Alaska Native and American Indian Direct Reimbursement Act of 2000
PL 106-417 (S.406), enacted 11/01/2000

114 STAT. 1812 
PUBLIC LAW 106-417—NOV. 1, 2000 
Public Law 106-417 
106th Congress 
An Act 
Nov. 1, 2000 
[S. 406] 
Alaska Native 
and American 
Indian Direct 
Reimbursement 
Act of 2000. 
25 u s e 1601 
note. 
25 u s e 1645 
note. 
To amend the Indian Health Care Improvement Act to make permanent the dem-
onstration program that allows for direct billing of medicare, medicaid, and other 
third party payors, and to expand the eligibility under such program to other 
tribes and tribal organizations. 
Be it enacted by the Senate and House of Representatives 
of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the "Alaska Native and American 
Indian Direct Reimbursement Act of 2000". 
SEC. 2. FINDINGS. 
Congress finds the following: 
(1) In 1988, Congress enacted section 405 of the Indian 
Health Care Improvement Act (25 U.S.C. 1645) that established 
a demonstration program to authorize 4 tribally-operated 
Indian Health Service hospitals or clinics to test methods for 
direct billing and receipt of payment for health services pro-
vided to patients eligible for reimbursement under the medicare 
or medicaid programs imder titles XVIII and XIX of the Social 
Security Act (42 U.S.C. 1395 et seq.; 1396 et seq.), and other 
third party payors. 
(2) The 4 participants selected by the Indian Health Service 
for the demonstration program began the direct billing and 
collection program in fiscal year 1989 and unanimously 
expressed success and satisfaction with the program. Benefits 
of the program include dramatically increased collections for 
services provided under the medicare and medicaid programs, 
a significant reduction in the turn-around time between billing 
and receipt of pa3nnents for services provided to eligible 
patients, and increased efficiency of participants being able 
to track their own billings and collections. 
(3) The success of the demonstration program confirms 
that the direct involvement of tribes and tribal organizations 
in the direct billing of, and collection of payments from, the 
medicare and medicaid programs, and other third party payor 
reimbursements, is more beneficial to Indian tribes than the 
current system of Indian Health Service-managed collections. 
(4) Allowing tribes and tribal organizations to directly man-
age their medicare and medicaid billings and collections, rather 
than channeling all activities through the Indian Health 
Service, will enable the Indian Health Service to reduce its 
administrative costs, is consistent with the provisions of the 
Indian Self-Determination Act, and furthers the commitment 
PUBLIC LAW 106-417—NOV. 1, 2000 
114 STAT. 1813 
of the Secretary to enable tribes and tribal organizations to 
manage and operate their health care programs. 
(5) The demonstration program was originally to expire 
on September 30, 1996, but was extended by Congress, so 
that the current participants would not experience an interrup-
tion in the program while Congress awaited a recommendation 
from the Secretary of Health and Human Services on whether 
to make the program permanent. 
(6) It would be beneficial to the Indian Health Service 
and to Indian tribes, tribal organizations, and Alaska Native 
organizations to provide permanent status to the demonstration 
program and to extend participation in the program to other 
Indian tribes, tribal organizations, and Alaska Native health 
organizations who operate a facility of the Indian Health 
Service. 
SEC. 3. DIRECT BILLING OF MEDICARE, MEDICAID, AND OTHER THIRD 
PARTY PAYORS. 
(a) PERMANENT AUTHORIZATION.—Section 405 of the Indian 
Health Care Improvement Act (25 U.S.C. 1645) is amended to 
read as follows: 
"(a) ESTABLISHMENT OF DIRECT BILLING PROGRAM.— 
"(1) IN GENERAL.—^The Secretary shall establish a program 
under which Indian tribes, tribal organizations, and Alaska 
Native health organizations that contract or compact for the 
operation of a hospital or clinic of the Service under the Indian 
Self-Determination and Education Assistance Act may elect 
to directly bill for, and receive payment for, health care services 
provided by such hospital or clinic for which pa3mnent is made 
under title XVIII of the Social Security Act (42 U.S.C. 1395 
et seq.) (in this section referred to as the 'medicare program'), 
under a State plan for medical assistance approved under title 
XIX of the Social Security Act (42 U.S.C. 1396 et seq.) (in 
this section referred to as the 'medicaid program'), or from 
any other third party payor. 
"(2) APPLICATION OF l
O
O PERCENT FMAP.—^The third sen-
tence of section 1905(b) of the Social Security Act (42 U.S.C. 
1396d(b)) shall apply for purposes of reimbursement under 
the medicaid program for health care services directly billed 
under the program established under this section. 
"(b) DIRECT REIMBURSEMENT.— 
"(1) USE OF FUNDS.—^Each hospital or clinic participating 
in the program described in subsection (a) of this section shall 
be reimbursed directly under the medicare and medicaid pro-
grams for services furnished, without regard to the provisions 
of section 1880(c) of the Social Security Act (42 U.S.C. 
1395qq(c)) and sections 402(a) and 813(b)(2)(A), but all funds 
so reimbursed shall first be used by the hospital or clinic 
for the purpose of making any improvements in the hospital 
or clinic that may be necessary to achieve or maintain compli-
ance with the conditions and requirements applicable generally 
to facilities of such t3^e under the medicare or medicaid pro-
grams. Any funds so reimbursed which are in excess of the 
amount necessary to achieve or maintain such conditions shall 
be used— 
"(A) solely for improving the health resources deficiency 
level of the Indian tribe; and 
114 STAT, 1814 
PUBLIC LAW 106-417—NOV. 1, 2000 
Reports. 
Deadline. 
"(B) in accordance with the regulations of the Service 
appUcable to funds provided by the Service under any 
contract entered into under the Indian Self-Determination 
Act (25 U.S.C. 450f et seq.). 
"(2) AUDITS.—The amounts paid to the hospitals and clinics 
participating in the program established under this section 
shall be subject to all auditing requirements applicable to pro-
grams administered directly by the Service and to facilities 
participating in the medicare and medicaid programs. 
"(3) SECRETARIAL OVERSIGHT.—^The Secretary shall monitor 
the performance of hospitals and clinics participating in the 
program established under this section, and shall require such 
hospitals and clinics to submit reports on the program to the 
Secretary on an annual basis. 
"(4) No PAYMENTS FROM SPECIAL FUNDS.—Notwithstanding 
section 1880(c) of the Social Security Act (42 U.S.C. 1395qq(c)) 
or section 402(a), no payment may be made out of the special 
funds described in such sections for the benefit of any hospital 
or clinic during the period that the hospital or clinic participates 
in the program established under this section. 
"(c) REQUIREMENTS FOR PARTICIPATION.— 
"(1) APPLICATION.—^Except as provided in paragraph (2)(B), 
in order to be eligible for participation in the program estab-
lished under this section, an Indian tribe, tribal organization, 
or Alaska Native health organization shall submit an applica-
tion to the Secretary that establishes to the satisfaction of 
the Secretary that— 
"(A) the Indian tribe, tribal organization, or Alaska 
Native health organization contracts or compacts for the 
operation of a facility of the Service; 
"(B) the facility is eligible to participate in the medicare 
or medicaid programs under section 1880 or 1911 of the 
Social Security Act (42 U.S.C. 1395qq; 1396J); 
"(C) the facility meets the requirements that apply 
to programs operated directly by the Service; and 
"(D) the facility— 
"(i) is accredited by an accrediting body as eligible 
for reimbursement under the medicare or medicaid 
programs; or 
"(ii) has submitted a plan, which has been 
approved by the Secretary, for achieving such accredi-
tation. 
"(2) APPROVAL.— 
"(A) IN GENERAL.—^The Secretary shall review and 
approve a qualified application not later than 90 days 
after the date the application is submitted to the Secretary 
unless the Secretary determines that any of the criteria 
set forth in paragraph (1) are not met. 
"(B) 
GRANDFATHER 
OF 
DEMONSTRATION 
PROGRAM 
PARTICIPANTS.—^Any participant in the demonstration pro-
gram authorized under this section as in effect on the 
day before the date of enactment of the Alaska Native 
and American Indian Direct Reimbursement Act of 1999 
shall be deemed approved for participation in the program 
established under this section and shall not be required 
to submit an application in order to participate in the 
program. 
PUBLIC LAW 106-417—NOV. 1, 2000 
114 STAT. 1815 
"(C) DURATION.—An approval by the Secretary of a 
qualified application under subparagraph (A), or a deemed 
approval of a demonstration program under subparagraph 
(B), shall continue in effect as long as the approved 
applicant or the deemed approved demonstration program 
meets the requirements of this section. 
"(d) EXAMINATION AND IMPLEMENTATION OF CHANGES.— 
"(1) IN GENERAL.—^The Secretary, acting through the 
Service, and with the assistance of the Administrator of the 
Health Care Financing Administration, shall examine on an 
ongoing basis and implement— 
"(A) any administrative changes that may be necessary 
to facilitate direct billing and reimbursement under the 
program established under this section, including any 
agreements with States that may be necessary to provide 
for direct billing under the medicaid program; and 
"(B) any changes that may be necessary to enable 
participants in the program established under this section 
to provide to the Service medical records information on 
patients served under the program that is consistent with 
the medical records information system of the Service. 
"(2) ACCOUNTING INFORMATION.—The accounting informa-
tion that a participant in the program established under this 
section shall be required to report shall be the same as the 
information required to be reported by participants in the dem-
onstration program authorized under this section as in effect 
on the day before the date of enactment of the Alaska Native 
and American Indian Direct Reimbursement Act of 1999. The 
Secretary may from time to time, after consultation with the 
program participants, change the accounting 
information 
submission requirements. 
"(e) WITHDRAWAL FROM PROGRAM.—A participant in the pro-
gram established under this section may withdraw from participa-
tion in the same manner and under the same conditions that 
a tribe or tribal organization may retrocede a contracted program 
to the Secretary under authority of the Indian Self-Determination 
Act (25 U.S.C. 450 et seq.). All cost accounting and billing authority 
under the program established under this section shall be returned 
to the Secretary upon the Secretary's acceptance of the withdrawal 
of participation in this program.". 
(b) CONFORMING AMENDMENTS.—(1) Section 1880 of the Social 
Security Act (42 U.S.C. 1395qq) is amended by adding at the 
end the following: 
"(e) For provisions relating to the authority of certain Indian 
tribes, tribal organizations, and Alaska Native health organizations 
to elect to directly bill for, and receive pajnnent for, health care 
services provided by a hospital or clinic of such tribes or organiza-
tions and for which pa3anent may be made under this title, see 
section 405 of the Indian Health Care Improvement Act (25 U.S.C. 
1645).". 
(2) Section 1911 of the Social Security Act (42 U.S.C. 1396j) 
is amended by adding at the end the following: 
"(d) For provisions relating to the authority of certain Indian 
tribes, tribal organizations, and Alaska Native health organizations 
to elect to directly bill for, and receive payment for, health care 
services provided by a hospital or clinic of such tribes or organiza-
tions and for which payment may be made under this title, see 
114 STAT. 1816 
PUBLIC LAW 106-417—NOV. 1, 2000 
section 405 of the Indian Health Care Improvement Act (25 U.S.C. 
1645).". 
25 use 1645 
(c) EFFECTIVE DATE.—^The amendments made by this section 
note. 
shall take effect on October 1, 2000. 
Effective dates. 
SEC. 4. TECHNICAL AMENDMENT. 
note. 
(a) IN GENERAL.—Effective November 9, 1998, section 405 of 
the Indian Health Care Improvement Act (25 U.S.C. 1645(e)) is 
reenacted as in effect on that date. 
(b) REPORTS.—Effective November 10, 1998, section 405 of the 
Indian Health Care Improvement Act is amended by striking sub-
section (e). 
Approved November 1, 2000. 
LEGISLATIVE HISTORY—S. 406: 
HOUSE REPORTS: No. 106-818, Pt. 1 (Comm. on Resources). 
SENATE REPORTS: No. 106-152 (Comm. on Indian Affairs). 
CONGRESSIONAL RECORD: 
Vol. 145 (1999): Sept. 15, considered and passed Senate. 
Vol. 146 (2000): Oct. 17, considered and passed House.