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By Mark Trahant
News From Indian Country 11-09

The idea that American Indians should be exempted from any mandate to purchase health insurance has almost become a given in the debate about health care reform.

Recently Speaker of the House Nancy Pelosi wrote to the National Congress of American Indians and said: – “We cannot ask Indian people to be penalized for choosing to use the Indian health care system.

The House bill will ensure that the exemption from the financial penalties is extended to federally recognized tribes and that tribally provided health care benefits are appropriately protected.” – The Senate Finance bill already contains such a provision.

I’ve wondered about this mandate from the beginning of the process. I know too many people who do not participate in the mainstream economy; many of these folks are either unable or unwilling to navigate such a complex system. Imagine someone who hunts, fishes or is involved in a subsistence enterprise, figuring out what part of their income should be used to purchase even subsidized health insurance.

But even if you agree with the exemption – as I do – there remains another issue to resolve, the money. Unless health care reform substantially improves the funding stream for the Indian health care delivery system, then the individual exemption is only a guarantee of permanent disparity. The reason for the exemption in the first place is the Indian health care system does not qualify as an acceptable insurance plan. The funding gap is too great.

The speaker hints at this in her letter to NCAI when she said that the “health reform legislation must ensure that adequate funds are made available to tribes to stamp out preventable illness and conditions that are having a devastating impact in your communities, such as diabetes.”

Could health care reform open up new revenue streams for the Indian health system? In theory, yes. All of the current health care bills in Congress contain elements that could significantly boost the funding stream for the Indian Health Service.

One way that could happen is by expanding Medicaid. Already there are many Native Americans who are eligible for Medicaid who do not apply, so any improvement in the application process ought to improve funding.

Medicaid is primarily designed for low-income families with children, pregnant women, and people with disabilities. The income requirements vary by state (because states are partners in Medicaid). None of this is final, but the House and Senate bills add adults without children with incomes up to 133 percent of the Federal Poverty Level or $14,404 per year for one person or $19,378 for two (the figure is higher in Alaska and Hawaii). (The Senate Health, Education, Labor and Pension Committee goes further, making those earning less than 150 percent of the Federal Poverty Level eligible.)

While the Senate Finance Committee bill boosts federal funding to states between now and 2019, it also proposes to exempt states from the Medicaid expansion if the state certifies that it is experiencing a budget deficit.

So the expansion could disappear into state budget woes. The Center for Budget and Policy Priorities says there is no sign that the financial situation at the state level is improving. “At least 48 states have addressed or still face shortfalls in their budgets for fiscal year 2010 totaling $168 billion or 24 percent of state budgets,” the center reported. “At least 27 states have implemented cuts that will restrict low-income children’s or families’ eligibility for health insurance or reduce their access to health care services.”

This is a great example of waste. (Remember everyone wants to cut fraud, waste and abuse.) Medicaid money for the Indian health system is often a 100 percent federal obligation, yet the guidelines, eligibility and paperwork flow through the states. It would seem that there is a simpler way to transfer money from one federal agency to another.

Pelosi wrote in her letter to NCAI that she is “working closely with the committees and the Obama administration to ensure that the health delivery system that was guaranteed to American Indians and Alaska Natives through treaty rights is not inadvertently harmed.”

What about inadvertently funded?

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