Indian Health Service: Improvements Needed in Credentialing Temporary Physicians
Released: 1995-05-01T00:00:00

Letter

Introduction

Over 1 million American Indians and Alaskan Natives are eligible for federally funded health care. The Indian Health Service (IHS), an agency of the U.S. Public Health Service, Department of Health and Human Services (HHS), serves as the principal federal agency for providing health care services to this population. IHS’ goal is to raise the health status of American Indians and Alaskan Natives to the highest possible level. This is to be accomplished primarily through direct delivery of health care services and assisting tribes in developing and operating their own health care programs.

In fiscal year 1994, IHS operated with a budget of about $1.9 billion and was authorized 15,441 full-time equivalent employee positions. Of the total number of positions, about 60 percent or 9,400 are directly involved in the delivery of health care. This includes about 5,500 health care professionals, such as physicians, nurses, and physical therapists. The remaining 40 percent is composed of administrative, technical, and management employees, some of whom administer the contract health services program.

Administratively, IHS is organized into 12 area offices with headquarters in Rockville, Maryland (see app. I). The area offices are responsible for overseeing the delivery of health care services to American Indians and Alaskan Natives by the 144 service units. The service units are responsible for providing health care.

IHS provides direct health care services at no cost to eligible American Indians and Alaskan Natives in 41 hospitals and 114 outpatient facilities. Tribes and tribal groups operate another 8 hospitals and 351 outpatient facilities funded by IHS. IHS and tribally operated hospitals are generally small, with 80 percent of them having 50 or fewer beds. IHS’ three largest hospitals are in Phoenix, Arizona; Gallup, New Mexico; and Anchorage, Alaska. The type and scope of direct health care services vary by facility and depend on the availability of staff, equipment, and financial resources. Most IHS and tribal hospitals do not provide nonprimary care services, such as cardiology, ophthalmology, and orthopedics. In fiscal year 1993, IHS facilities had a workload of over 69,000 inpatient admissions and 5.5 million outpatient visits.

Health care services that IHS cannot provide in its hospitals and outpatient facilities are purchased from the private sector through the contract health services program. In fiscal year 1993, the Congress appropriated $328 million for this program and in fiscal year 1994, $350 million. These funds are used to obtain care from non-IHS hospitals and providers for (1) patients needing medical services beyond the scope and capability of IHS hospitals and clinics or in emergency situations and (2) American Indians and Alaskan Natives living in IHS areas that do not have direct care medical services. To receive such funding, an individual must (1) be eligible for direct care from the IHS, (2) reside within a designated contract health services delivery area, and (3) be either a member of, or have close social and economic ties with, the tribe located on the reservation. However, some IHS areas, such as California and Portland (which covers Oregon, Washington, and Idaho), do not have any IHS hospitals and refer all American Indians and Alaskan Natives for all inpatient services to non-IHS facilities.

Contract health services funds are used to purchase medical services based on a priority system and specific authorization guidelines established by headquarters. The Congress annually appropriates funds for these services as a separate category within the IHS clinical services budget. IHS distributes these funds to area offices primarily based on past funding history. The area offices then distribute the funds to the service units.

IHS has historically had difficulty recruiting and retaining physicians to staff its hospitals and outpatient facilities. To compensate for physician shortages, IHS often contracts with companies that supply locum tenens physicians, who are temporary physicians hired to fill vacancies for a specific period of time. In addition, these physicians temporarily replace staff who are in training, sick, or on vacation. For 9 months of fiscal year 1993, IHS estimated that this service cost $16.4 million.

As U.S. citizens, American Indians and Alaskan Natives are eligible to participate in Medicare and Medicaid on the same basis as any other citizen. In fiscal year 1993, third-party sources reimbursed IHS service units for more than $145 million for direct care services provided to this population. IHS policy requires that third-party payers be used before it will assume responsibility for payment of services rendered by non-IHS providers. Thus, American Indians and Alaskan Natives who receive health care under the contract health services program and who are eligible for Medicaid, Medicare, or have private insurance must first use these resources to pay for their medical care. IHS will assume responsibility, as funding permits, for any remaining balance for the care received.

Health care services provided by IHS to American Indians and Alaskan Natives are not a federal health care entitlement. Rather, the Health Care Improvement Act (25 U.S.C. 1602), which authorizes IHS to provide health care services to American Indians and Alaskan Natives, depends on appropriations from the Congress. Thus, IHS provides health care services only to the extent that funds and resources are made available.

American Indian and Alaskan Native leaders have consistently maintained that health care is part of the trust obligation the United States has with the Indian people and that IHS is responsible for providing for all of the health care needs of this population. Tribal leaders do not believe that IHS is providing this level of service and in 1994, during hearings on health care reform, brought this issue before the Congress. In those hearings, tribal leaders stated that they want assurance that their members will receive basic and adequate health care coverage. These leaders also said that if the health care problems of American Indians and Alaskan Natives are not addressed in their early stages of development, the result will be an increase in serious illnesses.

The health status of this population is worse than that of the general population. For example, the death rate from tuberculosis for American Indians and Alaskan Natives is six times higher than for other Americans and three times higher for diabetes. Furthermore, diabetes is now so prevalent that in many tribes 20 percent of the members have the disease. Diabetes can cause other medical problems, such as (1) eye complications that can lead to blindness, (2) kidney problems that may require dialysis or a kidney transplant to sustain life, and (3) vascular problems that can lead to amputation of a leg. However, these complications can be delayed or prevented with early diagnosis and appropriate treatment, usually by a specialist.

Objectives, Scope, and Methodology

Concerned about American Indians’ and Alaskan Natives’ access to health care and the quality of the medical services they receive, the Ranking Minority Member of the Human Resources and Intergovernmental Relations Subcommittee, House Committee on Government Reform and Oversight, asked us in April 1993 to review the quality of medical care received. In subsequent discussions with subcommittee staff, we agreed to focus our review on two areas: IHS’ efforts to ensure that temporary physicians working in IHS facilities are qualified and competent to perform assigned duties, and what happens when requested medical services are delayed.

We performed work at IHS headquarters, the Oklahoma area office, and at Ada and Claremore, Oklahoma, IHS hospitals. We selected these sites because both hospitals indicated they had problems with temporary physicians. We selected the following companies for our review because they had contracts with the hospitals we visited: Harris, Kovacs, Alderman Locum Tenens, Inc., Atlanta, Georgia; Medical Doctor Associates, Norcross, Georgia; Jackson and Coker Locum Tenens, Inc., Atlanta, Georgia; and EmCare, Dallas, Texas.

To identify IHS facilities that used temporary physicians and determine the cost of their services, we surveyed IHS facilities (see app. II). To address the issue of how IHS ensures that temporary physicians working in IHS facilities are qualified and competent to perform the work assigned to them, we (1) reviewed IHS’ policies and procedures for credentialing and privileging temporary physicians, (2) obtained and analyzed fiscal year 1993 contracts that IHS facilities had with locum tenens companies, (3) reviewed the credentials files of temporary physicians at two IHS hospitals, and (4) interviewed officials at four locum tenens companies that IHS had contracts with and discussed each company’s policies and procedures for credentialing physicians. At the hospitals we visited, we reviewed minutes of 1993 meetings of quality assurance committees to determine whether the quality of care being provided by temporary physicians was ever questioned. When we identified problems, we reviewed the medical records of the patients involved and discussed the care with IHS staff physicians. We also interviewed an official of the Federation of State Medical Boards (FSMB) to discuss dissemination of physician performance and disciplinary information obtained from FSMB’s data bank.

To determine what happened to patients who did not receive health care services at the time they were requested, we reviewed a list prepared by the hospitals of all denials and deferrals for fiscal year 1993 at the two hospitals we visited. From this list, we selected 20 files and tracked whether these patients eventually received care from either IHS or elsewhere and interviewed the IHS and non-IHS clinicians who provided this care. We also interviewed tribal leaders and health advocates from the Chickasaw and Choctaw Nations and the Sisseton-Wahpeton Sioux and Oglala Sioux Tribes; and interviewed Oklahoma, Navajo, and Aberdeen area office staff and non-IHS health care providers. We reviewed and analyzed documents related to their contract health services budgets, eligibility requirements for receipt of care, medical priorities for funding, and program operations. At IHS headquarters, we analyzed contract health services management reviews of selected area and service unit programs and interviewed IHS officials who were knowledgeable about the program.

We performed our work between April 1993 and October 1994 in accordance with generally accepted government auditing standards.

More Complete Information on Past Performance Is Needed Before Temporary Physicians Treat Patients

IHS has a difficult time retaining enough qualified physicians. To help meet the constant need for physicians to fill vacancies at various facilities and to supplement current medical staff, IHS service units enter into contracts with private companies that supply temporary physicians, known as locum tenens physicians, who provide services in IHS facilities. However, neither IHS’ policy nor most of its service units’ contracts with locum tenens companies explicitly requires that an examination be done of all medical licenses that a temporary physician may have before deciding whether the physician is allowed to treat IHS patients. Furthermore, the contracts do not require that locum tenens companies provide IHS with all information they may have on all licenses a physician may hold. Instead, IHS requires only that a physician have a medical license without restrictions to practice medicine. Furthermore, IHS’ own credentialing review process for temporary physicians is often not done in a timely manner. As a result, IHS has unknowingly allowed physicians with performance problems or disciplinary actions taken or pending against their licenses for offenses such as gross and repeated malpractice and unprofessional misconduct to work in IHS hospitals and treat patients. At the two IHS hospitals we visited, we found that 7 of the 50 temporary physicians referred to IHS had prior histories of performance or disciplinary problems. In some cases, IHS officials did not know of these problems when the hospital accepted the physician for work because of incomplete credentials information.

IHS does not have a formal system to help its facilities share information on the performance of temporary physicians. At one hospital, IHS officials concluded that a temporary physician misdiagnosed and inappropriately treated a patient, which may have contributed to the patient’s death. The IHS facility notified the locum tenens company of the incident and told them that it did not want further services from this physician. However, the IHS facility took no action to alert other IHS facilities.

IHS Relies on Temporary Physicians to Fill Staffing Needs

IHS estimated that for 9 months of fiscal year 1993, it spent about $16.4 million on contracts with locum tenens companies. We estimated that during fiscal year 1993 IHS obtained the services of more than 300 temporary physicians working in such areas as family practice, internal medicine, emergency room care, pediatrics, and obstetrics and gynecology. These physicians were needed because of vacancies and short-term absences of physicians who were on vacation, in training, or sick. While facilities in each of IHS’ 12 area offices use temporary physicians, 5 areas—Oklahoma, Aberdeen, Navajo, Phoenix, and Alaska—accounted for most of the funds expended for temporary physicians’ services. Collectively, the 5 areas serve about 67 percent of IHS’ user population and, as table 2.1 shows, accounted for 84 percent of the $16.4 million spent during fiscal year 1993 on temporary physicians’ services as of July 1993.

IHS Contracts Do Not Always Require That Information Be Shared

IHS facilities generally do not include a requirement in their contracts with locum tenens companies to (1) verify all licenses that a physician may hold, (2) inform IHS of the status of all licenses, and (3) provide all performance and disciplinary data that they may have on a temporary physician. Furthermore, IHS’ credentials and privileges policy requires only that a physician have an active state medical license with no restrictions to practice medicine. As a result, IHS does not always obtain complete credentials information and is not always aware of temporary physicians with performance or disciplinary problems.

At the two locations we visited, 5 locum tenens companies provided 50 temporary physicians in fiscal year 1993. We reviewed the credential files of 21 of these physicians and found that 7 had prior performance or disciplinary problems. This information had not been provided to the IHS facility that had contracted for each physician’s services. IHS officials at these locations told us that they did not specifically request the companies to provide all available data because they were under the impression that the contracts with locum tenens companies require disclosure of performance and disciplinary information.

IHS contracts with locum tenens companies generally specify the length of time physician services are required; the type of specialty needed, such as emergency room physician; the diagnostic and procedural skills needed; and the minimum professional qualifications that a physician must meet. To determine whether a physician meets the minimum qualifications, contract terms also require that the locum tenens companies submit the following credentialing information to an IHS facility: (1) evidence that the physician has a medical degree, (2) a copy of the physician’s current medical license, (3) evidence of liability insurance, (4) a signed IHS application for appointment to the medical staff, (5) a request for clinical privileges, and (6) a statement of health. Other minimum qualifications vary by IHS facility and by the type of specialty requested.

Locum tenens company officials told us that they will perform whatever physician verification of professional qualifications and requirements are necessary to meet the terms of the contract. But most IHS contracts do not (1) contain explicit requirements that locum tenens companies obtain and disclose information on actions taken against any medical licenses held by a physician or (2) require that locum tenens companies obtain and provide IHS with any information on ongoing or pending investigations involving temporary physicians.

Three of the four locum tenens companies we visited routinely use FSMB’s disciplinary data bank to determine if any information has been reported on a physician’s performance. The FSMB data bank provides historical information from all state medical licensing boards about whether a physician’s medical license has action taken against it and the nature and date of the action. However, the FSMB data bank does not contain information on ongoing or pending investigations against a medical license. This information must be obtained from the individual state medical licensing boards, which all the locum tenens companies we visited contact to verify medical licenses.

Locum tenens companies query the FSMB data bank electronically and often receive results in a day. Thus, they quickly become aware of any performance problems that a temporary physician had in the past. However, the FSMB contract with locum tenens companies precludes the companies from providing detailed information on a physician’s performance to a third party, such as IHS. A company can, however, inform a third party that a physician had a performance or disciplinary action taken against a medical license. Thus, IHS can obtain an indication that a performance problem may exist if it asks for such information from a contractor. One of the IHS facilities that we visited does obtain this information. Because of prior problems that this facility encountered with temporary physicians and locum tenens companies, it contractually requires locum tenens companies to query FSMB and inform it as to whether a physician had performance or disciplinary action taken against a license. Because temporary physicians do not always disclose complete information on their past performance, IHS officials at this facility believe that it is especially critical that they check the status of each medical license.

The following example shows the importance of checking all medical licenses that a physician may have.

At one IHS facility, a temporary physician worked as an internist from June 21 to July 15, 1993. The locum tenens company provided the hospital with a curriculum vitae on June 17, 1993. The physician’s application for appointment to the medical staff at the IHS facility indicated that the physician was licensed to practice medicine in three states and that the physician was never censured or reprimanded by a licensing board. The locum tenens company provided copies of two state medical licenses. On June 21, 1993, the IHS credentialing official called the licensing board in one of these two states and learned that the physician’s license was in good standing. Upon further review of the physician’s curriculum vitae, the credentialing official noticed that the physician had practiced for 15 years in one of the three states where he was licensed. However, neither the company nor the physician had provided IHS with a copy of this license. The credentialing official contacted that state’s medical licensing board on July 14, 1993, and learned that the physician had two actions taken against this license in April 1992. According to the state licensing board’s report, the physician was fined $3,000 and ordered to attend 50 hours of continuing medical education for failure to keep written medical records justifying the course of treatment of a patient, altering medical records, and failing to practice medicine with an acceptable level of care, skill, and treatment in properly diagnosing a patient’s heart condition. The physician left the IHS facility after his contractual obligation ended on July 15, 1993.

IHS Does Not Always Verify Temporary Physicians’ Credentials in a Timely Manner

The Joint Commission on the Accreditation of Healthcare Organizations (JCAHO) requires all entities that seek accreditation to perform a credentialing review on each physician it employs. This requirement is designed to protect a patient from being treated by an unqualified or incompetent physician. IHS follows JCAHO’s accrediting requirements and requires each of its facilities to conduct a credentials review that consists of (1) verifying with a state medical licensing board that a physician has an active, unrestricted medical license; (2) verifying training with the medical school, internship, or residency program, and professional affiliations, such as board certification; (3) obtaining information to evaluate the physician’s suitability for appointment to the medical staff, such as explanations of past performance problems, disciplinary actions taken against a physician’s license, or malpractice suits that involved the physician; (4) checking with references to verify clinical competence, judgment, character, and ability to get along with people; and (5) obtaining information on physical and mental health status.

IHS procedures also require that a physician’s credentials be verified before the physician is allowed to provide medical services to a patient. However, if time does not permit a full credentialing review before a physician reports for duty, an IHS facility director can grant temporary privileges to practice medicine. The decision to grant temporary privileges to a physician is based on the clinical director’s review and approval of the physician’s application for appointment to the medical staff and his or her request for clinical privileges. But the credentialing official is still expected to perform a full review of a physician’s credentials.

IHS credentialing officials told us that sometimes they cannot conduct a full credentials review before a temporary physician treats patients because of the short period between the time when an IHS facility contracts for physician services and the time when a physician reports to the facility. As a result, a temporary physician can treat patients and leave a facility before a complete credentials review has been performed. An incomplete credentialing process can result in a health care facility unknowingly allowing an incompetent physician to provide medical care to patients, thereby placing the facility and patients at risk.

The short time frames were evident in the 43 contracts we reviewed; 37 were awarded less than 2 weeks before the facility acquired physician services, not enough time for a facility to confirm credentials information before a temporary physician begins work. Furthermore, temporary physicians often perform work and are gone before the credentials check is completed. The credentials check can take 30 days to complete. The average time from when a contract was awarded to the date services began was 7 days. The length of time IHS facilities needed the services of temporary physicians varied, with many periods of service ranging from 21 to 32 days. In addition, locum tenens companies often use more than one physician to fulfill a contract. For example, a company sent 10 different temporary physicians to staff 1 position for 1 month. When multiple physicians are used to fulfill a contract, credentialing becomes an even more time-consuming and complicated process.

IHS Service Units Do Not Share Information on Performance of Temporary Physicians

An official from one locum tenens company told us that temporary physicians tend to be transient and fall into one of three categories: (1) new physicians who do not know where they want to practice medicine and want to explore different settings before starting a practice, (2) physicians over 40 years old who no longer want to maintain a private practice and want to travel to different locations, and (3) physicians with performance or disciplinary problems who move from place to place to escape detection. Physicians in the latter category are identified primarily through state medical licensing boards although not all performance problems are reported to the boards.

At present, IHS facilities do not have a formal mechanism to share information on the performance of temporary physicians who have worked in the IHS system. As a result, a poorly performing physician can move from one IHS location to another with little chance of being detected. The importance of sharing information among IHS facilities is highlighted by the following example.

A temporary physician examined a patient in the emergency room. The patient was complaining of chest and abdominal pain that the physician diagnosed as constipation. He prescribed a laxative for the patient and sent him home. The patient returned to the emergency room about an hour later saying his pain had worsened. The temporary physician reexamined him, reaffirmed the diagnosis of constipation, and told him to go home again. However, the emergency room nursing supervisor noticed from the patient’s medical chart that he had a history of heart disease and that his condition had deteriorated since his first visit. Therefore, she ordered an electrocardiogram be performed on the patient and notified the full-time IHS internal medicine physician of the patient’s condition. The IHS staff physician ordered that the patient be admitted to the intensive care unit to determine whether the patient was having a heart attack. The nurse admitted the patient immediately, but he died of a cardiac arrest 15 minutes after being admitted.

The IHS facility’s chief of the emergency department deemed that the care this physician provided was unacceptable and informed the locum tenens company of his performance problems. The company removed the physician from its active list of applicants. However, the IHS facility did not inform other facilities of this individual’s performance. As a result, the physician could find work at another IHS facility under contract with a different locum tenens company.

Conclusions

American Indian and Alaskan Native patients should have reasonable assurance that every physician who treats them in an IHS facility is qualified to do so. Thus, except for emergencies, we do not believe that IHS should allow physicians to work within the IHS system until a complete examination of all medical licenses has been performed and IHS service unit officials are informed of the results. Furthermore, locum tenens companies under contract with IHS need to be required to provide all information they have available to them on a temporary physician that could potentially adversely affect the care provided to patients. Current IHS policy does not explicitly require that all medical licenses be verified. However, a review of all medical licenses can reduce the risk of patients receiving substandard care from temporary physicians who may have had prior performance problems.

IHS facilities can benefit from sharing information about the performance of temporary physicians. Better communication among facilities is needed to identify and track temporary physicians’ performance, both good and bad, while working with IHS. Such an information sharing network would be of substantial benefit to IHS personnel responsible for conducting credentialing checks and could reduce duplicative credentialing checks.

Recommendations

We recommend that the Assistant Secretary for Health, Public Health Service, ensure that the Director of IHS take the following actions:

Revise IHS’ credentials and privileges policy to explicitly state that the status of all state medical licenses, both active and inactive, be verified.

Develop standard provisions to include in contracts with locum tenens companies that require a company to verify and inform IHS of the status of all state medical licenses, both active and inactive.

Establish a system that will facilitate the dissemination of information among IHS facilities on the performance of temporary physicians who provide services in IHS.

Agency Comments and Our Evaluation

In commenting on a draft of this report, the U.S. Public Health Service agreed with our findings and recommendations. Its response is reprinted in appendix VI. The Public Health Service stated that IHS plans to revise its policy on personal services contracts to make it consistent with its policy guidance on the credentials and privileges review process of medical staff. This revision will require the verification of all medical licenses, both active and inactive, for all physicians—including temporary physicians whether hired directly by IHS or through locum tenens companies. The policy guidance on personal services contracts will also be revised to require locum tenens companies to verify and inform IHS of adverse actions taken on all medical licenses. In addition, IHS is developing an electronic bulletin board to share personnel information among area offices and services units. The bulletin board will include a component on credentialing activities, such as performance information on temporary physicians.

The Public Health Service also pointed out that in verifying state medical licenses, many states will not release information on matters under investigation. While this may be true in general, many state medical licensing boards will disclose whether an investigation is being conducted on a particular physician. If state boards are queried, the clinical director of the IHS facility can be alerted that a problem may exist and that follow-up with the physician in question may be warranted.

Funding and Staffing Limitations Reduce Availability of Medical Care

IHS facilities cannot meet all of the health care needs of American Indians and Alaskan Natives. Recognizing this, the Congress annually appropriates funds for care to be administered by non-IHS providers under contract with IHS. But the funds cover only 75 percent of the need for these services. Because of the limited funds, IHS prioritizes the care that it will pay for. The result is reduced access to contract medical services for American Indians and Alaskan Natives. In fiscal year 1993, IHS denied or deferred 82,675 requests for contract medical services.

IHS is now implementing staff reductions as required by the Federal Workforce Restructuring Act of 1994. An official in IHS’ Office of Administration and Management does not believe that these reductions will significantly affect either the delivery of medical services or planned expansion programs in fiscal years 1995 and 1996 if IHS’ appropriation for fiscal year 1996 is not reduced and medical services can be purchased through contracts with health care providers. However, he is concerned about how scheduled staff reductions after fiscal year 1996 may affect IHS’ delivery of medical services and its expansion program.

IHS Facilities Cannot Provide All Needed Medical Services

Few IHS service units are able to provide a full range of medical services to American Indians and Alaskan Natives. Thus, IHS utilizes non-IHS providers to deliver services that cannot be provided in-house. This is done with contract health services funds. For example, only 4 of IHS’ 144 service units have hospitals that are equipped and staffed to provide comprehensive medical services such as intensive care, inpatient surgery, high-risk obstetrics, and specialty medical services such as ophthalmology (see apps. III and IV for sizes of hospitals). Forty-five service units have inpatient hospitals that do not provide a full range of medical services, such as inpatient surgical services and obstetrical deliveries. Eighty-four service units have no inpatient IHS hospital and provide services at outpatient facilities. And 11 service units have no IHS medical facilities at all.

Contract Health Services Funds Used to Purchase Care From Non-IHS Providers

IHS distributes contract health services funds among its 12 area offices based primarily on the level of funding that the area received in previous years. This system of allocating funds does not take into account current data on the number of American Indians and Alaskan Natives in each area who rely on IHS for health care services, the health care needs of the population, or the health care services available within each area.

In fiscal years 1991 and 1992, appropriations for contract health services increased about 6 percent each year. However, an IHS official told us that the cost for contract health services rose over 11 percent from 1991 to 1992. Furthermore, according to IHS, the total funds available for contract health services covered only 75 percent of the need for this type of service. Table 3.1 shows the amount of contract health services funds available to area offices and the eligible population of each area for fiscal year 1993.

Needed Outside Medical Services Are Not Always Provided in a Timely Manner

IHS has developed medical priorities guidelines that are used by all facilities to determine what care will receive the highest priority for available contract health services funds (see app. V). Emergent and urgent care—such as emergency room care, life-threatening injuries, obstetrical deliveries, and neonatal care—is given the highest priority for funding and is generally funded. However, other care is given a lesser priority and is not always funded. Preventive care, such as screening mammograms, is next on the priority list. Third on the priority list are primary and secondary care services, such as specialty consultations in pediatrics and orthopedics. The lowest priority is for chronic tertiary and extended care services, such as skilled nursing facility and rehabilitation care.

Using medical priority guidelines, IHS service units denied or deferred 82,675 requests for contract health services in fiscal year 1993. This represents a 76 percent increase over denials and deferrals reported in fiscal year 1990. A request for funding is denied when the patient’s care does not fall within the medical priorities for which funds are available and the patient informs the contract health services staff that he or she intends to obtain medical care regardless of whether IHS will pay for it. If the medical care does not fall within medical priorities and a patient is willing to wait until funding may become available, the care is deferred. Of the 70,540 requests that were deferred, 43 percent were for preventive care, such as eye examinations. The remaining deferrals were for acute and chronic primary, secondary, and tertiary care, such as coronary bypass surgery and hip replacement surgery. Some of the patients whose initial requests were deferred may have ultimately received care from IHS or others, but IHS does not have data readily available on the extent to which this has occurred.

The following is an example of a case where the patient requested funding for medical care from the contract health services program, but had her request deferred because her condition was not of a sufficiently high priority to receive immediate funding. As a result, care was delayed for 6 months until the patient’s condition deteriorated to the point where the problem was critical and immediate care was required.

The 73-year-old woman was diagnosed with severe circulatory problems in her left leg in January 1993 at an IHS hospital. The physician assistant who saw the patient thought she should be referred to a vascular surgeon in the community for surgical treatment. The physician assistant did not believe that the patient was in immediate danger, that is, was not in danger of losing her leg within 48 hours. However, he did believe that care was needed to prevent further deterioration. This case was presented to the hospital’s contract health services committee on January 25, 1993, to determine whether her care was a high enough priority to be funded. Contract health services staff deferred her care because the funds available only allowed the service unit to treat the more seriously ill patients with more urgent medical conditions than hers. Although the woman was covered by Medicare, she could not afford to pay the $338 that Medicare would not cover. Had she been able to pay the $338, she could have received immediate care from a non-IHS provider.

Once a month for the next 6 months, the patient returned to the IHS hospital clinic for care. After each visit, her case was referred to the contract health services committee and her care was deferred each time because it did not fall within medical priorities. In July 1993, the patient’s referral was approved by contract health services because her condition had deteriorated to such an extent that she was in immediate danger of losing her left leg. IHS contract health services funds then paid the costs not covered by Medicare that the patient could not afford to pay.

Table 3.2 shows the number of cases that were denied and deferred in fiscal year 1993 by area office. IHS officials stated that the number of deferrals and denials only document part of the unmet need. Deferrals and denials only track those who have requested services. There is no way to track the number of American Indians and Alaskan Natives who do not use the IHS system because they know that their care will be deferred.

The Navajo and Oklahoma areas accounted for 69 percent of the total denials and deferrals in fiscal year 1993. These areas have 13 IHS hospitals ranging in size from 11 to 107 beds and 49 outpatient facilities that provide medical services to approximately 488,395 American Indians. This represents about 41 percent of all American Indians and Alaskan Natives who have used IHS services within the last 3 years. The hospitals and outpatient facilities in these areas do not have the staff or equipment to provide all of the health care services needed. As a result, contract health services funds are being relied upon to provide care that IHS does not have the capacity to provide. But if the care needed is not a high priority, it does not get funded. For example, in fiscal year 1993 in the Navajo area, 16,503 requests for eye examinations or eyeglasses were not funded because of insufficient contract health services funds.

Officials in both area offices told the Public Health Service that they need more funds to meet the needs of their populations. IHS has requested increased funding for the contract health services program, but HHS has not approved the level of increases that IHS has requested. Furthermore, the dollars available for health services to all areas are limited and any increase in funds to one IHS area would likely result in a decrease in funds to another IHS area.

Staff Reductions Could Increase Demands on Contract Health Services Program

The Federal Workforce Restructuring Act of 1994 requires executive agencies to reduce staff. In a September 1994 meeting with the Office of Management and Budget (OMB), the Secretary of HHS requested a waiver of this requirement for IHS. The Secretary stated that IHS needed time to plan and implement a restructuring program that would consolidate some of IHS’ area offices to reduce IHS’ workforce without drastically affecting delivery of health services. OMB did not approve the waiver but did agree to give IHS time to implement staff reductions in a way to minimize the impact on IHS’ delivery of medical services and its planned expansion program.

IHS has 15,425 staff for fiscal year 1995. Beginning in fiscal year 1996, this number will decrease annually until a staffing level of 14,083 is reached in fiscal year 1999. An official in IHS’ Office of Administration and Management told us that when supplemented by contract physicians, IHS’ staffing levels in fiscal years 1995 and 1996 will be adequate to meet the staffing requirements of both its current health facilities and those that are scheduled to open in these years. However, in his opinion, if IHS’ fiscal year 1996 appropriation is reduced, the agency will not be able to adequately staff its present facilities and the new facilities scheduled to open in fiscal years 1995 and 1996. If the agency is not able to adequately staff its new facilities, it will be unable to provide services such as physical therapy, respiratory therapy, radiology, optometry, and community health services, according to IHS officials. These services will have to be sought from non-IHS providers in the community with contract health services funds. As a result, more medical services could be denied and deferred.

This official also told us that he is concerned that the staffing reductions in fiscal year 1997 and beyond could affect IHS’ delivery of medical services and its planned expansion program. In fiscal year 1997, IHS plans to open and staff a large medical center in Anchorage, Alaska, to replace its old hospital. Additionally, IHS must staff new or expanded services in eight other facilities.