993 F.3d 917
D.C. Cir.2021Background:
- Congress enacted the Indian Self-Determination and Education Assistance Act (ISDEAA) to let tribes run federal programs; IHS must pay a "secretarial amount" equal to what it would have spent operating the program directly.
- A 1988 amendment requires IHS to also pay contract support costs (CSC) — reasonable costs tribes incur to comply with the funding agreement (e.g., indirect administrative costs, audits, payroll taxes).
- Tribes may bill third-party payers (Medicare, Medicaid, private insurers); the Act treats such insurance receipts as supplemental funding and forbids offsetting the secretarial amount because of that revenue.
- Swinomish operated a health program under a Funding Agreement with IHS; for 2010 IHS paid $3,028,213, and Swinomish sought an additional $245,867 in CSC calculated as percentages of the insurance-derived revenues it spent on the program.
- The district court granted summary judgment to the government; Swinomish appealed.
Issues:
| Issue | Swinomish’s Argument | Government’s Argument | Held |
|---|---|---|---|
| Whether ISDEAA requires IHS to pay CSC on third-party insurance revenue spent by a tribe | ISDEAA’s CSC provisions and the Act’s funding structure require CSC for all funds spent on the federal program, including insurance receipts | CSC reimbursement is limited to costs associated with the IHS–tribe contract; insurance is revenue from separate third-party contracts and not subject to CSC | No — ISDEAA does not require CSC on insurance-derived revenue |
| Whether the phrase "the Federal program" in §5325(a)(3) includes spending of insurance proceeds | "The Federal program" is the program the contract covers, which includes all funds used to provide services, so CSC should follow program spending including insurance money | "The Federal program" means the federal program under the IHS–tribe contract; it does not expand CSC to funds from other contracts | Held for government — the phrase refers to the contract program, not external funding sources |
| Whether §5388(c) (Subchapter V funding) expands CSC entitlement to include third-party payments | §5388(c)’s use of "including" and reference to funds related to services means Subchapter V tribes get CSC on insurance receipts | The provision clarifies equivalence to Subchapter I funding; it does not expand CSC beyond what Subchapter I provides | Held for government — §5388(c) does not authorize CSC on insurance revenue |
| Whether the Funding Agreement or IHS policy contractually obligated IHS to pay CSC on insurance income | The tribe points to its contract and billing program and argues it contracted for those CSC payments | The Funding Agreement ties CSC calculation to the statute and IHS policy, which does not cover CSC for insurance income | Held for government — the contract did not obligate IHS to pay CSC on insurance-derived funds |
Key Cases Cited
- Menominee Indian Tribe of Wisconsin v. United States, 136 S. Ct. 750 (2016) (describing tribes as contractors under ISDEAA and the Act’s purpose)
- Salazar v. Ramah Navajo Chapter, 567 U.S. 182 (2012) (explaining the secretarial amount obligation under ISDEAA)
- Swinomish Indian Tribal Community v. Azar, 406 F. Supp. 3d 18 (D.D.C. 2019) (district court opinion granting summary judgment to the government)
- Stoe v. Barr, 960 F.3d 627 (D.C. Cir. 2020) (noting standard of review: de novo on legal questions)