# IHS Laws, Regulations, and Policies

Contents

[3.1 Overview of IHS Laws, Regulations, and Policies
3-2](#overview-of-ihs-laws-regulations-and-policies)

[3.2 IHS Legislative Program Authority
3-2](#ihs-legislative-program-authority)

[3.2.1 The Snyder Act 3-2](#the-snyder-act)

[3.2.2 Transfer Act 3-2](#transfer-act)

[3.2.3 Public Law 86-121 3-3](#public-law-86-121)

[3.2.4 Indian Self-Determination and Education Assistance Act
3-3](#indian-self-determination-and-education-assistance-act)

[3.2.5 Public Law 102-184 3-3](#public-law-102-184)

[3.2.6 Public Law 102-573 3-4](#public-law-102-573)

[3.2.7 Tribal Self-Governance Amendments of 2000
3-4](#tribal-self-governance-amendments-of-2000)

[3.3 Billing and Collection Authority
3-4](#billing-and-collection-authority)

[3.3.1 Indian Health Care Improvement Act (IHCIA)
3-4](#indian-health-care-improvement-act-ihcia)

[3.3.2 Public Law 100-713 3-6](#public-law-100-713)

[3.3.3 IHS Medicare and Medicaid Third Party Revenue\
Legal Authorities
3-7](#ihs-medicare-and-medicaid-third-party-revenue-legal-authorities)

[3.3.4 Tribal Reimbursement 3-7](#tribal-reimbursement)

[3.3.5 Social Security Act, Title XXI, State Children's Health\
Insurance Program (SCHIP)
3-8](#social-security-act-title-xxi-state-childrens-health-insurance-program-schip)

[3.3.6 Tribal Direct Reimbursement, Title IV, IHCIA
3-9](#tribal-direct-reimbursement-title-iv-ihcia)

[3.3.7 Benefit Improvement and Protection Act (BIPA)
3-9](#benefit-improvement-and-protection-act-bipa)

[3.4 Statutory Bases of Liability-Fraud and Abuse
3-9](#statutory-bases-of-liability-fraud-and-abuse)

[3.4.1 Federal Criminal and Civil Provisions
3-9](#federal-criminal-and-civil-provisions)

[3.4.2 Emergency Medical Treatment and Active Labor Act\
(EMTALA) 3-11](#emergency-medical-treatment-and-active-labor-act-emtala)

[3.4.3 "Prompt Pay" Statutes and Regulations
3-12](#prompt-pay-statutes-and-regulations)

## Overview of IHS Laws, Regulations, and Policies

This section covers three major topics:

\(1\) A summary of important laws that provide basic program legislative
authority and appropriations to IHS.

\(2\) The legislative authority for IHS to bill Medicare, Medicaid and
receive reimbursements.

\(3\) A list of laws and regulatory requirements that provide an
overview of laws and penalties for improperly billing third-party payers
for services provided to American Indians (AI) and/or beneficiaries.

Each facility should have a compliance plan adopted by the Governing
Board, which outlines how the facility complies with the rules and
regulation of Medicare and Medicaid and other third party payers.

For more information go to this website:
[http://oig.hhs.gov](http://oig.hhs.gov/)

## IHS Legislative Program Authority

### The Snyder Act 

Public Law 67\
67^th^ Congress -- November 2, 1921(25 U.S.C. 13) (42 Stat. 208)

This Act provides the broad legal basis for Federal expenditure of funds
for health care for federally recognized Tribes, "for the relief of
distress and conservation of health". It provides legislative
authorization for the Federal Health Program for American Indians and
Alaska Natives, and is cited every year in the IHS budget appropriation.
In order for Congress to appropriate or spend money, it must have
legislative authority.

### Transfer Act

Public Law 83-568\
83^rd^ Congress -- August 5, 1954 (U.S.C. 444-449)

This act transferred the Indian Health Programs from the Department of
Interior to the Department of Health, Education, and Welfare, effective
July 1, 1955.

### Public Law 86-121

86^th^ Congress -- July 31, 1959\
(U.S.C. 2001-2004) (73 Stat. 267-268, 68 Stat. 674)

This Act Amends P.L. 83-568, "Transfer Act," to authorize the provisions
of water and waste disposal facilities to Indian homes, lands, and
communities. These activities are provided through the Office of
Environmental Health and Sanitation of the IHS.

### Indian Self-Determination and Education Assistance Act

Public Law 93-638\
93^rd^ Congress -- January 4, 1975\
(25 U.S.C. 450-452-458, 20 U.S.C. 276, 25 U.S.C. 2001, 43 U.S.C. 1601)\
(88 Stat. 2203-2217)

This act:

-   Authorizes the Secretary of HEW (now HHS) to enter into PL 93-638
    contracts and grants with Indian Tribes and Tribal Organizations for
    the purpose of enabling such Tribes and Tribal Organizations to
    carry out any or all of the Secretary's functions, authorities and
    responsibilities.

-   Provides for the full participation of Indian Tribes in programs and
    services conducted by the Federal Government for Indians and to
    encourage the development of human resources of the American Indians
    and Alaska Natives

-   Establishes a program of assistance to upgrade Indian education to
    support the rights of Indian Citizens to control their own
    educational activities, health activities, and for other purposes

### Public Law 102-184

102^nd^ Congress -- December 4, 1991 (25 U.S.C. 450) (105 Stat. 1278)

This law authorizes the Indian Health Service to undertake a study on
the feasibility of including health care programs operated by the IHS
under the authority of Tribal Self-governance.

### Public Law 102-573

102^nd^ Congress -- October 29, 1992 (25 U.S.C. 1601) (106 Stat. 4526)

This law amends the

-   Indian Health Care Improvement Act, P.L. 94-437, reauthorizing it
    through fiscal year 2000, adding programs and providing specific
    programs and administrative guidance in certain programs and
    activities.

-   Indian Self-Determination and Education Assistance Act, P.L 93-638,
    by extending Title III authority (Self Governance), for a Tribal
    Self-Governance Demonstration Project by IHS.

### Tribal Self-Governance Amendments of 2000

Public Law 106-260 August 18, 2000 (114 Stat. 711)

These amendments include the establishment of

-   Title V of the Indian Self-Determination Education and Assistance
    Act to make Self-Governance permanent within IHS

-   Title VI to study the feasibility of expanding self-governance to
    non-IHS programs and activities within the Department of Health and
    Human Services

## Billing and Collection Authority

This section covers laws associated with billing and collections of
third-party revenue for the IHS.

### Indian Health Care Improvement Act (IHCIA)

Public Law 94-437\
94^th^ Congress -- September 30, 1976 (25 U.S.C. 1601-1675, 40 U.S.C.
276,\
42 U.S.C. 2004-1395-1396) (90 Stat. 1400-1414)

The Indian Health Care Improvement Act (IHCIA) implements the Federal
responsibility for the care and education of the Indian people by
improving the services and facilities of Federal Indian Health Programs
and encouraging maximum participation of Indians in these programs.

IHCIA includes nine major Titles that strengthen health care to American
Indian (AI) and Alaskan Native (AN) people.

Title IV, Access to Health Services, covers the basic authorities for
collection of third party revenue in the IHS. It also includes copies of
amendments to Title XVIII, Medicare and Title XIX, Medicaid, and the
legal Authority for billing Medicare and Medicaid. .

Title II, Section 206, covers the right of IHS to recovery from third
party payers to the same extent that non-governmental providers of
services would be eligible to receive reimbursement.

**§ 1621e. Reimbursement from certain third parties of costs of health
services** (Release date: 2004-09-20)

**(a) Right of recovery**

Except as provided in subsection (f) of this section, the United States,
an Indian tribe, or a tribal organization shall have the right to
recover the reasonable expenses incurred by the Secretary, an Indian
tribe, or a tribal organization in providing health services, through
the Service, an Indian tribe, or a tribal organization, to any
individual to the same extent that such individual, or any
nongovernmental provider of such services, would be eligible to receive
reimbursement or indemnification for such expenses if --

\(1\) such services had been provided by a nongovernmental provider, and

\(2\) such individual had been required to pay such expenses and did pay
such expenses.

**(b) Recovery against State with workers' compensation laws or no-fault
automobile accident insurance program**

Subsection (a) of this section shall provide a right of recovery against
any State only if the injury, illness, or disability for which health
services were provided is covered under --

\(1\) workers' compensation laws, or

\(2\) a no-fault automobile accident insurance plan or program.

**(c) Prohibition of State law or contract provision impeding right of
recovery**

No law of any State, or of any political subdivision of a State, and no
provision of any contract entered into or renewed after November 23,
1988, shall prevent or hinder the right of recovery of the United
States, an Indian tribe, or a tribal organization under subsection (a)
of this section.

**(d) Right to damages**

No action taken by the United States, an Indian tribe, or a tribal
organization to enforce the right of recovery provided under subsection
(a) of this section shall affect the right of any person to any damages
(other than damages for the cost of health services provided by the
Secretary through the Service).

**(e) Intervention or separate civil action**

The United States, an Indian tribe, or a tribal organization may enforce
the right of recovery provided under subsection (a) of this section by
--

\(1\) intervening or joining in any civil action or proceeding brought
--

\(A\) by the individual for whom health services were provided by the
Secretary, an Indian tribe, or a tribal organization, or

\(B\) by any representative or heirs of such individual, or

\(2\) instituting a separate civil action, after providing to such
individual, or to the representative or heirs of such individual, notice
of the intention of the United States, an Indian tribe, or a tribal
organization to institute a separate civil action.

**(f) Right of recovery for services when self-insurance plan provides
coverage**

The United States shall not have a right of recovery under this section
if the injury, illness, or disability for which health services were
provided is covered under a self-insurance plan funded by an Indian
tribe or tribal organization.

### Public Law 100-713

100^th^ Congress -- November 23, 1988\
(U.S.C. 1601) (102 Stat. 4784)

This Law

-   Reauthorized the Indian Health Care Improvement Act (IHCIA) and
    modified and/or expanded some of the 1976 IHCIA provisions.

-   Established the Indian Health Service as an Agency of the Public
    Health Service.

### IHS Medicare and Medicaid Third Party Revenue Legal Authorities

In 1976, Congress enacted title IV of the Indian Health Care Improvement
Act (IHCIA) and amended Title XVIII, Medicare, and Title XIX, Medicaid,
of the Social Security Act (SSA), allowing IHS to bill for medical
services provided by IHS facilities to Indians eligible for Medicare or
Medicaid.

From 1976 to 2001, the authority to receive Medicare reimbursements was
limited to Medicare services provided in an IHS hospital or skilled
nursing home. Today, IHS has full authority to bill Medicare for all
covered services (excluding home health care, as covered in various
amendments to existing authority.

Congress requires that Medicare and Medicaid reimbursements be placed in
a special fund, to be used for the specific purpose of improving IHS
facilities to meet the standards set out in the Medicare and Medicaid
programs, including facility costs.

In order not to burden States with additional Medicaid expenditures,
Congress provided 100% Federal reimbursement to States for
reimbursements for services provided through an IHS facility to eligible
Indian beneficiaries. \[1905(b) of the SSA\]

### Tribal Reimbursement

Tribal reimbursement as facilities of IHS

By Memorandum of Agreement (MOA) between the Indian Health Service (IHS)
and the Center for Medicare and Medicaid Services (CMS) the 100% Federal
reimbursement to States was expanded to include Medicaid covered
services provided to Indian beneficiaries in 638 tribally operated
programs. This MOA also allows these tribal operated programs to elect
to receive Medicaid reimbursements at the all-inclusive rate published
annually by IHS in the Federal Register.

Tribal reimbursement as Federally Qualified Health Centers (FQHCs)

As stated in the Public Health Service Act, Sec 330, tribes and tribal
organizations and urban Indian programs have the option to receive
Medicaid and Medicare reimbursements as Federally Qualified Health
Centers (FQHCs) or as other Medicare or Medicaid provider types, if they
qualify (e.g., home health, physician, clinic, nursing home, etc.).

1.  IHS is not eligible for FQHC status, because it is a Federal
    facility.

### Social Security Act, Title XXI, State Children's Health Insurance Program (SCHIP)

Congress established the **State Children's Health Insurance Program
(SCHIP)** by creating Title XXI of the SSA as part of the Balance Budget
Act of 1997.

SCHIP is designed to provide health insurance coverage to children who
are not otherwise eligible for Medicaid or not covered by an employer
sponsored health insurance plan.

-   States can implement SCHIP by expanding their Medicaid program or by
    a separate program, such as through private insurance coverage.

-   IHS utilizes its existing Medicaid and private insurance collection
    reimbursement authorities to receive reimbursements for
    SCHIP-covered provided services.

In January, 2001, the Department of Health and Human Services (HHS)
published SCHIP regulations (42 CFR Parts 431, 433, 435, 436, and 457);
where. 42 CFR 457.530 exempts AI/AN children from cost-sharing
requirements under SCHIP.

In the preamble, HHS explained that the SCHIP statute imposes an
affirmative obligation to address barriers to AI/AN enrollment and
exempted AI/AN children from cost-sharing requirements because it
determined cost-sharing acts as a barrier to AI/AN enrollment in SCHIP.

### Tribal Direct Reimbursement, Title IV, IHCIA

On November 1, 2000, Congress enacted the Alaska Native and American
Indian Direct Reimbursement Act, amending Section 405 of IHCIA. Prior to
enactment, only four tribes were authorized to participate in the
section 405 demonstration program and receive Medicare and Medicaid
reimbursement directly.

This Act makes Section 405 permanent and authorizes tribal programs that
operate IHS owned or leased facilities to receive reimbursements for
Medicare and Medicaid directly without having the funds flow through the
special fund.

### **Benefit Improvement and Protection Act (BIPA)**

On December 15, 2000, Congress enacted Section 432 of the Medicare,
Medicaid, and SCHIP Benefits Improvement and Protection Act (BIPA). This
law authorizes hospitals and ambulatory care facilities that are
operated by the IHS or tribes to bill for Medicare Part B physician
services and other services (nurse practitioners, physician assistants,
etc.) that are reimbursable under the Medicare Physician Fee schedule.

## **Statutory Bases of Liability-Fraud and Abuse** 

The following citations cover requirements related to proper coding and
billing for services, and penalties for not complying with the rules and
regulations of third-party payers.

2.  The key principle is "*knowingly*," or intentionally, engaging in
    these activities.

### Federal Criminal and Civil Provisions

**A. Federal Criminal Provisions (42 U.S.C. § 1320A-7B)**

**1. Prohibition of False Claims**

False or Improper Claims (42 V.S.C. § 1320a-7a)\
(a) I-civil money penalties of up to \$10,000 per item or service, plus
an assessment of up to three times the amount claimed for each such item
or service, may be imposed upon any person who presents or causes to be
presented a claim for reimbursement from Medicare, Medicaid, or other
"federal health care programs" that:

Knowingly and willfully making or causing to be made any false statement
or representation of material fact in any claim or application for
benefits under Medicare or Medicaid.

Examples of prohibited conduct:

-   Billing for services not rendered.

-   Misrepresenting the services actually rendered.

-   Falsely certifying that certain services were medically necessary.

-   Presenting or causing to be presented a claim for physicians\'
    services, knowing that the individual who furnished the services was
    not a licensed physician.

**2. Prohibition of False Statements**

Knowingly and willfully making or causing to be made, or inducing or
causing to be induced, the making of any false statements of material
facts with regard to an institution\'s compliance with conditions of
participation for the purposes of certification.

**3. Intent Standard**

For the statute to be violated, the individual must have known the
claims were false at the time he was making the claims *(United States
v. Laughlin*, 26 F.3d 1523 (10th Cir. 1994))

**4. Penalties**

The offenses described above are felonies punishable by up to five years
imprisonment, and/or \$25,000 in fines.

**B. Federal Civil Provisions (31 U.S.C. § 3729(A)**

**1. Civil False Claims Act**

Prohibited Conduct

\(1\) The *knowing filing* of a false or fraudulent claim for payment to
the United States,

\(2\) The *knowing use* of a false record or statement to obtain payment
on a false or fraudulent claim,

*OR*

\(3\) The *conspiracy* to defraud the United States by getting a false
or fraudulent claim allowed or paid.

### **Emergency Medical Treatment and Active Labor Act (EMTALA)**

IHS **must comply** with the Emergency Medical Treatment and Active
Labor Act (EMTALA), as follows.

**IHS facilities:**

-   Hospitals are responsible for ensuring that any physician, including
    on-call physicians, respond within a reasonable period of time.

-   Hospitals must have policies and procedures in place to handle
    particular specialty conditions beyond the capabilities of the
    Emergency Room (ER) physician.

-   A central log must be maintained on each individual who comes to the
    ER seeking emergency medical treatment. The log should track the
    care provided to the individual.

**Medicare hospitals:**

-   If an individual comes to the Emergency Room (ER) and a request is
    made by that individual or his or her representative for examination
    or treatment of a medical condition by qualified hospital personnel,
    the hospital must provide an appropriate Medical Screening
    Examination (MSE) within the capability of the ER to determine if an
    emergency condition exists.

-   Every individual coming to the ER must be provided an MSE beyond
    initial triage. Triage is not the equivalent to an MSE.

-   The MSE must be the same MSE that the hospital would perform on any
    individual with similar signs and symptoms, regardless of their
    ability to pay.

-   The hospital must provide stabilizing care, such that the patient's
    condition would not deteriorate.

-   The hospital may transfer patients only for services or care not
    available in that hospital.

-   The facility must obtain a written informed refusal of medical exam,
    treatment, and/or transfer from the patient or patient family.

-   The facility must report any "suspect" transfer, which occurs when a
    recipient hospital has reason to believe it may have received an
    individual who was transferred in an unstable emergency medical
    condition from another facility.

### "Prompt Pay" Statutes and Regulations

The **Prompt Payment Final Rule (5 CFR Part 1315)** requires Executive
departments and agencies to pay commercial obligations within certain
time periods and to pay interest penalties when payments are late.

On June 17, 1998, the Office of Management and Budget (OMB) requested
comment on proposed revisions to the OMB Circular A-125, "Prompt
Payment." The Circular was revised to reflect the increased use of
electronic commerce in the Federal government and the private sector,
and to reflect the requirements of the [**Debt Collection Improvement
Act (DCIA) of 1996**](http://fms.treas.gov/debt/regulations.html). OMB
issued final revisions to Circular A-125 on September 29, 1999.

State-specific regulations are available at this website:

<http://www.naic.org/state_web_map.htm>

The following table provides a summary of the status/terms of the law by
State, as of 2005.

  ------------------------------------------------------------------------
  State           Status/Terms of Law
  --------------- --------------------------------------------------------
  Alabama         Clean claims must be paid within 45 working days for HMO
                  claims. Electronic clean claims are paid within 30 days
                  and clean paper claims are paid within 35 days.

  Alaska          Claims must be paid within 30 days

  Arizona         Clean claims must be paid within 30 days or interest
                  payments required (usually about 10%)

  Arkansas        Clean electronic claims must be paid or denied in 30
                  calendar days, paper in 45. 12% per annum late penalty
                  fee.

  California      Claims must be paid within 45 working days for an HMO,
                  30 days for a health service plan. Interest accrues at
                  15% per annum

  Colorado        Claims must be paid in 30 days if submitted
                  electronically, 45 if paper. Penalty is 10% annually.

  Connecticut     Claims must be paid within 45 working days. Interest
                  accrues at 15% per annum

  Delaware        Clean claims must be paid in 45 days.

  District of     None at the present although a 40 day timeframe has been
  Columbia        proposed

  Florida         Clean HMO claims must be paid in 35 days, non-HMO in 45
                  days. Claims where information was requested must be
                  paid in 120 days. Interest penalty is 10% per year.

  Georgia         Claims must be paid within 15 working days. Interest
                  accrues at 18% per annum

  Hawaii          Clean paper claims must be paid in 30 days; electronic
                  claims with 15 days. Interest accrues at 15% per annum.
                  Commissioner may impose fines

  Idaho           None. Department of Insurance will investigate abusive
                  patterns

  Illinois        Clean claims must be paid in 30 days. Interest accrues
                  at 9% per annum.

  Indiana         Claims must be paid in 45 days

  Iowa            Clean claims must be paid in 30 days. Penalty will be
                  10% per annum.

  Kansas          Claims will be paid in 30 days. Interest accrues at a
                  rate of 1% per month

  Kentucky        Claims must be paid or denied within 30 working days.
                  Interest accrues at 12% per annum when 31-60 days late;
                  18% when 61-90 days late; and 21% when 91+ days late.

  Louisiana       Claims submitted electronically must be paid within 25
                  days. Paper claims submitted in 45 days must be paid in
                  45 days; submitted after 45 days must be paid in 60
                  days. Penalty is 1% of unpaid balance.

  Maine           Clean claims must be paid within 30 days. Interest
                  accrues at 1.5% per month.

  Maryland        Clean claims must be paid within 30 days. Interest
                  accrues at monthly rates of 1.5% (31-60 days late), 2%
                  (61-120 days late), and 2.5% (121+ days late)

  Massachusetts   None. Division of Insurance will investigate abusive
                  patterns.

  Michigan        This law applies only to non-contracted providers;
                  Claims must be paid in 60 days with an interest penalty
                  of 12% per annum.

  Minnesota       Clean claims must be paid in 30 days. Interest accrues
                  at 1.5% per month if not paid or denied.

  Mississippi     Clean claims must be paid within 45 days. Interest
                  accrues at 1.5% per month.

  Missouri        Claims must be acknowledged within 10 days and paid
                  within 45 days. Once requested information is received,
                  claims must be paid or denied in 15 days. Interest
                  accrues at a monthly rate of 1%. After 40 processing
                  days entitled to a per day penalty: the lesser of 1.2
                  value of the claim or \$20 per claim.

  Montana         Clean claims must be paid within 30 days. Interest
                  accrues at 18% per annum.

  Nebraska        Claims must be paid or denied within 15 days of
                  affirmation of liability.

  Nevada          Claims must be paid in 30 days. Penalty interest accrues
                  at rate set forth in Nevada.

  New Hampshire   Clean paper claims must be paid in 45 days; electronic
                  in 15 days. 1.5% monthly interest penalty.

  New Jersey      Electronic claims must be paid within 30 days; paper
                  claims with 40 days.

  New Mexico      Clean claims must be paid within 30 days if electronic;
                  45 days if paper. Interest accrues at 1-1/2% per month.

  New York        Claims must be paid within 45 days. Interest accrues at
                  greater of 12% per year or corporate tax rate determined
                  by the Commissioner. Fines up to \$500 per day may be
                  imposed.

  North Carolina  Claims must be paid or denied within 30 days. Annual
                  interest penalty of 18%.

  North Dakota    Claims must be paid within 15 days.

  Ohio            Claims must be paid or denied within 30 days. Interest
                  penalty of 18% per annum.

  Oklahoma        Clean claims must be paid with 45 days. Penalty of 10%
                  of claim as interest for late claims.

  Oregon          Clean claims must be paid in 30 days. 12% interest
                  penalty applies.

  Pennsylvania    Clean claims must be paid in 45 days.

  Rhode Island    None. Department of Insurance will investigate abusive
                  patterns.

  South Carolina  Group health insurers must pay claims in 60 days.

  South Dakota    Electronic claims must be paid in 30 days; paper claims
                  in 45.

  Tennessee       Claims must be paid with 40 days. Interest accrues at
                  25% per annum.

  Texas           Claims must be paid with 45 days (HMOs only). Interest
                  accrues at 18% per annum.

  Utah            Claims must be paid or denied in 30 days. Interest
                  accrues at 18% per annum

  Vermont         Claims must be paid or denied in 45 days. Interest
                  penalty is 12% per annum

  Virginia        Clean claims must be paid within 40 days

  Washington      95% of the monthly volume of clean claims shall be paid
                  in 30 days. 95% of the monthly volume of all claims
                  shall be paid or denied within 60 days

  West Virginia   Claims must be paid in 30 days if electronic; 40 days if
                  paper. Interest and fines may apply. Interest penalty of
                  10% per year.

  Wisconsin       If clean claims are not paid within 30 days, they are
                  subject to a penalty interest rate of 12% per year

  Wyoming         Claims must be paid within 45 days. Penalties and fines
                  may accrue
  ------------------------------------------------------------------------