OIG Sends a Warning Shot to Tribal Governments

By: Robert G. Marasco | Attorney | robert.marasco@procopio.com
Theodore J. Griswold | Partner | ted.griswold@procopio.com

Attention Tribal Governments: The Federal Government is watching, and they may be looking deeper into your financial books. A recent cautionary notice issued by the Office of the Inspector General (OIG) of the US Department of Health and Human Services (HHS) puts tribal organizations on notice that OIG will be watching how they spend funds issued to them pursuant to the Indian Self-Determination and Education Assistance Act (ISDEAA). The contracts, compacts or funding agreements that tribal organizations have entered with the Indian Health Service (IHS), as well as other applicable laws, dictate how ISDEAA funds can be spent. Generally, such funds, as well as funds received through Medicare, Medicaid and the Children’s Health Insurance Program (CHIP), carry with them the limitation that they can only be spent on health care services or facilities.

The OIG has revealed that it has been conducting audits of tribal organizations – and will continue to do so – to determine whether ISDEAA funds are being spent properly. These audits have revealed that some tribal organizations have used ISDEAA funds to pay for other tribal expenses, cover tribal deficits or used for personal expenses – all of which are improper. Not only will such instances require the reimbursement of misspent funds to the government, but they may also result in the tribal organization being prevented from receiving ISDEAA funds in the future or from being permitted to directly bill Medicare, Medicaid or CHIP. Moreover, this misspending can be penalized civilly and prosecuted criminally.

Can your government prove that its ISDEAA funds are being spent appropriately? Taking the steps now to self-assess how ISDEAA funds are being used in your tribal organization can go a long way in helping you avoid an OIG audit or sail smoothly through such an audit should it occur. Ensuring the funds are spent properly and fixing any shortcomings will ensure this money is invested where the law requires – in the health of your community. The OIG Notice can be found here.

Robert Marasco is an attorney with Procopio’s Healthcare, Native American and White Collar Defense practice groups, handling governmental investigations and compliance.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.