National Self-Governance Feasibility Study
Regional Consultation Session
Nashville, TN

April 26, 2001

The second Tribal Self-Governance Feasibility Study regional consultation was held on April 26, 2001, in Nashville, Tennessee. Approximately 25 people attended the consultation, which was jointly chaired by the Department of Health and Human Services (DHHS) and the Tribal Self-Governance Advisory Committee (TSGAC).

Opening Remarks

Mike Herrell, DHHS Division of Planning and Evaluation, opened the meeting by summarizing Title VI of the Tribal Self-Governance Amendments of 2001, in which Congress asked DHHS to look at DHHS programs that Congress might want to consider making eligible for a self-governance demonstration project. He said that the key issue is whether Congress should authorize a self-governance demonstration project for some, many, or all DHHS programs?

He explained that part of DHHS’s role is simply to make recommendations to Congress, which will need to decide whether to authorize a self-governance demonstration project. Within that context, the purpose of the consultation is to determine what a number of groups, including tribes, think about this issue.

In his opening remarks, Merle Boyd, TSGAC Chair, Title VI Co-Chair and Second Chief of the Sac & Fox Nation, urged every Area to develop written comments on the demonstration project prior to the June 14 national consultation meeting. He explained that there are three program categories to consider. The first category includes programs that are already accessed by tribes; the second includes those that tribes are most likely wanting to access; and, the third includes those programs that have never been run by tribes and are the least likely to be of immediate interest to Tribes. However, Mr. Boyd did stress that the least likely programs need to remain on the table should a Tribe choose to want to operate it in the future. He stated that, if tribes want to “fast track” the self-governance process, then they probably should concentrate on the first two categories

Paul Alexander, Attorney, Alexander & Karshmer, summarized the legislative history of Title VI, enacted as a second aspect to the Tribal Self-Governance Amendments of 2000, which made permanent the IHS self-governance demonstration program. A tribal draft bill had proposed a process for an immediate demonstration project for DHHS programs. However, DHHS did not feel comfortable with this approach. With help from Congressional supporters, DHHS and tribes reached a compromise that required a feasibility study before proceeding to a demonstration project. He then said that the most valuable aspect of the study it that it provides a basis for building trust with other DHHS agencies and that consultation is just the start of the process, especially since DHHS is so large.

Mickey Peercy, Self-Governance Coordinator, Choctaw Nation of Oklahoma, asked whether information is being provided to state and local governments and to stakeholder groups regarding self-governance and tribes. Mr. Herrell responded that the letter inviting these entities to the June consultation meetings will refer them to the DHHS self-governance website, which contains comprehensive information. In addition, Eugenia Tyner-Dawson, Senior Advisor for Tribal Affairs, DHHS Intergovernmental Affairs, said that her office has sent information from the self-governance website to DHHS to regional directors for dissemination at the regional level.

Feasibility Discussion

Mr. Herrell began the discussion by stating that DHHS needs to recommend to Congress which of the more than 300 programs should be included in a demonstration project. He outlined several feasibility criteria developed by DHHS that could be applied to assess whether a program should be included in a demonstration project:

Tribal Interest/Potential to Manage Programs

Co-Chair Boyd said that, because tribal goals and objectives might be different five years from now, there should continue to be accessibility to other programs in a second round of self-governance discussions.

Beverly Wright, Chairperson, Wampanoag Tribe, said that she would need to review the program list regarding eligibility for programs with the tribal health director because it is so extensive. Mr. Herrell indicated that the DHHS self-governance website has additional information about tribal eligibility and program details. He also said that tribes could look beyond current eligibility to consider programs that currently go to states, since eligibility for direct funding could be changed through a demonstration project.

Arlene Mack, Health Planner, Poarch Creek Tribe, asked for additional program details, a view that was echoed by Paula Williams, Director, IHS Office of Tribal Self-Governance. Mr. Herrell again referred them to the DHHS self-governance website. However, he did state that information regarding overhead and administrative costs would not be available for many DHHS programs because that information is not kept at the federal level. Most DHHS grant programs include administrative costs as an eligible use of funding. Ms. Williams suggested that additional information should be sought from state governments regarding this matter.

Co-Chair Boyd said that, during the Minneapolis consultation meeting, the issue of inadequate funding to administer very small programs was raised and asked for additional follow-up from participants.

Mr. Herrell said that tribes should consider the fact that many DHHS programs have cost sharing elements. For example, Medicaid requires a 20-30 percent program cost share. Again, he referred to the DHHS self-governance website for more information.

Rhonda Butcher, Self-Governance Director, Citizen Potawatomi Nation, stated that the two questions that should form the basis for whether a program should be included in a demonstration project: (1) whether tribes are capable of running the program, (2) whether there will be a positive impact on beneficiaries. She said that the other criteria drafted by DHHS should be more flexible than these two items.

Mr. Herrell asked participants whether it would be worth trying to include a program if other stakeholders object to including a particular program in a demonstration project. This question was not responded to directly.

Ms. Butcher recommended a three-tiered approach to determining whether a program should be included in a demonstration project. The first tier would include DHHS programs currently administered by tribes; the second would include programs that have AI/AN beneficiaries; and, the third tier would include “long-shot” programs that do not have AI/AN beneficiaries.

Mr. Alexander said that DHHS needs to be aware of the diversity of Indian Country in terms of capability. Mr. Herrell then asked how DHHS could measure tribal potential beyond using current program management. In response, Cindy Grounds, Program Development Specialist, Kaw Nation of Oklahoma said that tribal DHHS grants could be used to demonstrate success for other agencies with comparable programs that may not currently be administered by Tribes.

Mr. Herrell asked whether management capacity demonstrated through audits of other federal programs should be used to determine feasibility. Ms. Butcher responded that it should be used as one criterion, along with the submission of a plan that demonstrates how a tribe intends to operate a particular DHHS program.

Gloria Teague, Clinical Director of Clinical Support, Cherokee Nation, recommended that tribes be provided with capacity-building funds for research and training programs. She indicated that states, but not tribes, were given such funds under the CDC Breast and Cervical Cancer Program. Mr. Herrell responded that this issue was also raised during the Minneapolis regional consultation, where it was suggested that there be a training/technical assistance component to the demonstration for tribes that are not currently operating DHHS programs.

Impact On Beneficiaries/Cost

Co-Chair Boyd said that the potential to manage programs and the impact on beneficiaries should be combined into one feasibility category. Mr. Herrell responded that potential impact on beneficiaries was required by Congress in Title VI and asked tribes to submit data demonstrating the positive impact of tribal self-governance on beneficiaries.

Co-chair Boyd stated that tribes are delivering higher quality health care at lower costs. Mr. Herrell indicated that he has seen studies that show that, because of higher overhead costs, self-governance tribes have higher costs.

In response, co-Chair Boyd said that increased flexibility in shifting overhead funds between programs – something that is not currently allowed under Interior and IHS self-governance – would help to address this issue. Ms. Butcher said that, even with high indirect cost rates, tribes cannot decrease services to individuals so they end up subsidizing and/or funding programs with tribal resources.

Legal Barriers

Mr. Herrell indicated that DHHS is required to provide Congress with a list of legal barriers that could impact the inclusion of programs in a self-governance demonstration project and asked for information about how such barriers could be overcome.

Co-Chair Boyd said that DHHS should look at whether states have the same barriers, and that Congress should consider making adjustments if the barriers are unique to tribes.

Tribal Shares Can Be Defined

Mr. Herrell said that it would be difficult to determine tribal shares in competitive funding programs with a limited number of grants. He also stated that, for some programs, such as the Maternal and Child Health Program, state agencies were “grandfathered” in at a certain level of base funding, making it difficult to identify resources that could be used for tribal shares.

Max Tashuda, Director, IHS Oklahoma Area Office, explained the process used to determine IHS tribal shares, saying that IHS looks at those administrative costs that are needed to operate the programs. When Mr. Herrell responded that, because small DHHS grant programs may be staffed by only one person, a comparable situation does not exist. Mr. Tashuda responded that the entire infrastructure used to support the grant should be included in tribal shares. Mr. Herrell said that this might be an issue in large programs such as Medicaid, but that this may not be applicable to small competitive programs at DHHS.

Mr. Alexander said that the question is whether the grant amount is sufficient to actually run the program. If a tribe were taking over a federal function, then it would need more information to determine if there is a sufficient pot of money available. Mr. Herrell responded that, for competitive DHHS grants, the grantees build the administrative costs into the grant amounts they propose. Then, there is a negotiation period to determine the final funding level before the grant award is made.

Ms. Williams said that tribes need full disclosure on the DHHS budget in order to know whether funds are held at the federal level or by states. Mr. Herrell said that federal administrative costs are not broken down by program, but are included in an overall administrative budget. This is because, for the most part, DHHS, unlike IHS, does not run programs itself. Instead, it distributes funds through grants.

Andrew Rock, Self-Governance Analyst, Office of the Secretary, DHHS, said that the Department probably could make some judgments regarding overhead costs based on a percentage of the budget. However, he said that this figure would likely represent a small subset of funding once DHHS determined how much of that overhead would be devoted to administer the tribal portion of a non-IHS program. He said that, no matter how much analysis DHHS does, there would be a residual issue of how to make up the difference between program funding and overhead needs. He said that tribes might be able to achieve economies of scale by operating more programs and that tribes make the need for overhead funds known so that Congress will focus attention on this issue.

Mr. Tashuda said that, even if DHHS determines that tribal shares are very small, tribes still need to be able to identify them and make their own determination about their size. Ms. Butcher said that, even if DHHS cannot identify the tribal shares right away, the programs should not be excluded from consideration for the demonstration program.

Program Discussion

Mr. Rock described the process by which DHHS has categorized its more than 300 programs in order to evaluate whether they should be included in a self-governance demonstration project. He said that the bottom line is that DHHS is looking for advice on what programs or group of programs that tribes would like to run. Mr. Rock then described DHHS programs in terms of the following eight eligibility categories:

Mr. Rock asked participants to state the total number of programs they operate and then the number of DHHS programs that they currently participate in. The few answers provided, ranged from approximately four to six DHHS programs out of thirty to fifty programs overall. Programs in the first category, are the first targets of opportunity, since it will be a much smaller step to move them into self-governance. They would then look at the second category or programs, under which tribes are eligible for, but not receiving funds.

Chairperson Wright asked why programs under which tribes are ineligible were included in the discussion. Mr. Rock responded that current ineligibility is a legal barrier to inclusion in a demonstration project, and Congress required that legal barriers be identified as part of the feasibility study. Mr. Herrell said that programs might be considered based on whether there is a tribal need, not based on current eligibility.

Mr. Rock said that the underlying question is whether to focus on programs included in the first three categories or to consider all 300-plus programs in all categories. Mr. Herrell added that Congress could consider expanding the eligible applicants for programs, so tribes may consider their interests to say what should be included in a demonstration project.

The consensus among participants was that most programs of interest were included in the first three categories. However, Ms. Teague said that some training programs could be used for capacity building and that research funds should be considered, since there is some NIH funding that goes to tribes.

Mr. Rock followed up his first question by asking whether there are any programs within the first three categories that should not be considered for inclusion in a demonstration project, particularly based on program size.

Ms. Butcher said that all programs in the first category should be considered. With respect to the second category, she suggested that DHHS look at recommending tribal set-asides because they are eligible for, but not receiving, funding under these programs.

Mr. Herrell said that it would be difficult to determine the amount of a set-aside for many of these programs because funding is not population-based. In response, Mr. Tashuda said that other factors, such as epidemiology, could be used to determine an appropriate set-aside based on tribal need. Ms. Grounds, who cited substance abuse and diabetes as examples where data could be used to justify a tribal allocation, echoed this view.

Mr. Rock said that it would be easier to determine tribal set-asides for block grant programs because percentage-based allocations could be determined. He indicated that this task would be more difficult for discretionary grant funds because they are competitively awarded based on certain need-based criteria.

Mr. Peercy said that there is a lack of sensitivity at the federal level about tribal programs, so discretionary grant funding is not provided to tribes. He indicated that this is why tribal set-asides are important.

Mr. Alexander said that tribes would need to determine whether it makes sense to administer the program and consider whether it would be better to get tribal shares or a grant set-aside. He urged careful consideration of this issue, because tribes do not want to recommend statutory changes to Congress that would turn out to be mistakes

Finally, Mr. Rock said that one possible option is a consolidated application process for tribes. Ms. Butcher recommended that DHHS review the “477” (P.L. 102-477, Indian Employment, Training and Related Services Demonstration Act of 1992), which allows tribes to consolidate federal child care, training, employment, and job creation funding into a single block grant with streamlined application and reporting requirements.

Design Discussion

Estelle Bowman, Consultant, DHHS, outlined the following categories developed by DHHS for consideration in developing the design of a tribal self-governance demonstration program:

Quality Assurance/Accountability

Ms. Bowman stated that, at the Minnesota regional consultation meeting, there seemed to be consensus that the Single Audit Act be used as a financial accountability measure and that there be a single point of contact for self-governance within DHHS.

Ms. Mack recommended that DHHS provide planning grants as a part of the demonstration project. In response, Ms. Bowman said that many tribes attending the Minneapolis consultation had the same recommendation. She suggested that tribes put this recommendation in writing, including any specific funding suggestions.

Ms. Butcher said that the “477” programs directs funding through BIA in order to expedite the process and asked whether a similar role for IHS has been considered.

Ms. Butcher also said that tribes already develop their own outcome measures and that, if services are not delivered, then tribal members hold the programs accountable. She said that, in developing performance measurements, it is important to start at the baseline from which tribes are providing services and not hold them to a standard of services that currently are not being provided.

In response to a question from Mr. Herrell, participants agreed that some kind of performance measures should be used to measure quality and that the Single Audit Act is a way to measure financial accountability. However, in response to a follow-up question regarding performance measures contained in program regulations (e.g., Head Start’s building and transportation standards), Ms. Butcher said that tribes should be able to obtain waivers so long as they meet regulatory goals. Ms. Teague said that tribes want comparable services, not substandard programs.

Mr. Alexander stated that federal accountability should be added to the program design elements in terms of an appeal process and conflict resolution. He stated that the Department of Interior process is amorphous and that its standard of proof is arbitrary and capricious.

Program Redesign Consolidation Authority

In response to a question from Mr. Herrell regarding the necessity of including program redesign consolidation authority in a demonstration program, Ms. Butcher said that this issue is a double-edged sword. She indicated that, while it is generally necessary in order to create program efficiencies that lead to improved services, redesign authority causes agencies to fight over the funding turf. Mr. Herrell responded that perhaps there could be redesign authority combined with an assurance that funds would continue to provide program services.

Regulatory Waivers

Mr. Rock added that, while the “477” program provides a model for structuring a DHHS self-governance demonstration project; he also is hearing that it doesn’t necessarily work that well in all circumstances. He asked for comments on where the “477” program has failed so that DHHS can learn from past mistakes. Ms. Butcher replied that one failure is that there is no clear answer about whether “477” supercedes existing regulations and that different agencies view this matter differently. She recommended that authority to redesign regulations be granted in order to achieve program efficiencies.

C. Juliet Pittman, SENSE, Inc., said that this issue could be covered through the drafting of the legislation to implement the demonstration program, which will occur after the feasibility study is submitted to Congress.

Eligibility

Mr. Herrell asked whether Title V eligibility requirements should be used in determining eligibility under a Title VI demonstration project.

Mr. Alexander described the Title V definition and said that it is very broad for federally recognized tribes and is based on the concept of the government-to-government relationship. However, he said that there is an attitude at DHHS that tribes are not entitled to perform duties that they could assume under a demonstration project and urged DHHS to work to change agency attitudes.

Ms. Butcher agreed with these comments, and said that she is afraid based on the history of self-governance that the demonstration project could result in chaos if too many programs are considered as part of the demonstration project. She asked whether tribes would be better off limiting the number of programs to a small number so that the demonstration project has a better chance of moving forward without agency resistance. Ms. Teague echoed this concept and that tribes should consider starting with programs that have a high likelihood of success and that are already operated by tribes.

Length of Demonstration Project

Ms. Teague recommended a three-year demonstration project. However, Ms. Butcher said that it sometimes takes two years to get programs off the ground, so the project period should take that into account.

Ileen Sylvester, Vice President of Executive and Tribal Services, Southcentral Foundation, said that tribes should be able to include programs that they currently operate in a self-governance agreement without having a demonstration phase. Ms. Pittman said that the demonstration project implementation bill could have tiers in place that would allow certain programs already run by tribes to skip the demonstration phase. In response, Mr. Herrell said that Congress would probably want to see whether the program is working before moving from the demonstration to a permanent phase.

Ms. Tyner-Dawson indicated that DHHS will look at the number operating divisions affected by the demonstration project to see how many of the 12 operating divisions would be impacted by its implementation. A first tier might include two operating divisions, while a second tier would include four to six operating divisions.

Mr. Alexander said there is a feeling that tribes should be able to move more expeditiously for some programs, and legislation can be drafted to reflect this view.

Wrap-Up

In response to a question from Ms. Teague regarding the state consultation process, Mr. Herrell said that the meeting will be jointly chaired and that the agenda is being developed in cooperation with the TSGAC. DHHS will present the tribal recommendations to the states as a baseline to gauge their reaction and will educate the states about tribal self-governance. He said that states may not provide opinions on the demonstration project until they get a more clear idea of what the federal recommendations will be, at which point they will likely become more engaged in the process.

Mr. Herrell then provided information regarding what will occur after the regional consultation meetings conclude next week. The state and local government and beneficiary representatives meetings will be held June 6th-7th in Washington, D.C. Then, there will be a National Wrap-up Consultation Session with all interested parties on June 14th in Washington, D.C.

Written comments will be accepted until July 1st and should be submitted to:

Dr. Delores Parron
Office of the Assistant Secretary for Planning and Evaluation
Room 447D
201 Independence Avenue SW
Washington, DC 20201

Email: SELFGOVERNANCE@OSASPE.DHHS.GOV

As they are received, comments will be posted on the DHHS self-governance website

(http://aspe.hhs.gov/SelfGovernance).

Comments on the draft report will be due in September 2001, with the submission of separate views to the final report due in December. The final report will be submitted to Congress by February 18, 2002.