IHS defends budget in Aberdeen Area

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An expenditure in the Aberdeen Area IHS budget may have been misunderstood
by members of the Great Plains Tribal Chairmen's Association.

At a recent chairmen's meeting, concern over the amount in the area IHS's
residual fund was Questioned and a resolution was passed to lower the
amount in favor of more funding for direct health care.

The resolution asked the residual fund be reduced from $6 million to $2
million. The savings, the tribal chairmen said, could then be put into
direct health care.

The residual fund is used to pay for inherent federal functions or those
that cannot be legally delegated to the tribes, according to the IHS.

The resolution stated that the amount of the residual fund was $6.2
million, which is more than twice the residual amount for the next largest
IHS area office.

"Each office had to identify all functions that we do, and identify which
are essentially inherent. Some areas had no inherent functions," said Rick
Sorenson of the Aberdeen Area Office.

The residual fund is not based on the size of the contract or budget; it is
based on the function that each office completes, Sorenson said.

He said the amount in the residual fund was agreed to by the tribal
chairmen in 1997 and approved each year since; although the tribal chairmen
who attended the meeting said they were not aware of how the fund worked or
the amount.

"When we developed the first numbers, we took a number to them as a
starting point. They looked at the number and converted it to a percentage,
2.7 percent, then they raised it to 3 percent," Sorenson said.

The Aberdeen Area conducts oversight and performance monitoring. Some areas
have a higher residual workload. There are approximately 50 federal
employees, commission corps employees and civil servants who are paid
through the residual fund in the Aberdeen Area.

Tribal officials at the meeting were impassioned in their pleas to the IHS,
asserting that people were suffering and dying while the IHS held onto the
residual funds. It was the tribal chairmen who approved the residual fund
amount.

The budget for the Aberdeen Area is based on a fiscal year 2002 budget
worksheet. The chairmen were presented with the plan for 2004 and 2005 and
decided to return to the 2002 worksheet as a base, IHS officials said.

According to the FY '02 worksheet, the residual fund is a little more than
$6 million. The IHS cannot carry funds over to the next Fiscal year.
Remaining funds in the account are spent; spent down or obligated.

If there is a program that has been very efficient or had staff changes,
the program is encouraged to send the remaining funds to the service unit
if they are not directed for residual functions, Sorenson said.

A problem with the understanding of what the residual fund may include
occurs because the IHS does not directly work with the Great Plains
Chairmen's Association; it works with the Aberdeen Area Tribal Chairmen's
Health Board, which is made up of many of the same people.

The Aberdeen Area includes all of North Dakota, South Dakota and Nebraska,
as well as the Sac and Fox Tribe of the Mississippi in Iowa.

"I understand what they [tribal chairmen] are saying. We do have a large
residual; the chairmen at that time [1997] raised it beyond what we
proposed. We recognize that it needs to be adjusted," Sorenson said.

"[IHS Director] Dr. Charles Grim has a national committee that is looking
at residual ceilings and floors, and we are waiting for that workgroup to
wind up their research. We don't want to rush into anything and find it is
contrary to the directors," he said.

If the residual funds are lowered by the committee, that could mean more
money for direct health care. That's what the tribal chairmen ask.

If the tribes used "638 contracts" to control and provide their own health
care, the residual fund would not be part of the funding they would
receive. The amount would be adjusted.

Most of the tribes in the Aberdeen Area are reluctant to contract and
manage their own health care. In light of their treaties, they want to be
assured the federal government will continue to fulfill its treaty
obligations.

All is not rosy between the tribal leaders and the IHS. Health care is a
major issue in the Great Plains. Tribal chairmen continually beg Congress
for more funding, and sometimes they direct their frustrations at the IHS
and Congress. Health care is a treaty obligation of the federal government.
However, more money is spent per capita for the health of prisoners than
for American Indians. The national per capita expenditure for all Americans
is more than $5,000; for prisoners it's $3,900, and for American Indians
it's $2,700.

Another frustrating factor is that a hospital plan for the Cheyenne River
Sioux Tribe received a cut in funding by 26 percent of what the need is,
according to Harold Frazer, tribal chairman.

He said he was clueless about what IHS was doing.

IHS holds quarterly meetings with the AATCHB. Sorenson said they would
offer a residual funding session at the next meeting and will take the new
proposed numbers to the chairmen for their approval.

An outspoken critic of the IHS, Lloyd Miller, attorney for Sonosky,
Chambers, Sachse, Miller & Munson LLP, said he had questions about, the
overall budget. He questioned a $1.7 million budget item for a judicially
mandated program, involuntary commitment for North and South Dakota.

That amount is required only for North and South Dakota to care for
psychological patients in state hospitals, said Nancy Davis, IHS public
affairs spokesman.

"What's happened is they have confused the point of this exercise. This
whole exercise is not how they should manage the area office budget, it's
about what is residual and what are tribes eligible to contract; they've
mixed it up in a way that only benefits IHS, not the tribes, and takes off
the table a substantial amount of funding," Miller said.

Should tribes choose to contract they would be eligible for all funds other
than the residual fund, which could be adjusted lower.

"If contracted, the residual is not based on the size of contract, it is
based on the function that each office completes; that's how it's
determined," Sorenson said.

That would free up more funding for direct health care that is operated by
the tribes.

The IHS cannot advocate for contracting. It provides technical assistance
and information to help tribes make the decision. Contracting was not
available until 1975, when the Indian Self-Determination and Educational
Assistance Act was put into effect.