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Senator charges Indian Health Service with ripping off Alaska Natives

Alex DeMarban
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Alaska's junior senator fired off a letter to President Obama this week that essentially accuses the Indian Health Service of trying to rip off Alaska Natives and American Indians.

Sen. Mark Begich asks for the president's help in "seeing to it" that the agency pays the hundreds of millions of dollars it owes tribal health organizations for unreimbursed administrative costs dating back more than a decade.  

The U.S. Supreme Court this summer ruled that the federal government must fully pay tribes those costs, Begich says. Yet after five months, the agency, under the leadership of director Yvette Roubideaux, is attempting to stall the process by re-auditing claims it has already audited. The agency hired an anti-fraud accounting firm to do the work, said Begich.

This appears to be an attempt at "attrition" against tribes that have already filed claims seeking reimbursement -- and hundreds of others that have not. The agency's approach will deprive tribes of what they're owed under federal law, Begich said in the Nov. 28 letter.

According to Indian Health Service reports, "In Alaska alone, three contractors suffered over $218 million in contract support shortfalls reaching as far back as 1997," Begich writes.

He adds that similar amounts are due tribes across the nation. "It is shocking that the agency would now delay justice, call for new audits, or seek 15 years later to renegotiate the amounts that were due at the time."

The three contractors due the $218 million are the Alaska Native Tribal Health Consortium and Southcentral Foundation, based in Anchorage, and the Yukon-Kuskokwim Health Corp. of Bethel in Southwest Alaska. 

Chris Mandregan Jr., head of the Indian Health Service office in Alaska, said the agency is reviewing the Supreme Court decision in the Ramah Navajo case.

"We are aware that Tribes are interested in how IHS will implement this decision," he said in a short email. "Although IHS cannot discuss specific matters that are in litigation, we have reassured Tribes that the Agency intends to follow the holding of the Ramah Navajo Chapter."

The Indian Health Service reimburses tribes for delivering health care to Alaska Natives and American Indians because of court decisions stemming from long-standing treaties between tribes and the federal government. But Indian Health Service has balked at paying "contract-support costs," which are certain administrative costs associated with delivering services.

The Indian Health Service has spelled out the shortfall in yearly reports to Congress, but it's now trying to claim those reports were just estimates, not actual calculations, said Lloyd Miller, an Anchorage attorney who has argued the case on behalf of tribes for years.

"There's a fundamental failure to accept the reality that these claims must be paid and that the time for litigation is over," Miller said.  

The Indian Health Service owes more than 300 tribes and tribal organizations $800 million for the last six years alone, Miller said. Go back farther and the total bill is much higher, he added.

The impact of the Supreme Court ruling is particularly important in Alaska, where 35 tribes and tribal organizations have completely taken over health-care services from the Indian Health Service, something that has not happened in any other state. The Alaska groups are due about one-third of the total amount owed, Miller said.  

In his letter to Obama, Begich calls for a prompt resolution to the claims by the year's end. 

Contact Alex DeMarban at alex(at)alaskadispatch.com