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Indian Givers

[whitespace] Indian Health Center
Skye Dunlap

Take a Deep Breath: Dr. Anne Verstraete gives Sheena Torres a checkup at the Indian Health Center, which may be forced to close because of a funding mix-up.

Most nonprofits struggle with not enough funding, but the state of California says the Indian Health Center in Willow Glen has the opposite problem--too much funding--and the state wants nearly $700,000 back

By Mary Spicuzza

SAMAKI JOHNSON, 4, just had his finger pricked, but he's not crying. "I like the doctor," he says shyly, his little finger wrapped in a bandage. His mother, Esther Johnson, says her son, whose name means "beautiful river" in Swahili, has been coming to the Indian Health Center on Meridian in San Jose since he was a baby.

On this day, Johnson brought two of her sons all the way from Salinas for blood tests and checkups. Twelve weeks pregnant, Johnson just had a prenatal checkup and got to hear the heartbeat of her fourth child for the first time.

With its busy doctors and stark white walls, the Indian Health Center on Meridian Avenue looks like any other community clinic. For 21 years, it has provided comprehensive health care to the county's 80 American Indian groups as well as any resident in need of services--including low-income families with little or no insurance.

But the center is fighting an unusual battle with the state of California that threatens the very existence of the clinic.

Due to an oversight by the Wilson administration's Department of Health Services (DHS), the clinic received federal money in error. Now the state wants its money back, and unless the Indian Health Center can convince the state to reverse its decision, the center will be forced to pay back nearly $700,000.

"We did what they told us to do," says Dr. Chris Mele, president of the clinic board. "We know it's their fault. They don't deny it's their fault. But we still have to pay it back."

THE EXTRA FUNDS, while they lasted, helped the clinic move into a bigger facility and expand hours and services. Now, the clinic has instituted a monthly repayment plan and is cutting back hours and services and considering a move to a smaller facility.

But footing the bill might mean closing the clinic doors entirely, which have been open to county residents needing medical, dental, mental health, disease-prevention and prenatal services for more than two decades. Administrators hope to rally support from the public and from local politicians to urge the state to grant an exemption from paying the misallocated funds.

Assemblyman Mike Honda has been working on behalf of the center, and over the next few weeks he will step up his campaign. Last week, Sen. Liz Figueroa (D-Fremont) signed a letter written by Honda, urging Supervisor James Beall Jr. to submit a resolution in support of the Indian Health Center to the county Board of Supervisors. Honda and Figueroa will then take the issue to the state Legislature.

The state discovered its own error when DHS audited the health center's books in October 1995. A year earlier, DHS had assured the center that it could apply for reimbursements from Medicare and Medi-Cal from the previous year. The state accepted the center's application and informed the staff it would begin receiving retroactive funds from the department for the previous year.

The state told the health center that the Medi-Cal and Medicare funds would be retroactive to 1993. But they hadn't realized that only cases administered through Medicare were retroactive.

When the auditors went through the books, they saw that the center had received money for Medi-Cal cases, too.

"They just stopped in the middle of the audit and left," interim executive director Barbara Miao says.

Rhonda McClinton-Brown, the health center's former executive director, was notified that the clinic owed the state $300,000 from 1993. An audit for the subsequent year found the health center owed the state $282,440. The state also withheld $77,427 it was to pay for services in 1994-95.

McClinton-Brown says she didn't receive the investigators' findings until April 1996.

During the years between the granting of funds and the audit, Indian Health Center directors had expanded services, extended office hours, continued struggling programs and moved to the larger Meridian Avenue facility from a cramped space in east San Jose.

"We needed to move because we were expanding so rapidly," says Michael Cross, who has worked at the center for 15 years.

Peter Long, director of development and programs for the center, says the center made key decisions based on the state's error. "If we didn't get that money, we wouldn't have moved to a new location," Long says.

When the Indian Health Center filed an appeal in May 1996, Department of Health Services lawyers conceded that the state had misinterpreted the regulations and paid the money in error, but they also insisted on the state's right to recover the money at the expense of the clinic.

Administrative law Judge Cynthia H. Scanlon sided with the state and rejected the health center's appeal, saying the health center should have studied the rules of the program that provided its funding.

"Both parties would be charged with the same responsibility to investigate thoroughly the application of federal FQHC principles to urban Indian health clinics," Scanlon ruled.

"Per the regulations, it was an error," Mele argues, "but it wasn't our error."

KEITH HONDA, AN ATTORNEY who works for his cousin, Assemblyman Honda, believes the only error the clinic made was relying on the government to interpret its own regulations.

"I can't think of anything that the Indian Health Center could have done or should have done differently," Honda says. "It goes back to inherent roles. The department is relied upon to interpret [legislation] and make decisions."

Assemblymember Honda's resolution argues that it's the Department of Health Services' responsibility to administer Medi-Cal, and a center that acted in good faith should not have to pay for a state agency's mistake.

"The position of the DHS is simply wrong," Honda writes. "The DHS cannot penalize a nonprofit for following the directives issued by DHS and for providing expanded services to more people in need."

If the appeal is not accepted, the Indian Health Center plans to take the issue to Superior Court.

"For the department to seek to recover those funds now will result in serious injury to the Indian community, the community at large, the clinic, and its employees," Long says. "It's as if someone gave food to a starving man and encouraged him to eat, then handed him a bill for $70 dollars and asked, 'Why did you eat so much?' "

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From the February 4-10, 1999 issue of Metro.

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