In a June 6, 2024 decision, the U.S. Supreme Court ruled that the Indian Health Service (IHS) must pay contract support costs (CSC) to tribes to cover the expenses tribes incur when they use income derived from other sources, such as Medicare and Medicaid payments, to further develop the health care activities and programs under a 638 ISDA self-determination agreement. Tribes will want to move quickly to ensure that they are able to recover the additional CSC for past years in which IHS should have paid CSC for these program activities. In general, there is a 6-year statute of limitations for claims under 638 self-determination agreements. Claims for additional CSC on past contracts that are not filed timely can be barred.
This is a significant ruling in favor of tribes. Congress currently appropriates about $8 billion annually for Indian health care, and this decision could require IHS to pay between $800 million and $2 billion more annually to tribes for healthcare, and possibly billions more retroactively for past years’ CSC, according to government sources.