Are You Aware?

In a case closely watched by many health care providers, the Administrative Review Board (“ARB”) ruled that the Office of Federal Contractor Compliance Programs (“OFCCP”) does not have jurisdiction over a hospital solely on the basis of its participation in TRICARE, a military health care program. OFCCP v. Fla. Hosp. of Orlando, DOL ARB, No. 11-011, 10/19/2012. [Click here for a copy of the decision.]

In October 2010, an Administrative Law Judge held that Florida Hospital of Orlando (“Florida Hospital”) was a federal subcontractor by virtue of its participation in a health care provider network administered by Humana Military Healthcare Services, Inc. for TRICARE, which is the Defense Department’s health care program for active and retired military personnel and their families. Florida Hospital appealed the decision to the ARB.

While the appeal was pending to the ARB, the National Defense Authorization Act of 2012 (“NDAA”) was signed into law. The NDAA specifically excluded a TRICARE managed care support contract from the OFCCP’s definition of contract or subcontract.

Following the passage of the NDAA, Florida Hospital moved to dismiss the case as moot pursuant to the NDAA. At the same time, the OFCCP continued to pursue its case against Florida Hospital, but put on hold pending compliance evaluations of health care providers where the sole basis of jurisdiction was TRICARE.

The ARB agreed with Florida Hospital and held that the NDAA removed the OFCCP’s jurisdiction over Florida Hospital. In its ruling, the ARB also found that it could retroactively apply the NDAA.

The ARB decision ends all proceedings before the Secretary of Labor in the Florida Hospital case. Any appeal of the decision must be made in federal district court.

What This Means for Health Care Providers

If TRICARE was the sole basis of the OFCCP's jurisdiction over your organization or, in other words, your organization does not have any other federal contracts or subcontracts, the OFCCP does not have jurisdiction over your organization and you are not subject to its affirmative action program requirements.