20
Indian Health Service: Creating a Clilllate for Change "As an enrolled member of the Laguna Pueblo in New Mexico, I am a member of the Sun Clan and have the name of my great grand- father, Osara, meaning 'the sun'," Dr. Michael Trujillo told the United States Senate Committee on Indian Affairs in 1994 during his confirmation hearing as Director of the Indian Health Service (see Exhibit 7/1). He told the committee that he had known the remoteness of Neah Bay at the northwest tip of Washington on the Makah reservation, lived in the Dakotas, and experienced the winters and geographic barriers to health care in Eagle Butte, Rosebud, and Twin Buttes. He had come before them, he also told them, "as the President's nominee for the Director of a national health care program that is essential to the well-being of 1.3 mil- lion American Indians and Alaska Natives belonging to more than 500 federally recognized tribes." Three years later, Trujillo was in front of the same Committee discussing the fiscal year 1998 budget request for the Indian Health Service (IHS). For the fourth consecutive year, the IHS would receive no after-inflation increase in its budget allocation. But what Trujillo said in 1994 was still true: "We, who are involved in Indian health care, are facing a changing external environment with new demands, new needs, and a shifting political picture. The changing internal environment demands increased efficiency, effecti veness, and accountabili ty." This case was written by Robert j. Tosatto, US Public Health Service; Terrie C. Reeves, University of Wisconsin, Milwaukee; W. Jack Duncan, University of Alabama at Birmingham; and Peter M. Ginter, University of Alabama at Birmingham. All quotes are taken from s tatements made before committees of Congress or the houses of Congress by the person qu oted. Used with permission from Terrie Reeves. Copyright © by Robert J. Tosatto, Terrie C. Reeves, W. Jack Duncan, and Peter M. Ginter and the North American Case Research Association. Reprinted . by per- mission from the Case Research [oum al. All rights rese rved . . ,

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Indian Health Service Creating a Clilllate for Change

As an enrolled member of the Laguna Pueblo in New Mexico I am a member of the Sun Clan and have the name of my great grandshyfather Osara meaning the sun Dr Michael Trujillo told the United States Senate Committee on Indian Affairs in 1994 during his confirmation hearing as Director of the Indian Health Service (see Exhibit 71) He told the committee that he had known the remoteness of Neah Bay at the northwest tip of Washington on the Makah reservation lived in the Dakotas and experienced the winters and geographic barriers to health care in Eagle Butte Rosebud and Twin Buttes He had come before them he also told them as the Presidents nominee for the Director of a national health care program that is essential to the well-being of 13 milshylion American Indians and Alaska Natives belonging to more than 500 federally recognized tribes

Three years later Trujillo was in front of the same Committee discussing the fiscal year 1998 budget request for the Indian Health Service (IHS) For the fourth consecutive year the IHS would receive no after-inflation increase in its budget allocation But what Trujillo said in 1994 was still true We who are involved in Indian health care are facing a changing external environment with new demands new needs and a shifting political picture The changing internal environment demands increased efficiency effecti veness and accountabili ty

This case was written by Robert j Tosatto US Public Health Service Terrie C Reeves University of Wisconsin Milwaukee W Jack Duncan University of Alabama at Birmingham and Peter M Ginter University of Alabama at Birmingham All quotes are taken from s tatements made before committees of Congress or the houses of Congress by the person quoted Used with permission from Terrie Reeves Copyright copy by Robert J Tosatto Terrie C Reeves W Jack Duncan and Peter M Ginter and the North American Case Research Association Reprinted by pershymission from the Case Research [oum al All rights reserved

INDIAII HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 71 Dr Michael Trujillo Chief Advocate for Indian Health

Dr Michael H Trujillo was named Director of the Indian Health Service on April 9 1994 His appointment was noteworthy for two reasons (1) he was the first IHS Director appointed by the President of the United States and confirmed by the Senate and (2) he was the first full-blooded American Indian to be appointed Director of the IHS Dr Trujillo was a member of the Sun Clan in the Laguna Pueblo in New Mexico His parents were elementary school teachers for the Bureau of Indian Affairs and were active in the political life of the pueblo His grandfather was a governor of the pueblo and was instrumental in drafting the first Laguna Pueblo constitution From an early age Dr Trujillo had been taught and shown by example to feel an obligation to the Indian people

The first American Indian to graduate from the University of New Mexico School of Medicine Dr Trujillo received both his undergraduate and medical degrees from that institution Family practice and internal medicine were his specialties but he was also chosen for a clinical fellowship in preshyventive medicine at the Mayo Clinic In addition he received an MPH in Public Health Administrashytion and Poli cy from the University of Minnesota School of Public Health

Dr Trujillo had numerous assignments within the IHS prior to becoming Director As an IHS physician he worked with many tribes in diverse locations As an IHS administrator he was Deputy Area Director and Chief Medical Officer for the Phoenix Aberdeen and Portland areas as well as a Clinical Specialty Consultant to the Bemidji area He initiated nationwide quality assurance programs and a medical provider recruitment program for urban Indian health centers

Shortly after being sworn in as Director Trujillo released his vision for the Indian Health Service He envisioned a new IHS one that adapted to the challenges it faced yet continued to be the best primary care rural health system in the world one that recognized the contributions and dedication of employees as well as the active participation of tribal members one that was redesigned to be more effective efficient and accountable Trujillo cautioned that any change must be accomplished in such a way that the Indian people noticed only improved quality of care

Trujillo s position as IHS Director allowed him to be a strong advocate for Indians in all matters regarding health Not only did he want to improve IHS but he also wanted improvement for the entire Indian health care system IHS leadership and direction would provide the course the agency would take in making these improvements

Dr Trujillo knew that in order to accomplish the agencys mission IHS must honor past trea ties as well as respect the beliefs and spiritual convictions of the various tribes The need to respect local traditions and beliefs was formally recognized in Indian self-determination

The Indian peoples had always managed with very scarce resources Howshyever Dr Trujillo was concerned IHS had not developed an adequate third-party payor billing system it faced difficulty recruiting professional s taff and it served a population whose health status was below that of the rest of the United States

IHS was considered a discretionary agency in the congreSSional budget process Dr Trujillo recognized the need to increase the health status of IHSs population in order to gain continued congressional funding and support He needed to answer some difficult and complex questions How could Indian self-determination be implemented What should be IHSs role in the future How should IHS change to best serve the self-determination of the Indian peoples

Dr Trujillo knew tha t his most difficult task was to provide additional much needed health services to a growing and needy population when there was little

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

prospect of increasing resources Simultaneously he had to ensure tha t local health needs were recognized and addressed

In January 1994 Dr Trujillo told the same Committee that the local tribes and communities needed to be more involved in the decision-making process to facilishy

tate Indian self-determination the process by which the Indian people may choose to assume some degree of the administration and operation of their health services The Indian Self-Determination and Education and Assistance Act was passed by Congress in 1975 and gave federally recognized tribes the option of staffing managing and operating the IHS programs in their communities Dr Trujillo was on record as fully supporting greater self-determination of all tribes as a means of enabling Indian people to operate their own health care systems He emphatically stated that During my tenure there is going to be continued emphasis throughout the agency and in our interactions with other health partners for complete recognition of the Indian self-determination process

Dr Trujillo knew that self-determination was far from complete Although IHS still had many important functions to fulfill putting health care back into the hands of the tribes was proving to be difficult Each tribe had different concepts of health and it was difficult to accommodate such variety in a government agency Moreover in the face of scarce resources there was always an inclination to censhytralize rather than decentralize decision making and Dr Trujillo knew that if the IHS created the impression that it could fulfill all the needs of local communities it would contribute to false expectations and disappointment

_ bull 1----- -- - _ ___ 4 __ -- - - - - - - bullbull - bull -- - - ~ -_- - - -------shy ~ist9ric~1 Perspective ~

IHS had a clear mandate to provide high-quality health services to American Indians and Alaska Natives (AIjANs) The basis for this responsibility was estabshylished and confirmed by numerous treaties statutes and executive orders The first treaty between the US government and an American Indian tribe was signed in 1784 and promised that the federal government would provide phYSician services to members of the Delaware Nation as partial payment for rights and property ceded to the United States Treaties were signed with many individual tribes and periodic appropriations were made by Congress to control specific diseases such as smallpox and tuberculosis and to educate the tribes about disshyease Recurring appropriations were not made until the Snyder Act of 1921 which authorized health care services for AllANs by an act of Congress

Health care for Native Americans was originally the responsibility of the Bureau of Indian Affairs however the services provided were in general very poor Despite the employment of field nurses the building of hospitals for Native Americans and the addition of dental services the health status of All ANs remained far behind that of the general population For example Indian infant

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

mortality was more than double that of the general population and life expectshyancy for Indians was ten years less than that of the rest of the United States

The major health problems found in the Native American population became evident during World War II when thousands of Indians volunteered for service in the US armed forces The poor health of many Indian volunteers was noted during induction physical examinations Citing the AI AN health statis tics varishyous state medical and professional groups began a push to put the US Public Health Service (USPHS) in charge of health care for Native Americans They argued that the Bureau of Indian Affairs could not run a quality health care system because health was only one of its many concerns Years of debate and political maneuvering followed Finally the IHS officially became a division of the USPHS on July 1 1955 The Transfer Act stated that all functions responsibilitshyies authorities and duties relating to the maintenance and operation of hospital and health facilities for Indians and the conservation of Indian health shall be administered by the Surgeon General of the United States Public Health Service

Although the overall health status of AI ANs did not improve immediately much progress appeared over the longer term Since 1973 infant mortality among AI ANs had decreased 60 percent and death due to tuberculosis dropped 80 percent During the same period life expectancy for AllANs increased by more than 12 years life expectancy for All ANs was just 26 years below that of the general population in the early 1990s

Over the years after the transfer the IHS developed a model for the proshyvision of high-quality comprehensive health services A major component of this model was the involvement of the tribes in the provision of heal th services to their people This provision had a snowballing effect As the health status of their tribes improved more tribal members began to get involved in the provision of health care which in turn allowed the tribes to provide even more services

Congress followed up the Indian Self-Determination and Educational Assistshyance Act with the Indian Health Care Improvement Act in 1976 and attempted to elevate the health status of All ANs to a level equal to that of the general population This Act gave IHS a larger budget allowed expanded health sershyvices and provided for new and renovated medical facilities and construction of safe drinking water and sanitary disposal facilities In addition it established scholarship and loan payback programs to increase the number of Indian health professionals IHS was elevated to agency status within the USPHS in 1988 This reflected the improving reputation of IHS as an institution as well as the growth of support for Indian self-determination and the IHS mission See Exhibits 712 and 73

Traditional AllAN beliefs concerning wellness sickness and treatment were difshyferent than the modern public health approach or the medical model American

--------------------------------------------------------------------------~~~~--~~~~~~----------

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 72 Timeline of Key Events In IHS History

1784 First treaty between the US government and an American Indian tribe signed

1849 Bureau of Indian Affairs transferred from War Department to Department of the Interior Physician services extended to Indians

1880s First federal hospital built for Indians

1908 Professional medical supervision of Indian health activities established with position of chief medical supervisor

1921 The Snyder Act authorized Indian health services by the federal government (under control of the Bureau of Indian Affairs)

1955 The Indian Health Service officially became a division of the United States Public Health Service (US PHS)

1975 Congress passed the Indian Self-Determination and Education Assistance Act

1976 Congress passed the Indian Health Care Improvement Act

1988 IHS was elevated to agency status within the USPHS IHS was allowed to bill thirdshyparty payors where applicable

1994 Dr Michael Trujillo appointed as Director of the Indian Health Service

1995 Preliminary recommendations of the Indian Health Design Team (a task force composed of Tribal leaders and IHS employees) published

1997 Final recommendations of the Indian Health Design Team published

Exhibit 73 IHS Mission

The mission of the Indian Health Service in partnership with American Indian and Alaska Native people is to raise their physical mental social and spiritual health to the highest level

Indians and Alaskan Natives beliefs included close integration within family clan and tribe harmony with the environment and a continuing circle of lifeshybirth adolescence adulthood elder years the passing-on and then rebirth Individual wellness was conceived of as the harmony and balance among mind body spirit and the environment Effective health services for AllANs had to integrate the philosophies of the tribes with those of the medical community

Of the more than 24 million AIANs in the United States approximately 14 million belonged to the 545 federally recognized Indian tribes All American Indian tribes were sovereign nations Therefore AllANs were citizens of both their tribes and of the United States This meant that AIjANs had a unique relashytionship with the federal government Based on the treaty rights established between most tribes and the United States the federal government had a trust responsibility to these tribes that entitled the Indian people to services such as education and health care However because not all tribes signed treaties with the United States less than two-thirds of all people with an Indian hershyitage were eligible to participate in the federal programs Since October 1978 the Bureau of Indian Affairs had received 215 letters of intent and petitions for

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 2: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

INDIAII HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 71 Dr Michael Trujillo Chief Advocate for Indian Health

Dr Michael H Trujillo was named Director of the Indian Health Service on April 9 1994 His appointment was noteworthy for two reasons (1) he was the first IHS Director appointed by the President of the United States and confirmed by the Senate and (2) he was the first full-blooded American Indian to be appointed Director of the IHS Dr Trujillo was a member of the Sun Clan in the Laguna Pueblo in New Mexico His parents were elementary school teachers for the Bureau of Indian Affairs and were active in the political life of the pueblo His grandfather was a governor of the pueblo and was instrumental in drafting the first Laguna Pueblo constitution From an early age Dr Trujillo had been taught and shown by example to feel an obligation to the Indian people

The first American Indian to graduate from the University of New Mexico School of Medicine Dr Trujillo received both his undergraduate and medical degrees from that institution Family practice and internal medicine were his specialties but he was also chosen for a clinical fellowship in preshyventive medicine at the Mayo Clinic In addition he received an MPH in Public Health Administrashytion and Poli cy from the University of Minnesota School of Public Health

Dr Trujillo had numerous assignments within the IHS prior to becoming Director As an IHS physician he worked with many tribes in diverse locations As an IHS administrator he was Deputy Area Director and Chief Medical Officer for the Phoenix Aberdeen and Portland areas as well as a Clinical Specialty Consultant to the Bemidji area He initiated nationwide quality assurance programs and a medical provider recruitment program for urban Indian health centers

Shortly after being sworn in as Director Trujillo released his vision for the Indian Health Service He envisioned a new IHS one that adapted to the challenges it faced yet continued to be the best primary care rural health system in the world one that recognized the contributions and dedication of employees as well as the active participation of tribal members one that was redesigned to be more effective efficient and accountable Trujillo cautioned that any change must be accomplished in such a way that the Indian people noticed only improved quality of care

Trujillo s position as IHS Director allowed him to be a strong advocate for Indians in all matters regarding health Not only did he want to improve IHS but he also wanted improvement for the entire Indian health care system IHS leadership and direction would provide the course the agency would take in making these improvements

Dr Trujillo knew that in order to accomplish the agencys mission IHS must honor past trea ties as well as respect the beliefs and spiritual convictions of the various tribes The need to respect local traditions and beliefs was formally recognized in Indian self-determination

The Indian peoples had always managed with very scarce resources Howshyever Dr Trujillo was concerned IHS had not developed an adequate third-party payor billing system it faced difficulty recruiting professional s taff and it served a population whose health status was below that of the rest of the United States

IHS was considered a discretionary agency in the congreSSional budget process Dr Trujillo recognized the need to increase the health status of IHSs population in order to gain continued congressional funding and support He needed to answer some difficult and complex questions How could Indian self-determination be implemented What should be IHSs role in the future How should IHS change to best serve the self-determination of the Indian peoples

Dr Trujillo knew tha t his most difficult task was to provide additional much needed health services to a growing and needy population when there was little

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

prospect of increasing resources Simultaneously he had to ensure tha t local health needs were recognized and addressed

In January 1994 Dr Trujillo told the same Committee that the local tribes and communities needed to be more involved in the decision-making process to facilishy

tate Indian self-determination the process by which the Indian people may choose to assume some degree of the administration and operation of their health services The Indian Self-Determination and Education and Assistance Act was passed by Congress in 1975 and gave federally recognized tribes the option of staffing managing and operating the IHS programs in their communities Dr Trujillo was on record as fully supporting greater self-determination of all tribes as a means of enabling Indian people to operate their own health care systems He emphatically stated that During my tenure there is going to be continued emphasis throughout the agency and in our interactions with other health partners for complete recognition of the Indian self-determination process

Dr Trujillo knew that self-determination was far from complete Although IHS still had many important functions to fulfill putting health care back into the hands of the tribes was proving to be difficult Each tribe had different concepts of health and it was difficult to accommodate such variety in a government agency Moreover in the face of scarce resources there was always an inclination to censhytralize rather than decentralize decision making and Dr Trujillo knew that if the IHS created the impression that it could fulfill all the needs of local communities it would contribute to false expectations and disappointment

_ bull 1----- -- - _ ___ 4 __ -- - - - - - - bullbull - bull -- - - ~ -_- - - -------shy ~ist9ric~1 Perspective ~

IHS had a clear mandate to provide high-quality health services to American Indians and Alaska Natives (AIjANs) The basis for this responsibility was estabshylished and confirmed by numerous treaties statutes and executive orders The first treaty between the US government and an American Indian tribe was signed in 1784 and promised that the federal government would provide phYSician services to members of the Delaware Nation as partial payment for rights and property ceded to the United States Treaties were signed with many individual tribes and periodic appropriations were made by Congress to control specific diseases such as smallpox and tuberculosis and to educate the tribes about disshyease Recurring appropriations were not made until the Snyder Act of 1921 which authorized health care services for AllANs by an act of Congress

Health care for Native Americans was originally the responsibility of the Bureau of Indian Affairs however the services provided were in general very poor Despite the employment of field nurses the building of hospitals for Native Americans and the addition of dental services the health status of All ANs remained far behind that of the general population For example Indian infant

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

mortality was more than double that of the general population and life expectshyancy for Indians was ten years less than that of the rest of the United States

The major health problems found in the Native American population became evident during World War II when thousands of Indians volunteered for service in the US armed forces The poor health of many Indian volunteers was noted during induction physical examinations Citing the AI AN health statis tics varishyous state medical and professional groups began a push to put the US Public Health Service (USPHS) in charge of health care for Native Americans They argued that the Bureau of Indian Affairs could not run a quality health care system because health was only one of its many concerns Years of debate and political maneuvering followed Finally the IHS officially became a division of the USPHS on July 1 1955 The Transfer Act stated that all functions responsibilitshyies authorities and duties relating to the maintenance and operation of hospital and health facilities for Indians and the conservation of Indian health shall be administered by the Surgeon General of the United States Public Health Service

Although the overall health status of AI ANs did not improve immediately much progress appeared over the longer term Since 1973 infant mortality among AI ANs had decreased 60 percent and death due to tuberculosis dropped 80 percent During the same period life expectancy for AllANs increased by more than 12 years life expectancy for All ANs was just 26 years below that of the general population in the early 1990s

Over the years after the transfer the IHS developed a model for the proshyvision of high-quality comprehensive health services A major component of this model was the involvement of the tribes in the provision of heal th services to their people This provision had a snowballing effect As the health status of their tribes improved more tribal members began to get involved in the provision of health care which in turn allowed the tribes to provide even more services

Congress followed up the Indian Self-Determination and Educational Assistshyance Act with the Indian Health Care Improvement Act in 1976 and attempted to elevate the health status of All ANs to a level equal to that of the general population This Act gave IHS a larger budget allowed expanded health sershyvices and provided for new and renovated medical facilities and construction of safe drinking water and sanitary disposal facilities In addition it established scholarship and loan payback programs to increase the number of Indian health professionals IHS was elevated to agency status within the USPHS in 1988 This reflected the improving reputation of IHS as an institution as well as the growth of support for Indian self-determination and the IHS mission See Exhibits 712 and 73

Traditional AllAN beliefs concerning wellness sickness and treatment were difshyferent than the modern public health approach or the medical model American

--------------------------------------------------------------------------~~~~--~~~~~~----------

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 72 Timeline of Key Events In IHS History

1784 First treaty between the US government and an American Indian tribe signed

1849 Bureau of Indian Affairs transferred from War Department to Department of the Interior Physician services extended to Indians

1880s First federal hospital built for Indians

1908 Professional medical supervision of Indian health activities established with position of chief medical supervisor

1921 The Snyder Act authorized Indian health services by the federal government (under control of the Bureau of Indian Affairs)

1955 The Indian Health Service officially became a division of the United States Public Health Service (US PHS)

1975 Congress passed the Indian Self-Determination and Education Assistance Act

1976 Congress passed the Indian Health Care Improvement Act

1988 IHS was elevated to agency status within the USPHS IHS was allowed to bill thirdshyparty payors where applicable

1994 Dr Michael Trujillo appointed as Director of the Indian Health Service

1995 Preliminary recommendations of the Indian Health Design Team (a task force composed of Tribal leaders and IHS employees) published

1997 Final recommendations of the Indian Health Design Team published

Exhibit 73 IHS Mission

The mission of the Indian Health Service in partnership with American Indian and Alaska Native people is to raise their physical mental social and spiritual health to the highest level

Indians and Alaskan Natives beliefs included close integration within family clan and tribe harmony with the environment and a continuing circle of lifeshybirth adolescence adulthood elder years the passing-on and then rebirth Individual wellness was conceived of as the harmony and balance among mind body spirit and the environment Effective health services for AllANs had to integrate the philosophies of the tribes with those of the medical community

Of the more than 24 million AIANs in the United States approximately 14 million belonged to the 545 federally recognized Indian tribes All American Indian tribes were sovereign nations Therefore AllANs were citizens of both their tribes and of the United States This meant that AIjANs had a unique relashytionship with the federal government Based on the treaty rights established between most tribes and the United States the federal government had a trust responsibility to these tribes that entitled the Indian people to services such as education and health care However because not all tribes signed treaties with the United States less than two-thirds of all people with an Indian hershyitage were eligible to participate in the federal programs Since October 1978 the Bureau of Indian Affairs had received 215 letters of intent and petitions for

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 3: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

prospect of increasing resources Simultaneously he had to ensure tha t local health needs were recognized and addressed

In January 1994 Dr Trujillo told the same Committee that the local tribes and communities needed to be more involved in the decision-making process to facilishy

tate Indian self-determination the process by which the Indian people may choose to assume some degree of the administration and operation of their health services The Indian Self-Determination and Education and Assistance Act was passed by Congress in 1975 and gave federally recognized tribes the option of staffing managing and operating the IHS programs in their communities Dr Trujillo was on record as fully supporting greater self-determination of all tribes as a means of enabling Indian people to operate their own health care systems He emphatically stated that During my tenure there is going to be continued emphasis throughout the agency and in our interactions with other health partners for complete recognition of the Indian self-determination process

Dr Trujillo knew that self-determination was far from complete Although IHS still had many important functions to fulfill putting health care back into the hands of the tribes was proving to be difficult Each tribe had different concepts of health and it was difficult to accommodate such variety in a government agency Moreover in the face of scarce resources there was always an inclination to censhytralize rather than decentralize decision making and Dr Trujillo knew that if the IHS created the impression that it could fulfill all the needs of local communities it would contribute to false expectations and disappointment

_ bull 1----- -- - _ ___ 4 __ -- - - - - - - bullbull - bull -- - - ~ -_- - - -------shy ~ist9ric~1 Perspective ~

IHS had a clear mandate to provide high-quality health services to American Indians and Alaska Natives (AIjANs) The basis for this responsibility was estabshylished and confirmed by numerous treaties statutes and executive orders The first treaty between the US government and an American Indian tribe was signed in 1784 and promised that the federal government would provide phYSician services to members of the Delaware Nation as partial payment for rights and property ceded to the United States Treaties were signed with many individual tribes and periodic appropriations were made by Congress to control specific diseases such as smallpox and tuberculosis and to educate the tribes about disshyease Recurring appropriations were not made until the Snyder Act of 1921 which authorized health care services for AllANs by an act of Congress

Health care for Native Americans was originally the responsibility of the Bureau of Indian Affairs however the services provided were in general very poor Despite the employment of field nurses the building of hospitals for Native Americans and the addition of dental services the health status of All ANs remained far behind that of the general population For example Indian infant

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

mortality was more than double that of the general population and life expectshyancy for Indians was ten years less than that of the rest of the United States

The major health problems found in the Native American population became evident during World War II when thousands of Indians volunteered for service in the US armed forces The poor health of many Indian volunteers was noted during induction physical examinations Citing the AI AN health statis tics varishyous state medical and professional groups began a push to put the US Public Health Service (USPHS) in charge of health care for Native Americans They argued that the Bureau of Indian Affairs could not run a quality health care system because health was only one of its many concerns Years of debate and political maneuvering followed Finally the IHS officially became a division of the USPHS on July 1 1955 The Transfer Act stated that all functions responsibilitshyies authorities and duties relating to the maintenance and operation of hospital and health facilities for Indians and the conservation of Indian health shall be administered by the Surgeon General of the United States Public Health Service

Although the overall health status of AI ANs did not improve immediately much progress appeared over the longer term Since 1973 infant mortality among AI ANs had decreased 60 percent and death due to tuberculosis dropped 80 percent During the same period life expectancy for AllANs increased by more than 12 years life expectancy for All ANs was just 26 years below that of the general population in the early 1990s

Over the years after the transfer the IHS developed a model for the proshyvision of high-quality comprehensive health services A major component of this model was the involvement of the tribes in the provision of heal th services to their people This provision had a snowballing effect As the health status of their tribes improved more tribal members began to get involved in the provision of health care which in turn allowed the tribes to provide even more services

Congress followed up the Indian Self-Determination and Educational Assistshyance Act with the Indian Health Care Improvement Act in 1976 and attempted to elevate the health status of All ANs to a level equal to that of the general population This Act gave IHS a larger budget allowed expanded health sershyvices and provided for new and renovated medical facilities and construction of safe drinking water and sanitary disposal facilities In addition it established scholarship and loan payback programs to increase the number of Indian health professionals IHS was elevated to agency status within the USPHS in 1988 This reflected the improving reputation of IHS as an institution as well as the growth of support for Indian self-determination and the IHS mission See Exhibits 712 and 73

Traditional AllAN beliefs concerning wellness sickness and treatment were difshyferent than the modern public health approach or the medical model American

--------------------------------------------------------------------------~~~~--~~~~~~----------

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 72 Timeline of Key Events In IHS History

1784 First treaty between the US government and an American Indian tribe signed

1849 Bureau of Indian Affairs transferred from War Department to Department of the Interior Physician services extended to Indians

1880s First federal hospital built for Indians

1908 Professional medical supervision of Indian health activities established with position of chief medical supervisor

1921 The Snyder Act authorized Indian health services by the federal government (under control of the Bureau of Indian Affairs)

1955 The Indian Health Service officially became a division of the United States Public Health Service (US PHS)

1975 Congress passed the Indian Self-Determination and Education Assistance Act

1976 Congress passed the Indian Health Care Improvement Act

1988 IHS was elevated to agency status within the USPHS IHS was allowed to bill thirdshyparty payors where applicable

1994 Dr Michael Trujillo appointed as Director of the Indian Health Service

1995 Preliminary recommendations of the Indian Health Design Team (a task force composed of Tribal leaders and IHS employees) published

1997 Final recommendations of the Indian Health Design Team published

Exhibit 73 IHS Mission

The mission of the Indian Health Service in partnership with American Indian and Alaska Native people is to raise their physical mental social and spiritual health to the highest level

Indians and Alaskan Natives beliefs included close integration within family clan and tribe harmony with the environment and a continuing circle of lifeshybirth adolescence adulthood elder years the passing-on and then rebirth Individual wellness was conceived of as the harmony and balance among mind body spirit and the environment Effective health services for AllANs had to integrate the philosophies of the tribes with those of the medical community

Of the more than 24 million AIANs in the United States approximately 14 million belonged to the 545 federally recognized Indian tribes All American Indian tribes were sovereign nations Therefore AllANs were citizens of both their tribes and of the United States This meant that AIjANs had a unique relashytionship with the federal government Based on the treaty rights established between most tribes and the United States the federal government had a trust responsibility to these tribes that entitled the Indian people to services such as education and health care However because not all tribes signed treaties with the United States less than two-thirds of all people with an Indian hershyitage were eligible to participate in the federal programs Since October 1978 the Bureau of Indian Affairs had received 215 letters of intent and petitions for

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 4: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

mortality was more than double that of the general population and life expectshyancy for Indians was ten years less than that of the rest of the United States

The major health problems found in the Native American population became evident during World War II when thousands of Indians volunteered for service in the US armed forces The poor health of many Indian volunteers was noted during induction physical examinations Citing the AI AN health statis tics varishyous state medical and professional groups began a push to put the US Public Health Service (USPHS) in charge of health care for Native Americans They argued that the Bureau of Indian Affairs could not run a quality health care system because health was only one of its many concerns Years of debate and political maneuvering followed Finally the IHS officially became a division of the USPHS on July 1 1955 The Transfer Act stated that all functions responsibilitshyies authorities and duties relating to the maintenance and operation of hospital and health facilities for Indians and the conservation of Indian health shall be administered by the Surgeon General of the United States Public Health Service

Although the overall health status of AI ANs did not improve immediately much progress appeared over the longer term Since 1973 infant mortality among AI ANs had decreased 60 percent and death due to tuberculosis dropped 80 percent During the same period life expectancy for AllANs increased by more than 12 years life expectancy for All ANs was just 26 years below that of the general population in the early 1990s

Over the years after the transfer the IHS developed a model for the proshyvision of high-quality comprehensive health services A major component of this model was the involvement of the tribes in the provision of heal th services to their people This provision had a snowballing effect As the health status of their tribes improved more tribal members began to get involved in the provision of health care which in turn allowed the tribes to provide even more services

Congress followed up the Indian Self-Determination and Educational Assistshyance Act with the Indian Health Care Improvement Act in 1976 and attempted to elevate the health status of All ANs to a level equal to that of the general population This Act gave IHS a larger budget allowed expanded health sershyvices and provided for new and renovated medical facilities and construction of safe drinking water and sanitary disposal facilities In addition it established scholarship and loan payback programs to increase the number of Indian health professionals IHS was elevated to agency status within the USPHS in 1988 This reflected the improving reputation of IHS as an institution as well as the growth of support for Indian self-determination and the IHS mission See Exhibits 712 and 73

Traditional AllAN beliefs concerning wellness sickness and treatment were difshyferent than the modern public health approach or the medical model American

--------------------------------------------------------------------------~~~~--~~~~~~----------

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 72 Timeline of Key Events In IHS History

1784 First treaty between the US government and an American Indian tribe signed

1849 Bureau of Indian Affairs transferred from War Department to Department of the Interior Physician services extended to Indians

1880s First federal hospital built for Indians

1908 Professional medical supervision of Indian health activities established with position of chief medical supervisor

1921 The Snyder Act authorized Indian health services by the federal government (under control of the Bureau of Indian Affairs)

1955 The Indian Health Service officially became a division of the United States Public Health Service (US PHS)

1975 Congress passed the Indian Self-Determination and Education Assistance Act

1976 Congress passed the Indian Health Care Improvement Act

1988 IHS was elevated to agency status within the USPHS IHS was allowed to bill thirdshyparty payors where applicable

1994 Dr Michael Trujillo appointed as Director of the Indian Health Service

1995 Preliminary recommendations of the Indian Health Design Team (a task force composed of Tribal leaders and IHS employees) published

1997 Final recommendations of the Indian Health Design Team published

Exhibit 73 IHS Mission

The mission of the Indian Health Service in partnership with American Indian and Alaska Native people is to raise their physical mental social and spiritual health to the highest level

Indians and Alaskan Natives beliefs included close integration within family clan and tribe harmony with the environment and a continuing circle of lifeshybirth adolescence adulthood elder years the passing-on and then rebirth Individual wellness was conceived of as the harmony and balance among mind body spirit and the environment Effective health services for AllANs had to integrate the philosophies of the tribes with those of the medical community

Of the more than 24 million AIANs in the United States approximately 14 million belonged to the 545 federally recognized Indian tribes All American Indian tribes were sovereign nations Therefore AllANs were citizens of both their tribes and of the United States This meant that AIjANs had a unique relashytionship with the federal government Based on the treaty rights established between most tribes and the United States the federal government had a trust responsibility to these tribes that entitled the Indian people to services such as education and health care However because not all tribes signed treaties with the United States less than two-thirds of all people with an Indian hershyitage were eligible to participate in the federal programs Since October 1978 the Bureau of Indian Affairs had received 215 letters of intent and petitions for

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 5: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

--------------------------------------------------------------------------~~~~--~~~~~~----------

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 72 Timeline of Key Events In IHS History

1784 First treaty between the US government and an American Indian tribe signed

1849 Bureau of Indian Affairs transferred from War Department to Department of the Interior Physician services extended to Indians

1880s First federal hospital built for Indians

1908 Professional medical supervision of Indian health activities established with position of chief medical supervisor

1921 The Snyder Act authorized Indian health services by the federal government (under control of the Bureau of Indian Affairs)

1955 The Indian Health Service officially became a division of the United States Public Health Service (US PHS)

1975 Congress passed the Indian Self-Determination and Education Assistance Act

1976 Congress passed the Indian Health Care Improvement Act

1988 IHS was elevated to agency status within the USPHS IHS was allowed to bill thirdshyparty payors where applicable

1994 Dr Michael Trujillo appointed as Director of the Indian Health Service

1995 Preliminary recommendations of the Indian Health Design Team (a task force composed of Tribal leaders and IHS employees) published

1997 Final recommendations of the Indian Health Design Team published

Exhibit 73 IHS Mission

The mission of the Indian Health Service in partnership with American Indian and Alaska Native people is to raise their physical mental social and spiritual health to the highest level

Indians and Alaskan Natives beliefs included close integration within family clan and tribe harmony with the environment and a continuing circle of lifeshybirth adolescence adulthood elder years the passing-on and then rebirth Individual wellness was conceived of as the harmony and balance among mind body spirit and the environment Effective health services for AllANs had to integrate the philosophies of the tribes with those of the medical community

Of the more than 24 million AIANs in the United States approximately 14 million belonged to the 545 federally recognized Indian tribes All American Indian tribes were sovereign nations Therefore AllANs were citizens of both their tribes and of the United States This meant that AIjANs had a unique relashytionship with the federal government Based on the treaty rights established between most tribes and the United States the federal government had a trust responsibility to these tribes that entitled the Indian people to services such as education and health care However because not all tribes signed treaties with the United States less than two-thirds of all people with an Indian hershyitage were eligible to participate in the federal programs Since October 1978 the Bureau of Indian Affairs had received 215 letters of intent and petitions for

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 6: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

THE SERVICE POPULATION AMERICAN INDIANS amp ALASKA NATIVES

Exhibit 74 Service Population

Area 1990 (Census) Population 1997 (Estimated) Population

Aberdeen 74789 94313 Alaska 86251 103713 Albuquerque 67504 78851 Bemidji 61349 79930 Billings 47008 55630 California 104828 119976 Nashville 48943 73042 Navajo 180959 215232 Oklahoma 262517 297888 Phoenix 120707 140969 Portland 127774 148791 Tucson 24607 27612

All Areas 1207236 1435947

Exhibit 75 Age Distribution (by percentage of total population)

25 Age Distribution

Cl 20 sect

c o g 15 OJ Cl 0)shy

~ ~ 10 OJQ 1 OJ

Q 5

0+-----r_--~~--_+----_+----~----+_----r_--~----_+----_1

lt1 1-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 gt85

Age in Years

1-- AIAN -- All Races - - - - White 1

Source Adapted from Trends in Indian Health 1996

federal recognition Forty-one of these petitions have been resolved with 21 new tribes being recognized

The total number of AI ANs eligible for IHS services in 1997 was approximately 143 million and increased about 22 percent each year Selected demographics of the service population are shown in Exhibits 74 through 710 Tribal memshybers lived mainly on reservations and in rural communities in 34 states

Similar to the nations health care system IHS operated in an environment of increasing health care costs growing numbers of beneficiaries and excess demand

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 7: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 76 Median Household Income (1990 Census)

$40000

Q) $35000E 0 u $30000c

1J 0 $25000 c Q)

$20000(fJ

J 0 I $15000 c lt1l

1J $10000 Q)

2 $5000

$0 Black

$36784

$31435 $30056

$24156

AIAN Hispanic White Asian All Races

Source Adapted from Trends in Indian Health 1996

Exhibit 77 Percent of Total Population Below Poverty Level

31 6 c 35 o ro Qi i ~ c-J ~~ ro Qj gt ~ ~ 15 0 5 C ~ Q) Q)

~ CD Q)

CL

30

25

20

10

5

141

98

White Asian Hispanic Black AIAN All Races

Source Adapted from Trends in Indian Health 1996

for services The shift in disease patterns (from acute to chronic diseases) and the increasing elderly population played an important role in health plarming for the IHS as well As with the Veterans Administration IHS was a health care provider within the US governmental system - though unlike the V A the IHS was not a Cabinet department and had no voice in policy making at the White House Unlike any other health care system in the country IHS was subject to both the manshydates of Congress and the approval of more than 540 sovereign Indian Nations

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 8: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

Exhibit 78 Infant Mortality Rates

70 Infant Mortality Rate Q)

~ 60

J

0 50 o en 0pound 40 -AIAN -t ~iii Q

30 20

-shy All Races - - - White

Q) ro a

10 a

- - shy -----shy -------shy

1955 1975 1980 1985 1990 1992 Calendar Year

Source Adapted from Trends in Indian Health 1996

Exhibit 79 Overall Measures of Health

AIAN All Races White

Life Expectancy at Birth (Years) 735 755 763 Years of Productive Life Lost

(Rate per 1000 population) 830 556 499 Age-adjusted Mortality Rate

(per 100000 population) 5981 5137 4868

Source Adapted from Trends in Indian Health 1996

Exhibit 710 Leading Causes of Death Hospitalization and Outpatient Visits

Leading Causes of Death Heart Diseases Cancer Accidents (Motor Vehicle and Other) Diabetes Mellitus Chronic Liver Disease and Cirrhosis Cerebrovascular Disease Pneumonia and Influenza Suicide Chronic Obstructive Pulmonary Diseases Homicide

Leading Causes of Hospitalization Obstetric Deliveries and Complications Respiratory System Diseases

of Pregnancy Digestive System Diseases Injury and Poisoning Circulatory System Diseases Genitourinary System Diseases Mental Disorders Endocrine Nutritional and Metabolic Disorders Skin Diseases

Leading Causes of Outpatient Visits Respiratory Diseases Nervous System Diseases Endocrine Nutritional and Metabolic Disorders Injury and Poisoning Musculoskeletal System Diseases Skin Diseases Complications of Pregnancy and Childbirth Circulatory System Diseases

Source Adapted from Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 9: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

dis T~day A ~ey Compon~nt of t~e Indi~n Health -Care Sy~terii Health care for AIANs was delivered through a system of interlocking proshygrams The system was composed of the IHS the Tribal Programs and the Urban Programs JHS programs called service units were those projects and facilities that were directly staffed operated and administered by IHS personneL As of October 1995 there were 68 IHS-operated service units that administered 38 hospitals and 112 health centers school health centers and health stations Tribal programs were those developed through the process of Indian self-determination Administered through 76 tribal-operated service units were 11 tribal program hospitals and 372 health centers school health centers health stations and Alaska village clinics Urban programs were relatively new but were expected to face a future of brisk demand because of the relocation of significant Indian populations from reservations to urban settings The urban programs ranged from informashytion referral and community health services to comprehensive primary health care services As of October 1995 there were 34 Indian-operated urban programs

IHS headquarters and the IHS area offices had ties to the tribal governshyments as well as to the Indian-operated urban projects The Indian and Alaskan tribal governments had input into the decisions of IHS-operated Service Units This interrelation between the federal government tribal governments and urban Indian groups was a key component of Indian health care management Exhibit 711 shows various features of the Indian health care system

Exhibit 7 11 Elements of the Indian Health Care System

IHS Headquarters

Indian-OperatedIndian and Alaskan Urban ProjectsTribal Governments

IHS Area Offices

- -lt

Service Units Service UnitsI I Health Clinics Outreach Hospitals Health Clinics Hospitals Health Centers

and Extended Care Facilities and Other Clinics and Referral Facilities

Note Solid lines reflect formal relationships dashed lines (-----) reflect important but less formal relationships

Source Adapted from Trends in Indian Health 1996

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 10: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

I H S TO DAY A KEY COM PO N E N T 0 FIN D I A N HE A L THe ARE S Y S T EM Iffj Exhibit 712 Executive Branch Organizational Chart

The President of the Un iteo States

Department of Health and Human Services

bull Office of the Secretary bull Administration for Children

and Families bull Administration on Aging bull Agencyfor Health Care

Policy and Research (AHCPR)

bull Agency for Toxic Substances and Disease Registry (ATSDR)

bull Centers for Disease Control and Prevention (CDC)

bull Food and Drug Administration (FDA)

bull Health Care Financing Administration (HCFA)

bull Health Resources arid Servic~s Adrninistrati~n (HRSA)

bull Indian Health Service (lHS)

bull National Institutes of Health (NIH)

bull Program Support Center bull Substance Abuse and

Mental Health Services Administration (SAMHSA)

Department of the Interior

bull Bureau of Indian Affairs

Other Executive Branch Departments

bull Agriculture bull Commerce bull Defense bull Education bull Energy bull Housing and Urban

Development bull Justice bull Labor bull State bull Tra nsportation bull Treasury bull Veterans Affairs

To further complicate the organizational structure IHS was an Operating Division within the Department of Health and Human Services (DHHS) Exhibit 712 shows the position of the IHS (in bold) on the organizational chart of the executive branch of the federal government

Within IHS the organizational structure consisted of three levels headquarters area offices and service units IHS headquarters located in Rockville Maryland

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 11: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 713 IHS Area Offices

Source IHS Homepage (wwwihsgov)

was ultimately responsible for all policy operations and management decisions The 12 area offices (see Exhibit 713) represented geographical regions and were responsible for performing various roles in administrative and program support for the local service units

Service units were composed of several types of facilities including hospitals health centers health stations and clinics Depending on local preferences and circumstances these service units could exist as single entities or as combinations of facilities For example the Fort Hall Service Unit in Idaho included only a single health center whereas the Pine Ridge Service Unit in South Dakota conshysisted of a hospital in Pine Ridge health centers in Kyle and Wanblee and small health stations in Allen and Manderson

IRS Programs and Initiatives

In many (but not in all) cases IHS provided comprehensive health care services to eligible All ANs To be eligible for services All ANs had to be members of federally recognized tribes with whom the United States had treaty agreements Services were provided through various programs and initiatives administered by the IHS covering a full range of preventive health behavioral health medishycal care environmental health and engineering services The initiatives focused on timely issues such as care of the elderly womens health AIDS traditional

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 12: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 714 IHS Programs and Initiatives

IHS Services and Programs

Preventive Health Prenatal and Postnatal Care Well Baby Care Immunizations Family Planning Services Womens Health Program Nutrition Program Health Education Program Community Health Representative Program Accident and Injury Reduction Program

Medical Inpatient Hospitalization Outpatient Services Emergency Services Pharmacy Program Laboratory Program Nursing Program Contract Health Services

Behavioral Health Mental Health Program Social Services Alcohol and Substance Abuse Program Diabetes Program

IHS Initiatives AIDS Initiative Traditional Medicine Initiative Indian Youth Initiative Maternal and Child Health Initiative Sanitation Facilities Initiative Indian Womens Health Initiative Injury Prevention Initiative Elder Care Initiative Otitis Media Initiative State Initiative

Environmental Health and Engineering Water and Waste Treatment Food Protection Environmental Safety and Planning Pollution Control Insect Control Occupational Safety and Health Facility Construction and Maintenance

medicine practices and injury prevention as shown in Exhibit 714 However in some locations the IHS did not have the necessary equipment or facilities to proshyvide comprehensive services In these instances services which were not readily accessible to AllANs could be provided under contracted health services with local hospitals state and local health agencies tribal health institutions and individual health care providers

In its relatively short history the IHS had contributed to tremendous improveshyments in the health status of its service population Some of the many reasons for these status improvements included increased primary medical care services sanitation facility construction and community health education programs The IHS was often instrumental in the infrastructure changes Exhibit 715 shows some of the more impressive accomplishments of the IHS

IRS Personnel

The Indian Health Service employed a workforce of approximately 15000 people Of these more than 62 percent were of American Indian or Alaska Native

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 13: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 715 Program Accomplishments

Percent Decrease in Selected Mortality Rates (since 1972)

Homicide

PneumoniaInfluenza

Accidents

Infant Deaths

Maternal Deaths

Gl Diseases

Tubercu losis

o 10 20 30 40 50 60 70 80

80

Source Adapted from Trends in Indian Health 1996

Exhibit 716 Percentage of Outpatient Visits by Type of Provider

All Other Providers

Other Primary 14

Care Providers 6 ~--ri~

Optometrist 3 ~~~~~~sect~Clinic RN 4 f

Nurse Practitione 6

Pharmacist

Physician 45

15

Source Adapted from Trends in Indian Health 1996

heritage IHS personnel consisted of nearly every discipline involved in the proshyvision of health social behavioral and environmental health services The IHS clinical staff was composed of primary care professionals and other providers as well as clinical technicians and assistants Primary care providers included physishycians phYSician assistants dentists nurse practitioners and nurse midwives Other providers included pharmacists optometrists public health nurses clinic nurses physical therapists and dietitians (see Exhibit 716) Over several years because

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 14: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

IHS TODAY A KEY COMPONENT OF INDIAN HEALTH CARE SYSTEM

Exhibit 717 IHS Staffing Trends

14000

12000 Ul Q) Q) 10000gtshy0 a E 8000 w +shy0 6000 Q)

0

E J 4000 z

2000

0

12392

Service Units

2806

742 509

Area Offices Headquarters

Source Adapte d from Trends in Indian Health 1996

of the Reinventing Government initiative of the Clinton Administration resultshying from a national preference for moving government decision making closer to the people as well as the IHS redesign process initiated by Dr Trujillo the trend in IHS staffing was towards an increase in personnel at the service unit level and decreases at the area and headquarters levels (see Exhibit 717)

An ongoing personnel problem concerned the recruitment and retention of dedicated qualified professionals Most IHS sites were remote and many lacked adequate schools stores and amenities To compensate for some of these qualityshyof-life imbalances IHS offered financial incentives in the form of scholarship s loan payback agreements and summer employment to selected health care professionals For most professionals however the pay scales continued to lag behind those in the private sector

Further exacerbating the personnel recruitment and retention problems many employees were concerned about the changes that were occurring within the IHS Federal employees at the service unit level wondered how long they could remain in their pOSitions once the local tribes assumed responsibility for health services Area and headquarters employees were concerned about the future of their careers because there were so many cuts being made in these programs All such issues concerning the organizational changes were addressed often by IHS leaders in memorandums reports and speeches Information technology resources particularly the Internet and electronic mail were also used to disseminate information Upper management felt that it was imperative to keep the lines of communication open and to involve IHS personnel at all levels of the change process but the uncertainty could not be eliminated

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 15: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

Itl CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CHANGE

Exhibit 718 Tribal Contract and Compact Funding (in m i llions of dollars)

Fiscal Year Contracts Compacts Total

1987 $2009 $98 $2107 1988 217 2 131 2303 1989 3066 235 3301 1990 3207 274 3481 1991 4101 401 4502 1992 511 6 509 5625 1993 4915 599 5514 1994 6481 1145 7626 1995 2975 3350 6325

Source Adapted from Trends in Indian Health 1996

The Indian Self-Determination and Education Assistance Act gave federally recognized tribes various options for their involvement in staffing The original Act allowed tribes to contract with the federal government These contracting tribes could redesign and assume responsibility for any aspect of their health care sershyvices Some tribes made the choice to contract all of their health care services A limitation of the contracting process was that IHS had to approve and allow all redesign proposals

Amendments to the Act removed this limitation by creating the Tribal SelfshyGovernance Demonstration Project This project allowed selected tribes to comshypact their health care services that is they took over complete responsibility without the need for IHS approval or oversight The project originally called for 30 tribes to be selected for inclusion but by 1997 there were already 34 participating tribes with several more anticipating their inclusion The number of tribes choosing to deliver at least some portion of their own health care had increased steadily Although contracts and compacts accounted for only an estimated 22 percent of the total IHS budget in 1987 these obligations grew to over 32 percent by 1995 and were expected to reach 50 percent by 2000 Exhibit 718 shows the trend in funding for tribal contracts and compacts

IRS Funding

Sources of funding for IHS included appropriations from the federal budget and collections from third-party billing Congress passed the Indian Health Care Amendments of 1988 which authorized the IHS to bill third parties for both inpatient and outpatient services Medicaid Medicare and other insurance payors were all defined as third-party payors and these were considered the only new revenue source for IHS programs IHS did not collect the co-payments or deductibles that were required with some policies and those eligible indishyviduals who did not have insurance coverage were not charged for the services they received Although collections from third-party payors were increasing there were still many concerns over the inability of IHS to bill and collect

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 16: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

Exhibit 719 Trend in IHS Budget Appropriations

IHS Budget (FY87-FY98)

Category FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998

Services Clinical $748 $817 $883 $1031 $1235 $1276 $1252 $1325 $1 370 $1418 $1452 $1468 Preventive Health 66 70 73 78 90 65 70 75 77 78 81 82 Other 56 60 63 70 85 90 204 246 260 264 274 285

Total Services $869 $947 $1019 $1 179 $1410 $1431 $1526 $1 646 $1707 $1760 $1807 $1835 Facilities 71 62 62 72 166 274 334 297 253 239 248 287

Total Appropriations $940 $1009 $1081 $1251 $1 576 $1705 $1860 $1943 $1 960 $1999 $2055 $2122

bull A ll va lues are dollars ($) in millions b Other services include urban health Indian health professions Tribal hea lth management direct operations self-governance and contract support costs

Source Adapted fr om Trends in Indian Health 1996

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 17: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

CASE 7 INDIAN HEALTH SERVICE CREATING CLIMATE FOR CH AN GE1 J

Exhibit 720 Trend in Third-Party Collections

Category FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996

MedicareMedicaid $66 $75 $88 $94 $122 $141 $160 $162 $177 Private Insurance 35 8 12 18 23 31 34

Total Collections $66 $75 $91 5 $102 $134 $159 $183 $193 $211

Note All values are dollars ($) in millions

Source Adapted from Trends in Indian Health 1996

adequately for all of the services that it provided In fact a 1995 review pubshymiddotlished by the Office of the Inspector General of the Department of Health and Human Services estimated that the IHS underbilled by about $85 million each quarter because of untrained staff shortage of staff or lack of controls

Because the IHS was considered a discretionary program within the confines of the federal budget and because any attempts to balance the federal budget would involve cuts in discretionary programs stakeholders of IHS were very conshycerned about the level of funding that the organization received from the federal government The termdiscretionary referred to funds con trolled by the annual appropriations process This included most of the regular operating funds for the federal agencies as well as funds for the thousands of large and small programs that have no binding legal obligations to their beneficiaries Estimates were made that many IHS programs were underfunded by 30 to 40 percent although some went as low as 70 percent below their level of need Exhibits 719 and 720 show the trends for these funding sources The 1998 budget request allowed no fund increases to account for inflation population growth or newly recognized tribes Exhibits 721 and 722 show the financial position of IHS for fiscal year 1996 and fiscal year 1997

The shift from direct federal funding to state block grant funding of health care programs (such as a Medicaid managed care program) was another great conshycern of IHS and tribal leaders It was a common occurrence for states to overlook or ignore Indian concerns when developing programs Many state governments had the misconception that Indian tribes had relationships only with the federal government and were not eligible for state resources when in fact AI ANs were entitled to the same privileges and resources as any other state citizen In response to these concerns a state initiative workgroup was created by the IHS to focus on the social economic legaL and policy issues pertaining to state health reform initiatives and Indian health programs

Also a strategic business plan was being developed by a workgroup composed of tribal leaders IHS personnel and private sector consultants This plan would focus on revenue generation cost control internal business improvements and allocation of tribal shares Although the business plan was still in the developshyment stage this committee represented the IHS commitment to a new style of leadership one that focused not only on the efficient and effective use of resources but also on the partnership with the Indian people

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 18: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

Exhibit 721 Statement of Financial Position

Assets Entity Assets Fund Balances with Treasury

Investments Accounts Receivable Net

From Federal Agencies From the Public

Interest Receivable Advances

To Federal Agencies To the Public

Inventories Property and Equipment Net

Non-Entity Assets Accounts Receivable Net

Total Assets

liabilities Funded Liabilities

Payables Due Federal Agencies Due the Public

Advances From Federal Agencies From the Public

Accrued Payroll and Benefits Unfunded Liabilities

Annual Leave Workers Compensation Benefits Other Liabilities Pensions

Total Liabilities

Net Position Unexpended Appropriations Invested Capital Cumulative Results of Operations Future Funding Requirements

Total Net Position

Total Liabilities and Net Position

(in millions) 1996 1997

$1172 $1108

19 6 4 16

13 10 40 13 15

497 647

$24 $26 42 48

47 64

29 30

60 60 44 45

2

247 275

991 954 511 662

84 48 (105) ~

1481 1557

$1728 $1832

Source DHHS website (httpwwwhhsgov)

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 19: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

_

Exhibit 722 Statement of Operations and Changes in Jet Position

Revenues and Financial Sources Appropriated Capital Used

General Appropriations Matching Contributions

Employment Taxes SMI Premium Collected Interest Revenue Sales of Goods and Services Imputed Financing Other Revenue and Financing

Total Revenue and Financing Sources

Expenses Operating

Personnel Costs Travel and Transportation Rent Communications and Utilities Printing and Reproduction Contractual Services Supplies and Materials Grants Insurance Claims and Indemnities Other Operating Expenses

Depreciation and Amortization Imputed Personnel Costs Other Non-Operating Expenses

Total Expenses

Excess of Revenues and Financing Sources

Net Position Beginning Balance Adjustments

Net Position Restated Beginning Balance Excess of Revenues and Financing Sources Non-Operating Changes

Net Position Ending Balance

(in millions) 1996 1997

$1991 $2135

310 415 71

$2301 $2621

$745 $755 46 48 43 40

2 1 738 851

80 180 516 605

1 81 24 24

71

$2275 $2577

$26 $44

$1464 $1481 178

1464 1659 26 44 (9) (146)

$1481 $1557

Source DHHS website (http wwwhhs gov)

------------------------------------------------- _shy

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov

Page 20: Indian Health Service: Creating a Clilllate for Change - UTAwweb.uta.edu/management/Dr.McGee_New/HCAD 5390/HCAD 5390 Su… · Indian Health Service: Creating a Clilllate for Change

REFERENCES

middot Th~ FutU~e of th~ IRS bull L _ _

Dr Trujillo knew that the IHS was a very dynamic organization that it was staffed by professional personnel that the AllAN populations were unique and that tribal cultures values religions and traditions must always be considered and respected when delivering health services to them In addition he knew that the IHS was at a crucial juncture in its existence Stakeholders in Indian health were calling for major changes in the organization Various economic changes were signaling the need for new and innovative ways to fund programs Tribes were asking for more control over the health care for their members At the same time that the IHS was constrained by treaties it was also considered a discretionary agency of the United States

Dr Trujillo was committed to Indian self-determination and knew that the spirit of self-determination required local assessment and definition of health service requirements At the same time he was responsible for improving the health status of the American Indians and Alaska Natives to the highest level posshysible Although there was no inherent conflict between self-determination and improvements in health status of all the Indian peoples in the face of scarce resources Dr Trujillo knew there were limits to the services that could be proshyvided to any single community He needed to carefully manage the expectations created by self-determination while not discouraging local communities from becoming involved in their own health affairs The creation of false expectations could be as damaging as not involving tribes in local health affairs Balancing expectations with local support required some serious thinking about the future mission and role of the IHS

RE FERENCES Kendrick T (1997) A Future of Possibilities for Health Indian Health and Indian Health Leaders Available

httpwwwihsgov Trujillo M H (January 27 1994) Confirmation Hearing Statement Before the United States Senate Committee on

Indian Affairs Available httpwwwihsgov Trujillo M H (May 11 1995) Opening Statement Before the Interior Subcommittee of the Senate Appropriations

Committee Available httpwwwihsgov Trujillo M H (November 28 1995) Time of Change Time for Change The State of the Indian Health Service

(presented at the National Indian Health Board 13th Annual Consumer Conference) Available http wwwihsgov

Trujillo M H (February 20 1996) Challenges and Change The State of the Indian Health Service Available httpwwwihsgov

Trujillo M H (December 1996) Message From the Director Looking to the Future of the Indian Health Service IHS Primary Care Pravider 21 no 12 pp 157-160

Trujillo M H (March 1997) The Future Indian Health Care System Available httpwwwihsgov