Supreme Court decision backs tribal contractors

On June 19 the U.S. Supreme Court ruled in favor of Native American and Alaska Native tribes in the Salazar, Secretary of the Interior v. Ramah Navajo Chapter case. Under the Court’s ruling, if Congress does not appropriate full funding, tribal contractors can sue the IHS or BIA for the underpayment just like any other government contractor.

The decision holds the government liable for failing to pay full contract support costs to tribes that run education and law enforcement services under contracts with the Bureau of Indian Affairs (BIA). The decision means a similar rule will be issued instructing the Indian Health Service (IHS) to pay full contract support costs and uphold similar damage claims for past contract underpayments.

In Alaska, tribal organizations such as YKHC contract with the government to deliver health care and other services. Over many years, the federal government has underfunded the contract support costs it has owed these tribal contractors, leaving Alaska tribes covering the gap or, in most cases, tribes not being able to provide necessary services to their members.

YKHC Vice President for Administration and General Counsel Dan Winkelman said, “For the second time in seven years, first with the 2005 Cherokee Nation v. Leavitt decision and now Ramah, the U.S. Supreme Court reaffirmed the validity of contracts between tribes and the federal government. The federal government will be held liable for breaching its contracts with tribes. For YKHC, it affects several years worth of contract support cost claims.”

Over the last two years, nationally, contract support cost funding from the IHS has increased by $126 million, but still falls approximately $80 million short annually. YKHC is owed several million dollars.

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