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[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5406 Introduced in House (IH)]

<DOC>

114th CONGRESS
  2d Session
                                H. R. 5406

 To amend the Indian Health Care Improvement Act to improve access to 
  tribal health care by providing for systemic Indian Health Service 
   workforce and funding allocation reforms, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                              June 8, 2016

    Mrs. Noem (for herself, Mr. Ashford, Mr. Smith of Nebraska, Mr. 
  Fortenberry, Mr. Cramer, and Ms. McCollum) introduced the following 
bill; which was referred to the Committee on Natural Resources, and in 
 addition to the Committees on Energy and Commerce and Ways and Means, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of 
                        the committee concerned

_______________________________________________________________________

                                 A BILL

 
 To amend the Indian Health Care Improvement Act to improve access to 
  tribal health care by providing for systemic Indian Health Service 
   workforce and funding allocation reforms, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Helping Ensure 
Accountability, Leadership, and Trust in Tribal Healthcare Act'' or the 
``HEALTTH Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
      TITLE I--EXPANDING AUTHORITIES AND IMPROVING ACCESS TO CARE

Sec. 101. Service hospital long-term contract pilot program.
Sec. 102. Expanded hiring authority for the Indian Health Service.
Sec. 103. Removal or demotion of employees.
Sec. 104. Improving timeliness of care.
       TITLE II--INDIAN HEALTH SERVICE RECRUITMENT AND WORKFORCE

Sec. 201. Exclusion from gross income for payments made under Indian 
                            Health Service Loan Repayment Program.
Sec. 202. Clarifying that certain degrees qualify individuals for 
                            eligibility in the Indian Health Service 
                            Loan Repayment Program.
Sec. 203. Cultural competency programs.
Sec. 204. Relocation reimbursement.
Sec. 205. Authority to waive Indian preference laws.
Sec. 206. Streamlining medical volunteer credentialing process.
           TITLE III--PURCHASED/REFERRED CARE PROGRAM REFORMS

Sec. 301. Codification of limitation on charges for health care 
                            professional services and non-hospital-
                            based care source.
Sec. 302. Allocation of Purchased/Referred Care program funds.
Sec. 303. Purchased/Referred Care program backlog.
Sec. 304. Report on financial stability of Service hospitals and 
                            facilities.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) The United States Government has a treaty obligation to 
        provide health care to American Indians and Alaska Natives.
            (2) The Indian Health Service is the Federal agency that is 
        entrusted to carry out this obligation.
            (3) Access to high quality health care is critical for 
        strong and vibrant tribal communities in the Great Plains Area 
        and throughout the United States.
            (4) In 2010, the Senate Committee on Indian Affairs 
        published a report titled ``In Critical Condition: The Urgent 
        Need to Reform the Indian Health Service's Aberdeen Area'', 
        which detailed deficiencies, abuses, and malfeasance within the 
        Aberdeen Area of the Indian Health Service, now called the 
        Great Plains Area.
            (5) In 2015 and 2016, the Centers for Medicare & Medicaid 
        Services conducted surveys of Indian Health Service hospitals 
        in the Great Plains Area and found serious structural 
        deficiencies that put patients' health and safety in immediate 
        jeopardy.
            (6) The Indian Health Service's failures in the Great 
        Plains Area have resulted in a severe reduction in access to 
        emergency care, needlessly long wait times, patient suffering, 
        low quality of life, and several tragic deaths.
            (7) The Indian Health Service is in need of comprehensive 
        reform that will hold its management and employees accountable, 
        foster strong and capable agency leadership, and restore tribal 
        members' trust in the care it delivers.

      TITLE I--EXPANDING AUTHORITIES AND IMPROVING ACCESS TO CARE

SEC. 101. SERVICE HOSPITAL LONG-TERM CONTRACT PILOT PROGRAM.

    Title VIII of the Indian Health Care Improvement Act (25 U.S.C. 
1671) is amended by adding at the end the following new section:

``SEC. 833. SERVICE HOSPITAL LONG-TERM CONTRACT PILOT PROGRAM.

    ``(a) In General.--The Secretary, acting through the Service, shall 
implement a 7-year pilot program to test the viability and advisability 
of entering into long-term contracts for the operation of eligible 
Service hospitals with governance structures that include tribal input.
    ``(b) Elements.--Under such pilot program, subject to subsection 
(e), the following shall apply:
            ``(1) The Secretary shall select three eligible Service 
        hospitals in rural areas to participate in the pilot program.
            ``(2) For each such participating hospital, the Secretary 
        shall enter into a long-term contract.
            ``(3) At each such participating hospital, the Secretary, 
        in consultation with the primary Indian tribes served by the 
        hospital, shall install a governing board described in 
        subsection (d), which shall be responsible for overseeing the 
        local operation of the hospital.
    ``(c) Eligible Service Hospital.--For purposes of this section, the 
term `eligible Service hospital' means a Service hospital that 
furnishes services in a rural area to direct services tribes and with 
respect to which the Secretary has obtained the permission of the 
primary Indian tribes served by the hospital for the hospital to 
participate under the pilot program under this section.
    ``(d) Governance Board Described.--For purposes of subsection (b), 
a governance board described in this subsection, with respect to a 
Service hospital participating in the pilot program, is a board that 
satisfies the following criteria:
            ``(1) Composition.--
                    ``(A) In general.--The governance board is 
                composed, in accordance with the best practices 
                specified under paragraph (3), of the following 
                individuals:
                            ``(i) Representatives of the Service, who 
                        shall be selected by the Secretary.
                            ``(ii) Representatives of the Service 
                        hospital.
                            ``(iii) Representatives of each primary 
                        Indian tribe served by the hospital, who shall 
                        be selected by the respective Indian tribe.
                            ``(iv) Experts in health care 
                        administration and delivery, who shall--
                                    ``(I) be selected by the Secretary 
                                and respective Indian tribe; and
                                    ``(II) to the extent possible, 
                                located in the State in which the 
                                hospital is located or otherwise 
                                familiar with such State.
                    ``(B) Voting rights.--In determining the 
                composition of the board with respect to voting rights 
                on the board--
                            ``(i) the number of voting members 
                        representing the Service shall be equal to the 
                        number of voting members representing the 
                        Indian tribes involved; and
                            ``(ii) the number of voting members 
                        representing the hospital may not be greater 
                        than the number of voting members representing 
                        the Service or the Indian tribes involved.
            ``(2) Duties.--The governance board shall perform duties in 
        accordance with the best practices specified under paragraph 
        (3) and shall include developing financial and quality metrics 
        and standards for salaries, recruitment, retention, training, 
        and dismissal of employees of such hospital.
            ``(3) Best practices.--The Secretary shall specify best 
        practices for the governance board described in this 
        subsection, including best practices relating to the number of 
        members of such board, the authorities of the board, and the 
        duties of the board.
    ``(e) Treatment of Eligible Service Hospitals Currently Under 
Contract.--In the case of an eligible Service hospital that is under a 
current contract with the Secretary as of the initiation of the 
selection process period for the pilot program, in order for such 
hospital to participate in the pilot program the Secretary, with the 
agreement of the hospital, may--
            ``(1) notwithstanding any other provision of law, modify or 
        terminate such contract and in order for such hospital to enter 
        into a long-term contract under the pilot program; or
            ``(2) enter into a long-term contract under the pilot 
        program (and begin the pilot program) beginning on the date 
        after the last date of such current contract.
    ``(f) Long-Term Contract Defined.--For purposes of this section, 
the term `long-term contract' means a contract for a period of at least 
5 years.
    ``(g) Clarification.--Nothing in this section shall be construed to 
inhibit a tribe's authority to enter into a compact or contract under 
the Indian Self-Determination and Education Assistance Act.
    ``(h) Reports.--For each year of the pilot program, the Secretary 
shall submit a report to Congress on the results of the program 
demonstrated during the respective year. Each such report shall include 
the following:
            ``(1) Information related to the financial health of each 
        eligible hospital participating in the pilot program.
            ``(2) Information on the affect the pilot program has on 
        access to care.
            ``(3) Information on patient satisfaction with services 
        provided at such hospitals.
            ``(4) The number of readmissions at such hospitals.
            ``(5) The number of hospital-acquired conditions at such 
        hospitals.
            ``(6) Recommendations on the viability and advisability of 
        the long-term contracts and hospital governance structure under 
        such pilot program.
            ``(7) Any other information the Secretary considers 
        necessary for a proper analysis of the pilot program.''.

SEC. 102. EXPANDED HIRING AUTHORITY FOR THE INDIAN HEALTH SERVICE.

    Section 601(d) of the Indian Health Care Improvement Act (25 U.S.C. 
1661(d)) is amended--
            (1) in paragraph (1)(A), by inserting ``and subject to 
        paragraph (4)'' after ``paragraph (2)''; and
            (2) by adding at the end the following:
            ``(4) Employment authority.--
                    ``(A) In general.--The Secretary may, with respect 
                to any employee described in subparagraph (B), provide 
                that one or more provisions of chapter 74 of title 38, 
                United States Code (other than subchapter V of such 
                chapter or of regulations promulgated under such 
                chapter other than under such subchapter), shall 
                apply--
                            ``(i) in lieu of any provision of title 5 
                        of the United States Code (other than as 
                        applied pursuant to section 834); or
                            ``(ii) notwithstanding any lack of specific 
                        authority for a matter with respect to which 
                        title 5 of the United States Code relates.
                    ``(B) Applicability to employees.--Authority under 
                this paragraph may be exercised with respect to any 
                employee in the Service holding a position--
                            ``(i) to which chapter 51 of title 5 of the 
                        United States Code applies, excluding any 
                        senior executive service position; and
                            ``(ii) which involves health care 
                        responsibilities.
                    ``(C) Definition.--For purposes of this paragraph, 
                `health care' means direct patient-care services or 
                services incident to direct patient-care services.''.

SEC. 103. REMOVAL OR DEMOTION OF EMPLOYEES.

    (a) In General.--Title VIII of the Indian Health Care Improvement 
Act (25 U.S.C. 1671 et seq.), as amended by section 101, is further 
amended by adding at the end the following new section:

``SEC. 834. REMOVAL OR DEMOTION OF EMPLOYEES.

    ``(a) In General.--The Secretary may remove or demote an individual 
who is an employee of the Service if the Secretary determines the 
performance or misconduct of the individual warrants such removal or 
demotion. If the Secretary so removes or demotes such an individual, 
the Secretary may--
            ``(1) remove the individual from the Service; or
            ``(2) demote the individual by means of--
                    ``(A) a reduction in grade for which the individual 
                is qualified and that the Secretary determines is 
                appropriate; or
                    ``(B) a reduction in annual rate of pay that the 
                Secretary determines is appropriate.
        In the case of an individual who is removed under paragraph (1) 
        or demoted under paragraph (2), the Secretary may require such 
        individual take unpaid administrative leave for not longer than 
        10 consecutive work days.
    ``(b) Pay of Certain Demoted Individuals.--(1) Notwithstanding any 
other provision of law, any individual subject to a demotion under 
subsection (a)(2)(A) shall, beginning on the date of such demotion, 
receive the annual rate of pay applicable to such grade.
    ``(2) An individual so demoted may not be placed on administrative 
leave or any other category of paid leave during the period during 
which an appeal (if any) under this section is ongoing, and may only 
receive pay if the individual reports for duty. If an individual so 
demoted does not report for duty, such individual shall not receive pay 
or other benefits pursuant to subsection (e)(5).
    ``(c) Notice to Secretary.--Not later than 30 days after removing 
or demoting an individual under subsection (a), the Service shall 
submit to the Secretary notice in writing of such removal or demotion 
and the reason for such removal or demotion.
    ``(d) Procedure.--(1) The procedures under section 7513(b) of title 
5 and chapter 43 of such title shall not apply to a removal or demotion 
under this section.
    ``(2)(A) Subject to subparagraph (B) and subsection (e), any 
removal or demotion under subsection (a) may be appealed to the Merit 
Systems Protection Board under section 7701 of title 5.
    ``(B) An appeal under subparagraph (A) of a removal or demotion may 
only be made if such appeal is made not later than seven days after the 
date of such removal or demotion.
    ``(e) Expedited Review by Administrative Judge.--(1) Upon receipt 
of an appeal under subsection (d)(2)(A), the Merit Systems Protection 
Board shall refer such appeal to an administrative judge pursuant to 
section 7701(b)(1) of title 5. The administrative judge shall expedite 
any such appeal under such section and, in any such case, shall issue a 
decision not later than 45 days after the date of the appeal.
    ``(2) Notwithstanding any other provision of law, including section 
7703 of title 5, the decision of an administrative judge under 
paragraph (1) shall be final and shall not be subject to any further 
appeal.
    ``(3) In any case in which the administrative judge cannot issue a 
decision in accordance with the 45-day requirement under paragraph (1), 
the removal or demotion is final. In such a case, the Merit Systems 
Protection Board shall, within 14 days after the date that such removal 
or demotion is final, submit to Congress a report that explains the 
reasons why a decision was not issued in accordance with such 
requirement.
    ``(4) The Merit Systems Protection Board or administrative judge 
may not stay any removal or demotion under this section.
    ``(5) During the period beginning on the date on which an 
individual appeals a removal from the Service under subsection (d) and 
ending on the date that the administrative judge issues a final 
decision on such appeal, such individual may not receive any pay, 
awards, bonuses, incentives, allowances, differentials, student loan 
repayments, special payments, or benefits.
    ``(6) To the maximum extent practicable, the Secretary shall 
provide to the Merit Systems Protection Board, and to any 
administrative judge to whom an appeal under this section is referred, 
such information and assistance as may be necessary to ensure an appeal 
under this subsection is expedited.
    ``(f) Termination of Investigations by Office of Special Counsel.--
Notwithstanding any other provision of law, the Special Counsel 
(established by section 1211 of title 5) may terminate an investigation 
of a prohibited personnel practice alleged by an employee or former 
employee of the Department after the Special Counsel provides to the 
employee or former employee a written statement of the reasons for the 
termination of the investigation. Such statement may not be admissible 
as evidence in any judicial or administrative proceeding without the 
consent of such employee or former employee.
    ``(g) Relation to Title 5.--The authority provided by this section 
is in addition to the authority provided by subchapter V of chapter 75 
of title 5 and chapter 43 of such title.
    ``(h) Definitions.--In this section:
            ``(1) The term `individual' means an individual occupying a 
        position at the Service but does not include--
                    ``(A) an individual, as that term is defined in 
                section 713(g)(1); or
                    ``(B) a political appointee.
            ``(2) The term `grade' has the meaning given such term in 
        section 7511(a) of title 5.
            ``(3) The term `misconduct' includes neglect of duty, 
        malfeasance, or failure to accept a directed reassignment or to 
        accompany a position in a transfer of function.
            ``(4) The term `political appointee' means an individual 
        who is--
                    ``(A) employed in a position described under 
                sections 5312 through 5316 of title 5 (relating to the 
                Executive Schedule);
                    ``(B) a limited term appointee, limited emergency 
                appointee, or noncareer appointee in the Senior 
                Executive Service, as defined under paragraphs (5), 
                (6), and (7), respectively, of section 3132(a) of title 
                5; or
                    ``(C) employed in a position of a confidential or 
                policy-determining character under schedule C of 
                subpart C of part 213 of title 5 of the Code of Federal 
                Regulations.''.
    (b) Conforming.--Section 4303(f) of title 5, United States Code, is 
amended--
            (1) by striking ``or'' at the end of paragraph (2);
            (2) by striking the period at the end of paragraph (3) and 
        inserting ``, or''; and
            (3) by adding at the end the following:
            ``(4) any removal or demotion under section 834 of the 
        Indian Health Care Improvement Act.''.

SEC. 104. IMPROVING TIMELINESS OF CARE.

    Title III of the Indian Health Care Improvement Act (25 U.S.C. 1631 
et seq.) is amended by adding at the end the following new section:

``SEC. 314. STANDARDS TO IMPROVE TIMELINESS OF CARE.

    ``(a) In General.--The Secretary, acting through the Service, 
shall--
            ``(1) establish, by regulation, standards to measure the 
        timeliness of the provision of health care services in Service 
        facilities; and
            ``(2) make such standards available to all Service areas 
        and Service facilities.
    ``(b) Data Collection.--The Secretary, acting through the Service, 
shall develop a process for Service facilities to submit to the 
Secretary data with respect to the standards established under 
subsection (a).''.

       TITLE II--INDIAN HEALTH SERVICE RECRUITMENT AND WORKFORCE

SEC. 201. EXCLUSION FROM GROSS INCOME FOR PAYMENTS MADE UNDER INDIAN 
              HEALTH SERVICE LOAN REPAYMENT PROGRAM.

    (a) In General.--Section 108(f)(4) of the Internal Revenue Code of 
1986 is amended by inserting ``under section 108 of the Indian Health 
Care Improvement Act,'' after ``338I of such Act,''.
    (b) Clerical Amendment.--The heading for section 108(f)(4) of such 
Code is amended by striking ``and certain'' and inserting ``, indian 
health service loan repayment program, and certain''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts received after the date of the enactment of this Act.

SEC. 202. CLARIFYING THAT CERTAIN DEGREES QUALIFY INDIVIDUALS FOR 
              ELIGIBILITY IN THE INDIAN HEALTH SERVICE LOAN REPAYMENT 
              PROGRAM.

    Section 108 of the Indian Health Care Improvement Act (25 U.S.C. 
1616a) is amended--
            (1) in subsection (b)(1)(B)--
                    (A) in clause (i), by inserting ``(including a 
                degree business administration with an emphasis in 
                health care management, as defined by the Secretary, or 
                a degree in health administration, hospital 
                administration, or public health)'' before the 
                semicolon; and
                    (B) in clause (ii), by inserting ``or a license or 
                certification to practice in the field of health 
                administration, hospital administration, business 
                administration, or public health, as applicable, in a 
                State'' before the semicolon;
            (2) in subsection (f)(1)(B)(iii), by striking ``2 years or 
        such longer period as the individual may agree to serve in the 
        full-time clinical practice of such individual's profession'' 
        and inserting ``2 years or such longer period as the individual 
        may agree to serve in the full-time practice of such 
        individual's profession (or 4 years or such longer period as 
        the individual may agree to serve in the half-time practice of 
        such individual's profession)''; and
            (3) in subsection (g)(2)(A), in the first sentence--
                    (A) by inserting ``, in the case of an individual 
                agreeing to serve in the full-time practice of such 
                individual's profession,'' before ``up to $35,000''; 
                and
                    (B) by inserting ``(or, in the case of an 
                individual agreeing to serve in the half-time practice 
                of such individual's profession, up to $17,500)'' 
                before ``on behalf of''.

SEC. 203. CULTURAL COMPETENCY PROGRAMS.

    Title I of the Indian Health Care Improvement Act (25 U.S.C. 1611 
et seq.) is amended by adding at the end the following new section:

``SEC. 125. CULTURAL COMPETENCY PROGRAMS.

    ``(a) In General.--The Secretary, acting through the Service, 
shall, not later than one year after the date of the enactment of this 
section and for each Service area, develop and implement training 
programs for cultural competency for employees of the Service, locum 
tenens medical providers, and other contracted employees who work at 
Service hospitals or other Service facilities and whose employment 
requires regular direct patient access.
    ``(b) Required Participation.--Notwithstanding any other provision 
of law, beginning with years beginning after (and for contracts entered 
into on or after) the date of implementation of the training programs 
under subsection (a), annual participation in such a program shall be a 
condition of employment (or of providing services in the capacity as a 
locum tenen medical provider or of the terms of the contracted 
employment, as applicable), and continued employment (or provision of 
such services in such capacity or contracted employment, as 
applicable), for each employee of the Service, locum tenens medical 
provider, and contracted employee described in such subsection. For 
purposes of the previous sentence, an individual shall not be 
considered as participating in such a program, with respect to a year, 
unless such individual satisfies such requirements, including testing, 
included in such program for such year, as specified by the Secretary.
    ``(c) Consultation.--In developing a training program under 
subsection (a) for a Service area, the Secretary shall consult with 
representatives of each Indian tribe served in such area.''.

SEC. 204. RELOCATION REIMBURSEMENT.

    Title I of the Indian Health Care Improvement Act (25 U.S.C. 1611 
et seq.), as amended by section 203, is further amended by adding at 
the end the following new section:

``SEC. 126. RELOCATION REIMBURSEMENT.

    ``(a) In General.--In the case of an employee of the Service who 
relocates to serve in a different capacity or position as an employee 
of the Service, the Secretary shall, subject to subsection (b), offer 
such employee reimbursement for reasonable costs associated with such 
relocation, as determined by the Secretary, incurred by such employee 
if--
            ``(1) such relocation is to fill a position that--
                    ``(A) is at a Service facility that is located in a 
                rural area or medically underserved area; and
                    ``(B) had not been filled by a full-time non-
                contractor for a period of at least 6 months; or
            ``(2) such relocation is to fill a position that is for 
        hospital management or administration, as determined by the 
        Secretary.
    ``(b) Amount for Relocation.--
            ``(1) In general.--The amount of reimbursement to an 
        employee under subsection (a) shall be in an amount that is at 
        least 50 percent, but not more than 75 percent, of the 
        specified pay amount (as described in paragraph (2)) of the 
        employee.
            ``(2) Specified pay amount.--For purposes of paragraph (1), 
        the specified pay amount, with respect to an employee, is the 
        annual rate of basic pay of the employee in effect at the 
        beginning of the service period of such employee multiplied by 
        the number of years (including fractions of a year) in the 
        service period, not to exceed 4 years.
    ``(c) Clarification.--Nothing in this section shall be construed as 
limiting the authority of the Secretary, as in existence before the 
enactment of this section, to offer reimbursement for travel or 
relocation.''.

SEC. 205. AUTHORITY TO WAIVE INDIAN PREFERENCE LAWS.

    Title VI of the Indian Health Care Improvement Act (25 U.S.C. 1611 
et seq.) is amended by adding at the end the following new section:

``SEC. 605. AUTHORITY TO WAIVE INDIAN PREFERENCE LAWS.

    ``To enhance recruitment and retention of employees of the Service, 
the Secretary may waive the requirements of the Indian preference laws 
(as defined in section 2(e) of Public Law 96-135 (25 U.S.C. 472a(e))) 
with respect to a personnel action with respect to a Service unit with 
the written request or resolution of an Indian tribe located within the 
applicable Service unit--
            ``(1) if such personnel action is with respect to a 
        facility that has a personnel vacancy rate of at least 20 
        percent; or
            ``(2) in the case such personnel action is with respect to 
        a former employee of the Service or former tribal employee who 
        was removed from such former employment or demoted for 
        misconduct that occurred during the five years prior to the 
        date of such personnel action.''.

SEC. 206. STREAMLINING MEDICAL VOLUNTEER CREDENTIALING PROCESS.

    Title I of the Indian Health Care Improvement Act (25 U.S.C. 1611 
et seq.), as amended by sections 203 and 204, is further amended by 
adding at the end the following new section:

``SEC. 128. STREAMLINING MEDICAL VOLUNTEER CREDENTIALING PROCESS.

    ``(a) In General.--The Secretary, acting through the Service, 
shall, in accordance with subsection (b), implement a Service-wide 
centralized credentialing system to credential licensed health 
professionals who seek to volunteer at a Service facility.
    ``(b) Requirements.--The credentialing system implemented under 
subsection (a) shall be in accordance with the following:
            ``(1) Credentialing of licensed health professionals who 
        seek to volunteer at a Service facility shall occur at the 
        Service level.
            ``(2) Credentialing procedures under such system shall be 
        uniform throughout the Service.
            ``(3) Under such system, in the case that such a licensed 
        health professional has successfully completed the 
        credentialing procedures under such system, such professional 
        shall be authorized to treat patients at any Service facility 
        or other facility within a Service area.
    ``(c) Regulations.--The Secretary may promulgate regulations to 
implement this section.
    ``(d) Consultation.--The Secretary may consult with public and 
private associations of medical providers in the development of the 
credentialing system under this section.
    ``(e) Application.--The credentialing system under this section 
shall apply with respect to licensed health professionals seeking to 
volunteer with respect to--
            ``(1) providing direct health care services at a Service 
        facility; and
            ``(2) providing services at facilities operated or 
        contracted by a tribe, tribal organization, or urban Indian 
        organization under the Indian Self-Determination and Education 
        Assistance Act.
    ``(f) Clarification.--Nothing in this section shall be construed to 
inhibit a tribe's authority to enter into a compact or contract under 
the Indian Self-Determination and Education Assistance Act.''.

           TITLE III--PURCHASED/REFERRED CARE PROGRAM REFORMS

SEC. 301. CODIFICATION OF LIMITATION ON CHARGES FOR HEALTH CARE 
              PROFESSIONAL SERVICES AND NON-HOSPITAL-BASED CARE SOURCE.

    (a) Applicability.--The requirements of this section shall apply 
to--
            (1) health programs operated by the Indian Health Service;
            (2) health programs operated by an urban Indian 
        organization through a contract or grant under title V of the 
        Indian Health Care Improvement Act, Public Law 94-437, as 
        amended; and
            (3) health programs operated by an Indian tribe or tribal 
        organization pursuant to a contract or compact with the Indian 
        Health Service under the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450 et seq.), provided that 
        the Indian tribe or tribal organization has agreed in such 
        contract or compact to be bound by this section pursuant to 
        section 108 of the Indian Self-Determination and Education 
        Assistance Act (25 U.S.C. 450l) and section 517(e) of such Act 
        (25 U.S.C. 458aaa-16(e)), as applicable.
    (b) Definitions.--For purposes of this section, the following 
definitions apply:
            (1) The term ``notification of a claim'' means, the 
        submission of a claim, with respect to services for an 
        individual, that meets the requirements of section 136.24 of 
        title 42, Code of Federal Regulations, in accordance with the 
        following:
                    (A) Such claim is submitted within the applicable 
                period specified under such section 136.24, or if 
                applicable, section 406 of the Indian Health Care 
                Improvement Act (25 U.S.C. 1646), and includes 
                information necessary to determine the relative medical 
                need for the services and the individual's eligibility.
                    (B) The information submitted with the claim is 
                sufficient to--
                            (i) identify the individual as eligible for 
                        Indian Health Service services (such as name, 
                        address, home or referring service unit, tribal 
                        affiliation);
                            (ii) identify the medical care provided 
                        (such as the date of service and description of 
                        services); and
                            (iii) verify prior authorization by the 
                        Indian Health Service for services provided 
                        (such as the IHS purchase order number or 
                        medical referral form) or exemption from prior 
                        authorization (such as copies of pertinent 
                        clinical information for emergency care that 
                        was not prior-authorized).
                    (C) To be considered sufficient notification of a 
                claim, a claim submitted by a provider or supplier for 
                payment shall be in a format that complies with the 
                format required for submission of claims under title 
                XVIII of the Social Security Act (42 U.S.C. 1395 et 
                seq.) or recognized under section 1175 of such Act (42 
                U.S.C. 1320d-4).
            (2) The term ``provider'' means a provider of services not 
        governed by or subject to subpart D of part 136 of title 42, 
        Code of Federal Regulations, and may include a skilled nursing 
        facility, comprehensive outpatient rehabilitation facility, 
        home health agency, or hospice program.
            (3) The term ``referral'' means an authorization for 
        medical care by the appropriate ordering official in accordance 
        with subpart C of part 136 of title 42, Code of Federal 
        Regulations.
            (4) The term ``repricing agent'' means an entity that 
        offers the Indian Health Service or a tribe, tribal 
        organization, or urban Indian organization discounted rates 
        from public and private providers that are not the Indian 
        Health Service or a tribe, tribal organization, or urban Indian 
        organization as a result of existing contracts that the public 
        or private provider other than the Indian Health Service or a 
        tribe, tribal organization, or urban Indian organization may 
        have within the commercial health care industry.
            (5) The term ``supplier'' means a physician or other 
        practitioner, a facility, or other entity (other than a 
        provider) not already governed by or subject to subpart D of 
        part 136 of title 42, Code of Federal Regulations, that 
        furnishes items or services under this section.
    (c) Payment for Provider and Supplier Services Purchased by Indian 
Health Programs.--
            (1) In general.--Payment to providers and suppliers for any 
        level of care authorized under subpart C of part 136 of title 
        42, Code of Federal Regulations, by a Purchased/Referred Care 
        program of the Indian Health Service, authorized by a tribe or 
        tribal organization carrying out such a program of the Indian 
        Health Service under the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450 et seq.), authorized 
        for purchase under section 136.31 of such title 42, Code of 
        Federal Regulations, by an urban Indian organization (as that 
        term is defined in 25 U.S.C. 1603(h)) (hereafter collectively 
        referred to as the ``I/T/U''), shall, subject to subsection 
        (e), be determined based on one of the methods described in the 
        following subparagraphs, as applicable:
                    (A) MFC rate method.--
                            (i) In general.--The method described in 
                        this subparagraph is that, subject to clause 
                        (ii), in the case a specific amount for an item 
                        or service has been negotiated with a specific 
                        provider or supplier or its agent by the I/T/U, 
                        the I/T/U shall pay that amount for such item 
                        or service.
                            (ii) Limitation.--The amount applied under 
                        clause (i) for an item or service shall be an 
                        amount that is at least the amount of the 
                        provider's or supplier's most favored customer 
                        rate, as defined by the Secretary of Health and 
                        Human Services, for an item or service, as 
                        evidenced by commercial price lists or paid 
                        invoices and other related pricing and discount 
                        data to ensure that the I/T/U is receiving a 
                        fair and reasonable price. The limitation under 
                        the previous sentence shall not apply with 
                        respect to an item or service if--
                                    (I) the amount offered to the I/T/U 
                                under the negotiation under clause (i) 
                                is fair and reasonable, as determined 
                                by the I/T/U, even though comparable 
                                discounts were not negotiated; and
                                    (II) the amount is otherwise in the 
                                best interest of the I/T/U, as 
                                determined by the I/T/U.
                    (B) Medicare rates.--The method described in this 
                subparagraph is that, in the case that an amount for an 
                item or service has not been negotiated in accordance 
                with subparagraph (A), the I/T/U will pay the lowest of 
                the following amounts for the item or service:
                            (i) The amount that is the applicable 
                        payment amount under the Medicare program under 
                        title XVIII of the Social Security Act for such 
                        item or service, including payment according to 
                        a fee schedule, a prospective payment system or 
                        based on reasonable cost for the period in 
                        which the service was provided, or in the event 
                        of a Medicare waiver, the payment amount will 
                        be calculated in accordance with such waiver. 
                        For purposes of this paragraph, the amount 
                        described in this clause shall be referred to 
                        as the ``Medicare rate''.
                            (ii) An amount negotiated by a repricing 
                        agent if the provider or supplier is 
                        participating within the repricing agent's 
                        network and the I/T/U has a pricing arrangement 
                        or contract with that repricing agent.
                            (iii) An amount not to exceed the provider 
                        or supplier's most favored customer rate 
                        described in subparagraph (A)(ii) for such item 
                        or service, as evidenced by commercial price 
                        lists or paid invoices and other related 
                        pricing and discount data to ensure that the I/
                        T/U is receiving a fair and reasonable price, 
                        but only to the extent such evidence is 
                        reasonably accessible and available to the I/T/
                        U.
                    (C) Other.--The method described in this 
                subparagraph is that, in the case that a Medicare rate 
                does not exist for an item or service, and no other 
                method described in a previous subparagraph is 
                accessible or available, the amount shall be deemed to 
                be 65 percent of authorized charges for such item or 
                service.
            (2) Coordination of benefits and limitation on recovery.--
        If an I/T/U has authorized payment for items and services 
        provided to an individual who is eligible for benefits under 
        title XVIII of the Social Security Act, title XIX of such Act, 
        or another third-party payer, the following shall apply:
                    (A) The I/T/U shall be the payer of last resort 
                under section 2901(b) of the Patient Protection and 
                Affordable Care Act (25 U.S.C. 1623(b)).
                    (B) If there are any third-party payers, the I/T/U 
                shall pay the amount for which the patient is being 
                held responsible after the provider or supplier of 
                services has coordinated benefits and all other 
                alternate resources have been considered and paid, 
                including applicable copayments, deductibles, and 
                coinsurance that are owed by the patient.
                    (C) The maximum payment by the I/T/U shall be only 
                the portion of the payment amount determined under this 
                section not covered by any other payer.
                    (D) The I/T/U payment may not exceed the rate 
                calculated in accordance with paragraph (1) of this 
                section (plus applicable cost sharing).
                    (E) In the case payment is made under such title 
                XIX for an item or service such payment shall be 
                considered payment in full and there shall be no 
                additional payment made by the I/T/U for such item or 
                service.
            (3) Authorized services.--Payment shall be made only for 
        those items and services authorized by an I/T/U consistent with 
        this section or section 503(a) of the Indian Health Care 
        Improvement Act (25 U.S.C. 1653(a)).
            (4) No additional charges.--
                    (A) If an amount has not been negotiated under 
                paragraph (1)(A) for an item or service, the provider 
                or supplier shall be deemed to have accepted the 
                applicable payment amount under paragraph (1)(B) for 
                such item or service as payment in full if--
                            (i) the item or service was provided based 
                        on a referral;
                            (ii) the provider or supplier submits a 
                        notification of a claim for payment to the I/T/
                        U; or
                            (iii) the provider or supplier accepts 
                        payment for the provision of such item or 
                        service from the I/T/U.
                    (B) A payment made and accepted in accordance with 
                this section shall constitute payment in full and the 
                provider or its agent, or supplier or its agent, may 
                not impose any additional charge--
                            (i) on the individual for I/T/U authorized 
                        items and services; or
                            (ii) for information requested by the I/T/U 
                        or its agent or fiscal intermediary for the 
                        purposes of payment determinations or quality 
                        assurance.
            (5) Notification of claim.--The Indian Health Service shall 
        not adjudicate a notification of a claim that does not contain 
        the information described in subsection (b)(1) with an approval 
        or denial, except that the Service may request further 
        information from the individual, or as applicable, the provider 
        or supplier, necessary to make a decision. A notification of a 
        claim meeting the requirements specified herein does not 
        guarantee payment.
            (6) Rate authorized.--No service shall be authorized and no 
        payment shall be issued under this section in excess of the 
        rate authorized by this section.
    (d) Authorization by an Urban Indian Organization.--An urban Indian 
organization may authorize for purchase items and services for an 
eligible urban Indian as those terms are defined in section 4 of the 
Indian Health Care Improvement Act (25 U.S.C. 1603) according to 
section 503 of such Act (25 U.S.C. 1653) and applicable regulations. 
Services and items furnished by physicians and other health care 
professionals and non-hospital-based entities shall be subject to the 
payment methodology set forth in this section.
    (e) Exception.--In the case of a payment described in subsection 
(c) that is with respect to a rare specialty service, as specified by 
the Secretary of Health and Human Services, or a service furnished in 
highly rural and medically underserved areas, as specified by the 
Secretary, the Indian Health Service or tribe or tribal organization 
involved may negotiate an amount for such payment for such service that 
is greater than the payment amount that would be recognized under title 
XVIII of the Social Security for such service.
    (f) Report.--Not later than two years after the date of the 
enactment of this Act, the Secretary of Health and Human Services, 
acting through the Director of the Indian Health Service, shall submit 
to Congress a report on the impact of this section on access to care 
under the Purchased/Referred Care program, including recommendations 
for such legislative actions as the Secretary determines appropriate.

SEC. 302. ALLOCATION OF PURCHASED/REFERRED CARE PROGRAM FUNDS.

    (a) In General.--Title II of the Indian Health Care Improvement Act 
is amended by inserting after section 226 (25 U.S.C. 1621y) the 
following new section:

``SEC. 227. PURCHASED/REFERRED CARE PROGRAM DISBURSEMENT FORMULA.

    ``(a) In General.--The Secretary shall, with respect to the 
Purchased/Referred Care program (formerly referred to as the `contract 
health services program') funded by the Indian Health Service and 
operated by the Indian Health Service, an Indian tribe, or tribal 
organization, review the distribution of funds pursuant to the program 
and initiate procedures under subchapter III of chapter 5 of title 5, 
United States Code, to negotiate or promulgate regulations to develop 
and implement a revised distribution formula in accordance with the 
subsequent subsections of this section.
    ``(b) Considerations.--In developing the revised distribution 
formula under subsection (a), the Secretary shall consider--
            ``(1) the extent to which services are available at a 
        Service hospital or facility of the Service rather than the 
        mere existence of such a hospital or facility;
            ``(2) population growth and the potential for population 
        growth;
            ``(3) the socioeconomic makeup of the population of each 
        contract health service delivery area;
            ``(4) the geographic makeup of each contract health service 
        delivery area;
            ``(5) the size of the hospital or facility;
            ``(6) the relative regional cost of purchasing services;
            ``(7) actual counts of Purchased/Referred Care users; and
            ``(8) accreditation problems at the Service hospital or 
        facility of the Service.
    ``(c) Implementation Deadline.--The revised distribution formula 
under subsection (a) shall be implemented not later than the date that 
is 3 years after the first October 1 following the date of the 
enactment of this Act.
    ``(d) Transition.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, for the period beginning on the first October 1 following 
        the date of the enactment of this section and ending the day 
        before the implementation date of the revised distribution 
        formula under subsection (a), the Secretary shall provide for 
        the distribution of funds, with respect to direct health care 
        services provided by a Service facility, pursuant to the 
        Purchased/Referred Care program (and with respect to services 
        provided by any other facility under such program, at the 
        option of such facility) be consistent with the following:
                    ``(A) During any portion of such period for which a 
                Service area has been designated as a high IHS level 
                area under paragraph (2)(B), such area shall not 
                receive any funds pursuant to such program in addition 
                to the base allotment determined under the distribution 
                formula under the program for 2016 with respect to such 
                area.
                    ``(B) In the case that during such period the 
                amount of funds made available to the Service for such 
                distribution under such program is in excess of the 
                total amounts of base allotments for distribution under 
                such program for 2016, the Secretary shall distribute 
                such excess amount, in accordance with a methodology 
                specified by the Secretary, to Service areas which for 
                an applicable portion of such period of excess funding 
                have been designated as a low IHS level area under 
                paragraph (2)(A).
            ``(2) Area designations.--For purposes of paragraph (1), 
        the Secretary shall, with respect to each contract health 
        service delivery area--
                    ``(A) review the services provided in the area to 
                determine the IHS medical priority level pursuant to 
                section 136.23(e) of title 42, Code of Federal 
                Regulations, of such services; and
                    ``(B) in the case majority, as specified by the 
                Secretary, of the services so provided in the area were 
                determined to have--
                            ``(i) such a priority level of a I or II, 
                        designate such area as a low IHS level area; 
                        and
                            ``(ii) any other priority level, designate 
                        such area as a high IHS level area.
    ``(e) Application of Reduction Clause.--In the case of a facility 
that, as of the date of the enactment of this section, is under 
contract with the Secretary with respect to the Purchased/Referred Care 
program and such contract applies to a period to which subsection (d) 
or the revised distribution formula under subsection (a) applies, if 
application of subsection (d) or the revised distribution formula 
results in the distribution of an amount of funds to such facility 
during such period that is less than the amount of funds that would be 
provided during such period to such facility under such contract with 
respect to the Purchased/Referred Care program before application of 
such subsection (d) or such revised distribution formula, respectively, 
the Secretary may under section 106(b) of the Indian Self-Determination 
and Education Assistance Act (25 U.S.C. 450j-1(b)) reduce such amount 
accordingly to be consistent with such subsection (d) or revised 
distribution formula, respectively.
    ``(f) Clarification.--Nothing in this section shall be construed to 
supersede a Tribe's self-governance contract under the Indian Self-
Determination and Education Assistance Act.
    ``(g) Update.--The Secretary shall periodically, but not more 
frequently than once every 3 years and not less frequently than once 
every five years, review and, as necessary, update the formula 
implemented under subsection (a).
    ``(h) Consultation.--In developing the formula under subsection (a) 
and reviewing and making updates to such formula under subsection (f), 
the Secretary shall consult with Indian tribes, including such tribes 
consulted for purposes of carrying out section 226.
    ``(i) Reports.--Not later than one year after the date of the 
enactment of this section, and annually thereafter, the Secretary shall 
submit to Congress a report on the implementation of this section. Each 
such report shall include information, with respect to the period for 
such report, on--
            ``(1) the distribution of funds for such period pursuant to 
        the Purchased/Referred Care program among the contract health 
        service delivery area, tribes, tribal organizations, and urban 
        Indian organizations;
            ``(2) whether during such period any contract health 
        service delivery area, tribe, tribal organization, or urban 
        Indian organization had a shortfall in such funding and, if so, 
        the amount of such shortfall; and
            ``(3) recommendations for such legislative action as the 
        Secretary deems appropriate.''.
    (b) Conforming Amendments.--Section 226 of the Indian Health Care 
Improvement Act (25 U.S.C. 1621y) is amended--
            (1) in subsection (a)--
                    (A) by striking ``As soon as practicable after the 
                date of enactment of the Indian Health Care Improvement 
                Reauthorization and Extension Act of 2009'' and 
                inserting ``Not later than 2 years after the date of 
                the enactment of section 227'';
                    (B) by striking ``the study'' and inserting ``a 
                study''; and
                    (C) by striking ``as requested by Congress in March 
                2009, or pursuant to section 830'' and inserting ``, 
                including as amended pursuant to section 227'';
            (2) in subsection (b)--
                    (A) in the matter preceding paragraph (1), by 
                inserting ``, and submit, not later than one year after 
                the date of the enactment of section 227 and annually 
                thereafter, to Congress a report on'' after ``pursuant 
                to the program'';
                    (B) in paragraph (3), by striking at the end 
                ``and'';
                    (C) by redesignating paragraph (4) as paragraph 
                (5);
                    (D) by inserting after paragraph (3) the following 
                new paragraph:
            ``(4) to determine whether during the period of the report 
        any contract health service delivery area, tribe, tribal 
        organization, or urban Indian organization had a shortfall in 
        such funding and, if so, the amount of such shortfall; and
            ``(5) recommendations for such legislative action as the 
        Secretary deems appropriate.''; and
                    (E) in paragraph (5), as redesignated by 
                subparagraph (C), by inserting ``, including 
                recommendations for such legislative actions as the 
                Secretary determines appropriate'' before the period at 
                the end; and
            (3) by striking subsection (c).

SEC. 303. PURCHASED/REFERRED CARE PROGRAM BACKLOG.

    Title II of the Indian Health Care Improvement Act (25 U.S.C. 
1621), as amended by section 302, is further amended by adding at the 
end the following new section:

``SEC. 228. PURCHASED/REFERRED CARE PROGRAM BACKLOG.

    ``Not later than one year after the date of the enactment of this 
section, the Secretary shall develop and implement a system to 
prioritize any backlog of unpaid balances under the Purchased/Referred 
Care program for each Service area. In developing such system, the 
Secretary shall consider--
            ``(1) the monetary amount of each such unpaid balance; and
            ``(2) how long such balance has remained unpaid.''.

SEC. 304. REPORT ON FINANCIAL STABILITY OF SERVICE HOSPITALS AND 
              FACILITIES.

    Not later than one year after the date of the enactment of this 
Act, the Comptroller General of the United States shall submit to 
Congress a report on issues related to the financial stability of 
hospitals and facilities of the Indian Health Service that have 
experienced sanction or threat of sanction by the Centers for Medicare 
& Medicaid Services. Such report shall focus on the effects of any 
revenues lost as a result of the sanction or threat of sanction and 
shall include recommendations for legislative action.
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