B-129066, SEP. 18, 1956

B-129066, SEP. 18, 1956

TO THE SECRETARY OF HEALTH, EDUCATION, AND WELFARE:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 23, 1956, REQUESTING TO BE ADVISED IF WE WOULD OBJECT TO THE SURGEON GENERAL AMENDING CONTRACT NO. I- L-IND-42562 BETWEEN THE UNITED STATES AND THE BOARD OF COUNTY COMMISSIONERS OF BERNALILLO COUNTY, STATE OF NEW MEXICO, AND THE BOARD OF TRUSTEES OF BERNALILLO COUNTY HOSPITAL.

IT IS STATED IN YOUR LETTER THAT PURSUANT TO THE PROVISIONS OF PUBLIC LAW 438 (81ST CONGRESS, 1ST SESSION), AUTHORIZING FEDERAL ASSISTANCE FOR THE CONSTRUCTION AND OPERATION OF A COUNTY HOSPITAL AT ALBUQUERQUE, NEW MEXICO, FOR CARE AND TREATMENT OF INDIANS, A CONTRACT GOVERNING THE HOSPITAL AND MEDICAL CARE OF INDIANS, WAS ENTERED INTO BY THE ACTING COMMISSIONER OF INDIAN AFFAIRS ON JUNE 18, 1952. YOU FURTHER STATE IN YOUR LETTER THAT THE CONTRACT PROVIDED IN PARAGRAPH 1 THAT THE COUNTY AND TRUSTEES WERE TO "PROVIDE ALL MEDICAL, SURGICAL AND OBSTETRICAL SERVICES AND CARE ...' TO INDIANS, AND IN PARAGRAPH 3, THE CONTRACT FURTHER PROVIDED THAT THE COUNTY AND TRUSTEES WOULD FURNISH "ALL PERSONNEL, INCLUDING MEDICAL AND SURGICAL STAFF FACILITIES ...' PARAGRAPH 8 PROVIDED THAT THE COMMISSIONER OF INDIAN AFFAIRS WOULD REIMBURSE THE TRUSTEES FOR THE CARE AND TREATMENT OF INDIANS "AT RATES NOT IN EXCESS OF THE AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE FOR THE INDIAN HOSPITAL.' THE CONTRACT FURTHER PROVIDED THAT THE AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE WAS TO BE DETERMINED BY DIVIDING "THE TOTAL COST OF OPERATING AND MAINTAINING THE HOSPITAL FOR ONE YEAR ... BY THE NUMBER OF HOSPITAL DAYS ACCRUED DURING SAID YEAR AND THE RESULTING QUOTIENT SHALL BE THE AVERAGE ANNUAL PER DIEM COST PER BED ...'

THE CONTRACT RESERVED TO THE COMMISSIONER OF INDIAN AFFAIRS THE RIGHT TO PASS ON ALL ITEMS ENTERING INTO THE COMPUTATION OF THE AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE.

YOU STATE THAT AFTER THE SURGEON GENERAL OF THE PUBLIC HEALTH SERVICE OF YOUR DEPARTMENT SUCCEEDED TO THE RESPONSIBILITIES AND DUTIES OF THE COMMISSIONER OF INDIAN AFFAIRS ON JULY 1, 1955, PURSUANT TO PUBLIC LAW 568, 83D CONGRESS, 2ND SESSION (42 U.S.C. 2001, ET SEQ.), THE COUNTY AND HOSPITAL AUTHORITIES ADVISED THAT THEY WERE INCLUDING IN THE ANNUAL COST OF OPERATION AND MAINTENANCE OF THE HOSPITAL THE COST OF PROVIDING TO THE INDIANS MEDICAL SERVICES OF PHYSICIANS WHO WERE NOT EMPLOYEES OF THE HOSPITAL AND REQUESTED THAT THEY BE GIVEN PERMISSION TO DISCONTINUE THAT PRACTICE. YOU ALSO REPORT THAT AS A RESULT OF INCLUDING IN THE ANNUAL COST OF OPERATION AND MAINTENANCE THOSE COSTS CHARGED BY NON-RESIDENT PHYSICIANS ATTENDING INDIANS FOR WHOM THE HOSPITAL WAS RECEIVING REIMBURSEMENT, THE HOSPITAL WAS BEING REIMBURSED FOR THOSE SERVICES AT SUBSTANTIALLY LESS THAN THE ACTUAL COST TO THE HOSPITAL. YOU ADVISE THAT THIS SITUATION RESULTS FROM THE FACT THAT NON-RESIDENT PHYSICIANS FURNISH SERVICES TO INDIGENT NON INDIAN PATIENTS AT NO CHARGE TO THE HOSPITAL, AND THE FACT THAT THE COSTS CHARGED BY THESE NON-RESIDENT PHYSICIANS FOR TREATMENT OF INDIANS ARE INCLUDED IN THE TOTAL COST WHICH UNDER THE FORMULA IS DIVIDED BY THE NUMBER OF HOSPITAL DAYS ACCRUED BY BOTH INDIAN AND NON INDIAN PATIENTS WHEN COMPUTING THE AVERAGE PER DIEM COSTS.

IT IS YOUR POSITION THAT THE INTERPRETATION OF THE TERMS OF THE CONTRACT REQUIRING THE HOSPITAL TO FURNISH ALL MEDICAL SERVICES, INCLUDING SERVICES PROVIDED BY NON-RESIDENT PHYSICIANS, IS NOT IN ACCORD WITH THE CUSTOMARY METHODS OF HOSPITAL OPERATION, AND YOU DO NOT CONSIDER THAT THE STATUTE REQUIRES THAT SUCH TOTAL MEDICAL CARE BE PROVIDED BY THE HOSPITAL. YOU REPORT THAT IN THE USUAL HOSPITAL OPERATION, GENERAL MEDICAL ATTENTION AND CARE ARE NORMALLY PROVIDED BY RESIDENT PHYSICIANS AND INTERNS WHO ARE EMPLOYED AS ESSENTIAL STAFF OF THE HOSPITAL. YOU STATE THAT THE PHRASE "CARE AND TREATMENT" AS CONTAINED IN SECTION 1 (B) OF PUBLIC LAW 438 WOULD ORDINARILY BE TAKEN AS REFERRING TO GENERAL MEDICAL STAFF SERVICES, THE COST OF WHICH MAY BE APPROPRIATELY CONSIDERED AS A PART OF THE COST OF OPERATING THE HOSPITAL, AS WELL AS APPROPRIATE FOR INCLUSION IN COMPUTING THE AVERAGE COST FOR REIMBURSEMENT.

IT IS YOUR CONTENTION, HOWEVER, THAT WHEN THE HOSPITAL IS REQUIRED TO OBTAIN THE SERVICES OF NON-RESIDENT PHYSICIANS FOR INDIAN PATIENTS AND THOSE NON-RESIDENT PHYSICIANS ARE NOT EMPLOYEES OF THE HOSPITAL STAFF, IT IS INAPPROPRIATE TO INCLUDE THE COST OF SUCH SERVICES IN THE COST OF OPERATION AND MAINTENANCE OF THE ENTIRE HOSPITAL, ESPECIALLY WHERE SUCH INCLUSION RESULTS IN REIMBURSEMENT AT LESS THAN THE FULL COST OF PROVIDING THE REQUIRED MEDICAL SERVICES TO INDIAN PATIENTS. YOU ALSO CONTEND THAT, UNDER ORDINARY HOSPITAL OPERATIONS, PHYSICIANS' SERVICES BEYOND THOSE PROVIDED BY THE HOSPITAL STAFF, WHICH ARE RENDERED ON A FEE BASIS, ARE ARRANGED AND PAID FOR BY THE PATIENT.

IN VIEW OF THE ABOVE FACTS YOU PROPOSE TO AMEND THE CONTRACT TO PROVIDE FULL REIMBURSEMENT OF CHARGES INCURRED BY THE HOSPITAL FOR THE PROVISION OF MEDICAL CARE TO INDIANS BY PHYSICIANS NOT EMPLOYED BY IT AS MEMBERS OF ITS RESIDENT STAFF. YOU ALSO PROPOSE TO INCLUDE A PROVISION REQUIRING THAT PAYMENT SHALL BE MADE FOR SUCH SERVICES IN ACCORDANCE WITH A SCHEDULE OF FEES WHICH SHALL BE SUBJECT TO APPROVAL BY THE SURGEON GENERAL.

PUBLIC LAW 438 AUTHORIZED FEDERAL ASSISTANCE FOR THE CONSTRUCTION AND MAINTENANCE OF A COUNTY HOSPITAL AT ALBUQUERQUE, NEW MEXICO, TO MAKE AVAILABLE HOSPITAL FACILITIES FOR THE TREATMENT OF INDIANS AND PROVIDED IN SECTION 1 (B):

"THAT SUCH HOSPITAL SHALL BE CONSTRUCTED, OPERATED, AND MAINTAINED BY THE COUNTY OF BERNALILLO, STATE OF NEW MEXICO, OR ITS SUCCESSOR OPERATOR, IN ACCORDANCE WITH STANDARDS ACCEPTABLE TO THE STATE OF NEW MEXICO, AND SHALL BE AVAILABLE TO ALL INDIANS: PROVIDED FURTHER, THAT THE COMMISSIONER OF INDIAN AFFAIRS SHALL REIMBURSE THE COUNTY OF BERNALILLO, OR ANY SUCCESSOR OPERATOR OF SUCH HOSPITAL, FOR THE CARE AND TREATMENT OF INDIANS ELIGIBLE UNDER THE REGULATIONS OF THE SECRETARY OF THE INTERIOR FOR HOSPITAL AND MEDICAL EXPENSES WHO MAY BE ADMITTED TO OR TREATED IN SAID HOSPITAL UNDER THE PROVISIONS OF THE ACT OF APRIL 16, 1934, AS AMENDED (U.S.C. TITLE 25, SECS. 452-454), AT RATES NOT IN EXCESS OF THE AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE FOR THE ENTIRE HOSPITAL, BUT IN NO EVENT SHALL THE AMOUNT OF SUCH PAYMENT BY THE COMMISSIONER OF INDIAN AFFAIRS BE LESS THAN THE AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE FOR 80 PERCENTUM OF THE BEDS REQUIRED TO BE MADE AVAILABLE. THE METHOD OF DETERMINING AVERAGE ANNUAL PER DIEM COST OF OPERATION AND MAINTENANCE SHALL BE AGREED UPON BETWEEN THE COUNTY OF BERNALILLO AND THE COMMISSIONER OF INDIAN AFFAIRS IN THE CONTRACT BETWEEN THE RELATING TO SUCH HOSPITAL

THE OBVIOUS PURPOSE OF THIS LEGISLATION WAS TO PROVIDE FOR THE CONSTRUCTION, OPERATION, AND MAINTENANCE OF HOSPITAL FACILITIES FOR INDIANS UNDER THE DIRECTION OF THE COUNTY OF BERNALILLO. IT IS APPARENT THAT THE STATUTE CONTEMPLATED THAT THE HOSPITAL WAS TO BE REIMBURSED BY THE FEDERAL GOVERNMENT WITHIN THE LIMITS OF A GIVEN FORMULA FOR THE COSTS OF CARE AND TREATMENT OF THOSE INDIANS WHO WERE QUALIFIED TO RECEIVE MEDICAL ATTENTION THROUGH THE FACILITIES AND SERVICES PROVIDED BY THE HOSPITAL. FURTHERMORE, INASMUCH AS PUBLIC LAW 438 DOES NOT REQUIRE THAT THE HOSPITAL PROVIDE THE SERVICES OF SPECIALISTS ON ITS STAFF, IT CAN BE REASONABLY ASSUMED THAT THE STATUTE INTENDED THE HOSPITAL TO ARRANGE FOR THE SERVICES OF SPECIALISTS WHEN NEEDED WITHOUT ANY FINANCIAL LOSS TO THE HOSPITAL. THE RESPONSIBILITY FOR CONSERVATION OF THE HEALTH OF THE INDIANS WOULD REQUIRE THE HOSPITAL AND ITS STAFF TO DO THIS AS A MINIMUM.

IN VIEW OF THESE CONSIDERATIONS WE AGREE THAT THE STATUTE DOES NOT REQUIRE THAT THE HOSPITAL, IN PROVIDING TOTAL MEDICAL CARE, SHOULD FURNISH NON-RESIDENT MEDICAL SERVICES AT ITS EXPENSE. WE ARE ALSO OF THE OPINION, HOWEVER, THAT THE STATUTES CONTEMPLATE THAT THE HOSPITAL WILL ASSURE THAT THE INDIANS UNDER THE CARE OF THE GOVERNMENT WHO ARE PROPERLY QUALIFIED FOR ADMITTANCE WILL RECEIVE THE ADEQUATE MEDICAL ATTENTION WHICH THE HOSPITAL DEEMS NECESSARY IN THE INDIVIDUAL CASES. UNDER THE TERMS OF THE PRESENT CONTRACT IT WOULD APPEAR THAT THE HOSPITAL HAS BEEN REQUIRED TO FURNISH AND PAY FOR THE SERVICES OF NON RESIDENT PHYSICIANS WHERE NECESSARY WHICH HAS RESULTED IN A LOSS TO THE HOSPITAL. WERE THIS SITUATION TO CONTINUE, IT WOULD BE AT LEAST POSSIBLE THAT IN SOME INSTANCES THE HOSPITAL MIGHT REFRAIN FROM OBTAINING THE NECESSARY OUTSIDE MEDICAL SERVICES TO AVOID SUSTAINING A MONETARY LOSS. AMENDING THE CONTRACT TO PROVIDE THAT THE HOSPITAL COULD BE REIMBURSED FOR THOSE COSTS INCURRED FOR THE SERVICES OF NON RESIDENT PHYSICIANS WOULD THEREFORE BENEFIT THE GOVERNMENT IN THAT IT WOULD ASSURE THAT THE RESPONSIBILITY OF THE FEDERAL GOVERNMENT TO PROVIDE ADEQUATE MEDICAL TREATMENT FOR QUALIFIED INDIANS WAS BEING PROPERLY AND FULLY DISCHARGED. WE HAVE NO OBJECTION TO THE PROPOSED MODIFICATION OF THE CONTRACT.