multiple ACA provisions designed to encourage
AI/AN enrollment in the Marketplaces; and (3) compliance with the mandate requires a
significant diminution in Tribal governmental services. We discuss each issue in turn.
individual. However, IHS is chronically underfunded, and AI/ANs continue to suffer the highest
purchase of employee health insurance from private companies.
8
9
FOR
10
health markets).
4
June 29, 2015
system, while also allowing insurance companies to step in and keep a percentage of the funding
for themselves. The trust responsibility neither envisions Tribes as middlemen for transactions
between private insurers and IHS nor Tribal “funding” of federal agencies through the payment
of penalties.
coverage,11 special AI/AN enrollment periods,12 and the ability for Tribes sponsor Marketplace
plan premium payments for Tribal members.13 Many Tribes and Tribal organizations have
aggressively sought to facilitate AI/AN enrollment in Marketplace plans in order to take
advantage of these protections. However, the employer mandate actively discourages AI/AN
Marketplace participation, in direct contradiction to the provisions described above.
understanding that the IRS has opined that Tribal premium sponsorship for member employees
does not satisfy the employer mandate. Tribes will therefore be forced to either continue
offering premium assistance and pay the employer mandate penalty (thus diminishing the
funding available for premium assistance and AI/AN Marketplace enrollment) or else purchase
employer coverage and discontinue premium assistance (which may not be financially viable and
which forecloses Tribes from obtaining a benefit that Congress deliberately included in the
ACA).
11
42 U.S.C. § 18071(d).
12
42 U.S.C. § 18031(c)(6)(D).
13
25 U.S.C. §§ 1642, 1644.
5
June 29, 2015
coverage.
14
15
26 U.S.C. § 36B(2)(B); 26 U.S.C. § 5000A(f)(1)(B), (f)(2).
6
June 29, 2015
year.16
penalty costs.
16
4980H(c)(2)(D); 26 C.F.R. § 54.4980H–1(a)(41).
17
7
June 29, 2015
mandate, or the disqualification of AI/ANs from their statutorily-established Marketplace
benefits and protections. The end result is that the Tribe must either bear the burden of paying
for expensive and/or low-quality coverage or else subject itself to significant employer mandate
before they can qualify for the benefits and protections in the Marketplace to which they are
18
8
June 29, 2015
Employer Mandate.
W-2 forms.19 For the reasons discussed above, the IRS should similarly exempt Tribes and
Tribal organizations from the employer mandate.
“applicable large employers” subject to the mandate does not explicitly include Indian Tribes.20
19
20
21
22
grant awards).
23
9
June 29, 2015
employer member.
employer.
....
U.S.C. § 1603).
III.
Conclusion.
We request a meeting to further discuss this issue and ask that the IRS exercise its legal authority
to provide categorical relief for Indian Tribes, Tribal organizations, and Urban Indian
Organizations from the employer mandate. The ACA employer mandate creates an impossible
choice for Tribal governments, forcing them to either pay for the cost of insurance for Tribal
member employees who are otherwise exempt from having to obtain coverage, or pay a tax
penalty in order to ensure that Tribal member employees qualify for the benefits and protections
to which they are entitled by law. The mandate discourages Tribes from facilitating AI/AN
Marketplace enrollment, requires Tribes to pay an individual mandate penalty by proxy on behalf
of its AI/AN employees, and precludes AI/AN eligibility for tax credits. The mandate also acts
as a federal directive that many AI/ANs pay for their health care in circumvention of the trust
responsibility. Finally, the mandate is unaffordable for many Tribes, as Tribes will pay for both
the penalties and the insurance payments with already-scarce resources that would be far better
allocated towards funding direct Tribal services and programs.
employer mandate. NIHB Director of Federal Relations, Devin Delrow ([email protected]),
will follow up by phone to secure a mutually acceptable meeting date and time.
Sincerely,
24
Reg. 8,544 (Feb. 12, 2014); 26 C.F.R. § 54.4980H–1(a)(23).
10
June 29, 2015
Marilynn (Lynn) Malerba
Chief, Mohegan Tribe
Chairwoman, TSGAC
W. Ron Allen, Chairman
Chief, Jamestown S’Kallam Tribe
Chairman, SGCETC
Brian Cladoosby, Chairman
Swinomish Indian Tribal Community
President, NCAI
Sandra Ortega, Councilwoman,
Tohono O’odham Nation
Chair, DSTAC
Attachments:
1. TTAG Strategic Plan, Appendix B [See footnote 5]
2. Rocky Mountain Tribal Leaders Council Resolution and Letter to White
House, May 18, 2015
3. NIHB and USET Letter to White House Requesting Relief from Employer
Mandate, February 2, 2015
11
Appendix B:
Legal Basis for Special CMS Provisions for American Indians and Alaska Natives
Carol Barbero, Esq.5
Elliott Milhollin, Esq.
Hobbs, Straus, Dean and Walker, LLP
November 2012
I.
Introduction
There is a special relationship between the United States and Indian Tribes that creates a trust
responsibility toward Indian people regarding health care. The existence of this truly unique obligation
supplies the legal justification and moral foundation for health policy making specific to American
Indians and Alaska Natives (AI/ANs) – with the objectives of enhancing their access to health care and
overcoming the chronic health status disparities of this segment of the American population.
It is beyond question that the obligation to carry out the trust responsibility to Indians applies to all
agencies of the federal government – including the Centers for Medicare & Medicaid Services (CMS) –
as evidenced by Presidential Executive Orders and Special Memoranda.6 Furthermore, with regard to
health care for AI/ANs, federal law assigns comprehensive duties to the Secretary of the Department of
Health and Human Services (HHS) in order to achieve the goals and objectives established by Congress
for Indian health. The trust responsibility, and laws enacted pursuant thereto, provides ample
authority for the Secretary – whether acting through the Indian Health Service (IHS), CMS, or other
agency of HHS – to take pro-active efforts to achieve the Indian health objectives Congress has
articulated.
5
The initial version of this Appendix D appeared in the first Strategic Plan submitted to CMS in 2005 by the CMS Tribal
Technical Advisory Group. In that submission, the author acknowledged the Northwest Portland Area Indian Health Board
(NPAIHB) and its member tribes for their generous support of the author’s earlier work which provided foundation for that
paper. That earlier paper, titled "The Federal Trust Responsibility: Justification for Indian-Specific Health Policy," was
presented at the National Roundtable on the Indian Health System and Medicaid Reform sponsored by the NPAIHB at the
Urban Institute on August 31, 2005. This Appendix D has been updated to reflect significant Indian-specific health policy
legislative and administrative actions that have occurred since it was originally drafted. The authors would like to thank the
United South and Eastern Tribes, Inc. for its generous support in updating this Appendix D.
6
See, e.g., Exec. Order No. 13175, 65 Fed. Reg. 67249 (Nov. 6, 2000) reprinted in 2000 U.S.C.C.A.N. at B77; White House
Memorandum for Heads of Executive Departments and Agencies, Nov. 5, 2009; Dep't of Health and Human Services Tribal
Consultation Policy (Dec. 14, 2010); Centers for Medicare and Medicaid Services Tribal Consultation Policy (Nov. 17, 2011);
Cramer v. United States, 261 U.S. 219 (1923).
42
HHS and CMS both recognize this authority in their tribal consultation policy:
Since the formation of the Union, the United States (U.S.) has recognized
Indian Tribes as sovereign nations. A unique government-to-government
relationship exists between Indian Tribes and the Federal Government
and this relationship is grounded in the U.S. Constitution, numerous
treaties, statutes, Federal case law, regulations, and executive orders that
establish and define a trust relationship with Indian Tribes. This
relationship is derived from the political and legal relationship that Indian
Tribes have with the Federal Government and is not based upon race.
This special relationship is affirmed in statutes and various Presidential
Executive Orders …7
While CMS often looks to the Social Security Act for authority, the historic and complex body of federal
Indian law and case law applies throughout the federal government to all agencies, including CMS. The
intent of this paper is to provide a brief summary of federal Indian law that is most relevant to current
and future regulations and guidance regarding participation of Indians and the Indian health system in
Medicare, Medicaid, Child Health Insurance Programs, and health insurance exchanges.
II.
The United States has a Trust Responsibility to Indians
A.
Origins of the trust responsibility to Indians
The federal trust responsibility to Indians, and the related power to exercise control over Indian affairs
in aid of that responsibility, is rooted in the United States Constitution – most significantly the Indian
Commerce Clause, the Treaty Clause, and the exercise of the Supremacy Clause.8 The Constitution
contains no explicit language that defines the trust relationship. Rather, the parameters of the trust
responsibility have evolved over time through judicial pronouncements, treaties, Acts of Congress,
Executive Orders, regulations, and the ongoing course of dealings between the federal government
and Indian tribal governments.
7
Dep't of Health and Human Services Tribal Consultation Policy (Dec. 14, 2010), at 1; Centers for Medicare and Medicaid
Services Tribal Consultation Policy (Nov. 17, 2011), at 1.
8
Morton v. Mancari, 417 U.S. 535, 551-552 (1974) ("The plenary power of Congress to deal with the special problems of
Indians is drawn both explicitly and implicitly from the Constitution itself."); McClanahan v. Arizona State Tax Comm’n, 411
U.S. 164, 172, n.7 (1973); see also TASK FORCE No. 9, VOL. 1, AMERICAN INDIAN POLICY REVIEW COMM’N 31 (1976)
(explaining the origins of Constitutional power to regulate Indian affairs as flowing from Congress’s treaty making powers,
powers to regulate commerce with Indian tribes, and its authority to withhold appropriations); FELIX S. COHEN, HANDBOOK
OF FEDERAL INDIAN LAW 418-423 (2005); Reid Payton Chambers, Judicial Enforcement of the Federal Trust Responsibility to
Indians, 27 STAN. L. REV. 1213, 1215-1220 (1975).
43
The earliest formal dealings between the federal government and Indian Tribes were undertaken
through treaty-making. From the United States’ perspective, treaty objectives were essentially twofold: cessation of hostilities to achieve and maintain public peace, and acquisition of land occupied by
tribal members. Tribes doubtless had a peace-making motive as well, but in return for the vast tracts
of land they relinquished to the more powerful federal government, Tribes also obtained the promise –
expressed or implied – of support for the social, educational, and welfare needs of their people,
including health care. These treaties/promises were the first expression of the federal government’s
obligation to Indian tribes.
The initial express recognition that a trust responsibility existed came from the courts. In the landmark
case of Cherokee Nation v. Georgia, 30 U.S, 1 (1831), Chief Justice John Marshall established the legal
foundation for the trust responsibility by describing Indian Tribes as “domestic dependent nations”
whose relationship with the United States “resembles that of a ward to his guardian.” Id. At 17. That
theme – and the duty of the federal sovereign to Indian Tribes – carried forward some 50 years later
when, in United States v. Kagama, 118 U.S. 375, 384 (1886), the Supreme Court acknowledged that
Tribes are under the protection and care of the United States:
From their very weakness and helplessness, so largely due to the course
of dealing of the federal government with them, and the treaties in which
it has been promised, there arises the duty of protection, and with it the
power [of protection].9
Through nearly two centuries of case law, the courts have extensively examined the parameters of the
trust responsibility to Indians, frequently in the context of whether the federal government has the
authority to perform an action and whether there are limitations on the exercise of Congressional
power over Indian affairs. While Congress has plenary authority over Indian matters through the
Constitution, the “guardian-ward” relationship articulated by Chief Justice Marshall requires that
federal actions be beneficial, or at least not harmful, to Indian welfare. This is not to say, however,
that the United States has always acted honorably toward Indians throughout its history. 10
Nonetheless, the fact that our government has failed in some instances to act in an honorable manner
9
See also Board of County Commissioners of Creek County v. Seber, 318 U.S. 705, 715 (1943) ("Of necessity the United
States assumed the duty of furnishing . . . protection [to Indian tribes] and with it the authority to do all that was required
to perform that obligation . . . .").
10
An example is unilateral abrogation of Indian treaties by Congress. See, e.g., Lone Wolf v. Hitchcock, 187 U.S. 553
(1903).
44
toward Indians does not and should not absolve the more powerful sovereign from its responsibility to
carry out its obligations honorably.
B.
“Indian” as a political rather than a racial classification: Indian-specific lawmaking and
the “rationally related” standard of review
In pursuit of its authority under the Constitution and the trust responsibility, Congress has enacted
Indian-specific laws on a wide variety of topics11 as well as included Indian-specific provisions in
general laws to address Indian participation in federal programs.12 In the landmark case of Morton v.
Mancari, 417 U.S. 535 (1974), the Supreme Court set out the standard of review for such laws – the
“rational basis” test. In Mancari, the Court reviewed an assertion by non-Indians that the application
of Indian preference in employment at the Bureau of Indian Affairs (as ordered in the Indian
Reorganization Act13) was racially discriminatory under the then-recently amended civil rights law
which prohibited racial discrimination in most areas of federal employment.
11
See, e.g., Indian Health Care Improvement Act, 25 U.S.C. § 1601, et seq.; Indian Self-Determination and Education
Assistance Act, 25 U.S.C. §450, et seq.; Indian Education Act, 20 U.S.C. §7401, et seq.; Tribally Controlled Schools Act, 25
U.S.C. §2501, et seq.; Tribally Controlled College or University Assistance Act, 25 U.S.C. §1801, et seq.; Native American
Housing Assistance and Self-Determination Act, 25 U.S.C. §4101, et seq.; Indian Child Welfare Act, 25 U.S.C. §1901, et seq.;
Indian Child Protection and Family Violence Prevention Act, 25 U.S.C. §3201, et seq.; Indian Employment, Training, and
Related Services Demonstration Act, 25 U.S.C. §3401, et seq.
12
See, e.g., 42 U.S.C. §1395qq (eligibility of IHS/tribal facilities for Medicare payments); 42 U.S.C. §1396j (eligibility of
IHS/tribal facilities for Medicaid payments); 42 U.S.C. §1397bb(b)(3)(D) (assurance of CHIP services to eligible low-income
Indian children); Elementary and Secondary Education Act, as amended, 20 U.S.C. §6301, et seq. (funding set-asides
throughout this law for the benefit of children enrolled in the Bureau of Indian Affairs school system); Impact Aid Program,
20 U.S.C. §7701, et seq. (federal aid to public school districts for Indian children living on Indian lands); Carl D. Perkins
Vocational and Applied Technology Education Act, 20 U.S.C. §§2326 and 2327 (funding set-aside for Indian vocational
education programs and tribal vocational Institutions); Higher Education Act, 20 U.S.C. §1059c (funding for triballycontrolled higher education institutions); Individuals with Disabilities Education Act, 20 U.S.C. §1411(c) (funding set-aside
for Bureau of Indian Affairs schools); Head Start Act, 42 U.S.C. §9801, et seq. (includes funding allocation for Indian tribal
programs and special criteria for program eligibility); Federal Highway Act, 23 U.S.C. §101, et seq. (1998, 2005, 2008 and
2012 amendments include funding set-asides for Indian reservation roads programs and direct development of regulations
through Negotiated Rulemaking with tribes); American Recovery and Reinvestment Act of 2009, P.L. 111-5 (Feb. 17, 2009)
(§5006 making amendments to the Social Security Act to provide various protections for Indians under Medicaid and CHIP,
discussed below); Patient Protection and Affordable Care Act, P.L. 111-148 (Mar. 23, 2010) (various Indian specific
provisions, discussed below).
13
25 U.S.C. §461, et seq. The Indian hiring preference appears at 25 U.S.C. §472.
45
While the Supreme Court’s civil rights jurisprudence has generally applied strict scrutiny when
reviewing classifications based on race, color, or national origin,14 in Mancari the Court determined
that this test was not appropriate when reviewing an Indian employment preference law. Indeed, the
Court declared that the practice under review was not even a “racial” preference. Rather, in view of
the unique historic and political relationship between the United States and Indian Tribes, the Court
characterized the preference law as political rather than racial, and said that “[a]s long as the special
treatment [for Indians] can be tied rationally to the fulfillment of Congress’ unique obligation toward
the Indians, such legislative judgments will not be disturbed.” Id. At 555. The Court found that hiring
preferences in the federal government’s Indian service were intended “to further the Government’s
trust obligation toward the Indian tribes,” to provide greater participation in their own selfgovernment, and “to reduce the negative effect of having non-Indians administer matters that affect
Indian tribal life” in agencies, such as the BIA, which administer federal programs for Indians. Id. At
541-542 (emphasis added).15
Once the link between special treatment for Indians as a political class and the federal government’s
unique obligation to Indians is established, “ordinary rational basis scrutiny applies to Indian
classifications just as it does to other non-suspect classifications under equal protection analysis.”
Narragansett Indian Tribe v. National Indian Gaming Comm’n., 158 F.3d 1335, 1340 (D.C. Cir. 1998).
The Indian hiring preference sanctioned by the Court in Mancari is only one of the many activities the
Court has held are rationally related to the United States’ unique obligation toward Indians. The Court
14
The Supreme Court has interpreted Title VI to allow racial and ethnic classifications only if those classifications are
permissible under the Equal Protection Clause. Regents of Univ. of Cal. v. Bakke, 438 U.S. 265, 287 (1978). In this regard,
the Court has also stated that "all racial classifications, imposed by whatever federal, state, or local governmental actor,
must be analyzed by a reviewing court under strict scrutiny. In other words, such classifications are constitutional only if
they are narrowly tailored measures that further compelling governmental Interests." Adarand Constructors, Inc. v. Pena,
515 U.S. 200, 227 (1995).
15
Indian Preference provisions are not limited to the BIA, and have been applied in a variety of federal programs for the
benefit of Indians. Section 7 of the Indian Self Determination Act, for example, establishes a broad federal policy of
providing hiring, training, and contracting preferences for Indians in contracts or grants with Indian organizations across all
federal agencies. 25 U.S.C. § 450e(b). Indian preference provisions are also found in other statutes. See, e.g., 42 U.S.C. §
9839(h) (establishing an Indian hiring preference at American Indian Programs Branch of Head Start Bureau); 20 U.S.C. §
3423c(c) (establishing an Indian employment preference in the Office of Indian Education in the Department of Education).
See also Preston v. Heckler, 734 F.2d 1359 (9th Cir. 1984) (Indian Preference Act requires Secretary of HHS to adopt
standards for evaluating qualifications of Indians for employment in the Indian Health Service that are separate and
independent from general civil service standards).
46
has upheld a number of other activities singling out Indians for special or preferential treatment, e.g.,
the right of for-profit Indian businesses to be exempt from state taxation, Moe v. Confederated Salish
& Kootenai Tribes, 425 U.S. 463, 479-80 (1976); fishing rights, Washington v. Washington State
Commercial Passenger Fishing Vessel Ass’n, 443 U.S. 658, 673 n.20 (1979); and the authority to apply
federal law instead of state law to Indians charged with on-reservation crimes, United States v.
Antelope, 430 U.S. 641, 645-47 (1977). The Court in Antelope explained its decisions in the following
way:
The decisions of this Court leave no doubt that federal legislation with
respect to Indian tribes, although relating to Indians as such, is not based
upon impermissible racial classifications. Quite the contrary,
classifications singling out Indian tribes as subjects of legislation are
expressly provided for in the Constitution and supported by the ensuing
history of the Federal Government’s relations with Indians.
Antelope, 430 U.S. at 645 (emphasis added).
The courts continue to acknowledge the special political status of Indians and to uphold legislation
singling out Indians on that basis. See, e.g., Am. Fed’n of Gov’t Employees, AFL-CIO v. United States,
330 F.3d 513, 522-23 (D.C. Cir. 2003) (finding outsourcing preference for Indian-owned firms was
rationally related to the legitimate legislative purpose of promoting the economic development of
federally recognized Tribes and their members); United States v. Wilgus, 638 F.3d 1274, 1287-88 (10th
Cir. 2011) (upholding exception to the Bald Eagle Protection Act for Indian tribal members to possess
eagle feathers).
III.
Congress’s Recognition of the Federal Trust Responsibility in Health Laws
Since the early part of the 20th century, Congress has enacted a number of laws that authorize, direct,
and fund the provision of health care services to Indian people.16 Here we focus on the most
significant legislative enactments intended to ensure access of Indian people to federally-assisted
health care programs and to enhance the viability of Indian Health Service and tribal programs that
serve the Indian population.
A.
The Indian Health Care Improvement Act
16
See, e.g., Snyder Act, 25 U.S.C. § 13; Johnson-O'Malley Act, 25 U.S.C. § 452; Transfer Act, 42 U.S.C. § 2001, et seq.
(transferred responsibility for Indian health to Public Health Service); annual appropriations to the Indian Health Service
included in the Interior and Related Agencies Appropriations Acts.
47
The Indian Health Care Improvement Act (IHCIA)17 was originally enacted in 1976 as Public Law 94-437.
It brought statutory order and direction to the delivery of federal health services to Indian people. Its
legislative history catalogued the deplorable conditions of Indian health that demanded legislative
attention: inadequate and under-staffed health facilities; improper or non-existent sanitation facilities;
prevalence of disease; poor health status; inadequate funding;18 low enrollment of Indians in
Medicare, Medicaid, and Social Security; serious shortage of health professionals, including Indian
health professionals; and the need for health care for Indian people who had moved from reservations
to urban areas. The legislation addressed each of these deficiencies through focused titles: Manpower;
Health Services; Health Facilities (including sanitation facilities); Access to Medicare and Medicaid;
Urban Indian Health; and a feasibility study for establishing an American Indian School of Medicine. 19
The IHCIA has been periodically reauthorized and amended since 1976. In 2010, the law was
comprehensively amended and authorized as a permanent law of the United States.20
Throughout its history, the IHCIA has contained an unequivocal recognition of the United States’
responsibility to improve the health of Indian people, to provide federal health services to this
population, and to foster maximum Indian participation in health care program management. The
2010 amendments reiterated and reinforced these federal commitments through the following
provisions:
Congressional Findings
The Congress finds the following:
(1) Federal health services to maintain and improve the health of the Indians are consonant with and
required by the Federal Government’s historical and unique legal relationship with, and resulting
responsibility to, the American Indian people.
(2) A major national goal of the United States is to provide the resources, processes, and structure that will
enable Indian tribes and tribal members to obtain the quantity and quality of health care services and
17
25 U.S.C. §1601, et seq. The Indian Health Care Improvement Act was amended and permanently reauthorized by
Section 10221 of the Patient Protection and Affordable Care Act, P.L. 111-148 (Mar. 23, 2010).
18
The House Interior and Insular Affairs Committee noted that per capita spending on Indian health in 1976 was 25
percent less than the average American per capita amount. H.R. REP. No. 94-1026, pt. I, at 16 (1976), reprinted in 1976
U.S.C.C.A.N. 2652, 2655. According to the U.S. Commission on Civil Rights, IHS per capita spending for Indian medical care
in 2003 was 62 percent lower than the U.S. per capita amount. U.S. Commission on Civil Rights, Broken Promises:
Evaluating the Native American Health Care System (Sept. 2004), at 98.
19
The IHCIA was later amended to include formal establishment of the Indian Health Service as an agency of DHHS. Pub.
L. No. 100-713 (1988). The IHS establishment is codified at 25 U.S.C. § 1661.
20
Sec. 10221 of the Patient Protection and Affordable Care Act, P.L. 111-148 (Mar. 23, 2010).
48
opportunities that will eradicate the health disparities between Indians and the general population of the
United States.
(3) A major national goal of the United States is to provide the quantity and quality of health services which
will permit the health status of Indians to be raised to the highest possible level and to encourage the
maximum participation of Indians in the planning and management of those services.
(4) Federal health services to Indians have resulted in a reduction in the prevalence and incidence of
preventable illnesses among, and unnecessary and premature deaths of, Indians.
(5) Despite such services, the unmet health needs of American Indian people are severe and the health status
21
of the Indians is far below that of the general population of the United States.
Declaration of National Indian Health Policy
Congress declares that it is the policy of this Nation, in fulfillment of its special trust responsibilities and legal
obligations to Indians –
(1) to ensure the highest possible health status for Indians and urban Indians and to provide all resources
necessary to effect that policy;
(2) to raise the health status of Indians and urban Indians to at least the levels set forth in the goals contained
within the Healthy People 2010 initiative or successor objectives;
(3) to ensure maximum Indian participation in the direction of health care services so as to render the
persons administering such services and the services themselves more responsive to the needs and
desires of Indian communities;
(4) to increase the proportion of all degrees in the health professions and allied and associated health
professions awarded to Indians so that the proportion of Indian health professions in each Service are is
raised to at least the level of that of the general population;
(5) to require that all actions under this chapter shall be carried out with active and meaningful consultation
with Indian tribes and tribal organizations, and conference with urban Indian organizations, to implement
this chapter and the national policy of Indian self-determination;
(6) to ensure that the United States and Indian tribes work in a government-to-government relationship to
ensure quality health care for all tribal members; and
(7) to provide funding for programs and facilities operated by Indian tribes and tribal organizations in
amounts that are not less than the amounts provided to programs and facilities operated directly by the
22
Service.
It is important to note that these expressions of policy, obligation, and objectives apply to the federal
government as a whole. The Act reposes responsibility for their implementation in the Secretary of
Health and Human Services. While the Indian Health Service has first-line responsibility for
administering the Indian health system, the Secretary of HHS remains the official with ultimate
responsibility to see that programs are performed as directed and the objectives established by
Congress are achieved. Thus, the obligation to exercise the trust responsibility for Indian health, to
implement the expressed policies, and to achieve the stated goals extend to the Centers for Medicare
& Medicaid Services, as an agency of HHS.
21
25 U.S.C. §1601.
22
25 U.S.C. §1602.
49
B.
Statutory Authority for Participation in Medicare and Medicaid
In the 1976 IHCIA, Congress amended the Social Security Act to extend to Indian health facilities the
authority to collect Medicare and Medicaid reimbursements. Prior to these amendments, the IHS, as a
federal agency, was not permitted to claim reimbursements from Medicare and Medicaid.
•
•
•
Sec. 188023 made IHS hospitals (including those operated by Indian Tribes24) eligible to collect
Medicare reimbursement.
Sec. 191125 made IHS and tribal facilities eligible to collect reimbursements from Medicaid
An amendment to Sec. 1905(b)26 applied a 100 percent federal medical assistance percentage
(FMAP) to Medicaid services provided to an Indian by an IHS or tribally-operated facility.
Sections 1880 and 1911 were intended to bring additional revenue into the Indian health system in
order to address the deplorable condition of Indian health facilities, many of which were in such a poor
state they were unable to achieve accreditation. The application of a 100 percent FMAP to the
Medicaid-covered services provided by these facilities was made in express recognition of the federal
government’s treaty obligations for Indian health. The Committee of jurisdiction observed that since
the United States already had an obligation to pay for health services to Indians as IHS beneficiaries, it
was appropriate for the U.S. to pay the full cost of their care as Medicaid beneficiaries.27 This action is
consistent with the status of AI/ANs as a political designation.
Through amendments to Sec. 1880 made in 2000, 2003 and 2010, IHS and tribal hospitals and clinics
are authorized to collect reimbursements for all Medicare Part A and Part B services. As health care
23
42 U.S.C. §1395qq.
24
Tribes and tribal organizations are authorized to operate IHS-funded hospitals and clinics through contracts and
compacts issued pursuant to the Indian Self-Determination and Education Assistance Act, 25 U.S.C. § 450, et seq.
25
42 U.S.C. §1396j.
26
42 U.S.C. §1396d(b).
27
H.R. REP. No. 94-1026, pt. III, at 21 (1976), as reprinted in 1976 U.S.C.C.A.N. 2782, 2796.
50
providers, IHS and tribal health programs are authorized to collect reimbursements under Medicare
Parts C and D, as well.28
C.
Statutory Authority for Participation in CHIP
IHS and tribal health providers are authorized to collect payments when providing services to
individuals enrolled in the Children’s Health Insurance Program (CHIP).29 To assure that low-income
Indian children who are CHIP-eligible are not overlooked, Congress, when creating the program in
1997, expressly required States to describe in their State plans the procedures they will use to assure
access for these children.30
D.
Indian-Specific Provisions Designed to Ensure Indian Access to Medicaid, Medicare and
CHIP
Since early 2009, Congress has added several significant provisions to Titles XIX and XXI of the Social
Security Act that give voice to the federal government’s unique responsibility to Indian people and the
need to remove barriers to their participation in Medicaid and CHIP, especially when AI/ANs eligible for
those programs receive services from Indian health providers. We highlight these actions below.

Proof of Citizenship for Medicaid Enrollment. In the Deficit Reduction Act of 2005 (DRA),
Congress directed that on and after July 1, 2006, persons who apply to enroll or renew
enrollment in Medicaid must provide documentary proof of identity and U.S. citizenship, and
identified the types of documents that would be acceptable proof. Indian health advocates
feared – correctly, as it turns out – that many AI/ANs would not possess sanctioned
documentation of their status as U.S. citizens. Recognizing the barrier this presented for Indian
access to Medicaid and CHIP, in 2009 Congress amended these requirements to designate
documents issued by a federally-recognized Indian Tribe evidencing an individual’s
membership, enrollment in, or affiliation with such Tribe as satisfactory evidence of U.S.
28
In fact, Congress expressly authorized the Secretary of HHS to issue standards to assure access by pharmacies operated
by the IHS, tribes and urban Indian organizations to the Medicare Part D prescription drug benefit (42 U.S.C. §1395w104(b)(1)(C)(iv)), and required the Secretary to establish procedures (including authority to waive requirements) to assure
participation by these pharmacies in the transitional assistance feature of the temporary discount drug program. 42 U.S.C.
§1395w-141(g)(5)(B). Congress added language in the Affordable Care Act to allow Indian patients to qualify for the
catastrophic coverage phase of the Part D program. 42 U.S.C. §1395w–102(b)(4)(C).
29
42 U.S.C. §2105(c)(6)(B); see also 25 U.S.C. §1647a.
30
42 U.S.C. §2103(a)(3)(D).
51
citizenship.31 Significantly, Congress gave tribal documentation “tier I” status – the same as a
U.S. passport. Individuals presenting tribal affiliation documentation would not be required to
present any additional identity documentation.
This legislative action recognizes not only the historic reality that Indian people were the
original occupants of the North American continent, it also implements in the clearest possible
way the policy of maintaining a government-to-government relationship with Indian Tribes. It
also demonstrates respect for the sovereignty of Tribes both to determine tribal membership
and to issue legal documents. As a practical matter, amending the law to order acceptance of
tribal documentation underscores Congress’s recognition of its continued responsibility to
enact Indian-specific legislation when needed to assure full access to federal programs.

Medicaid Premium and Cost-Sharing Protections. Pursuant to an amendment to Medicaid
made in 2009, States are prohibited from imposing any premium or cost-sharing on an Indian
for a covered service provided by the IHS, a health program operated by an Indian Tribe, Tribal
Organization or urban Indian organization, or through referral under contract health services.32

Disregard of Certain Indian Property from Resources for Medicaid and CHIP Eligibility. In 2009,
Congress amended the Medicaid and CHIP laws to exempt from the resources calculation
certain enumerated types of Indian property. Primarily, the excluded property is of a type that
flows to an individual Indian by virtue of his/her membership in a Tribe.33

Medicaid Estate Recovery Protections. In an express endorsement of a provision in the CMS
State Medicaid Manual, in 2009 Congress statutorily exempted certain Indian-related income,
resources and property held by a deceased Indian from the Medicaid estate recovery
31
42 U.S.C. §1396b(x)(3)(B), as added by Sec. 211 of the Children’s Health Insurance Program Reauthorization Act of 2009
(P.L. 111-3) (Feb. 4, 2009).
32
42 U.S.C. §§1396o(j) and 1396o-1(b)(3)(vii), as added by Sec. 5006(a) of the American Recovery and Reinvestment Act
of 2009 (P.L. 111-5) (Feb. 17, 2009). In recognition of the trust responsibility, Indian children have been exempt from costsharing in the CHIP program pursuant to regulation at 42 C.F.R. §457.535.
33
42 U.S.C. §§1396a(ff) and 1397gg(e)(1)(H), as added by Sec. 5006(b) of the American Recovery and Reinvestment Act of
2009 (P.L. 111-5) (Feb. 17, 2009).
52
requirement.34 The objective of the Manual and statutory protection was to remove a
disincentive to enrollment for Indian people eligible for Medicaid.

Special Indian-specific Rules for Medicaid Managed Care. In 2009, Congress removed several
barriers to full and fair participation of Indian people and Indian health providers in Medicaid
programs operated through managed care entities. This gave an Indian Medicaid enrollee the
option to select an Indian health program as his/her primary care provider, and directed that
Indian health providers (IHS, tribal, and urban Indian organization programs) be paid at a rate
not less than that of the managed care entity’s network provider.35 These changes were
needed to overcome the reluctance of managed care entities to admit Indian health providers
to their networks and to reimburse them for services provided to Indian Medicaid enrollees.

Authority for Tribal Medicaid Administrative Match. Federal funds may not be used to meet
State matching requirements, except as authorized by Federal law. In 2005, CMS issued a State
Medicaid Director letter that permits Indian Tribes and Tribal Organizations to certify funds
received under the Indian Self-Determination and Education Assistance Act as public
expenditures to be used as the non-Federal share of expenditures to fulfill State matching
requirements for administrative claiming activities under the Medicaid program. These
activities include, among other things, outreach and application assistance for Medicaid
enrollment and activities that ensure appropriate utilization of Medicaid services by Medicaid
beneficiaries.
E.
Solicitation of Input from Indian Health Programs.
In recognition of the need to assure that impacts on the unique Indian health system by proposed
changes in Medicare, Medicaid, and CHIP are fully evaluated, Congress placed in the Social Security Act
a requirement for prior notice to and solicitation of input from IHS, tribal health programs, and urban
34
42 U.S.C. §1396p(b)(3)(B), as added by Sec. 5006(c) of the American Recovery and Reinvestment Act of 2009 (P.L. 111-5)
(Feb. 17, 2009).
35
42 U.S.C. §1396u-2(h), as added by Sec. 5006(d) of the American Recovery and Reinvestment Act (P.L. 111-5) (Feb. 17,
2009).
53
Indian organizations. On the federal level, this requirement is to be carried out by CMS through
maintenance of the Tribal Technical Advisory Group originally chartered by the agency in 2003.36
States are required to solicit advice from IHS and tribal health programs and urban Indian organizations
within their borders prior to submission of any state plan amendments, waiver requests, and
demonstration projects to CMS.37
F.
Cap on Rates Charged for Contract Health Services.
Modeling on the Medicare Provider Agreement provision that caps the amount a hospital can charge
for services purchased by the Department of Veterans Affairs, in 2003 Congress enacted a similar
limitation on the amount a Medicare participating hospital may charge for services purchased by
Indian health programs operated by the IHS, Tribes, and Tribal Organizations, and urban Indian
organizations (I/T/Us). As a condition for participation in Medicare, such hospitals must accept
patients referred by I/T/Us in accordance with the admission practices, payment methodology, and
payment rates set forth in Secretarial regulations, and may accept no more than the payment rates set
by the Secretary.38 This statutory rate cap is often referred to by the shorthand “Medicare-like rates.”
In regulations issued by IHS and CMS in 2007, the maximum amount a Medicare hospital is permitted
to accept for a service purchased by an I/T/U is the applicable Medicare rate.39
These statutory and regulatory actions are intended to enable I/T/Us to achieve greater economies for
the services they must purchase for their Indian patients with funds appropriated for contract health
services.
36
42 U.S.C. §1320b-24, as added by Sec. 5006(e)(1) of the American Recovery and Reinvestment Act (P.L. 111-5) (Feb. 17,
2009). The maintenance of the Tribal Technical Advisory Group does not substitute for government-to-government
consultation with tribes.
37
42 U.S.C. §§1396a(a)(73) and 1397gg(e)(1)(C), as added by Sec. 5006(e)(2) of the American Recovery and Reinvestment
Act (P.L. 111-5) (Feb. 17, 2009).
38
42 U.S.C. §1395cc(a)(1)(U), as added by the Medicare Modernization Act of 2003 (P.L. 108-173).
39
72 Fed. Reg. 30706 (June 4, 2007), adding Subpt. D to 42 C.F.R. Part 136, and adding §489.29 to 42 C.F.R. Part 489.
These regulations became effective on July 5, 2007.
54
G.
Indian-Specific Provisions Designed to Ensure Indian Access to the Health Insurance
Exchanges
The Patient Protection and Affordable Care Act (ACA) was enacted by Congress in 2010 in order to
reform the health insurance market and make health insurance more accessible and affordable for all
Americans. It imposes a responsibility on most Americans to acquire or maintain health insurance
coverage, and contains a number of provisions intended to strengthen health insurance consumer
protections and enhance the health care workforce. Congress included a number of provisions
designed to ensure that Indians could take advantage of the new reforms. We highlight several of
these below.

Exemption from Penalty for Failure to Comply with the Individual Mandate. Although Congress
designed the law to make nearly all Americans responsible for acquiring or maintaining
acceptable levels of health insurance coverage, Congress specifically exempted members of
Indian Tribes from the tax penalty for failure to obtain acceptable coverage.40 This provision is
based on the theory that the United States is responsible for providing health care to Indians,
but it has failed to supply an acceptable package of benefits through the Indian Health Service.
Having failed in that responsibility, it would violate the trust responsibility to require Indians to
pay for non-IHS coverage or be assessed a tax penalty for failing to do so.

Cost-Sharing Protections for Indians Enrolled in a Health Insurance Exchange Plan. The
Affordable Care Act prohibits assessment of any cost-sharing for any service provided by an
Indian health provider to an AI/AN enrolled in an Exchange plan. Furthermore, no cost sharing
may be assessed by non-Indian health providers to an AI/AN enrolled in such a plan if the
individual receives services through an Indian health provider or through contract health
services. Indians with income below 300 percent of the Federal Poverty Level do not have cost
sharing in the private sector even if they do not have a referral from an Indian health provider.
The Secretary of HHS is responsible for paying the Exchange plan the additional actuarial cost
that results from these cost-sharing protections.41

Special enrollment periods for AI/AN. The ACA provides special enrollment periods for AI/ANs
for health insurance exchanges. This is another measure to provide access to this important
source of funding for the I/T/U.
40
26 U.S.C. §5000A(e)(3).
41
42 U.S.C. §18071(d).
55
These provisions are designed to reduce the costs for AI/ANs to access the Exchange plans and to
provide incentives for them to do so, as well as to increase the likelihood that I/T/Us will receive
payments from health insurance exchange plans for services they provide to AI/Ans.
IV.
Executive Branch Recognition of the Federal Trust Responsibility in Administering Federal
Health Programs
A.
Executive Branch Administration of the Trust Responsibility
The Executive Branch is responsible for carrying out the federal trust responsibility to provide health
care to Indians. The federal government’s general trust duty to provide social services and its duty as a
trustee to protect and manage Indian trust property are different types of duties and thus are treated
differently by the courts.42 Courts have generally been reluctant to impose liability for the federal
government’s failure to provide social services under the general trust relationship.43 One notable
exception is the case of Morton v. Ruiz44 where the Supreme Court said the Bureau of Indian Affairs
erred in refusing to provide welfare benefits to unemployed Indians who lived off, but near, their
reservation. The Court reiterated that the “overriding duty of our Federal Government [is] to deal
fairly with Indians wherever located”, and that BIA’s failure to publish eligibility criteria through
Administrative Procedure Act regulations was not consistent with the “distinctive obligation of trust
incumbent upon the Government in its dealings” with Indians.45
The IHCIA policy statements quoted above expressly recognize a trust responsibility to maintain and
improve the health of Indians, and establish a national policy to assure the highest possible health
status to Indians, as well as to provide all resources necessary to effect that policy. While currently
there may be no available mechanism to enforce these policies judicially, this does not make them
meaningless. They establish the goals, which the Executive Branch – particularly the Department of
Health and Human Services – must strive to achieve as it implements federal law. In fact, they justify –
indeed, require – the Executive Branch to be proactive and use its resources “to assure the highest
possible health status for Indians and urban Indians and to provide all resources necessary to effect
42
Seminole Nation v. United States, 316 U.S. 286, 297 (1942).
43
See, e.g., Gila River Pima-Maricopa Indian Community v. U.S., 427 F.2d 1194 (Ct.CI. 1970), cert. denied. 400 U.S. 819
(1970).
44
415 U.S. 199 (1974).
45
Id. at 236. See also Chambers, note 2, supra, at 1245-46 (arguing that courts should apply the trust responsibility as a
"fairness doctrine" in suits against the United States for breach of a duty to provide social services).
56
that policy.” 25 U.S.C. §1602(1). The Executive Branch has a dual duty – to carry out the policy
established by Congress in federal law, and to perform the United States’ trust responsibility to Indians
in accord with the Congressionally-established standard.
Indian people take the United States at its word when reading the policy statement in the IHCIA, and
have a right to expect its trustee to achieve the goal of assuring them the highest possible health
status. As stated by Justice Black in his lament over the U.S. breaking faith with Indians, “Great
nations, like great men, should keep their word.”46
B.
CMS Administration of the Trust Responsibility
As part of DHHS, and as an agency required to implement statutory provisions intended to benefit
Indian health, CMS should affirmatively advance policy objectives as set out by Congress in the IHCIA
when making Indian-related decisions in the Medicare and Medicaid programs. The trust responsibility
and the federal laws enacted to carry it out not only permit CMS to treat AI/ANs served by the Indian
health system as unique Medicare and Medicaid consumers entitled to special treatment, they require
it.
CMS shares the responsibility to carry out the policy goals established by Congress in the IHCIA. Both
the HHS and CMS tribal consultation policies recognize “the unique government to government”
relationship between the United States and Tribes, as well as the trust responsibility “defined and
established” by “the U.S. Constitution, numerous treaties, statutes, Federal case law, regulations, and
executive orders.”47 One manifestation of this trust responsibility is CMS’s recognition that “CMS and
Indian Tribes share the goals of eliminating health disparities for American Indians and Alaska Natives
(AI/AN) and of ensuring that access to Medicare, Medicaid, the Children’s Health Insurance Program
(CHIP), and Exchanges is maximized.”48 Through its consultation policy, CMS has committed to
consulting with Indian Tribes when developing policy that may affect Indians.
CMS has exercised its authority to administer federal health care programs and interpret the statutes
within its jurisdiction in a manner that assures access by Indian people and participation by the unique
Indian health delivery system. In recent decades, CMS (previously HCFA) has taken steps to carry out
46
Federal Power Comm'n v. Tuscarora Indian Nation, 362 U.S. 99, 142 (1960) (Black, J., dissenting),
47
Centers for Medicare & Medicaid Services Tribal Consultation Policy (Nov. 17, 2011), at 1; U.S. Dep't of Health and
Human Services Tribal Consultation Policy (Dec. 14, 2010), at 1.
48
Centers for Medicare & Medicaid Services Tribal Consultation Policy (Nov. 17, 2011), at 2.
57
the trust responsibility to Indians in its administration of the Medicare, Medicaid, and CHIP programs.
Each was a rational exercise of the agency’s authority and fully justified by the United States’ special
obligations to Indian Tribes.
A summary of these actions follows:
49

Authority for Tribal Facilities to Bill Medicaid at the Same Rate as IHS Facilities. In 1996,
through a Memorandum of Agreement with IHS, HCFA re-interpreted the term “facility of the
Indian Health Service” in Section 1911 (Medicaid) to allow a tribally-owned facility operated
under an ISDEAA agreement to elect designation as a “facility of the Indian Health Service.”
Previously, HCFA had interpreted the term “facility of the Indian Health Service” to include only
facilities actually owned or leased by IHS. The MOA enabled these tribally-owned facilities to
bill Medicaid at the annually-established Medicaid billing rates for IHS facilities and applied the
100 percent FMAP to Medicaid services provided by such facilities.

Exemption of IHS and Tribal Clinics from the Outpatient Prospective Payment System. In 2002,
the Director of the Center for Medicare agreed to continue the exemption of IHS and tribal
clinics from the Outpatient Prospective Payment System.

CMS has Broadly Defined the Hospital Services that are Subject to the Medicare-like Rates Cap.
In 2007, CMS issued regulations implementing Section 506 of the Medicare Modernization Act
to require all Medicare-participating hospitals to accept Medicare-like rates when providing
services to I/T/U beneficiaries. The final regulations broadly defined hospital and critical access
hospital services subject to the rule to include inpatient, outpatient, skilled nursing facilities,
and any other service or component of a hospital. 42 C.F.R. §136.30; 42 C.F.R. §489.29.

IHS and Tribal Facility Participation in Medicaid. The 1996 IHS/HCFA MOA incorporated the
regulatory policy that states must accept as Medicaid providers IHS facilities that meet state
requirements, but these facilities are not required to obtain a state license. 42 C.F.R. §431.110.
Thus, it applied this regulatory policy to tribally-owned facilities. Congress converted this policy
into law for all federally-funded health programs serving AI/AN in the 2010 amendments to the
Indian Health Care Improvement Act.49
25 U.S.C. §1647a.
58

Cost-Sharing Protections for Indian Children in CHIP. In 1999, HCFA issued guidance, followed
by a proposed rule, that prohibits states from imposing any cost-sharing on AI/AN children
under CHIP, citing the unique federal relationship with Indian Tribes. This rule was
subsequently promulgated in final form. 42 C.F.R. §457.535. This HCFA regulation reflects the
agency’s interpretation of how best to carry out the statutory provision requiring states to
demonstrate how they will assure CHIP access for eligible Indian children. 42 U.S.C.
§1397bb(b)(3)(D). In 2000, HCFA announced that the policy prohibiting cost sharing for Indian
children under CHIP would be extended to Section 1115 Medicaid demonstration projects and
stated the agency would no longer approve Section 1115 projects that impose such costsharing. 66 Fed. Reg. 2490, 2526 (Jan. 11, 2001).

State-Tribal Consultation on Medicaid Programs. In 2001, CMS issued a policy statement that
requires states to consult with Tribes within their borders on Medicaid waiver proposals and
waiver renewals before submitting them to CMS.50 Congress subsequently made this
consultation requirement statutory, adding State Plan Amendments and demonstration
projects as requisite subjects of tribal consultation.51 CMS informed the States of this
consultation requirement on several occasions and codified the 2001 policy statement. 52 In
May of 2012, CMS announced that it would not accept the waiver applications submitted by
New Mexico and Kansas until they met the tribal consultation requirements.

CMS Tribal Technical Advisory Group. In 2003, CMS chartered a Tribal Technical Advisory Group
comprised of tribal officials and tribal employees to advise the agency on Medicare, Medicaid,
and CHIP issues that impact Indian health programs. CMS’s foresight was met with approval by
Congress, which granted the TTAG explicit statutory status in 2009 and added representatives
of the IHS and urban Indian organizations to the TTAG’s membership. 42 U.S.C. §1320b-24.

Indian Health Addendum Required for Medicare Part D Pharmacy Contracts. When
implementing the Medicare Part D drug benefit, CMS recognized that special terms and
conditions in pharmacy contracts would be needed to assure that IHS, tribal, and urban Indian
50
Letter from Health Care Fin. Admin. To State Medicaid Directors (July 17, 2001)
http://downloads.cms.gov/cmsgov/archived-downloads/SMDL/downloads/smd071701.pdf.
51
42 U.S.C. §§1396a(a)(73) and 1397gg(e)(1)(C), as added by Sec. 5006(e)(2) of the American Recovery and Reinvestment
Act (P.L. 111-5) (Feb. 17, 2009).
52
CMS SMD #09-003 (June 17, 2009); CMS SMDL #10-001 (Jan. 22, 2010); 77 Fed. Reg. 11678 (Feb. 27, 2012).
59
organization pharmacies would be able to participate in the Part D program. The agency
requires Part D plans to include the CMS-approved text of an Indian Health addendum in
contracts offered to those pharmacies. 42 C.F.R. §423.120(a)(6). The addendum addresses
several aspects of federal law and regulations applicable to those pharmacies, such as Federal
Tort Claims Act coverage (obviating the need for privately-purchased professional liability
insurance).53

Approval of Indian-specific State Medicaid Plan Provision. In April of 2012, CMS approved an
Arizona Medicaid waiver request through which several optional Medicaid services can
continue to be covered at IHS and tribal facilities, although they are otherwise discontinued
from coverage in the State’s plan. When these services are provided to Indian patients at IHS
and tribal facilities, the 100 percent FMAP continues to apply. This action is a significant
acknowledgement by CMS that it has the authority and the obligation to carry out its trust
responsibility for Indian health.
Carrying out the trust responsibility to Indians in these and other ways coincides with and compliments
CMS’s stated program objectives.
V.
The Unique Nature of the Indian Health System
The IHS-funded system for providing health services to AI/ANs is one-of-a kind; it is unlike any other
mainstream health delivery system. In fact, the federal government created and designed the system
in use today for the specific purpose of serving Indian people in the communities in which they live.
Overall, the Indian health programs have a community-based approach and seek to provide culturallyappropriate services. As demonstrated in this Plan, the IHS system was created for Indian people as a
political class, not as a racial group. These circumstances require unique rules and policies from CMS
to enable IHS-funded programs to fully access Medicare, Medicaid, and CHIP and to achieve the
agency’s health disparities elimination objective.
We outline below some of the unique circumstances of this health system and of Indian Tribes that
have been established or recognized by federal law and regulations:

Limited service population. The IHS health care system is not open to the public. It is
established to serve AI/AN beneficiaries who fall within the eligibility criteria established by the
53
The text of the Addendum is included in the Medicare program's solicitation for applications for new cost plan
sponsors. See, e.g., "Medicare Prescription Drug Benefit, Solicitation for Applications for New Cost Plan Sponsors, 2012
Contract Year," at 131.
60
IHS. See 42 C.F.R. §136.12.54 The IHS estimates the service population served by IHS and
tribally-operated programs in more than 30 states is approximately 2.1 million AI/Ans.

No cost assessed to patients. IHS serves AI/AN beneficiaries without cost. For several years,
Congress reinforced this policy with language in the annual IHS appropriations act that
prohibited the agency to charge for services without Congressional consent.55 IHS services at
no cost to the Indian patient remains IHS policy today. Some members of Congress have
described the IHS as a pre-paid health plan – pre-paid with land ceded by Tribes to the U.S.
government.

Indian preference in employment. Indian preference in hiring applies to the Indian Health
Service. 42 C.F.R. §136.41-.43.56 Such preference also applies to tribally-operated programs
through the requirement that, to the greatest extent feasible, preference for training and
employment must be given to Indians in connection with administration of any contract or
grant authorized by any federal law to Indian organizations or for the benefit of Indians. 25
U.S.C. §450e(b).

Only Tribes have rights under ISDEAA. Indian Tribes (and Tribal Organizations sanctioned by
one/more Tribes) – and only those entities – can elect to directly operate an IHS-funded
program through a contract or compact from the Indian Health Service issued pursuant to the
Indian Self-Determination and Education Assistance Act (ISDEAA). 25 U.S.C. §450 et seq. The
tribal operator receives the program funds the IHS would have used and additional funding for
administrative costs. A tribal operator directly hires its staff and has the authority to re-design
the program(s) it offers.

Federal Tort Claims Act coverage. Pursuant to federal law, tribal health programs and their
employees are covered by the Federal Tort Claims Act (FTCA). 25 U.S.C. §450f, note. For this
54
Under certain circumstances non-Indians connected with an Indian beneficiary (such as minor children and spouses)
can receive services as beneficiaries. Other non-Indians may receive services in carefully defined circumstances, but are
liable for payment. See 25 U.S.C. §1680c.
55
See, e.g., Pub. L. No. 104-134, 110 Stat. 1321-190 (April 26, 1996).
56
See also Preston v. Heckler, 734 F.2d 1359 (9th Cir. 1984) (upholding the Indian Health Service's Indian employment
preference).
61
reason, it is often unnecessary for Tribes to purchase liability insurance for the health services
they operate with federal funding.
57

Use of HHS personnel. To help staff their programs, Tribes and Tribal Organizations are
authorized by law to utilize employees of HHS under Intergovernmental Personnel Act
assignments and commissioned officers of HHS under Memoranda of Agreement. 25 U.S.C,
§450i.

Creation of specific health care providers. Federal law has created health care delivery
providers found only in the Indian health care system. See Community Health Representative
Program, 25 U.S.C. §1616; Community Health Aide Program (CHAP) for Alaska, 25 U.S.C. §1616l.
The Alaska Medicaid Plan reimburses Indian health programs for covered services provided by
CHAPs in Alaska. Through a 2010 amendment to the IHCIA, the Secretary is authorized to
implement a CHAP program for Tribes in the lower 48 states.

IHS as payer of last resort. A longstanding IHS regulation makes IHS programs the payer of last
resort for eligible Indian beneficiaries, notwithstanding any state or local law to the contrary.
42 C.F.R. §136.61. Congress has made this payer of last resort status a statutory requirement
for IHS, tribal, and urban Indian organization programs.57

IHS-specific Medicare and Medicaid reimbursement rates. On an annual basis, the IHS (in
consultation with CMS) establishes the rates at which Medicare outpatient and Medicaid
inpatient and outpatient services provided to eligible Indians shall be reimbursed to IHS
facilities. See, e.g.,77 Fed. Reg. 33470 (June 6, 2012). This is an all-inclusive encounter rate
which is unique to Indian health care. Tribal clinics may instead elect to bill for services as a
Federally Qualified Health Center (FQHC).

100 Percent Federal Medical Assistance Percentage. The cost of Medicaid covered services
provided to AI/ANs in IHS and tribal facilities are reimbursed to the States at 100 percent FMAP
in recognition that the responsibility for Indian health care is a federal obligation. Sec. 1905(b)
of SSA; 42 U.S.C. §1396d(b).
25 U.S.C. §1623(b), as added by Sec. 2901(b) of the Affordable Care Act (P.L. 111-148) (Mar. 23, 2010).
62

No U.S. right of recovery from Tribes. If an Indian Tribe (or a Tribal Organization sanctioned by
one/more Tribes) has a self-insured health plan for its employees, the United States is
prohibited by law from recovering from that plan the cost of services provided unless the
sponsoring Tribe/Tribal Organization expressly authorizes such recovery. 25 U.S.C. §1621e(f).

Indian Tribes are governments. Upon achieving federal recognition, an Indian Tribe is
acknowledged to be and is treated as a government by the United States. The U.S. deals with
Indian Tribes on a government-to-government basis that is recognized in Executive Orders and
consultation policies adopted by federal agencies.58 Indian Tribes determine their own
governmental structure. They are not required to follow the U.S. model of separate legislative,
executive, and judicial branches.

State law does not apply. By virtue of the Supremacy Clause, state laws generally do not apply
to the IHS system.59 The Supreme Court has recognized that Indian tribal governments are not
subject to state laws, including tax laws, unless those laws are made expressly applicable by
federal law. See, e.g., McClanahan v. Arizona State Tax Comm’n, 411 U.S. 1641 (1973). Indian
tribal governments are not political subdivisions of states. Tribal facilities and their employees
may not be required to have state licensure to perform their duties.

Federal trust responsibility. The United States has a trust responsibility to Indian Tribes
(described above).

Tribal sovereign immunity. Indian tribal governments enjoy sovereign immunity except vis-à-vis
the United States government, the superior sovereign. See, e.g., United States v. United States
Fidelity & Guaranty Co., 309 U.S. 506 (1940).
58
See, e.g., Exec. Order No. 13175, "Consultation and Coordination with Indian Tribal Governments (Nov. 9, 2000) (issued
by President Clinton and subsequently endorsed by Presidents George W. Bush and Barack Obama); White House
Memorandum for Heads of Executive Departments and Agencies, Nov. 5, 2009 (President Obama endorsement); Dep't of
Health and Human Services Tribal Consultation Policy (Dec. 14, 2010); Centers for Medicare and Medicaid Services Tribal
Consultation Policy (Nov. 17, 2011).
59
For example, Section 408 of the IHCIA provides that an entity operated by IHS, an Indian tribe, tribal organization or
urban Indian organization that meets state requirements for licensure must be accepted as a provider but is not required to
obtain a state license. 25 U.S.C. §1647a.
63
In sum, an Indian Tribe that has elected to directly operate its health care program can simultaneously
serve in several capacities: as a sovereign government; as beneficiary of IHS-funded health care; as a
direct provider of health care (including the right of recovery from third party payers); as administrator
of a health program with responsibilities for advising its patients about eligibility for Medicare,
Medicaid, and CHIP; and as a sponsor of a health insurance plan for its employees (and the payor
under such a plan if it is a self-insured plan). CMS must take these multiple roles into account and
fashion special policies to effectively implement Medicare, Medicaid, and CHIP in Indian communities
in ways that assure full access by Indian beneficiaries and IHS/tribal providers.
64
[email protected]
February 2, 2015
Jodi A. Gillette
Senior Policy Advisor for Native American Affairs
The White House
Raina D. Thiele
The White House
Re:
Dear Jodi Gillette and Raina Thiele:
On behalf of the National Indian Health Board (NIHB) and the United South and Eastern Tribes,
Inc. (USET), we write to request a meeting with you to discuss the need for relief for Tribes from
the Affordable Care Act’s employer shared responsibility rule (the “employer mandate”).
The Internal Revenue Service’s (IRS) employer shared responsibility rule is inconsistent with the
federal trust responsibility, denies many Tribal members the opportunity to take advantage of the
benefits and protections designed for them in the Marketplace, and chills Marketplace enrollment
for American Indians and Alaska Natives (AI/AN). It is cost-prohibitive for many Tribes and
will result in a diminution of Tribal services for Indian people. If fully implemented in Indian
Country, Tribes will be faced with having to choose between providing coverage, which will
result in reducing governmental services and disqualifying their Tribal member employees from
the benefits and protections for AI/AN in the marketplace, or using scarce federal resources to
pay the IRS substantial penalties if they do not comply. Neither outcome represents good federal
policy.
The employer shared responsibility rule is mandated by Section 4980H of the Tax Code, as
added by Section 1513 of the Patient Protection and Affordable Care Act (ACA) (as amended).1
1
See 26 U.S.C. § 4980h; 26 C.F.R. § 54.4980H–1 - .4980H-5.
February 2, 2015
Section 4980H of the Code does not specifically apply to Tribal governments, and Section
As discussed below, Tribal workforces include a significant number of Tribal member
employees, who are otherwise exempt from the individual mandate. The ACA contains several
provisions designed to encourage AI/AN enrollment in the ACA Marketplaces, including special
cost-sharing exemptions for AI/ANs. The Center for Consumer Information and Insurance
purposes to encouraging Marketplace enrollment, as an offer of coverage to a Tribal member
employee disqualifies that employee from the premium subsidies that are critical to facilitating
Marketplace enrollment. With the employer mandate in place, Tribes are placed in the untenable
position of either having to offer insurance at full price to their Tribal member employees, who
will then be unable to take advantage of Marketplace premium subsidies even if they do not
accept the employer-based coverage, or to forego offering coverage (or offer insufficient
coverage) to their Tribal member employees and pay substantial penalties to the IRS.2
Together, they create a federal policy that is both inconsistent with the right of AI/ANs to obtain
trust-obligated health care without charge to the individual at I/T/U facilities and that forces
many Tribal employers to purchase coverage for workforces largely comprised of Tribal
members who are (1) exempt from the ACA’s individual mandate to obtain coverage and (2)
eligible to obtain health care through the I/T/U system. Finally, application of the employer
mandate will be simply unaffordable to many Tribes and Tribal organizations and act as a barrier
to the provision of critical governmental services.
With the employer mandate deadline taking effect on January 1, 2015, we request consultation
on the need for Tribal relief from the rule as soon as possible.
I.
Background.
Congress has recognized that “[f]ederal health services to maintain and improve the health of the
Indians are consonant with and required by the Federal Government’s historical and unique legal
relationship with, and resulting responsibility to, the American Indian people.”3 The federal trust
responsibility and laws enacted pursuant thereto provide ample authority for the federal agencies
of the Executive Department to design, implement and tailor federal programs in a manner that
2
3
25 U.S.C. § 1601(1).
2
February 2, 2015
recognizes and supports the unique government to government relationship between sovereign
Tribal governments and the United States.4
Congress has also recognized that it is a “major national goal . . . to provide the resources,
processes, and structure that will enable Indian tribes and tribal members to obtain the quantity
and quality of health care services and opportunities that will eradicate the health disparities
between Indians and the general population of the United States.”5 In recognition of this federal
trust responsibility, AI/ANs are eligible to receive care through the Indian Health Service (IHS)
system without charge to the individual patient.6
II.
Discussion.
employers presents three primary problems: (1) it undercuts multiple ACA provisions designed
to encourage AI/AN enrollment in the Marketplaces; (2) it undercuts the federal government’s
trust responsibility by forcing AI/ANs to “pay” for health coverage (whether directly or by proxy
through their Tribal employer); and (3) compliance with the mandate requires a significant
diminution in Tribal governmental services. We discuss each issue in turn.
4
5
25 U.S.C. § 1601(2).
6
42 C.F.R. §§ 136.11 and 136.12.
7
employer mandate).
8
3
February 2, 2015
coverage,9 special AI/AN enrollment periods,10 and the ability for Tribes to assist with
Marketplace plan premium payments for Tribal members.11 Many Tribes and Tribal
organizations have aggressively sought to facilitate AI/AN enrollment in Marketplace plans in
order to take advantage of these protections. However, the employer mandate actively
discourages AI/AN Marketplace participation, in direct contradiction to the provisions described
above.
understanding that Tribal premium sponsorship for member employees does not satisfy the
employer mandate. Tribes will therefore be forced to either continue offering premium
assistance and pay the employer mandate penalty (thus diminishing the funding available for
premium assistance and AI/AN Marketplace enrollment) or else purchase employer coverage
and discontinue premium assistance (which may not be financially viable and which forecloses
Tribes from obtaining a benefit that Congress deliberately granted included in the ACA).
9
42 U.S.C. § 18071(d).
10
42 U.S.C. § 18031(c)(6)(D).
11
25 U.S.C. §§ 1642, 1644.
12
4
February 2, 2015
coverage.
year.14
13
26 U.S.C. § 36B(2)(B); 26 U.S.C. § 5000A(f)(1)(B), (f)(2).
14
4980H(c)(2)(D); 26 C.F.R. § 54.4980H–1(a)(41).
5
February 2, 2015
penalty costs.
15
6
February 2, 2015
mandate, or a disqualification of AI/ANs from their statutorily-established Marketplace benefits
and protections. The end result is that the Tribe must either bear the burden of paying for
expensive and/or low-quality coverage or else subject itself to significant employer mandate
so that they can qualify for the benefits and protections in the Marketplace to which they are
individual. However, IHS is chronically underfunded and AI/ANs continue to suffer the highest
purchase of employee health insurance.
system. The trust responsibility neither envisions Tribes as middlemen for transactions between
private insurers and IHS nor Tribal “funding” of federal agencies through the payment of
penalties.
16
FOR
17
health markets).
7
February 2, 2015
Employer Mandate.
W-2 forms.19 As discussed above, the IRS should similarly exempt Tribes and Tribal
organizations from the employer mandate.
18
19
8
February 2, 2015
“applicable large employers” subject to the mandate does not explicitly include Indian Tribes. 20
employer member.
employer.
....
U.S.C. § 1603).
20
21
22
grant awards).
23
24
Reg. 8,544 (Feb. 12, 2014); 26 C.F.R. § 54.4980H–1(a)(23).
9
III.
February 2, 2015
Conclusion.
The ACA employer mandate creates an impossible choice for Tribal governments, forcing them
to either pay for the cost of insurance for Tribal member employees who are otherwise exempt
from having to obtain coverage, or pay a tax penalty in order to ensure that Tribal member
employees qualify for the benefits and protections to which they are entitled. The mandate
discourages Tribes from facilitating AI/AN Marketplace enrollment, requires Tribes to pay an
individual mandate penalty by proxy on behalf of its AI/AN employees, and precludes AI/AN
eligibility for tax credits. The mandate also acts as a federal directive that many AI/ANs pay for
their health care in circumvention of the trust responsibility. Finally, the mandate is unaffordable
for many Tribes, as Tribes will pay for both the penalties and the insurance payments with
already-scarce resources that would be far better allocated towards funding direct Tribal services
and programs. We therefore ask that the IRS exercise its legal authority to provide categorical
relief for Indian Tribes, Tribal organizations, and Urban Indian Organizations from the employer
mandate.
employer mandate.
Sincerely,
10
P.O. Box 1734, McAlester, Oklahoma 74501
Telephone (918) 302-0252 – Facsimile (918) 423-7639 – Website: www.tribalselfgov.org
WORKGROUP REPORTING FORM
NAME OF WORKGROUP (please check which Committee this report will be for)
Technical Workgroup
HHS Secretary’s Tribal Advisory Committee (STAC)
Budget Formulation Workgroup
Facilities Appropriation Advisory Board (FAAB)
Tribal Leaders Diabetes Committee (TLDC)
AI/AN Health Research Advisory Group
TTAG: Sept. 9, 2015
DATE OF
MMPC: Sept. 3, 2015
MEETINGS
COMMITTEE CHAIRMAN W. Ron Allen
Information Systems Advisory Committee (ISAC)
Contract Support Costs (CSC) Workgroup
Health Promotion/Disease Prevention Policy Group
CDC Tribal Consultation Advisory Committee
(TCAC)
x
Tribal Technical Advisory Group (CMS-TTAG)
HHS Self-Governance Tribal Federal Workgroup
(SGTFW)
All teleconferences
LOCATION OF
MEETINGS
Mim Dixon
ATTENDANCE (please list all present during the meeting)
W. Ron Allen, Melanie
Mim Dixon, Doneg
Fourkiller
McDonough, Technical
Advisors
COMMITTEE RECORDER
AGENDA ITEM
SUMMARY/HIGHLIGHTS (Committee action should be noted in this section)
Expanding 100% FMAP
CMS has received requests from Alaska and South Dakota to apply the 100% FMAP for
Medicaid services in Tribal and IHS facilities to additional services outside the walls of the
facilities, including transportation, telemedicine, specialty medical care, and CHRs.
Oklahoma has requested 100% FMAP to purchase health plans for American Indian
Medicaid beneficiaries. CMS has held meetings with Tribes in each state, as well as two
All Tribes teleconferences and a listening session on Sept. 21, 2015, to consider these
specific state requests related to funding Medicaid Expansion, as well as applying the
expansion nationally. Tribes have supported the expansion of 100% FMAP.
CMS has held several teleconferences and a listening session on Sept. 21, 2015, related
to changing requirements for referral forms from the I/T/U for AI/AN enrolled in limited cost
sharing plan variations through the Marketplace. The issue arose from a plan in Alaska
that wants to impose additional requirements. Tribes have supported keeping the existing
guidance, and the option for “blanket” or comprehensive referrals. Also, TTAG sent a
letter to CCIIO requesting confirmation that eligibility determinations are being made
correctly for the “03”/limited cost-sharing protections for AI/ANs enrolled in Marketplace
coverage. CCIIO has responded by confirming that the “03/L-CSV” applies to AI/AN under
100% FPL and CCIIO is in the process of confirming that eligibility determinations are
being made through the FFM accordingly.
The Employer Mandate in ACA requires all employers with more than 50 full time
equivalent employees to offer health insurance or pay a fixed amount to the federal
government. Some Tribes feel that this is creating an economic hardship and is not
consistent with the federal trust responsibility. One Tribe filed a lawsuit against the
mandate, and has now appealed a negative ruling on their lawsuit. Along with other
national Indian organizations, NIHB/TSGAC/NCAI/DSTAC leadership attended a White
House meeting on this issue on Sept. 10, 2015. A Tribal-preferred administrative fix is
under development. Obama Administration feedback suggests Tribes should limit their
request to exemption for Tribal employees who are also Tribal members. NIHB is also
working with Congress on a legislative fix.
A provision in ACA would create a tax on insurance issuers that would likely be passed
along to employers if the cost of health insurance exceeds a fixed amount. Depending on
how the cost of insurance is calculated this could be costly for Tribes. NIHB has
submitted comments to IRS asserting that Tribes are exempt from this provision in ACA.
IRS is soliciting additional comments that are due by October 1, 2015.
Issues related to Limited
Cost Sharing Plans for AI/AN
through the Marketplace
Exemption to Tribal
Employer insurance mandate
Tribal Exemption to “Cadillac
Tax” provision in ACA
AI/AN Exemptions to the
Individual Mandate for
insurance under ACA
Managed Care Regulations
CMS Tribal Consultation
Policy
AI/AN Enrollment in
Medicaid, CHIP and
Marketplace plans
CCIIO Tribal Workgroup
I/T/U Participation in QHP
provider networks
Definition of Indian in
Exchanges
Payment for Services
provided by Tribes
Medicare Provider-based
rules
Medicare Payment Reforms
Medicaid Estate Recovery
CMS announced in September that they are considering delegating full authority to IRS
for issuing the exemptions to the Individual Mandate for AI/AN enrolled Tribal members
and shareholders in ANSCA corporations, and IHS beneficiaries. In the past, the
Marketplace also issued certificates of exemption, but this activity would be discontinued if
authority to issue exemptions were fully transferred to the IRS by HHS.
The Managed Care regulations are being revised by Medicaid for the first time since
2003. The Notice of Proposed Rule Making (NPRM) was released on May 26, 2015 and
comments were submitted July 27, 2015.
The CMS AI/AN Strategic Plan Addendum calls for the CMS Tribal Consultation Policy to
be revised by November 2014. CMS held an All Tribes call on this on September 15, and
comments were due by October 1, 2014. CMS provided further edits to the Tribal draft
that was submitted in December 2014. This revised policy has not yet been completed.
rd
The Treasury Department issued its final Tribal Consultation policy on September 23 .
TTAG Data Subcommittee met by teleconference on May 26, 2015, to review two tables
of summary data provided by CMS. For all the FFM, only 125,882 AI/AN individuals
applied and 66 percent (83,654) were determined eligible for QHPs and less than one
percent (799) were eligible for Medicaid. Among Tribal members determined eligible for
QHPs, only 20 percent (26,256) selected plans. The data raise questions about whether
people are being properly enrolled in limited cost sharing plans.
At the TTAG meeting on November 19, 2014, CCIIO Director Kevin Counihan offered to
establish a joint CCIIO/Tribal Workgroup. One meeting has been held to date.
The CMS 2015 letter to issuers requires all QHPs in the FFM to make a good faith effort
to offer contracts with the contents of the Indian Addendum to all I/T/Us. CMS has
reported that all QHPs have provided contracts with the Indian Addendum to all I/T/Us. In
response to concerns from THOs that the QHP issuers were not fully complying with
these requirements, TSGAC prepared a report on this issue. The report determined
compliance was not uniform, and many QHPs had zero I/T/Us in their plan networks.
TSGAC/TTAG recommended: 1) the requirements on QHP be put into regulations; and,
2) the requirements under the FFM be extended to state-operated Marketplaces. CCIIO is
using the report to engage specific QHP issuers on compliance issues
TTAG, NCAI, NIHB, and TSGAC leadership and technical advisors are continuing to look
for a vehicle for a legislative fix for the definition of Indian in ACA. Recent budgets
passed by both the House and the Senate have included language directing HHS to
better synchronize the various definitions of Indian.
Recent analysis has shown that cost sharing reductions are not being applied properly for
people who have insurance through the FFM and receive services at a Tribal facility (and
also at non-ICHPs). This may be a result of the improper assignment of people to limited
cost sharing plans. TSGAC technical advisors have worked with NIHB to write a letter
about this problem, and it has been on the CCIIO Work Group agenda, but no meeting
has been held.
CMS has held Tribal Consultation on grandfathering the use of the Encounter Rate for
Medicare for hospital-based provider services. Recent interpretation that hospitals and
clinics are required to have same operating Board is a threat to Tribal sovereignty and the
self-determination/self-governance process.
Value based purchasing and other payment reforms may reduce Medicare payments for
IHS and Tribal hospitals that do not score high enough on quality measures. MMPC has
formed a workgroup to consider these issues.
While this applies primarily to people over 55 who may not otherwise qualify for long term
care or community-based services, fear of estate recovery deters others from enrolling in
Medicaid. STAC has requested the HHS Secretary to use her authority to waive estate
recovery for AI/AN. CMS is working with the TTAG Outreach and Education
Subcommittee to develop consumer education materials on Medicaid estate recovery.
RECOMMENDED TSGAC ACTIONS
1.
2.
3.
4.
Legislative advocacy:
a. Make the definition of Indian in ACA the same as in Medicaid.
b. Statutory requirement for Medicare-like rates for ambulatory services provided through CHS/PRC.
c. Exempt Tribes from the employer mandate under ACA, and reaffirm that Tribes are exempt from
“Cadillac Tax.”
Advocate with HHS Secretary to:
a. Use authority for an administrative fix for definition of Indian in ACA.
b. Use existing authority to waive Medicaid estate recovery for AI/AN.
Continue to monitor developments in the implementation of ACA, participate in Tribal Consultations and policy
subcommittees, and make formal comments. Current focus is:
a. Proper assignment of people to limited cost sharing plans and proper application of cost sharing
reductions in payment of invoices for services provided by I/T/U.
b. Data for better monitoring of enrollment.
c. Network adequacy and assuring the IHCPs receive contracts with the Indian Addendum.
Advocate for implementation of the CMS AI/AN Strategic Plan, 2015-2018, as revised Feb 20, 2014.
2120 L Street, NW, Suite 700
T 202.822.8282
F 202.296.8834
HOBBSST RAUS.CO M
MEMORANDUM
September 8, 2015
TO:
Tribal Health Clients
FROM:
Hobbs, Straus, Dean and Walker LLP
Re:
ALERT – CMS Soliciting Tribal Comments on Whether to Expand
Interpretation of 100% FMAP Rule to Purchased/Referred Care Services;
Announces Two All Tribes Calls on Sept. 11 and 16th.
The Center for Medicare and Medicaid Services (CMS) is actively considering
whether to expand its existing interpretation of the 100 percent Indian Federal Medical
Assistance Percentage (FMAP) rule to cover purchased/referred care services (formerly
known as contract health services). Under the Medicaid program, the United States and
the States share the cost of providing Medicaid services. For “regular” Medicaid, the
United States between 50-72 percent (with a maximum of 82 percent). For the Medicaid
expansion population, the United States pays 100 percent until 2016, and then phases
down to 90 percent in years 2020 and beyond. The FMAP for services “received
through” the IHS or a tribal health facility, however, is 100 percent.
The tribal 100 percent FMAP rule is found in Section 1905(b) of the Social
Security Act, and was enacted when the IHS system was first authorized to bill the
Medicaid program in 1976 in order to ensure that States did not have to bear the costs
associated with such services. CMS interpretation of the scope of the 100 percent FMAP
rule has evolved over time. For the first 20 years of its implementation, CMS took the
view that it applied only in facilities owned by the IHS. Then in 1996, CMS entered into
an MOA with the IHS in which it announced that it was revising its interpretation so that
the rule would also apply in tribally owned facilities operated under an Indian SelfDetermination and Education Assistance agreement.
Twenty more years has passed, and CMS is now actively considering whether to
expand its interpretation once again. The States of South Dakota and Alaska, and to a
lesser extent, Oklahoma, have all proposed tribal Medicaid waivers which seek to expand
the scope of CMS’s interpretation of the rule to cover Purchased/Referred Care services.
Under CMS’s existing interpretation, the 100 percent FMAP rule applies to:
(1) all services provided within an IHS or tribal facility;
HOBBS STRAUS DEAN & WALKER, LLP
WASHINGTON, DC
|
PORTLAND, OR
|
OKLAHOMA CITY, OK
|
SACRAMENTO, CA
MEMORANDUM
September 8, 2015
Page 2
(2) services provided by other providers within those facilities through arrangements (i.e,
contracts) with outside providers; and
(3) services provided beyond the four walls of the facility through contractual
arrangements, so long as the service is billed by the facility itself (i.e., contracts with
outside specialists like teleradiology, etc.).
Purchased/Referred care services are not covered under its existing interpretation,
however.
The 100 percent FMAP rule should apply to purchased/referred care services. Section
1905(b) of the Social Security Act provides that it applies to all services “received
through,” the IHS or tribal health facilities, and the purchased/referred care program is a
program provided through the IHS and tribal health facilities.
Expanding CMS’s existing interpretation to cover purchased/referred care services will
benefit IHS and Tribal health programs by allowing States to expand coverage for
AI/ANs, either by covering additional population groups or additional services at no cost
to the State. This could result in significant savings to purchased/referred care budgets.
South Dakota, for example, has proposed expanding Medicaid if CMS expands its
interpretation of the rule to cover purchased/referred care. Because purchased/referred
care is the payor of last resort, Medicaid expansion will allow the IHS and tribes in that
State to save significant health care resources which could be used to provide higher level
priorities of care and fewer purchased/referred care denials.
CMS just announced two all Tribes’ calls on this proposal; one on Sept. 11 and one on
Sept. 16th (Attached). CMS is also holding a tribal consultation in person prior National
Indian Health Board’s annual consumer conference. While CMS has not announced a
timetable for reaching a decision on this important issue, it appears that a decision is
imminent. Tribes are developing comments in support of this proposal. Please let us
know if you would like assistance in drafting comments as well.
****
For further information on this proposal, please contact Elliott Milhollin at (202) 8228282 or [email protected] or Geoff Strommer at (503) 242-1745 or
[email protected].
HOBBS STRAUS DEAN & WALKER, LLP
WASHINGTON, DC
|
PORTLAND, OR
|
OKLAHOMA CITY, OK
|
SACRAMENTO, CA
Sent Electronically to: [email protected]
August 4, 2015
Mr. Robert G. McSwain, Principal Deputy Director
U.S. Department of Health and Human Services
Suite 440, The Reyes Building
801 Thompson Avenue
Rockville, MD 20852-1627
RE:
Quality Reporting Measures
Dear Principal Deputy Director McSwain:
On behalf of the Tribal Self-Governance Advisory Committee (TSGAC), I am writing to
provide you with our recommendations regarding quality reporting measures and to request IHS
to conduct an analysis. As you are aware, the trends for both Medicare and Medicaid are to
require providers to utilize their electronic medical records as part of clinical quality
management. TSGAC and the Tribal Technical Advisory Group (TTAG) for the Centers for
Medicare and Medicaid Services (CMS) have had discussions with CMS about using GPRA
measures instead of the clinical quality management approaches. However, it appears that
those recommendations have not gained any traction in CMS or HHS.
The proposed Medicaid Managed Care regulations1 intend to align the Medicare and
Medicaid quality measures so that health care delivery systems do not duplicate their efforts.
We believe that the IHS and Tribes should also be aligning their quality assurance with the
Medicare and Medicaid approaches, particularly since there may be economic consequences
with regard to revenue from these important sources of payment for services.
Therefore, we would like to request that IHS conduct an analysis and comparison of the
GPRA and Clinical Quality Management approaches. This analysis could include the following
information:
a.
Timelines for each (Are they the same or different?)
b. Type of data collection (What types of data are being collected? Are they the same or
different?)
c. Cost of data collection (What is the cost, to include equipment and software and human
resources, of GPRA data collection system wide? How does that compare to the
estimated cost of collecting data under Clinical Quality Management approaches that are
in regulation or proposed regulations? What is the cost of doing both, versus one or
another?)
1
Medicaid and Children’s Health Insurance Program (CHIP) Programs; Medicaid Managed Care, CHIP
Delivered in Managed Care, Medicaid and CHIP Comprehensive Quality Strategies, and Revisions
Related to Third Party Liability; Proposed Rules, 80 Fed. Reg. 31,097 (June 1, 2015) (“Proposed Rule”).
Letter to Robert G. McSwain, Principal Deputy Director, IHS
August 4, 2015
Re: Quality Reporting Measures
Page 2
____________________________________________________________________________________
Many Self-Governance Tribes have been actively involved in GPRA pilot projects over the
past several years. It would be helpful to know how many Self-Governance Tribes are reporting
GPRA data and how many are not.
The reason we are asking IHS to conduct this analysis and provide a written report is that
we think it is important for the IHS and Tribes to work together on a common goal. That goal
could be to exempt Indian health from GPRA reporting, or it could be to use GPRA instead of
Medicare and Medicaid clinical quality measures. Alternatively, we may find that there is no
duplication of effort and the costs of doing both are negligible. Before we can make a
recommendation on this important topic, we need to be better informed about the consequences
of each approach.
We would like to put this important topic on our agenda for the next TSGAC quarterly
meeting on October 6, 2015 and request that you assign someone to conduct this analysis and
present a report of the findings at that meeting.
Should you need additional information or have questions regarding this letter and request,
please contact me at (860) 862-6192; or via email: [email protected]. Thank you.
Sincerely,
Chief Lynn Malerba, Mohegan Tribe
Chairwoman, TSGAC
cc:
P. Benjamin Smith, Director, OTSG, IHS
TSGAC and Technical Workgroup
Submitted via http://regulations.gov
February 4, 2015
Ms. Betty Gould,
Regulations Officer,
Indian Health Service,
801 Thompson Avenue,
TMP STE 450,
Rockville, Maryland 20852
Mr. Carl Harper, Director
Office of Resource Access and Partnerships,
Indian Health Service,
801 Thompson Avenue,
Rockville, Maryland 20852
Re:
Comments on IHS Proposed Rule entitled “Payment for Physician and Other
Health Care Professional Services Purchased by Indian Health Programs and
Medical Charges Associated with Non-Hospital-Based Care,” 79 Fed. Reg. 72160
(Dec. 5, 2014)
On behalf of the Indian Health Service Tribal Self-Governance Advisory Committee (TSGAC), I
write to offer the following comments on the Indian Health Service’s (IHS) Proposed Rule to
expand the Medicare-Like Rate entitled “Payment for Physician and Other Health Care
Professional Services Purchased by Indian Health Programs and Medical Charges Associated
With Non-Hospital-Based Care,” 79 Fed. Reg. 72160 (Dec. 5, 2014) (the “Proposed Rule”). I
strongly support expanding Medicare-Like Rates beyond hospital-based providers, and believe
that the Proposed Rule is a good step towards achieving that goal.
However, as drafted the Proposed Rule does not provide the flexibility that is necessary to ensure
continued access to care for American Indians and Alaska Natives (AI/ANs) through the
Purchased/Referred Care (PRC) programs. Without a mechanism to ensure such flexibility, the
Proposed Rule could operate to deny many AI/ANs access to critically important and life-saving
services. Enclosed are TSGAC’s proposed revisions to the Proposed Rule in redline format.
These proposed changes provide the flexibility needed to ensure continued access to care while
still lowering costs. As discussed below, TSGAC believes the Proposed Rule cannot work
without these revisions, and as a result cannot support the Proposed Rule without these revisions.
TSGAC urges the IHS to finalize the rule with the revisions indicated below as a Final Rule. If
the IHS decides to revise the rule differently, we ask IHS to refrain from issuing the rule as it is
too restrictive. In either case, as discussed below, we request Tribal Consultation on the
Proposed Rule.
TSGAC Comments on IHS Proposed Rule entitled “Payment for Physician and Other Health Care
Professional Services Purchased by Indian Health Programs and Medical Charges Associated with NonHospital-Based Care,”
February 4, 2015
Page 2
Below are our general comments on the Proposed Rule followed by an explanation of our
proposed revisions.
I.
General Comments on the Proposed Rule
a.
The Proposed Rule Addresses a Critical Need
According to the Proposed Rule, Indian Health Service (IHS), Indian Tribes and Tribal
organizations (collectively, I/T/U) would cap the rates that they will pay for hospital services to
what the Medicare program would pay for the same service (the "Medicare-Like Rate").
However, this Medicare-Like Rate cap applies only to hospital services, which represent only a
fraction of the services provided through the PRC system. 25 C.F.R. § 136.30.
PRC programs continue to routinely pay full-billed charges for non-hospital services, including
physician services. As data recently released by the Center for Medicare and Medicaid Services
(CMS) demonstrate, full-billed charges may have no relationship to costs, and are dramatically
higher than the rates Medicare, or even private insurance would pay for the same services.1 Yet
PRC programs remain the only entities other than the uninsured that continue to routinely be
charged and pay full-billed charges for non-hospital services.
This has had a dramatic impact on the lives of Indian people. The PRC budget is significantly
underfunded. As IHS noted in the Proposed Rule, it recently reported to Congress that IHS and
Tribal PRC programs denied an estimated $760,855,000 for an estimated 146,928 contract care
services needed by eligible beneficiaries in FY 2013. The denial of needed services throughout
the IHS system is endemic, and year after year it leads to unnecessary health care complications
and the progression of otherwise treatable conditions.
Due to the lack of funding, PRC programs are routinely forced to ration care, and are often only
able to authorize care in extreme “life or limb” scenarios. This rationing of care often results in
otherwise preventable or treatable conditions going undiscovered until they become sufficiently
acute that a referral can finally be authorized. Tragically, and too often, this can result in patients
whose conditions would have been treatable through early detection progressing to a point where
treatment is no longer possible. It can also lead to simply medicating a condition rather than
treating it.
The cost-savings achieved by expanding Medicare-Like Rates beyond hospital providers will
allow PRC programs to allow higher priority levels of care. This will enable PRC programs to
begin authorizing referrals for preventive care and diagnostics so critical to positive health care
outcomes. It is also significantly more efficient, as the cost of preventive care and early
detection is significantly lower than the referrals for acute “life or limb” treatment that PRC
programs are often forced to limit themselves to approving.
1
http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-ProviderCharge-Data/index.html.
2
February 4, 2015
Page 3
b.
The GAO Report Highlights the Need for Medicare-like Rates
In April 2013, the Government Accountability Office (GAO) issued a report concluding that the
Medicare-like Rate Cap should be expanded to cover all services purchased under the contracthealth services (CHS) program. The GAO concluded that “Congress should consider imposing a
cap on payments for physician and other nonhospital service made through IHS’s CHS program
(now referred to as PRC) that is consistent with the rate paid by other federal agencies.” The
Department of Health and Human Services (HHS) reviewed the report and concurred with the
GAO’s conclusions and recommendations.
The GAO Report examined data for IHS’s federal CHS programs, concluding that a cap on
Medicare-like rates for nonhospital services would save the IHS CHS program an estimated
$31.7 million annually.
The GAO found that the vast majority of federal CHS program payments were made at nonnegotiated rates. The GAO reported that over 80 percent of IHS’s federal CHS program
payments to physicians for services were made at non-negotiated rates, totaling approximately
$50.5 million. Additionally, GAO found that approximately 77 percent of federal CHS program
payments to other types of nonhospital providers were made at billed rates rather than negotiated
rates, totaling approximately $52.1 million.
The payment of non-negotiated rates cost IHS’s federal CHS program significantly more than
negotiated rates. The GAO estimated that federal CHS programs paid approximately twice as
much as Medicare would have paid for the same services and one and a quarter times the amount
that private insurance would have paid. The GAO found that where IHS CHS programs
contracted rates, they saved approximately 58 percent in physician rates and approximately 68
percent in rates for other nonhospital providers.
The GAO concluded that applying a Medicare-like Rate cap to nonhospital services would allow
IHS to spend its resources more effectively and provide approximately 253,000 additional
physician services annually. The GAO stated that IHS is “a steward of public resources” and is
therefore “responsible and accountable for using taxpayer funds efficiently and effectively.”
GAO emphasized that implementing a Medicare-like rate cap for all services purchased under
the CHS program “would enable IHS to achieve needed savings that could be used to expand
patient access to care.”
c.
The Proposed Rule is Consistent with the Federal Trust Responsibility and Will
Bring IHS in Line with other Federal Health Care Providers
The United States has a federal trust responsibility to provide health care to American Indian and
Alaska Native people, which has been recognized by Congress in numerous federal statutes,
including the Snyder Act, 25 U.S.C. § 13; Johnson-O'Malley Act, 25 U.S.C. § 452; Transfer Act,
42 U.S.C. § 2001, et seq. (transferred responsibility for Indian health to Public Health Service);
Indian Health Care Improvement Act, 25 U.S.C. §1601, et seq. (recently amended and
permanently reauthorized as part of the Patient Protection and Affordable Care Act, P.L. 111-148
3
February 4, 2015
Page 4
(Mar. 23, 2010)). As Congress has stated: “Federal health services to maintain and improve the
health of American Indians and Alaska Natives are consonant with and required by the Federal
Government's historical and unique legal relationship with, and resulting trust responsibility to,
the American Indian and Alaska Native people.” 25 U.S.C. § 1601(1).
The current system results in the rationing of care, a result that is fundamentally at odds with the
federal trust responsibility. While the Proposed Rule would not in and of itself provide full
funding for PRC so as to meet all remaining unmet needs in Indian country, it would represent a
giant step forward for the Administration in implementing the Federal Trust responsibility.
The Proposed Rule (as amended in our proposal) would bring IHS billing and payment policy in
line with other federal agencies, such as the Department of Veterans Affairs (VA) and the
Department Of Defense (DOD), which already impose a Medicare-equivalent rate for nonhospital services. The VA, for example, has imposed a Medicare-Like Rate cap on the care it
purchases for Veterans since 2010. 75 Fed. Reg. 78901 (Dec. 17, 2010). In addition, on
November 5, 2014 the VA issued an interim final rule that would impose a Medicare-Like Rate
cap on the services it was recently authorized by Congress to purchase through the Veterans
Access, Choice, and Accountability Act of 2014 (Act), Pub. L. 113-146. The Proposed Rule
would bring the IHS in line with the VA and other federal programs such as the Medicare
program by making the rate the IHS pays for medical services consistent with the rates paid by
other federal programs.
d.
The Proposed Rule’s Potential Impact on Individual Providers is Likely to Be
Minor
While the Proposed Rule would provide an enormous benefit to the IHS and Tribal health care
programs, its impact on individual providers is likely to be minor. One of the significant goals of
this Administration is to lower the cost of health care in the United States. Yet current policy
appears to allow the IHS and Tribal programs to continue to pay full-billed charges for the health
care services they purchase from non-hospital providers. Individual providers should not be able
to continue to charge the most underfunded programs in the nation the highest rates for care.
Those rates are often magnitudes higher than market rates, let alone the rates paid by other
federal programs.
American Indians and Alaska Natives make up only 1 percent of the Nation’s population, and as
a result are in nearly every case a mere fraction of individual providers’ patient loads. In its
report, the GAO found that the expansion of Medicare-like Rates would not be likely to have a
significant impact on physicians, including the top billers to PRC programs. The GAO
interviewed physicians among the federal PRC programs’ top 25 percent of physicians in terms
of volume of paid services, and most of the physicians interviewed indicated that the CHS
program constituted a small portion of their practice, accounting for 10 percent or less of their
total payments. A majority of the physicians interviewed supported capping PRC program
payments at Medicare-like rates and identified several advantages, noting the savings to IHS, the
decrease in the amount of time physician practices spend negotiating with different CHS
4
February 4, 2015
Page 5
programs, the fact that Medicare rates are already nearly universally accepted by physicians, and
the fact that such a cap would lead to a consistent payment methodology.
Most hospital officials that the GAO interviewed stated that the current Medicare-like Rates
requirements had little or no financial effect on their hospitals. However, the current Medicarelike Rate requirements, according to GAO interviews, allowed IHS and Tribal programs to
expand access to care. The same should hold true for practice groups and other types of nonhospital providers.
In addition, implementing Medicare-Like Rates for non-hospital providers will not impact total
funding for the PRC program, which will remain unchanged. Because more AI/ANs will have
access to care if Medicare-Like Rates are expanded, they will increase the volume of services
being sought, which will result in providers achieving more volume to offset the decrease in
rates.
e.
Provider Outreach and Monitoring and Reporting is Needed
If the Proposed Rule is revised and implemented as suggested in these comments, IHS should
engage in provider outreach and monitoring to ensure the rule is effectively implemented. If a
Final Rule is issued, the IHS Director, in collaboration with Tribes, should develop and issue a
“Dear provider letter” for all I/T/U’s to use to educate their network of providers regarding this
regulation. Education and outreach to providers will be a critical component in successfully
implementing the rule.
The IHS should also develop and implement a process in consultation with Tribes to monitor and
report on the success of the Rule once it is implemented. As part of any Final Rule, the IHS
should commit to developing a report within 12 months of the effective date of the rule, and
annually thereafter, that would include an assessment of:





II.
The number of programs by region that have implemented the Rule;
The actual number of PRC visits each year by region to demonstrate the increase in
referrals seen by providers;
The savings achieved by PRC programs by region;
The number of providers by region who refuse to accept the rate, type of provider and
location of that provider;
Identify barriers to implementation of the Rule.
Summary of Attached Redline Revisions to Proposed Rule
As discussed above, while TSGAC supports the Proposed Rule’s goal in expanding a MedicareLike Rate cap to non-hospital providers, we are concerned that the Rule as drafted is too
inflexible and could result in significant diminution in access to care in different areas of the
country. We have provided suggested revisions to the Proposed Rule which we believe are
necessary to provide the flexibility some PRC programs need to ensure continued access to
5
February 4, 2015
Page 6
providers while maintaining the integrity of Medicare-Like Rates as a general rule. We provide
a narrative summary and justification for our proposed changes below.
a.
The Proposed Rule Should Not Imply that Professional Services Are Never
Covered by the Existing Medicare-Like Rate Regulations
The Title to Subpart I is “Limitation on Charges for Health Care Professional Services and NonHospital-Based Care.” Similarly, the Title for Section 136.201 is “Payment for physician and
other health care professional services purchased by Indian health programs and other medical
charges associated with non-hospital-based care.” Both titles suggest that care provided by
physicians and other health care professionals is never subject to the current Medicare-Like Rate
regulations. That is not the case.
The current Medicare-Like Rate regulations apply to “all Medicare-participating hospitals, which
are defined for purposes of this subpart to include all departments and provider-based facilities of
hospitals (as defined in sections 1861(e) and (f) of the Social Security Act) and critical access
hospitals (as defined in section 1861(mm)(1) of the Social Security Act), that furnish inpatient
services ….” 25 C.F.R. § 136.30(a). The payment methodology of the current regulations
applies to “all levels of care furnished by a Medicare-participating hospital, whether provided as
inpatient, outpatient, skilled nursing facility care, as other services of a department, subunit,
distinct part, or other component of a hospital (including services furnished directly by the
hospital or under arrangements) ….” 25 C.F.R. § 136.30(b).
This includes physicians and other health care professionals if they are employed directly by the
hospital or even “under arrangements.” As a result, if the hospital bills for a professional’s
services as part of the hospital (i.e., under the same provider number), then the existing
Medicare-Like Rate regulations apply.
We propose edits to the Proposed Rule to clarify that it applies to all non-hospital providers
(including non-hospital based physicians and other health care professionals).
b.
§ 136.201(a)(1)(3)
Section 136.201 of the Proposed Rule states that I/T/Us may only pay the lowest of either (1) the
Medicare-Like Rate; (2) a rate negotiated by the I/T/U or its repricing agent; or (3) the amount
the provider “bills the general public for the same service.” We are concerned that the criterion
the amount the provider “bills the general public” for the same service is too vague. The term
“general public” is subject to multiple interpretations. We believe the intent of the provision is
to cover the amount the provider “accepts as payment for the same service from
nongovernmental entities, including insurance providers.”
6 14
February 4, 2015
Page 7
c.
Need for Exceptions in New Section 136.201(b)
Section 136.201(a) of the Proposed Rule provide that that Medicare-Like Rates are the highest
rates the IHS could pay. As summarized in the Preamble, “The rule caps the rate that I/T/Us are
authorized to pay non-I/T/U health care providers and suppliers for services and leaves no
discretion for the I/T/U and the health care provider to negotiate higher rates.”
While this lack of discretion is likely intended to make the rule as strong as possible, it renders it
unworkable in many areas in Indian country. We are concerned that the absolutist approach
taken in Section 136.201(a) will deny many I/T/Us the discretion and flexibility they need to deal
with unique circumstances that may necessitate negotiating a rate that is different from, or even
higher than, the Medicare-Like Rate. Flexibility is one of the foundational principles underlying
the Indian Self-Determination and Education Act and Tribes and Tribal Organizations who
negotiate agreements under that Act with the IHS should have the right to choose not to apply
this new rule if they choose to do so. Similarly, urban Indian organizations should be given this
same right to ensure that they can decide for themselves if they want the rule to apply.
Further, unless the Proposed Rule is amended to allow for the possibility of an exception to the
general rule, it will operate to deny access to certain providers who will refuse to take the
Medicare-Like Rate. This is particularly true in rural areas where access to care is more limited,
and certain types of providers may be the only accessible provider of that type. If there is no
possibility for an exception to this rule, certain providers may simply refuse to see patients,
necessitating referrals to other providers so distant that the cost of traveling to see them will
negate any benefit from requiring payment at the Medicare-Like Rate.
The VA recognized access to care could be an issue, and has implemented its Medicare-Like
Rate regulations to address access to care issues in both Alaska and the lower 48 states. 38
C.F.R. §§ 17.56(a); 17.1535. We believe the IHS must adopt a similar approach in its Rule. We
offer the following exception to implement this needed approach.
i.
Exception at Election of I/T/U
As discussed above, in order for the rule to work, it is imperative that it contain a “safety valve”
that would allow Indian health care providers to negotiate a different rate than the rates set out in
Proposed Section 136.201(a) in order to ensure continued access to care. We have proposed two
new provisions that offer safety valves for I/T/Us in different circumstances around the country.
The first provision, set out in section 136.201(b) (1), is designed for Tribes and Tribal
Organizations who have negotiated agreements with the Indian Health Services under the Indian
Self-Determination and Education Act and urban Indian organizations, and makes it clear that
they have the right to choose for themselves not to apply this rule.
We also propose that a new Section 136.201(b) (2) be added to the Proposed Rule. This new
section would allow I/T/Us, when necessary, to negotiate a rate with providers that is higher than
7
February 4, 2015
Page 8
the rate provided for in Proposed Section 136.201(a). However, we also propose that such rate
be capped at no more than what the provider certifies to the I/T/U that it charges nongovernmental entities, including insurance providers, for the same service. This structure should
provide I/T/Us the flexibility they may need to ensure continued access to care from certain
providers, while at the same time ensuring that rates of payment are no more than what other
non-governmental entities pay for the same services.
III.
Request for Tribal Consultation on the Proposed Rule
The Proposed Rule would have significant Tribal implications and substantial direct effects on
one or more Indian Tribes. As a result, pursuant to the HHS Tribal Consultation Policy, Tribal
Consultation is required. While TSGAC welcomes the opportunity to comment on the Proposed
Rule through the notice and public comment process required by the Administrative Procedure
Act, the HHS, acting through the Director of the IHS, must also engage in Tribal Consultation on
the Proposed Rule before any action is taken to finalize the rule.
We thank you for the opportunity to submit these comments, and look forward to being able to
engage in Tribal Consultation on the proposal as well.
Respectfully submitted,
Marilynn “Lynn” Malerba
Chief, The Mohegan Tribe of Connecticut
Chairwoman, Tribal Self-Governance Advisory Committee
Board Member, Self-Governance Communication and Education Tribal Consortium
Enclosure:
Proposed redline changes to the Proposed Rule
8
For the reasons set forth in the preamble, the Indian Health Service proposes to amend 42
CFR chapter I as set forth below:
PART 136—INDIAN HEALTH
1. The authority citation for part 136 continues to read as follows:
Authority: 25 U.S.C. 13; 42 U.S.C. 1395cc (a) (1) (U), 42 U.S.C. 2001 and 2003,
unless otherwise noted.
2. Add new subpart I consisting of §§ 136.201 and 136.202, to read as follows:
Subpart I—Limitation on Charges For Health Care Professional Services and NonHospital-Based Care
Sec.
13
136.201 Payment for physician and other health care professional services purchased by
Indian health programs and other medical charges associated with non-hospitalbased care.
136.202 Authorization by urban Indian organizations.
§ 136.201 Payment for physician and other health care professional services purchased
by Indian health programs and other medical charges associated with non-hospital-based
care.
(a) Payment to physicians and health care professionals and all otherfor nonhospital-based entities, including non-hospital based physicians and professional
services, for any level of care authorized under part 136, subpart C by a
Purchased/Referred Care (PRC) program of the Indian Health Service (IHS); or
authorized by a Tribe or Tribal organization carrying out a PRC program of the IHS
under the Indian Self-Determination and Education Assistance Act, as amended, Public
Law 93-638, 25 U.S.C. 450 et seq.; or authorized for purchase under § 136.31 by an
urban Indian organization (as that term is defined in 25 U.S.C. 1603(h)) (hereafter
“I/T/U”), shall be determined based on the applicable method in this section:
The I/T/U will pay the lowest of the following amounts:
(1) The applicable Medicare payment amount, including payment according
to a fee schedule, a prospective payment system or based on reasonable cost (“Medicare
14
rate”) for the period in which the service was provided, or in the event of a Medicare
waiver, the payment amount will be calculated in accordance with such waiver.
(2) An amount that has been negotiated with a specific provider or its agent, or
supplier or its agent by the I/T/U or the amount negotiated by a repricing agent if the
provider or supplier is participating within the repricing agent's network and an I/T/U has
a pricing arrangement or contract with that repricing agent. For the purposes of this
section, repricing agent means an entity that seeks to connect I/T/U with discounted rates
from non-I/T/U public and private providers as a result of existing contracts that the nonI/T/U public or private provider may have within the commercial health care industry.
(3) The amount that the provider or supplier bills accepts as payment for
the same service from nongovernmental entities, including insurance providersthe
general public for the same service.
(b) Exception.
(1) Subpart (a) shall apply to a Tribe or Tribal organization under the Indian SelfDetermination and Education Assistance Act, as amended, Public Law 93-638, 25
U.S.C. 450 et seq., and urban Indian organizations (as that term is defined in 25
U.S.C. 1603(h) only at the election of the Tribe, Tribal organization or urban Indian
organization.
(2) The I/T/U, either directly or through a repricing agent, may elect to negotiate a
rate that is more than the rate described in 15 paragraph (a) of this section with a
non-hospital based entity, but in no event shall such rate be higher than the lowest rate
the non-hospital based entity certifies to the I/T/U that it accepts as payment for the
same service from nongovernmental entities, including insurance providers.
(bc) Coordination of benefits and limitation on recovery: If an I/T/U has authorized
payment for items and services provided to an individual who is eligible for benefits
under Medicare, Medicaid, or another third party payer--
(1) The I/T/U is the payer of last resort under 25 U.S.C. 1623(b);
(2) If there are any third party payers, the I/T/U will pay the amount for which
the patient is being held responsible after the provider or supplier of services has
coordinated benefits and all other alternate resources have been considered and paid,
including applicable co-payments, deductibles, and coinsurance that are owed by
the patient; and
(3) The maximum payment by the I/T/U will be only that portion of the payment
amount determined under this section not covered by any other payer; and
(4) The I/T/U payment will not exceed the rate calculated in accordance
with paragraph (a) or (b) of this section (plus applicable cost sharing); and
(5) When payment is made by Medicaid it is considered payment in full and there
will be no additional payment made by the I/T/U to the amount paid by Medicaid.
(d) Authorized services: Payment shall be made only for those items and services
authorized by an I/T/U consistent with part 136 of this title or section 503(a) of the Indian
Health Care Improvement Act (IHCIA), Public Law 94-437, as amended, 25 U.S.C
1653(a).
(e) No additional charges.
(1) The health care provider or supplier shall be deemed to have accepted the
applicable Medicare payment amount, including payment according to a fee schedule, a
prospective payment system or based on reasonable cost (“Medicare rate”) for the period
in which the service was provided), or other payment amount in accordance with
paragraph (b) of this Section, as payment in full if:
16
(i) The services were provided based on a PRC referral authorized
for payment; or,
(ii) The health care provider or supplier submits a Notification of a Claim
for payment to the I/T/U; or
(iii) The health care provider or supplier accepts payment for the provision of
services from the I/T/U.
(2) A payment made and accepted in accordance with this section shall constitute
payment in full and the provider or its agent, or supplier or its agent, may not impose
any additional charge—
(i) On the individual for I/T/U authorized items and services; or
(ii) For information requested by the I/T/U or its agent or fiscal intermediary
for the purposes of payment determinations or quality assurance.
(e) For physicians and health care professionals and all other non-hospital-based
entities, including non-hospital based physicians and health care professionals
required by law to accept the rates specified in this section, the applicable rate shall
be the lowest of any amount calculated under paragraph (a)(1) or (b) of this section,
without regard to paragraph (d)(1) of this section.
(f) No service shall be authorized and no payment shall be issued in excess of the
rate authorized by this subpartSection.
17
§ 136.202 Authorization by an urban Indian organization.
An urban Indian organization may authorize for purchase items and services for an
eligible urban Indian (as those terms are defined in 25 U.S.C. 1603(f) and (h)) according
to section 503 of the IHCIA and applicable regulations. Services and items furnished by
physicians and other health care professionals and non-hospital-based entities including
non-hospital based physicians and other health care professionals shall be subject to the
payment methodology set forth in § 136.30201.
[FR Doc. 2014-28508 Filed 12/04/2014 at 8:45 am; Publication Date: 12/05/2014]
18

2015 October TSGAC Combined - Internet Copy

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