The Alaska Native Medical Center is reflected in the campus pond on Sept. 9, 2022. The hospital is among several facilities on the Alaska Native Tribal Health Consortium campus in Anchorage. ANTHC is the nation’s largest Native tribal organization. (Photo by Yereth Rosen/Alaska Beacon)
The federal government has agreed to pay the Alaska Native Tribal Health Consortium $400 million to settle claims of inadequate cost coverage over several years.
The settlement, announced on Tuesday by the U.S. Justice Department, stems from a lawsuit filed by the nonprofit tribal health group in 2021 against the Department of Health and Human Services, which operates the Indian Health Service.
At issue in the case are “contract support costs,” the term for the expenses necessary for administration, facilities maintenance and other functions that support the healthcare services that tribal organizations provide through contracts with the federal government.
In a statement, the Justice Department acknowledged that the federal government owed ANTHC money to cover contract support costs.
“This settlement reflects our commitment to resolving litigation fairly and ensuring that federal resources are appropriately directed toward serving Native communities,” Associate Attorney General Stanley Woodward said in the statement. “We are pleased to have reached an authorized agreement that benefits American Indian and Alaska Native communities and remains consistent with the legal framework established by Congress.”
Natasha Singh, ANTHC’s president and chief executive officer, characterized the settlement as a fair resolution of a longstanding dispute over costs borne by the organization.
“ANTHC welcomes the authorization of this settlement, addressing contract support costs that have long been owed to Tribes that assumed responsibility for delivering healthcare on the federal government’s behalf. This settlement marks an important step toward ensuring that resources accurately reflect the true cost of operating a complex Tribal health system and advancing self-determination in healthcare,” Singh said in a statement.
For more than a decade, different tribal health organizations have claimed that the Indian Health Service was underpaying contract support costs. There is a history of litigation and Congressional action over the issue.
In 2024, the U.S. Supreme Court weighed in. Ruling in a case concerning tribes in Arizona and Wyoming, the court said the Indian Health Service is obligated to pay the full costs of contract support services.
Those costs are necessary for tribal health organizations to provide medical services, the 5-4 ruling said. If the costs are not fully covered by the IHS, “the tribe would have to divert some program income to pay such costs, or it would have to pay them out of its own pocket,” amounting to a penalty for pursuing self-determination under federal law.
The settlement is in line with that 2024 ruling, as well as with the Indian Self-Determination and Education Assistance Act, the federal law through which tribal organizations administer their own healthcare programs, the Justice Department said.
ANTHC is the nation’s largest tribal health organization. At its approximately 140-acre campus in east Anchorage, it operates the Alaska Native Medical Center, which is one of the state’s biggest hospitals, along with various in-patient services, research and epidemiology services and an environmental health program, among other functions. It provides services throughout the state.
The consortium, formed in 1997, has embarked on a facilities expansion program, enlarging the hospital’s emergency department and constructing a skilled nursing facility for patients needing extended care, along with other periodic upgrades.
Singh, in her statement, said the ANTHC board had “committed resources toward long-standing needs across our system of care” in anticipation of the settlement announced Tuesday. Those commitments include the investments in the ongoing construction projects, she said.
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