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Melanne Verveer's Subject Files
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INDIAN HEALTH
PHOTOCOPY
PRESERVATION
is
4.
NE
PHOTOCOPY
PRESERVATION
INDIAN HEALTH
From the Desk of
From the Desk of
MELANNE VERVEER
MELANNE VERVEER
The bottom line!
file under
mry way to really
frie Indian
Indians -
health adequalty
is Three health
nd fn HRC'S
speech
Core refrem
HUMAN
SERVICES
USA
HEALTH
DEPARTMENT OF HEALTH & HUMAN SERVICES
Public Health Service
oF
Office of the Assistant Secretary
April 28, 1994
for Health
Washington DC 20201
NOTE TO:
Melanne Verveer
The White House
As discussed last evening, attached are two pieces that may be
helpful:
One is a briefing note on issues of concern to tribal leaders
that have come out in our regional meetings. As noted, the
budget issues have been partially addressed by restoring $125
million for health services and sanitation facilities. Issues on
FTEs remain. Many of the tribes have become more active in
preparing for health care reform. There is general support for
the Health Security Act, although there are specific technical
concerns which we are working through with the Indian Health
Service and tribal leaders.
Major concern is that budget cuts and FTE reductions for FY95 are
contradictory to preparing the IHS and tribal programs to deliver
the benefits package under the Health Security Act. In fact, the
Veterans Administration will receive $3.3 billion over 3 years to
prepare for reform, while the IHS is guaranteed only $40 million
in 1995 under a pay go provision and $200 million/year over the
next four years, but only if appropriated.
As you know, there will be a final summit meeting in Washington,
May 24-25. The First Lady and Secretary Shalala have been
invited to join the tribal leaders during that time to hear their
concerns first hand and to receive their recommendations on how
the HSA can be modified to meet the needs of Indian country.
There is great respect for and continued hope that this
Administration will finally mobilize the resources needed to
address the health and broad concerns of Indian people.
It would be important if the First Lady could attend the summit
because in a sense it is the summing up of an effort that she
started with me and Congressman Pat Williams over a year ago in
Montana when she suggested that these series of regional meetings
be held to establish a dialogue with Indian people.
I hope this is helpful.
Thank you.
Philip R Lee, M.D.
Assistant Secretary for Health
POSSIBLE ISSUES
for
Tribal Leaders Meeting
Tribal leaders expect an "equal partner" role in the Federal
decisionmaking process. Tribes base their relationship with
the Federal Government on a sovereign nation to sovereign
nation model.
There is a perception that the U.S. Government is not
committing adequate resources to meet the Government's
obligations to Indians as outlined in treaties, legislation,
and court decisions. Health care is an area of great
concern to the Tribes.
Assistant Secretary for Health, Philip R. Lee, M.D. and his
principal deputy, Jo Ivey Boufford, M.D., are reaching out
to Indian Country by conducting 3 regional and 1 national
forum(s) with Tribal leaders. The three regional meetings
were held in Albuquerque, New Mexico; Portland, Oregon; and
Billings, Montana. The national meeting will be held in
Washington, D.C. and is scheduled for May 24-26.
Tribal leaders expect to actively participate in any
planning to streamline or restructure the IHS. Furthermore,
the Tribes expect any savings that may result to be
redirected for services and transferred to tribally operated
programs.
Health Related Activities -- Indian Health Service
Budget and FTEs
The FY 1995 Budget submitted in February proposes a $247
million net reduction in budget authority (BA) composed of a
+ $29 million for health services; - $172 million in new
construction; and $104 million shift in revenue sources from
BA to insurance collections. Given the President's current
goal to reduce overall federal staffing, HHS believes this
would result in a reduction of 1,114 FTEs at IHS by 1995.
Tribal leaders view these proposals as a significant threat
to health services.
Many members of Congress (Senators Domenici, Reid, Inouye,
Stevens, McCain and Hatfield; and Representative Yates) have
expressed serious concerns with the FY 1995 budget and the
possible negative impacts if enacted as proposed. These
concerns include:
--
estimated growth in insurance collections (a
400% increase in private insurance in one year)
will not materialize causing either a drop in
services or force Congress to increase the
appropriation.
--
no new staff to fully utilize new larger
facilities that are opening in FY 1994 and FY
1995. The new facilities Belcourt, ND; Crow, MT;
Tohatchi, NM; Stilwell, OK; Shiprock, NM; and
Kotzebue, AK
-- basic deficiencies in the Indian communities
(e.g., the number of homes without adequate
sanitation due to the elimination of new
construction funding in FY 1995).
--
self-determination and self-governance are
tribally driven and tribal programs retain federal
employees; the time frame of the proposed FTE
reductions is faster than interested Tribes
believe they can manage the transition.
Secretary Shalala has asked OMB Director Panetta to
reconsider staffing reductions and instead hold IHS staffing
constant through FY 95 at the FY 93 level of 15, 441, to
allow time to negotiate a longer term strategy with Tribes.
(Director Panetta has not yet acted on this.)
On April 22, the President submitted to Congress a FY 1995
budget amendment to provide an additional $125 million for
the Indian Health Service. As a result of this amendment,
total funding for IHS is now $1.8 billion. This amendment
would guarantee that IHS continues to be funded at the FY
1994 level for critical health service activities and
restore sanitation construction projects. It also lowers
previously unrealistically high revenue targets from third
party payers (Medicare, Medicaid and private insurance) and
any funds earned over the target can be used to finance
programs locally.
Self Governance
Some tribal leaders believe that reducing FTEs is part of a
strategy to force them into self-determination contracting
or self-governance compacting. Tribes have always believed
that any transfer of health services would take place at
roughly the same level of resources -- not at a reduced
level, if and when a Tribe decides to assume new
responsibilities.
A proposed rule which describes the guidelines for self-
determination contracting (638 provisions) was published on
January 20. This rule continues to ensure the integrity of
IHS administered and delivered programs while assisting
interested Tribes transition into managing their own health
services. HHS and the Department of Interior have already
held regional meetings to maximize Indian participation
during the comment period. A national meeting is planned
for May 2-4 in Albuquerque, New Mexico. The comment period
ends May 12.
Senator Inouye, at the urging of the Tribes, has introduced
a bill which will legislate such controversial issues as
what services and staff support are contractible. The
Administration has not yet taken a position on this bill.
Senator McCain has introduced a bill, "The Indian Self
Determination Contract Reform Act of 1994" which would
prohibit HHS and DOI from promulgating self determination
contracting rules. Essentially, this legislation would
require the two Departments to enter into contracts with
Indians at their request for whatever services they are
willing to provide. The Administration has not yet taken a
position on this bill.
The Self-Governance Demonstration Project permits Tribes to
use federal funds to redesign and administer local health
services programs. Legislation has been introduced to make
Self-Governance a permanent program for the Department of
the Interior and we expect similar action for IHS programs.
Tribes not participating in self-contracting or compacting
arrangements expect IHS to ensure that resources are not
reduced for IHS administered and/or delivered services.
Health Care Reform
Although tribal leaders generally endorse the President's
Health Security Act (HSA), they have expressed the following
concerns:
--
Budget and FTE cuts now proposed will result in Indian
health programs being less able than they currently are
to deliver the HSAs universal benefits package.
--
Funding may not be available to IHS and the Tribes at
the time states will be implementing the benefits
package, thereby disadvantaging Indian health programs.
--
The role of states in regulating alliances and plans,
and in mental health and long term care planning, is
seen as threatening the government to government
relationship that Tribes enjoy with the federal
Government.
Other Departmental Activities -- Administration for Children and
Families (ACF)
The Administration for Native Americans (ANA), part of ACF,
issued a program announcement on March 25 requesting
competitive applications to ensure the survival and
continuing vitality of Native American languages.
Approximately, $1 million will be awarded under this grant
program in FY 1994.
Secretary Shalala has approved the establishment of the
Intra-Departmental Council on Native American Affairs in
ACF. The Council will be a visible focal point for Indian
concerns within the Department.
The Administration for Native Americans and the Council are
represented on a recently established Welfare Reform Work
Group addressing tribal concerns. The goal of this group is
to examine tribal welfare programs to identify ways for
improving services. Many Indian Tribes are concerned by
reports of a proposed gambling tax to finance part of the
Welfare Reform package.
Efforts to improve Head Start have been bolstered by
increased appropriations for the program, including a $14.6
million increase for Indian Head Start programs in FY 1994,
the largest dollar increase ever for Indian Head Start.
SECRETARY DONNA E. SHALALA
BEFORE
THE HOUSE INTERIOR APPROPRIATIONS SUBCOMMITTEE
APRIL 26, 1994
Good morning Mr. Chairman, thank you for inviting me to testify before your
Subcommittee on the President's FY 1995 Budget and its impact on the health
of Native Americans and Alaska Natives. As I have said before, the
President's FY 1995 Budget is one of the toughest in memory. We were forced
to make some very difficult decisions in order to meet the deficit reduction
goals set in last year's economic plan. The overall hard freeze on spending
limited discretionary growth in this Department to just 3%. Operating under
those budgetary constraints, we were determined to meet the challenges of
continuing the President's investments begun last year and making a
contribution to necessary deficit reduction. These well-placed investments will
lead to future service improvements, cost savings, and, ultimately, to citizens
who are more independent. However, real budget and deficit control over the
long term will come only through changes in our entitlement programs --
primarily health care reform.
Health and Human Services (HHS) is the Department most concerned with
people, and most involved in human concerns -- from mailing out Social
Security checks, to operating the most successful biomedical research enterprise
in the world, to providing the most vulnerable members of our society with
basic financial assistance, health care, and supportive services needed to achieve
a better life. Through our efforts, we touch the lives of virtually every
American, from infancy through retirement.
Our budget for FY 1995 provides sizable expansions for critical HHS
investments with proven rates of success. We have worked hard to sustain
commitments and accomplishments that emerged from the budget constraints we
faced last year. Areas where we are continuing to invest are Head Start,
Childhood Immunizations, Child Care for low income families, the National
Institutes of Health (NIH), AIDS, Substance Abuse Treatment and Prevention,
and improvements to the Social Security disability claims processing. Within
this buildup, I would note specific and direct benefits for Indian People -- Head
Start will provide $108 million directly to Indian programs, a 21% increase in
one year; the Child Care Block Grant reserves for Indian Tribes will increase
by 22%; and within the NIH there are over 60 research programs aimed
specifically at advancing our understanding of health and illness unique to
American Indians and Alaska Natives.
-2-
Beyond these investments which will have a direct and immediate benefit for
Indian People, HHS recognizes its special relationship and obligation to the
Indian tribes. Springing from the United States Constitution, that responsibility
has been the foundation for the Indian Health Service and grounds our work to
improve and then maintain the well being of Indian People. This obligation is
one I take very seriously and is a moral responsibility that my colleagues and I
are committed to fulfilling.
But I want to emphasize that our investment increases did not come without a
price. We made difficult choices by looking critically at our base and finding a
reasonable path for those programs. This meant determining ways to reduce
costs and eliminate duplication. We put forth program consolidations, we froze
the funding in many programs, and seven major programs are cut by over $1
billion, including a $754 million decrease in the Low Income Home Energy
Assistance Program. I realize that a budget which sets priorities and finances
those with a reduction in other programs will be painful to adopt.
I am not here to say that our discretionary budget will result in significant
improvements in the health of Native Americans. As you, Mr. Chairman, and
I have discussed, the twin constraints of discretionary budget caps and statutory
FTE ceilings will make it more difficult to achieve this most important goal.
The answer here, in the long term, is health care reform. The President's
Health Security Act offers Indian People new benefits -- a guarantee of
universal coverage and comprehensive services. While I am only one year into
my tenure as Secretary of HHS, I want to give my full assurance that I too am
absolutely committed to continued improvements in the health of Native
Americans.
We have seen substantial improvements, over the last 25 years, in the health of
Indian People. For example, a 40% reduction in their age-adjusted mortality
rate, a 50% reduction in the number of years of productive life lost, a 50%
decrease in the infant mortality rate, and a 74% decrease in tuberculosis
mortality. However, there is still much catching up to do. Overall mortality
rates for Native Americans are still 11% higher than for all Americans, years of
productive life lost are 37% higher, and the mortality rate from accidents is 2.7
times higher. In terms of per capita spending, IHS spends about $1,500
annually which is one-half of what is spent on all other Americans. While this
gap is large, it is important to note that a quarter of IHS users have private
health insurance and obtain part of their health care services elsewhere. You,
-3-
Mr. Chairman, have played a major part in the improvements, but we both
know there are serious unmet needs that must be addressed.
Turning now to the budget of the Indian Health Service, I am pleased that we
were able to provide recently an amendment to the President's Budget which
includes an additional $125 million above what was proposed back in February.
As a result of this amendment, total funding for the IHS is $1.8 billion. This
amendment guarantees that we will be level-funding the critical health services
activities of the IHS. We heard the concerns expressed, and we acted. But not
without cutbacks in salaries and expenses, as well as in programs. For example
our offsets include, $39 million in primary care services and training of the
Health Resources and Services Administration, $29 million in activities of the
Centers for Disease Control and Prevention, $23 million from prevention and
demonstrations in the Substance Abuse and Mental Health Services
Administration, and $11 million from the Health Care Financing Administration
which manages the Medicare and Medicaid programs.
In the Indian Facilities program, in recognition of IHS' important disease
prevention mission in Indian Country, our recent budget amendment restores
$42.5 million for construction of sanitation facilities. At this level of funding,
IHS will be able to assure that resources are available to provide access to
waste disposal and safe drinking water to new homes being built and to those
being rehabilitated -- approximately 3,200. Throughout the Federal Budget, the
tight discretionary spending cap has resulted in a "pause" of new construction
projects in FY 1995. We see this same situation occurring for medical facilities
construction in the Department of Veterans Affairs, school construction in the
Bureau of Indian Affairs and some HUD housing programs. As budget plans
for the coming years are developed, we must work together to ensure that the
health facility needs of Native Americans continue to be met.
A special initiative throughout the Government is to increase treatment services
to hard core substance abusers. We have included, in the IHS budget request,
an increase of $10.4 million for treatment capacity expansion as well as
increasing certification rates for substance abuse counselors. The IHS will be
addressing both substance and alcohol abuse, a leading cause of death among
Native Americans.
I know of the concerns expressed about the feasibility of attaining significant
increases in insurance reimbursements that were assumed in our initial budget.
With this budget amendment, we have reduced our private insurance collections
-4-
target to $28 million for FY 1995, with expected growth in future years. Any
increases in reimbursements received -- Medicaid, Medicare, and private -- will
increase the total resources available for the hospitals and clinics. As you and
the Committee are fully aware, IHS has made significant progress in recent
years to enhance collection of both public and private insurance. Indeed, its
record is impressive -- 50% increases in public insurance collections between
FY 1991 and FY 1993 and a 106% increase in private insurance collections
over the same period. We also know that 25% of Native Americans living in
IHS service areas have private health insurance which is a large part of the
eligible population. However, our present collection of private insurance only
represents 1% of health services revenues. It makes sense that health insurance
collections should be used to pay for the care of those Native Americans who
are insured. This use of insurance is fundamental to the way in which Native
American health care will be funded under the Health Security Act.
On the subject of IHS staffing, I want to assure you I am continuing to work
with Director Panetta to try to develop adequate and sensible staffing plans for
the IHS. I agree that we should be providing staff to more fully utilize the new
facilities that have opened this year and those that will be ready to open next
year. However, I also understand that, at the same time, the Federal Work
Force Restructuring Act of 1994 mandates reductions to the Federal work force
of 272,900 Full Time Equivalents (FTE) by 1999. These are real reductions,
and they have real implications. They require us to seek out novel ways to
meet staffing needs in critical health care areas, as well as to reduce
administrative layers, consolidate operations across government, and seek
outside support where it is reasonable to do so. In addition, our IHS
amendment provides an increase of $7.5 million to fully fund the Indian Self
Determination Fund so that there are resources available to Tribes who seek to
begin or expand their management of health service programs.
I would like to reiterate the importance of health care reform and the benefits
which Indian people can expect under the President's plan. Unlike any of the
other main health care plans before the Congress, the President's Health
Security Act reaffirms the unique Federal role and responsibility for health care
to Indian people by specifically addressing their health care needs, and by
explicitly retaining other Federal statutes related to the provision of health care
to Indians. The President's health care plan was also written, and will be
implemented, with the extensive involvement of American Indians and Alaska
Natives. Leaders of the Indian Health Service have discussed health care
reform at every consultation they have had with tribes since last summer. My
-5-
Assistant Secretary for Health also hosted four health care reform consultations
with Indian People. We will continue to fully discuss the implementation of
Health Care Reform with Native Americans and push to ensure that their views
are included and incorporated into the most fundamental piece of domestic
legislation we will adopt this century.
The Health Security Act offers significant new benefits to Indian people, as it
does for all Americans. Under the Act, Native American families and
individuals will receive the same guaranteed universal coverage for
comprehensive benefit services as other Americans, either through the IHS,
Tribal/Urban programs, or through a regional health alliance. Native
Americans who choose to remain in the IHS, Tribal, and Urban Indian
programs will receive this care without charge. However, cost sharing
provisions in the Act -- including discounts -- will apply to Native Americans
who choose to enroll in an alliance health plan in the same way that they apply
to other Americans. The Indian Health Service will also continue to provide
various public health activities, such as public health nursing, community health
representatives, and sanitation construction to eligible beneficiaries. The Health
Security Act assures that Tribal control over the provision of local health
services, for those Tribes who seek it, will continue to be encouraged under the
Indian Self Determination and Education Assistance Act.
Mr. Chairman, another important aspect of the Health Security Act is the
extension of services to urban Indians. As you well know, the population of
Indians living in urban areas has consistently lacked adequate health care.
While most of these Indians are eligible for services when provided in an IHS
facility, they are unable to access them because of distance. A further problem
is the loss of contract care coverage or eligibility once an Indian have left the
reservation for 180 days. With universal coverage, this population will gain
access to the health care they need. The Act extends full coverage to Indians
living in urban areas in which Urban Indian programs are offered. Indians
residing in a geographic area in which a health program of the IHS is not
offered will enroll in an alliance plan to receive the comprehensive benefits
package.
Revenues to fund the comprehensive benefit package will consist of a blend of
non-tribal employer premiums paid to the IHS, cost sharing discounts
equivalents for low-income non-employed Indians, premiums paid by non-
Indian family members, and Federal appropriations. The Health Security Act
authorizes additional appropriations of $1 billion, specifically for IHS, over the
-6-
next five years for enabling services such as transportation, outreach, and new
construction. The Act also authorizes a new loan program to finance capital
improvements and other infrastructure development. This will enable the
Federal Government to assist Tribes and Tribal organizations in obtaining the
necessary capital to expand and improve local health care facilities. There is
also $40 million authorized for IHS for FY 1995 and included in the Health
Care Reform section of the President's Budget as a PAYGO item. In addition,
Indian programs will also be eligible for funding under Title III programs in the
Health Security Act.
Mr. Chairman, we have a real challenge - how to improve the health of Native
Americans and Alaska Natives in a time of severe budget and staffing
constraints. I believe the President's Health Security Act is the best way to
significantly expand services to Indian people. I look forward to working with
you in the future to ensure that the health of Native Americans continues to
improve. I would be happy to answer any questions that you might have.
APR 28 '94 12:41PM IMMED OFFICE ASH
P.2/8
file Inder health
Talking Points
Donna E. Shalala
U.S. Secretary of Health and Human Services
at
The Tribal Leaders Meeting
April 29, 1994
The White House
Thank you.
Talk about your Peace Corps training at Many Farms in
Arizona. Your recent trip to North Dakota.
Historic meeting -- first time a Secretary of HHS has met
with all the tribal leaders.
HHS recognizes special relationship and obligation to the
Indian tribes.
This "nation to nation relationship" must be the
foundation for the Indian Health Service's work with
Tribal leaders to improve and maintain the health and
well-being of Indian people.
This obligation is one I take very seriously and is a moral
responsibility that my colleagues and I are committed to
fulfilling.
P.3/6
2
Tough budget year. We had to: reduce costs, eliminate
duplication, consolidate programs all across the government.
Only a few increases, but increases in programs that are
important for Native Americans.
Head Start will provide $108 million directly to Indian
programs -- that's a 21% increase in one year.
The Child Care Block Grant reserves for Indian Tribes
will increase by 22%.
Within NIH, there are over 60 research programs aimed
specifically at advancing our understanding of health
and illness unique to American Indians and Alaska
Natives.
[level] $17 million in Administration on Aging grants
for aging Indian people.
[level] $3.5 million for HIV/AIDS related services.
194 12:42PM IMMED OFFICE ASH
P.4/8
3
Recent amendment to President's Budget includes an
additional $125 million for IHS over what was proposed back
in January.
O
Total funding for IHS, now $1.8 billion.
o
This means we're level-funding the critical health
services of IHS.
We heard your concerns and acted. That meant reductions in
other programs across the department to fund the new
amendment.
Amendment restores $42.5 million for construction of
sanitation facilities: means waste disposal and safe
drinking water to more than 3,000 homes under construction.
IHS budget request includes an increase of $10.4 million for
treatment capacity expansion as well as increasing
certification rates for substance abuse counselors.
IHS amendment provides $7.5 million increase to fully fund
the Indian Self Determination Fund so that there are
resources available to tribes who seek to begin or expand
their management of health service programs.
APR 28 '94 12:42PM IMMED OFFICE ASH
P.5/8
4
Insurance reimbursements: with this amendment, we have
reduced our private insurance collections target to $28
million for FY 1995, with expected growth in future years.
o
Any reimbursements above the target levels in Medicaid,
Medicare, and private insurance will increase resources
available to hospitals and clinics.
o
It makes sense that health insurance collections should
be used to pay for the care of those native Americans
who are insured. This use of insurance is fundamental
to the way in which Native American health care will be
funded under the Health Security Act.
Finally, staffing: Would like to provide staff to fully
utilize new facilities. We are working with Mr. Panetta to
seek solutions to the overall limitations, but the reality
is that FTE ceilings require us to seek out novel ways to
meet staffing needs, reduce administrative layers, and
consolidate our operations.
The key to any major infusion of resources in IHS and tribal
programs is health care reform.
P.6/8
5
President's health reform plan is the only plan before
Congress that reaffirms the unique Federal role and
responsibility for health care to Indian people.
o
Addresses health needs.
Explicitly retains other Federal statutes that provide
health care to Indians.
President's plan was written, and will be implemented, with
extensive involvement of American Indians and Alaska
natives.
o
IHS leaders have discussed health care reforms at every
consultation they have had with tribes since last
summer.
o
Assistant Secretary Phil Lee also hosted four health
care reform consultations with Indian leaders
throughout the country.
Health Security Act
0
Native Americans will receive health care that can
never be taken away.
APR 28 '94 12:43PM IMMED OFFICE ASH
P.7/8
6
o
Same comprehensive benefits package guaranteed to all
Americans.
o
Individual choice:
1.
Remain in IHS, Tribal, or Urban Indian programs -- no
charge.
2.
Enroll in alliance -- cost sharing.
IHS will continue to provide public health nursing,
community health representatives, and sanitation
construction to eligible beneficiaries.
HSA assures Tribal control over the provision of local
health services, for those who seek it. Will continue to be
encouraged under the Indian Self Determination and Education
Assistance Act.
HSA authorizes additional $1 billion for IHS over the next
five years for transportation, outreach, and new
construction.
o
Also authorizes new loan program for capital
improvements and infrastructure.
APR 28 '94 12:43PM IMMED OFFICE ASH
P.8/8
7
O
$40 million is authorized for IHS for FY 1995 and
included in the Health Care Reform section of the
President's budget with a guaranteed funding stream.
Indian programs will be eligible for funding under all
the Public Health Service programs in the Health
Security Act.
Our challenge is:
O
To work with you to provide services in a way that
meets each tribe"s needs,
0
to improve the IHS,
O
and to provide health security through reform.
We understand the enormous diversity of our American Indian
population -- and we are committed to working with all of
you to promote health security and opportunity for all
individuals and all tribes.
Thank you.
04-28-94 03:05PM FROM OASPA NEWS DIV
TO 94566244
P002/007
SECRETARY DONNA E. SHALALA
BEFORE
THE HOUSE INTERIOR APPROPRIATIONS SUBCOMMITTEE
APRIL 26, 1994
Good morning Mr. Chairman, thank you for inviting me to testify before your
Subcommittee on the President's FY 1995 Budget and its impact on the health
of Native Americans and Alaska Natives. As I have said before, the
President's FY 1995 Budget is one of the toughest in memory. We were forced
to make some very difficult decisions in order to meet the deficit reduction
goals set in last year's economic plan. The overall hard freeze on spending
limited discretionary growth in this Department to just 3%. Operating under
those budgetary constraints, we were determined to meet the challenges of
continuing the President's investments begun last year and making a
contribution to necessary deficit reduction. These well-placed investments will
lead to future service improvements, cost savings, and, ultimately, to citizens
who are more independent. However, real budget and deficit control over the
long term will come only through changes in our entitlement programs --
primarily health care reform.
Health and Human Services (HHS) is the Department most concerned with
people, and most involved in human concerns -- from mailing out Social
Security checks, to operating the most successful biomedical research enterprise
in the world, to providing the most vulnerable members of our society with
basic financial assistance, health care, and supportive services needed to achieve
a better life. Through our efforts, we touch the lives of virtually every
American, from infancy through retirement.
Our budget for FY 1995 provides sizable expansions for critical HHS
investments with proven rates of success. We have worked hard to sustain
commitments and accomplishments that emerged from the budget constraints we
faced last year. Areas where we are continuing to invest are Head Start,
Childhood Immunizations, Child Care for low income families, the National
Institutes of Health (NIH), AIDS, Substance Abuse Treatment and Prevention,
and improvements to the Social Security disability claims processing. Within
this buildup, I would note specific and direct benefits for Indian People -- Head
Start will provide $108 million directly to Indian programs, a 21% increase in
one year; the Child Care Block Grant reserves for Indian Tribes will increase
by 22%; and within the NIH there are over 60 research programs aimed
specifically at advancing our understanding of health and illness unique to
American Indians and Alaska Natives.
04-28-94 03:05PM FROM OASPA NEWS DIV
TO 94566244
P003/007
-2-
Beyond these investments which will have a direct and immediate benefit for
Indian People, HHS recognizes its special relationship and obligation to the
Indian tribes. Springing from the United States Constitution, that responsibility
has been the foundation for the Indian Health Service and grounds our work to
improve and then maintain the well being of Indian People. This obligation is
one I take very seriously and is a moral responsibility that my colleagues and I
are committed to fulfilling.
But I want to emphasize that our investment increases did not come without a
price. We made difficult choices by looking critically at our base and finding a
reasonable path for those programs. This meant determining ways to reduce
costs and eliminate duplication. We put forth program consolidations, we froze
the funding in many programs, and seven major programs are cut by over $1
billion, including a $754 million decrease in the Low Income Home Energy
Assistance Program. I realize that a budget which sets priorities and finances
those with a reduction in other programs will be painful to adopt.
I am not here to say that our discretionary budget will result in significant
improvements in the health of Native Americans. As you, Mr. Chairman, and
I have discussed, the twin constraints of discretionary budget caps and statutory
FTE ceilings will make it more difficult to achieve this most important goal.
The answer here, in the long term, is health care reform. The President's
Health Security Act offers Indian People new benefits a guarantee of
universal coverage and comprehensive services. While I am only one year into
my tenure as Secretary of HHS, I want to give my full assurance that I too am
absolutely committed to continued improvements in the health of Native
Americans.
We have seen substantial improvements, over the last 25 years, in the health of
Indian People. For example, a 40% reduction in their age-adjusted mortality
rate. a 50% reduction in the number of years of productive life lost, a 50%
decrease in the infant mortality rate, and a 74% decrease in tuberculosis
mortality. However, there is still much catching up to do. Overall mortality
rates for Native Americans are still 11% higher than for all Americans, years of
productive life lost are 37% higher, and the mortality rate from accidents is 2.7
times higher. In terms of per capita spending, IHS spends about $1,500
annually which is one-half of what is spent on all other Americans. While this
gap is large, it is important to note that a quarter of IHS users have private
health insurance and obtain part of their health care services elsewhere. You,
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Mr. Chairman, have played a major part in the improvements, but we both
know there are serious unmet needs that must be addressed.
Turning now to the budget of the Indian Health Service, I am pleased that we
were able to provide recently an amendment to the President's Budget which
includes an additional $125 million above what was proposed back in February.
As a result of this amendment, total funding for the IHS is $1.8 billion. This
amendment guarantees that we will be level-funding the critical health services
activities of the IHS. We heard the concerns expressed, and we acted. But not
without cutbacks in salaries and expenses, as well as in programs. For example
our offsets include, $39 million in primary care services and training of the
Health Resources and Services Administration, $29 million in activities of the
Centers for Disease Control and Prevention, $23 million from prevention and
demonstrations in the Substance Abuse and Mental Health Services
Administration, and $11 million from the Health Care Financing Administration
which manages the Medicare and Medicaid programs.
In the Indian Facilities program, in recognition of IHS' important disease
prevention mission in Indian Country, our recent budget amendment restores
$42.5 million for construction of sanitation facilities. At this level of funding,
IHS will be able to assure that resources are available to provide access to
waste disposal and safe drinking water to new homes being built and to those
being rehabilitated approximately 3,200. Throughout the Federal Budget, the
tight discretionary spending cap has resulted in a "pause" of new construction
projects in FY 1995. We see this same situation occurring for medical facilities
construction in the Department of Veterans Affairs, school construction in the
Bureau of Indian Affairs and some HUD housing programs. As budget plans
for the coming years are developed, we must work together to ensure that the
health facility needs of Native Americans continue to be met.
A special initiative throughout the Government is to increase treatment services
to hard core substance abusers. We have included, in the IHS budget request,
an increase of $10.4 million for treatment capacity expansion as well as
increasing certification rates for substance abuse counselors. The IHS will be
addressing both substance and alcohol abuse, a leading cause of death among
Native Americans.
I know of the concerns expressed about the feasibility of attaining significant
increases in insurance reimbursements that were assumed in our initial budget.
With this budget amendment, we have reduced our private insurance collections
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target to $28 million for FY 1995, with expected growth in future years. Any
increases in reimbursements received -- Medicaid, Medicare, and private -- will
increase the total resources available for the hospitals and clinics. As you and
the Committee are fully aware, IHS has made significant progress in recent
years to enhance collection of both public and private insurance. Indeed, its
record is impressive -- 50% increases in public insurance collections between
FY 1991 and FY 1993 and a 106% increase in private insurance collections
over the same period. We also know that 25% of Native Americans living in
IHS service areas have private health insurance which is a large part of the
eligible population. However, our present collection of private insurance only
represents 1% of health services revenues. It makes sense that health insurance
collections should be used to pay for the care of those Native Americans who
are insured. This use of insurance is fundamental to the way in which Native
American health care will be funded under the Health Security Act.
On the subject of IHS staffing, I want to assure you I am continuing to work
with Director Panetta to try to develop adequate and sensible staffing plans for
the IHS. I agree that we should be providing staff to more fully utilize the new
facilities that have opened this year and those that will be ready to open next
year. However, I also understand that, at the same time, the Federal Work
Force Restructuring Act of 1994 mandates reductions to the Federal work force
of 272,900 Full Time Equivalents (FTE) by 1999. These are real reductions,
and they have real implications. They require us to seek out novel ways to
meet staffing needs in critical health care areas, as well as to reduce
administrative layers. consolidate operations across government, and seek
outside support where it is reasonable to do so. In addition, our IHS
amendment provides an increase of $7.5 million to fully fund the Indian Self
Determination Fund so that there are resources available to Tribes who seek to
begin or expand their management of health service programs.
I would like to reiterate the importance of health care reform and the benefits
which Indian people can expect under the President's plan. Unlike any of the
other main health care plans before the Congress, the President's Health
Security Act reaffirms the unique Federal role and responsibility for health care
to Indian people by specifically addressing their health care needs, and by
explicitly retaining other Federal statutes related to the provision of health care
to Indians. The President's health care plan was also written, and will be
implemented, with the extensive involvement of American Indians and Alaska
Natives. Leaders of the Indian Health Service have discussed health care
reform at every consultation they have had with tribes since last summer. My
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Assistant Secretary for Health also hosted four health care reform consultations
with Indian People. We will continue to fully discuss the implementation of
Health Care Reform with Native Americans and push to ensure that their views
are included and incorporated into the most fundamental piece of domestic
legislation we will adopt this century.
The Health Security Act offers significant new benefits to Indian people, as it
does for all Americans. Under the Act, Native American families and
individuals will receive the same guaranteed universal coverage for
comprehensive benefit services as other Americans, either through the IHS,
Tribal/Urban programs, or through a regional health alliance. Native
Americans who choose to remain in the IHS, Tribal, and Urban Indian
programs will receive this care without charge. However, cost sharing
provisions in the Act including discounts -- will apply to Native Americans
who choose to enroll in an alliance health plan in the same way that they apply
to other Americans. The Indian Health Service will also continue to provide
various public health activities, such as public health nursing, community health
representatives. and sanitation construction to eligible beneficiaries. The Health
Security Act assures that Tribal control over the provision of local health
services, for those Tribes who seek it, will continue to be encouraged under the
Indian Self Determination and Education Assistance Act.
Mr. Chairman, another important aspect of the Health Security Act is the
extension of services to urhan Indians. As you well know, the population of
Indians living in urban areas has consistently lacked adequate health care.
While most of these Indians are eligible for services when provided in an IHS
facility, they are unable to access them because of distance. A further problem
is the loss of contract care coverage or eligibility once an Indian have left the
reservation for 180 days. With universal coverage, this population will gain
access to the health care they need. The Act extends full coverage to Indians
living in urban areas in which Urban Indian programs are offered. Indians
residing in a geographic area in which a health program of the IHS is not
offered will enroll in an alliance plan to receive the comprehensive benefits
package.
Revenues to fund the comprehensive benefit package will consist of a blend of
non-tribal employer premiums paid to the IHS, cost sharing discounts
equivalents for low-income non-employed Indians, premiums paid by non-
Indian family members. and Federal appropriations. The Health Security Act
authorizes additional appropriations of $1 billion, specifically for IHS, over the
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next five years for enabling services such as transportation, outreach, and new
construction. The Act also authorizes a new loan program to finance capital
improvements and other infrastructure development. This will enable the
Federal Government to assist Tribes and Tribal organizations in obtaining the
necessary capital to expand and improve local health care facilities There is
also $40 million authorized for IHS for FY 1995 and included in the Health
Care Reform section of the President's Budget as a PAYGO item. In addition,
Indian programs will also be eligible for funding under Title III programs in the
Health Security Act.
Mr. Chairman. we have a real challenge - how to improve the health of Native
Americans and Alaska Natives in a time of severe budget and staffing
constraints. I believe the President's Health Security Act is the best way to
significantly expand services to Indian people. I look forward to working with
you in the future to ensure that the health of Native Americans continues to
improve. I would be happy to answer any questions that you might have.