Health | Law

IHS pays $53M to settle another contract support cost dispute

The Kasaan Health Center in Kasaan, Alaska, a clinic that's part of the SouthEast Alaska Regional Health Consortium. Photo from Facebook

The Indian Health Service is paying $53 million to settle a contract support cost dispute in Alaska.

The SouthEast Alaska Regional Health Consortium was owed $39.5 million for underpayment of its self-determination contracts between 1999 and 2013. With interest, the amount rose to $53 million.

"This is a very good settlement and has concluded several years of legal wrangling and political advocacy in Washington, DC. I could not be more pleased to have these issues come to resolution and look forward to focusing our efforts in a more constructive direction,” SEARHC President and CEO Charles Clement said in a press release.

The Indian Self-Determination and Education Assistance Act authorizes IHS to enter into contracts with tribes and tribal organizations. The law requires the agency to pay for the costs of the program, plus additional contract support costs that are needed to manage the program.

For years, the IHS failed to provide the contract support costs. It took U.S. Supreme Court and a change in administration for the federal government to finally pay up.

“The federal government should honor the costs of all contractual obligations regardless of whether or not the contractor is a tribal organization,” Sen. Mark Begich (D-Alaska) said in a press release. “Refusing to pay these contracts in full and in a timely manner is a slap in the face to all the tribal organizations who are on the ground, doing the work, and making sure their people get the quality care and services they need."

Begich, a member of the Senate Indian Affairs Committee, introduced two bills on Thursday to address the matter. The Self-Determination Commitment to Tribes Act makes contract support costs mandatory to prevent federal agencies from taking money from other programs to pay what's required under the law.

The Self-Determination Contract Reporting Commitment to Tribes Act requires IHS and the Bureau of Indian Affairs to submit contract support cost shortfall reports to Congress and to the public.

The bills are S.2668, and S.2669. The text is not yet available in Thomas.

Get the Story:
$53 Million Settlement Reached with Indian Health Service (SitNews 7/24)

Federal Register Notices:
Contract Support Costs (April 8, 2014)
Contract Support Costs (February 21, 2014)

Relevant Documents:
FY14 Omnibus Text & Joint Explanatory Statement | Detailed Omnibus Summary | Subcommittee Allocations

Supreme Court Decisions:
Salazar v. Ramah Navajo Chapter (June 18, 2012)
Cherokee Nation v. Leavitt:
Cherokee Nation v. Leavitt (March 1, 2005)

Related Stories:
Native Sun News: Great Plains tribes call for full contract funds (7/23)
IHS pays $29.5M to end contract dispute with Cherokee Nation (07/15)
ANTHC accepts $153M settlement in contract support cost case (07/01)
Michael Gross: Tribes must protect self-determination contracts (05/09)
IHS pays $275M to settle claims for back contract support costs (05/02)
Opinion: Funds for contract support costs should be mandatory (05/02)
IHS resolves some contract support costs claims for $200M (4/28)
Health and Human Services Secretary Kathleen Sebelius resigns (04/11)
BIA and IHS hold another consultation on contract support costs (04/08)
Mark Begich: Pay back tribes for overdue contract support costs (03/03)
BIA and IHS schedule consultation about contract support costs (02/21)
BIA and IHS agree to fully fund contract support costs for 2014 (2/18)
Budget bill urges solution to contract support cost battle (01/15)

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