The proposed budget authority for the Indian Health Service (IHS), an agency in the Department of Health and Human Services (HHS), for fiscal year (FY) 2003 is $2.88 billion. This is a $61 million, or 2 percent, increase over the FY 2002 comparable level.
Adding in funds from health insurance collections estimated at $508.8 million, mandatory diabetes funds of $100 million, and $5.9 million for staff quarters rental collections, increases the proposed budget for the IHS to $3.5 billion in program level spending. This increase reflects the impact of the Department’s tribal budget consultations and a continuing Federal Government commitment to provide for the health of members of Federally recognized tribes.
The IHS proposed budget authority represents less than 1% of the total HHS budget authority and 5% of the HHS discretionary budget. Although there are increases of $84 million in the proposed budget, there are also $23 million in decreases in some specific IHS budget areas.
Program Increases in the IHS budget proposal totaling $84 million are seen in the following areas: Pay cost - An additional $27 million will go toward increased pay costs for Federal employees, (including retirement and health benefits) and $20 million to go toward comparable pay cost increases in tribal programs. Funds are included in the request to cover the full government share of the accruing cost of all retirement and retiree health care benefits for Federal employees. Tribal Contract Support Costs: The budget proposal includes $271 million for Contract Support Costs, an increase of $2.5 million or 1 % more than appropriated for FY 2002. Contract Support Costs are additional costs that tribes incur when they take over the operation of local health programs from the IHS. Tribes and tribal organizations currently operate 13 hospitals and 435 various types of health facilities through contracts with IHS authorized by the Indian Self-Determination Act. Through the Indian Self-Determination and Education Assistance Act (Public Law 93-638) and other similar mechanisms, tribes manage 52 percent of the funds appropriated to the IHS.
Staffing of New Facilities: A total of $17 million is being added to staff newly opened facilities at Fort Defiance, Arizona; Winnebago, Nebraska; and Parker, Arizona.
Contract Health Services: To partially offset the increased cost of purchasing medical care from the private sector that cannot be provided by the IHS, $7 million is being added to last year’s $459 million allocation, for a 1.5 % increase.
Maintenance and Improvement: The proposed budget has an increase of $1 million (1%) to maintain Federal and tribal health facilities space.
Recruitment: The Health Professions category will see an increase of $4 million to recruit former military health professionals to work for the IHS. The IHS currently has an overall vacancy rate for health professionals of approximately 13%.
Research: The Tribal Epidemiology Program will have its funding doubled with a $1.5 million increase.
Information Systems: The IHS will get $2.5 million to improve its information processing technology. Health Insurance Portability and Accountability Act (HIPAA) -- The proposed budget includes approximately $0.8 million to implement HIPAA privacy regulations.
Program Reductions: A total reduction of $23 million in program spending is proposed for the FY 2003 IHS budget.
Health Facilities Construction: Funding is being requested to continue construction of the top six ranked projects from the Health Care Facility Construction Priority System. This is 17% ($14 million) less than provided in FY 2002.
Administrative and Management Costs: A reduction of $9 million for IHS Headquarters and Area Office administrative functions is expected to be addressed through cost-cutting measures such as reducing travel costs, limiting the hiring of non-health staff, and reducing the acquisition of new office space.
The IHS is the principal federal health care advocate and provider for approximately 1.5 million American Indians and Alaska Natives who belong to more than 560 federally recognized tribes in 35 states. It is composed of 12 regional offices and a system of 49 hospitals, 221 health centers, 123 health stations, and 170 Alaska village clinics, and provides support to 34 urban projects.
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