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Rounds Urges Indian Affairs Committee to Consider Audit of Failing IHS System

WASHINGTON — U.S. Sen. Mike Rounds (R-S.D.) today wrote to Senate Indian Affairs Committee Chairman John Barrasso (R-Wyo.) to thank him for his commitment to fixing the systemic problems within Indian Health Service (IHS) and identify areas which an external audit may be helpful in finding solutions to the crisis.

“Over the last year, my office has been looking deep into the financial, structural and administrative problems at IHS so we can better understand how to fix the broken agency and provide better care to our tribal members,” said Rounds. “The goal of today’s letter is to provide the Indian Affairs Committee with the research and problems we’ve identified as it considers possible legislative solutions. In the Great Plains Area – particularly in South Dakota – the failings of the IHS have reached a crisis level. Tribal members are literally dying due to inadequate care. I thank Chairman Barrasso for his continued commitment to address the systemic problems we’ve identified within IHS and look forward to working with him on this critical issue. The care and well-being of our Native Americans is our top priority.”

Last month, Rounds met with the Great Plains Tribal Chairman’s Association (GPTCA) to discuss these findings. In response, the GPTCA passed a resolution calling for a Government Accountability Office audit of the IHS.

A copy of Rounds’ letter to Barrasso can be found below: 

May 12, 2016

The Honorable John Barrasso, M.D.

Chairman, Indian Affairs Committee

United States Senate

838 Hart Building

Washington, DC 20510

Dear Chairman Barrasso:


I write today to thank you for your hard work and attention to the crisis facing the Indian Health Service in the Great Plains Area.  As you know, pursuant to the United States trust obligations to Native American tribes, the federal government established the Indian Health Service (IHS) to provide health care for federally recognized tribal members. However, IHS has historically been criticized by tribes and federal officials for failing to meet their trust responsibility. 


Most recently, a Great Plains Area hospital diverted emergency services because the hospital has been unable to meet basic requirements set by the Centers for Medicare and Medicaid Services (CMS) and now faces potential termination of its CMS certification. Additionally, a second hospital within the Great Plains Area lost its CMS certification and a third Great Plains Area hospital is in jeopardy of losing the same.


As you are also aware, our office has been researching IHS’s history, funding, systems management, and organizational structure in order to better understand whether the data supported the narrative. We believe our analysis confirms what is being experienced throughout IHS. During this review, we have evaluated Government Accountability Office (GAO) reports, Congressional Research Service (CRS) publications, the Health and Human Services fiscal year 2017 publication, have had discussions with IHS officials, and continue to have frequent communication with tribal leadership.  In the Great Plains Area, particularly in South Dakota, this issue has reached a crisis stage.  People are literally dying waiting for a solution. 


Based on our review, our office has identified multiple and primary areas of concern about IHS’s administrative management, financial management, and the quality of care delivered at IHS facilities.  As the Committee considers ways to resolve these issues within IHS, I respectfully request that as a part of any legislative package, you would consider – at a minimum - language to pursue a third-party, objective audit to recommend appropriate legislative solutions.  I believe an audit, similar to what was recently conducted at the Veterans Health Administration, which identified shortfalls and recommended solutions, is a potential model for addressing these critical and systemic issues within the IHS. Such action is supported by the Great Plains Tribal Chairman’s Association, which recently passed a resolution calling upon Congress to demand an external GAO audit of IHS.


Administrative Management

Leadership/Management: The competency of leadership with respect to culture, accountability, leadership development, physician alignment, employee engagement, succession planning, and performance management.

  1. What are the organization’s performance evaluation methods?
    1. How is performance tracked and reported?
    2. How is performance addressed?
    3. How does IHS track chronic vacancies? Turnover?
      1. How long can someone be ‘Acting’?


Staffing/Productivity: The staffing level at each medical facility and the productivity of each health care provider, compared with health care industry performance metrics.

  1. Specific to the Great Plains Area:
    1. At full employment, are the number of health care professionals adequate to provide the health care service capabilities?
    2. What vacancy rates exist and how is this tracked/reported?
    3. Is the number or proportion of administrative staff appropriate compared to other health care systems?
    4. Is there a whistleblower program and if so how is it administered?


Financial Management

Facilities and Asset Management: Management structure and process for construction and maintenance projects, the facilities leasing process, the purchasing, distribution and use of pharmaceuticals, medical and surgical supplies, medical devices and equipment.

  1. Is the maintenance budget updated with the addition of new facilities and is it enough to support the growth of facilities?
  2. How are long term growth plans determined?
  3. How is equipment purchased and deployed? How do facilities address equipment maintenance and upgrades?
  4. How are pharmaceuticals authorized and obtained?


Budget Allocation and Distribution: There is no funding formula to determine how the budget is distributed between regions; just historical distribution. 

  1. Is the funding appropriated adequate to serve the minimum capabilities of IHS?
  2. What is a realistic analysis of Purchased and Referred Care shortages based upon minimum health care capabilities?
  3. What is the allocation of budget spent on administration vs. direct health care?
    1. Does this vary by IHS operated vs. Tribally operated?
    2. According to IHS’ annual budget book, there are 3700 “Medicaid reimbursable FTE”. How many are certified coders?
    3. Are there consistent tracking of “dual eligible” patients (ex. Patients eligible for Medicaid, IHS and/or other federal healthcare programs)?
      1. How are “dual eligible” patients managed?


Quality of Care

Health Care Capabilities: Capabilities by region including hospital care, medical services, and other health care furnished by non-Department facilities under contract.

  1. Are there minimum basic minimum standards for the categories of hospital care, medical services, individual specialties, and post-care rehabilitation that IHS beneficiaries should expect to be able to receive? 
  2. If not, what minimum health care capabilities should be able to be received?
  3. How do different regions use contracts to augment care capabilities?
  4. How does Purchased and Referred Care (PRC) support these minimum capabilities?
  5. Are the current use and process of PRC medical priority levels adequate?
  6. What options are there for behavioral health currently, and what can be improved to increase access?
    1. Are there options for more cultural approaches?
    2. Specific to the Great Plains Area, how does each service unit manage its PRC program?
      1. What priority levels are being approved for PRC at each service unit in the Great Plains Area on July 1, 2016?


Workflow: Processes for ensuring standard quality of patient scheduling, access to care, clinical staffing, documentation, and care transitions.

  1. What workflow processes exist to achieve appropriate and high quality patient scheduling, access to care, clinical scheduling, accurate documentation and coding of inpatient services, and care transitions?
    1. Are these processes similar and as rigorous as comparable large, successful health care systems?
    2. How is compliance with these processes monitored?


Health Information Technology: IT strategies with respect to furnishing and managing health care, including an identification of any weaknesses and opportunities.

  1. What is the additional GPRA appropriation in the FY17 budget intended to produce?
  2. Why isn’t there a regular regional area office comparison study?
    1. If cost is a prohibiting factor, what is the cost to complete this?
    2. Are there recognized standardized qualitative health care measurements in the private sector and if so, does IHS track similar measurements?


I thank you and the committee for the work you’ve done on this issue.  We clearly share a common focus of finally solving the inadequate healthcare being delivered throughout the IHS system. My staff and I look forward to working with you to address the issues we’ve identified and would provide any resources available to us to assist in the Committee’s efforts.  Please contact Gregg Rickman, my legislative director, if you or your staff have any questions concerning this request.








M. Michael Rounds                            

United States Senator                        





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