the National Congress of American Indians, the tribal leaders SelfGovernance Advisory Committee, and the National Council on Urban Indian Health, stand ready to work with this committee to make necessary changes and improvements to craft a bill that will assist us in our goal of raising the health status of American Indians and Alaska Natives.

I hope this hearing can be the final kick-off of the renewed effort to reauthorize the Indian Health Care Improvement Act. The Indian Health Service is no longer able to assist the National Steering Committee as it did in 1999, with support for travel and staff expenses. So it is a challenge to the tribes and the national Indian organizations, including the National Indian Health Board, to move this effort forward. We will meet this challenge and the continued support of this committee is a critical element of our efforts to pass this bill in this session of this Congress.

Just a note, I would like to support the confirmation of Dr. Grim. I was pleased to hear the announcement by Senator Campbell regarding his confirmation. I would also like to comment, as a tribal leader, that the One-DHHS Initiative that my counterpart here is going to comment on, needs to be reviewed thoroughly by tribal governments. Speaking as a tribal leader, having the head offices in Baltimore is a concern that we have as tribal leaders. The other concern is keeping the government-to-government relationship intact that we have with the Federal Government.

Thank you for this time and I would be happy to answer any questions that you have.

[Prepared statement of Ms. Davis-Wheeler appears in appendix.] The CHAIRMAN. Thank you, Julia.

We will now move to Chairman Kashevaroff.

STATEMENT OF DON KASHEVAROFF, REPRESENTATIVE, TRIBAL SELF-GOVERNANCE ADVISORY COMMITTEE; PRESIDENT AND CHAIRMAN OF THE ALASKA NATIVE TRIBAL HEALTH

CONSORTIUM

Mr. KASHEVAROFF. Thank you, Mr. Chairman.

I would also request that my written testimony be put in the record.

The CHAIRMAN. Yes; it will be included in the record.

Mr. KASHEVAROFF. Thank you. And I would like to thank you for the opportunity to testify here on the reauthorization of the Indian Health Care Improvement Act and on the One-HHS proposal that is going through. Since Ms. Davis-Wheeler touched a lot on the Indian Health Care Improvement Act, I would just like to add a few things from my viewpoint.

First, I also represent the Tribal Self-Governance Advisory Committee. This committee is of tribal leaders, convened by the Indian Health Service, to address the health care needs of all eligible American Indian and Alaska Natives, especially those served by tribal health programs operated through self-governance compacts. Even though we have somewhat compacted and separated and started to do our own direct operations apart from the IHS, we are still very concerned and take both the Indian Health Care Improvement Act Reauthorization and the One-HHS proposals-we take them both seriously.

The Indian Health Care Improvement Act, as stated before, was worked out in 1999, 4 years ago, and a lot has happened since then. We have been going through and making modifications. We have been making compromises to some of the requests that came down. I think even though we have some compromises, we have a much better bill that the House side again is working up, and we would ask that that bill when it becomes available in the next couple of weeks be substituted for the current bill on the Senate side. There were a couple of criticisms that we heard back on the 1999 bill that took immediate offense. There was discussion about the high score of the bill, and looking at the Medicaid-Medicare provisions and the amount of costs that they will require. My viewpoint is that the Indian Health Service and the U.S. Government should fully fund the tribes in this country. We do not get fully funded. We are basically forced to go out and find the funding on our own. As compacted tribes, we have taken that on as our own responsibility and have been trying to run our hospitals, our clinics, like a private organization. Private organizations, go out and bill for everything they can bill. They bill private insurance. They bill Medicaid. They bill Medicare. We have been doing that also. It would be nice if we did not have to. It would be nice if we were 100 percent fully funded, but knowing that is not the case, I do not think it should be an issue that we are doing the same thing the rest of the country does in health care. I think we should be allowed to do that. There are also some demonstration projects that were underway that we think should be made available to all tribes, and I think contributed somewhat to the high score also.

So when the substitute bill comes, we hope, or when the House bill comes, we hope that that can be substituted and we look forward to working with this committee and taking on any extra questions or extra concerns, and working with this committee to make sure that we have a good bill for you.

[Prepared statement of Mr. Kashevaroff appears in appendix.] The CHAIRMAN. Okay. Thank you, Mr. Kashevaroff.

You have a major job, Alaska being so big, and I am delighted to see Senator Murkowski has just arrived. I am sure you know that your new Senator is doing a great job, just like her Dad did when he was here.

I note with interest that neither one of you talked very much, or in fact almost not at all, about the One-HHS proposal. Would either one of you like to comment on that? If you don't, I would like to ask you to give us some feedback, some written explanation or evaluation of the proposal, if you could.

Mr. KASHEVAROFF. Thank you, Mr. Chairman. I will comment on that. In my written testimony, we have a couple of pages on it. Basically, I understand that HHS is a very large Department, and in a large Department there should be efficiencies that can be obtained. Change is not bad. Change is usually good. I would have no problem, actually. I applaud Secretary Thompson for trying to make change, trying to create efficiencies, and trying to do a better service.

What I think is missing is the understanding that IHS is a unique agency. IHS provides direct health service, and by providing direct health service, that brings a whole host of other parts that

you need. You need a better HR system. You need an HR system that looks at the nursing shortage in America, and says, how can we compete for the same nurses that the private sector is competing for? Now, that is somebody you need there at the hospital, getting those nurses to come to your hospital, not somebody back in Baltimore who is out of the loop, away from the local level, not knowing what is going on.

Similarly, on the information technology-on IT, we need data systems of patients that have clinical data; we need information systems. We need those type of systems. The rest of HHS does not really need those type of systems. We also have what we call the RPMS, or Resource Patient Management System, that collects data from all of IHS and the tribes, combines it together to provide data to the Congress. That is unique among HHS also, and that is something that takes a lot of work to keep going.

It was an antiquated system. We have proposals on the IHS side, the tribes have been putting forth proposals, IHS has put forth proposals-around $36 million for a better centralized system that looks at a business perspective of what a hospital needs to be efficient and be successful. So we are looking for a $36-million in

crease.

At the same time, HHS has come out and said that we need to reduce the $54 million IT budget by $9 million. At the same time, the IHS hospitals and clinics are very far behind the private sector, we cannot be reducing the budget. We need to be increasing that.

As I said again, I do not mind HHS combining a lot of things. I am sure they can combine like agencies that just do a lot of granting, but when you turn over to the IHS and see the unique status of it, it needs to stand out by itself and be recognized for that.

If they want One-HHS, they should have One-HHS. They should look at the disparities in health for the American Indians and Alaska Natives, and see that we have the worst statistics across the country. One-HHS should come together and say, we are going to handle the Indian population, we are going to bring them up to the rest of the population, that would be our One-HHS mission, and that is what we are going to do first.

When they do that, then we can talk about all being equal again, and then putting everybody back together.

The CHAIRMAN. Julia?

Ms. DAVIS-WHEELER. Yes; thank you, Senator Campbell.

As a tribal leader and participating in the One-HHS restructuring initiative with Indian Health Service, one of the concerns that came forward many times and was a very hot issue at the very beginning of our meetings with certain tribal leaders was the downsizing of the Indian Health Service again. I can truly say that in a couple of those meetings, we had some tribal leaders just almost walk out on the whole process, because they felt that down-sizing the Indian Health Service any more was just a catastrophe for us to take care of our people.

The one other big concern that came forward, and I appreciate Dr. Grim's response to you on the question of consultation, was that the timeframe for proper consultation on the One-DHHS Initiative was very short. We had basically seven months to try to

consult with all the tribes across the United States. We did the best that we could under the circumstances, but I think in all reality it really needs to be like hearings or field hearings or that type of issue. I know that the Department of Health and Human Services was really putting a lot of pressure on the Indian Health Service agency to do this. So as a tribal leader, we worked very hard to help the Indian Health Service meet that deadline. It does need some more reviewing.

Thank you.

The CHAIRMAN. Okay. Well, since Dr. Grim is still here, I might say in his presence that if you think that some of the tribes have not had an adequate voice in that, we probably ought to ask him to extend that consultation process at least a few more months, Dr. Grim.

Senator Murkowski, did you have an opening statement or any questions of our witnesses?

STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM ALASKA

Senator MURKOWSKI. Thank you, Mr. Chairman. With your permission I would like to submit my opening remarks for the record. I did have some questions, just general questions, that I will also submit for the record.

I would like to take the opportunity to welcome my constituent, Mr. Kashevaroff. We had a little bit of a chance yesterday to speak, but I am pleased to have you here this morning and you have you answer the questions from this committee.

You did address briefly in your comments here the issue of the merger and how that might affect, for instance, the IT end of things within the Indian Health Services. A more general and broad question for you this morning would be how tribal self-governance, with the Alaska Natives, has affected the Indian Health Service Program and the delivery of the health services. I am not looking for specifics, but if you can just briefly describe how is this all working with the tribal self-governance.

Mr. KASHEVAROFF. Thank you, Senator Murkowski. Alaska looks forward to another long tenure of a Senator Murkowski, and keep adding the years to the same name. So that will be good.

I appreciate your question. Alaska, as mentioned earlier by Dr. Grim, has pretty much, or is 100 percent contracted-compacted. The tribes all operate their own organizations themselves, and IHS has a residual there. The residual does have 10 HR people that will come over to the tribal side as the number of Federal employees dropped. So there are still some residual, plus some transition.

But we think from Alaska, and think this because we have been told from around the country, and we have many people from around the country coming up to Alaska to see what was accomplished in our compacting. I think the shining example, the first thing that comes to our mind when we talk about what we accomplished, is we took 229 tribes and we built a consensus and built a working relationship amongst each other. We have been able to expand this relationship now to Federal partners, to do projects such as the telemedicine project.

The idea of working together, cooperating is not unique among Indian Nations, but in Alaska, with so many tribes, it was amazing that we could come together, and we pretty much try to speak with one voice now. I think the power we gain by that can be shared across the Nation, not only among Indian tribes, but other groups, to say that if you can come together and work together, there is a lot that can be accomplished.

What we have done for the Indian Health Service is we took over a system back in 1998, 1999-actually it was 1997-that was not meeting the needs of our customers, our owners. We call them customer-owners now because every one of the 115,000 Natives in Alaska own the health system now because we are compacted. We took over a system, and we have been steadily improving it. The reason we improve it now is that control has been passed from Rockville to the local villages, to Anchorage. I sit as Chair of that, the Tribal Health Consortium, but I am also President of my tribe. I am elected by 400-and-some tribal members. When those folks come to our hospital, I want to make sure that they get the best care possible. They are treated with the highest respect possible, because I know that my election depends on it.

Every one of our tribal leaders now that are overseeing health care know that, and we have taken this to heart, that our people come first. Now that we have local control, we can see the needs at a local level and adjust to it. We are very agile now. We can make changes when needed. We can also go out and get more resources. We have been getting new grant funding we are bringing in to supplement what we have. Again, I know that you do not want specifics, but a quick example-my small tribe, IHS just refused to give us a clinic. They gave us contract health money. Unfortunately, with contract money, they would give us 2 or 3 percent a year. Our costs from the private doctor we went to were 14 to 15 percent increase every year. We are going in the red every year. By taking over our own services and doing it ourselves, we then have to go out and get grant money, and now we lease a clinic, and hopefully we are going to build a clinic here, too, pretty quick; but we are leasing a clinic; we are doing it ourselves; we are controlling our costs-something that IHS just would never have been in a position to do.

So there are a lot of examples. I guess one last thing that I want to say about how IHS can work with the compactors, is they can take and look at the success the compactors have had all across the country, not just in Alaska. And they can pick out the items that we have been successful in and try to duplicate those, called best practices, looking at what one organization does best and taking that and spreading it across the rest of IHS.

I think if IHS takes that mentality, and I know Dr. Grim, who I have had some work with the last year, I know he has come to the IHS with a business mind, wanting to do that. I do support his nomination. I think he is a great choice to take a government agency and try to mold it into a very efficient and top-rated health system. I think working with the tribes, he can probably accomplish that.