ADDITIONAL VIEWS OF MR. SIMON

Over 100 years ago, our Nation entered into solemn treaties with the Indian nations of our country. There were over 800 treaties entered into, by virtue of which the Indian tribes agreed to cede over 50 million acres of Indian lands to the United States, in exchange for certain commitments that the Indian nations understood would remain in perpetuity.

Amongst these promises, contained in almost every treaty, was the United States' commitment to provide health care to Indian people. In our role as members of the Senate Committee on Indian Affairs, we have come to understand that the Indian nations of this country purchased the first pre-paid health plan in the United States.

It is with this understanding that we want to closely examine the President's Budget Request for the Indian Health Service (IHS) within the context of treaty commitments and the obligations that the United States understood in exchange for the land we now enjoy.

Beginning in 1980, the Reagan Administration initiated a budgetary effort to eliminate the Indian Health Service programs. By 1990, over forty percent of the infrastructure of the IHS was whittled away by program reductions and inflationary cost increases while comparable programs within the Department of Health and Human Services were sustained or received increased funding. This tenuous situation was revealed in a study conducted by the Congressional Research Service at the request of the Committee on Indian Affairs. In an effort to restore greater equity, the Budget Committees and Appropriations Committees of the House and the Senate recommended increases on behalf of the Indian Health Service programs beginning in fiscal year 1990. Despite the increase, the Indian Health Service as described in the Fiscal Year 1994 President's Budget Document is only meeting 49 percent of the health needs of American Indian and Alaska Native people.

The President's Budget for Fiscal Year 1995 proposes a total of $1,695,994,000 for the Indian Health Service in budget authority, a decrease of $247,076,000 or 12.7 percent below the level of funding provided in FY 1994 for both health services and facilities construction.

An issue that we have been hearing consistently from Indian Country about is the proposed reduction in Full Time Equivalent (F.T.E.) positions within the Indian Health Service. Indian People are very concerned about this proposal, because the Indian Health Service has been trying to address a crisis in this area-the critical shortage of doctors and nurses and other health care professionals. Indian people are also concerned because they hear about the great promises of health care reform, and they wonder how the Indian Health Service can ever meet the promise of health care reform if

its staff capabilities are whittled to the bone and then reduced even further.

In FY 1995, the President's budget applies the 1993 staffing level in the Indian Health Service as the staffing level base for 1994, notwithstanding the fact that the Congress approved a considerably higher level of staffing last year, and then calculates the F.T.E. Reduction targets based on 1993 levels of staffing, so that they don't appear to be quite a drastic as they are.

To put this into a clearer perspective, we might do well to examine what is being proposed for the overall Department of Health and Human Services. In fiscal year 1994, the department would take a reduction of 1,329 positions, and in fiscal year 1995, an additional reduction of 549 positions.

In contrast, the Indian Health Service takes an actual reduction of 1,369 positions in fiscal year 1994 from the amounts the Congress actually approved, and an additional reduction of 460 positions in fiscal year 1995.

This means, in fiscal year 1995, the Indian Health Service will assume 49 percent of the Department's F.T.E. Reductions, and in fiscal year 1995, the Indian Health Service will assume 83 percent of the Department's F.T.E. Reductions. While at the same time, the Indian Health Service represents a mere two percent of the Department's total budget, and the inequity is obvious.

Compounding this grim picture is the fact that these reductions don't event take into account the staffing needs of those facilities that opened in the last year, or those that are scheduled to open in the coming year. To remedy the loss in staffing needs, the Administration proposes to make up for losses in services with contracting. Unfortunately, the budget does not propose any increase in funds available for contracting.

The proposed fiscal year 1995 budget also proposes to fund programs with projected private insurance and Medicare/Medicaid collections, a proposal which Congress has formerly rejected.

The Administration projects that it will collect over $106.8 million from private insurance collections. It has taken the IHS nearly three years to increase its collections from $6 million in FY 1989 up to $18 million in FY 1993. The rationale for a 463 percent increase in the collection of third party reimbursements is based upon projections from a 1988 study.

It is absurd to build a budget which operates from the assumption that large sums can be collected from private health insurers in the continuing absence of any evidence to support such an assumption.

Finally, three of the Facility Construction accounts are zeroed out in FY 1995. Many tribes have waited for nearly twenty years making their way up the facility priority list in order to replace or build new facilities which are more than 60 years old or absent in their communities. It is understood that the existing priority list and five year plan indicates that $126,552,000 can be obligated in fiscal year 1995 for Facilities Construction for 13 projects. Many of these projects are already in the second or third phase of construction and need the additional funding for completion.

For water and sanitation, the picture is even worse. With the elimination of the $85 million appropriated in fiscal year 1994, at

least 5,100 families that were to have moved into new-constructed homes will find that there are no water or sewage systems to serve their homes. And 3,800 families who were counting on repairs to water and sewer systems because they don't meet the standards of Federal environmental laws will continue to suffer the effect of unsafe drinking water.

These cuts are being made to a system whose resources currently are so limited that they are able to address only 49 percent of the need in reservation communities and only 22 percent of the need in urban Indian communities. In sum, these sad statistics constitute today's reality of the promises and commitments that were made so long ago in those solemn treaties. Treaties which we are obligated to uphold.

RECOMMENDATION

As members of both the Budget Committee and Committee on Indian Affairs we would recommend a total appropriation of $2,093,534,000 in FY 1995, this includes $1,751,725,000 for Indian Health Services and $341,809,000 for Indian Health Facilities. The total reflects a 7.2 percent increase in the provision of health services over the fiscal year 1994 appropriation. The increases recommended by the Committee are authorized under recent enactment of two major Acts: (1) the Indian Health Care Improvement Act of 1976 (P.L. 94-437) and subsequent amendments to that Act (P.L. 100-713, P.L. 100-630, and P.L. 102–573); and (2) the Indian Self-Determination Act (P.L. 93-638) and its amendments (P.L. 100-472).

In addition to the inclusion of funds authorized under these Acts, we would recommend increases to the base IHS budget which include: (1) restoration of amounts necessary to address the annualized staffing need for new facilities which opened in fiscal year 1994; (2) the provision of sufficient funding to assure full staffing in two new facilities due to open in fiscal year 1995; (3) amounts to fully and directly fund built-in increases given the fact that the President's budget proposes to fund these increases in a manner that is prohibited by law: (4) the recapture of funding decreases for all program resulting from inflation (5.2 percent for medical costs and 4.2 percent for non-medical costs) to maintain the same level of care provided in fiscal year 1994 in the upcoming fiscal year; and (5) funding to address a 2.35 percent growth in the IHS patient population.

PRIORITY FUNDING CONCERNS

New funding is urgently needed in the following program areas: $5 million to implement community-based mental health initiatives; $5 million to address virtually nonexistent child abuse prevention and treatment efforts; $6 million for epidemiology grant programs; $7.5 million for school-based health programs; $5 million for the establishment of women's treatment programs; $5.5 million for fetal alcohol syndrome and fetal alcohol effect prevention and treatment programs, $5.3 million for recruitment and retention

ADDITIONAL VIEWS OF SENATOR GRASSLEY

I am disturbed about continuing discrepancies between the Department of Defense (DOD) Future Years Defense Program (FYDP) and the President's budget.

Testimony by senior DOD officials, including Secretary of Defense Perry, indicates that funding allocated in the FYDP exceeds the amounts allowed in the President's budget by at least $20 billion. While they testified that the additional $20 billion in the FYDP is needed to cover higher inflation estimates, Mr. Perry reports that the President made a decision in December 1993 not to raise the overall DOD budget figure to accommodate those higher inflation estimates. In his prepared statement to the Committee on March 9th, Mr. Perry stated: "the President opted not to budget for the multi-year inflation bill." Given the President's decision, I question the propriety of including those costs in the FYDP.

Once the General Accounting Office completes its analysis of the FY 1995 FYDP in May, I should be better informed as to the cause and magnitude of the FYDP/Budget mismatch.

In the meantime, I am concerned the $20 billion discrepancy between the FYDP and the President's budget could constitute a violation of Section 221 of Title 10 of the U.S. Code. Under Section 221, DOD must submit a FYDP to Congress each year that is fully consistent with the President's budget. The purpose of this law is to force the Secretary of Defense to make the hard decisions necessary to squeeze all the programs into the budget. Overprogramming in the outyears has a direct, adverse impact on the budget itself.

The FY 1995 FYDP does not appear to be consistent with the President's budget. DOD appears to have inserted a $20.2 billion negative funding wedge in the FYDP in an attempt to conceal the discrepancy and to make the two sets of books balance.

The use of negative funding wedges is inconsistent with the spirit and intent of Section 221. This law was amended in 1989 specifically to prohibit the use of negative funding wedges. The 1989 amendment allowed for the use of management contingency accounts, like potential funding requirements, but only if such accounts were included in both the FYDP and the budget. The FY 1995 FYDP does not appear to conform with this rule.

For these reasons, I respectfully request that the department bring the FY 1995 FYDP into line with the budget and the law. CHUCK GRASSLEY.