SPONSORED | PART 3 OF 4: For the average Alaskan, 1997 was the year that brought the most visible change to Tribal health care. That’s when the Indian Health Service finished construction on the $170 million Alaska Native Medical Center in midtown Anchorage.

Behind the scenes, something much bigger was taking shape.

The Alaska Tribal Health Compact

Since the 1970s, Alaska’s Tribes had been contracting with the federal government, Read Part 2, to manage an increasing number of health care programs overseen by IHS. In 1992, those opportunities expanded with new legislation that gave Tribes the ability to enter into long-term compacts with IHS and manage a wider range of programs. Four Tribal health organizations -- Tanana Chiefs Conference, Southeast Alaska Regional Health Consortium, Southcentral Foundation, and Yukon-Kuskokwim Health Corp. -- received grants to help them prepare for the new self-governance designation, and soon it was proposed that the regional organizations collaborate on a single statewide compact to include all Alaska Tribes.

This complex undertaking, which had been discussed by Tribal groups as early as 1990, would involve more than one-third of the federally recognized Tribes in the country. The IHS approved the Alaska Native Health Board’s proposed “All-Alaska Compact” in 1994 as part of its first round of Tribal health care compacts, and the Alaska Tribal Health Caucus was organized later that year.

During two years of meetings from 1995 to 1997, the Caucus refined its vision: an inter-Tribal health consortium that would elevate care for all Alaska Native people. Tribal leaders needed to work out general terms among themselves and with IHS, as well as determine Alaska’s exact share of the national IHS budget and how it would be allocated among Alaska’s stakeholders. It was a full-time job involving Tribal leaders and staff, attorneys, and financial analysts working to determine each Tribe’s share of the resources.

A new hospital, a new health care hub

Around the same time, IHS was undertaking its most ambitious capital improvement project in the state: construction of a brand-new, state-of-the-art hospital at Tudor Centre to replace the aging Alaska Native Service hospital downtown.

Dr. Dick Mandsager was a young IHS physician who had arrived in Anchorage in 1985 to serve as the Anchorage Service Unit Director and Director of the Alaska Native Medical Center. He hadn’t been on the ground long before he learned that his job would involve overseeing a major capital project.

“During that planning process, it became very clear to me that the standards IHS were using were very old standards that were very hospital-based and weren't really keeping up with new standards,” Mandsager said. In particular, the old hospital wasn’t well equipped for outpatient care. IHS approached Southcentral Foundation, the nonprofit organization serving Alaska Native people from the Cook Inlet region, about contracting to manage small health centers around Anchorage. That proposal evolved into a central ambulatory care clinic, built alongside the new hospital and operated by Southcentral Foundation.

Photo courtesy of Alaska Native Tribal Health Consortium

This new medical campus was only the second biggest change coming to Tribal health care in Alaska. By the time the hospital building was complete, Tribal leaders were ready to proceed with plans to contract for its operations.

A senator steps in

It was the most complex and ambitious step yet for Alaska’s self-governance movement. Because the hospital would serve the entire state, all of Alaska’s 229 federally recognized Tribes would have to sign authorizing resolutions. This undertaking would require outreach and negotiation that seemed, if not impossible, at least monumental.

Enter Sen. Ted Stevens.

In 1997, Stevens introduced language in the appropriations act that allowed IHS to enter into a compact to manage statewide services with a then-nonexistent statewide intertribal health consortium.

Known as Section 325, Stevens’ language outlined the structure of the new consortium -- and allowed the agreement to be made without authorization from individual Tribal governments.

This development met with a mixed response from Tribal leaders.

“There was an incredible amount of anger,” Mandsager said. It wasn’t that the law itself was bad -- in his opinion, Stevens “got it about 95 percent right” -- but leaders felt blindsided by the specifics. On one hand, Section 325 advanced the goal of full Tribal management of health care. It also flouted the requirement that Tribes authorize the contract -- a fundamental principle of self-governance.

Despite those concerns, Congress approved the legislation, and the stage was set for a statewide Tribal health care system.

Building from the ground up

Leaders from the state’s Tribal health organizations convened in Anchorage in December 1997 to organize what would become known as the Alaska Native Tribal Health Consortium. The following month, Paul Sherry was asked to serve as the new consortium’s interim president and CEO.

Sherry was presented with a monumental task: to organize, from scratch, an entity that would impact the life and health of every Alaska Native person. With start-up loans from Norton Sound Health Corp. and Yukon-Kuskokwim Health Corp., the new ANTHC leadership opened a bank account, rented some office space, and got to work.

In the spring of 1998, ANTHC worked with IHS to establish an initial self-determination contract with a three-stage transition plan for management of statewide offices in IHS’ Alaska Area, with the final phase scheduled for January 1999.

“Communication was the key from my perspective at that time,” Sherry said. “We absolutely had to communicate to all the players a message of stability and a message of accountability and transparency.”

Given the scope of the coming change, there was understandably some anxiety among the people affected -- including significant concern from employees about whether they would still have jobs when the dust settled. In fact, most did; Sherry recalls that on one single day in December 1998, he signed more than 1,000 personnel agreements and memoranda of agreement to retain IHS employees as ANTHC prepared to assume management of the hospital.

“I just remember that whole first year was an effort to basically communicate to the stakeholders that we were going to move deliberately, that we were going to move carefully and not disrupt what is a very valuable system to a lot of people,” Sherry said.

Board meetings and employee forums were central to the communication effort.

“One of my old chief bosses here in the Interior always said, ‘There are some decisions that you can make over a cup of tea, and then there are some that you have to drink gallons of tea over multiple days to make,’” Sherry said. “That was a time that we were drinking gallons of tea. For months.”

During this time, Mandsager, who had come to Alaska expecting a straightforward administrative position, often found himself acting in the role of mediator. That first year, he said, was all about building trust between IHS, Southcentral Foundation, and the new consortium.

“The idea about self-governance was really uncharted territory from an IHS perspective,” he said. “Our job was to facilitate, and to listen.”

Sorting out responsibilities

One of the trickier pieces to negotiate was the new hospital, because IHS had a co-management agreement in place with Southcentral Foundation.

“Trying to lay out that first agreement got really into the weeds of hospital management,” Mandsager said.

ANTHC and Southcentral Foundation agreed to the establishment of a joint operating board, a formula for dividing federal funding, and a system by which each organization would purchase services from the other. ANTHC took responsibility for inpatient services, while Southcentral Foundation oversaw outpatient services. The hospital building itself remained federally owned.

Then there was the framework of a new, complex organization, all of which had to be built from the ground up: policies, human resources, purchasing, financial management, and other administrative matters, plus software to manage all of it. It was important that the new consortium be able to secure revenue from sources other than IHS, so systems were established to bill Medicare, Medicaid, and private insurance, as well as to seek state, federal, and private grants. When possible, Sherry said, ANTHC would adopt best practices from the regional health care organizations, which served the dual purpose of saving work while building trust among the consortium’s partners.

It was an exhausting, exhilarating process. While various negotiations and arrangements would continue to take shape, within two years, the major pieces were in place. On Jan. 4, 1999, a ceremony in the main lobby of ANMC celebrated the completion of the transition to statewide Tribal health services under Alaska Native ownership.

Correction: An earlier version of this story incorrectly reported that Mandsager served as Director of the Alaska Area Native Health Service in the Indian Health Service. That position was held by Gerald Ivey. Mansager reported to Ivey in his role as Anchorage Service Unit Director.

Next week: Innovation, ingenuity, and the future of Tribal health care in Alaska.

This story was sponsored by Alaska Native Tribal Health Consortium, a statewide nonprofit Tribal health organization designed to meet the unique health needs of more than 175,000 Alaska Native and American Indian people living in Alaska. Read Part 1. Read Part 2. Read Part 4.

This story was produced by the creative services department of the Anchorage Daily News in collaboration with Alaska Native Tribal Health Consortium. The ADN newsroom was not involved in its production.