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Part 2, Chapter 3: Manual Exhibit 2-3-M


Provider/Patient Full Name
City, State Zip Code

Dear Provider/Patient Full Name:

This letter is intended to remind you of the prohibition against billing beneficiaries of the Indian Health Service (IHS or Service) for care provided under the Purchased/Referred Care (PRC) program (formerly Contract Health Services or CHS).

Section 222 of the Indian Health Care Improvement Act [25 U.S.C. § 1621u] provides:

(a)NO PATIENT LIABILITY. A patient1 who receives contract health care servicesthat are authorized2 by the Service3 shall not be liable for the payment of any charges orcosts associated with the provision of such services.

(b)NOTIFICATION. The Secretary shall notify a contract care provider and anypatient who receives contract health care services authorized by the Service that suchpatient is not liable for the payment of any charges or costs associated with the provisionof such services not later than 5 business days after receipt of a notification of a claim bya provider of contract care services.

(c)NO RECOURSE. Following receipt of the notice provided under subsection (b), or,if a claim has been deemed accepted under section 220(b), the provider shall have nofurther recourse against the patient who received the CHS services.

The PRC rate rules4 [42 C.F.R. Part 136, Subparts D and I] similarly provide that PRC payments made in accordance with the rules shall constitute "payment in full" and therefore, no additional charges may be imposed on the IHS beneficiary. The PRC rate rules include definitions for "notification of a claim" and "referral." If the patient is eligible for benefits from Medicare, Medicaid or another third party payer, the provider or supplier must coordinate benefits. Once all other alternate resources have been considered and paid, the PRC program will pay in accordance with the PRC rate rules.

In summary, a patient is not liable for services that have been authorized for payment by a PRC program. Providers are prohibited from collecting any payments for these services from the patient, whether directly or through referral to an agent for collection. Please note that not all visits or referrals of IHS eligible patients to non-IHS providers are authorized for payment.

Enclosed is a sample Agency Form 843-1A used to authorize payment for PRC services from IHS. Please note that a PRC program carried out by a Tribal health program may use a similar form when authorizing care. If you have questions about the PRC program, please contact our office at [insert phone number]. Thank you.


Name of Entity/Sender: [Insert Name of I/T Site]
Contact-Position/Office: [Insert Position/Office]
Address: [Insert Street Address, City, State & Zip Code of Entity]
Phone Number: [Insert Entity Phone Number]

1 Patients who are eligible per PRC regulations
2 Authorized and approved for payment
3 Program carried out by IHS or by a Tribe/Tribal Organization through an Indian Self-Determination Act agreement
4 Medicare-like rates (MLR) are PRC rates.
Manual Exhibit 2-3-M