The U.S. Department of Labor’s Administrative Review Board (ARB) in OFCCP v. Florida Hospital of Orlando ruled that the OFCCP lacks jurisdiction over Florida Hospital of Orlando, a TRICARE health services provider. The ARB based it’s decision on Section 715 of the National Defense Authorization Act (NDAA).
Background Summary
2007: The OFCCP sent Florida Hospital a scheduling letting informing them that they were scheduled for an OFCCP desk audit. The hospital replied stating that they were neither a federal contractor or federal subcontractor and would not comply with the OFCCP audit. The OFCCP then issued a Notice to Show Cause.
2008: The OFCCP filed an Administrative Complaint with the Office of Administrative Law Judges requesting that Florida Hospital be permanently enjoined for refusing to comply and that it be directed to permit OFCCP access to Florida Hospital to complete its compliance review.
2010: The Administrative Law Judge (ALJ) ruled in favor of the OFCCP asserting that Florida Hospital was a federal subcontractor. Then in November, the hospital filed an appeal with the Administrative Review Board. In December, President Obama signed the NDAA into law which included directives in Section 715 regarding TRICARE contracts.
Section 715 of the NDAA states:
“…For the purpose of determining whether network providers under such provider network agreements are subcontractors for purposes of the Federal Acquisition Regulation or any other law, a TRICARE managed care support contract that includes the requirement to establish, manage, or maintain a network of providers may not be considered to be a contract for the performance of health care services or supplies on the basis of such requirement…”
2012: In October the ARB ruled that Section 715 could be applied retroactively and that Florida Hospital of Orlando as a TRICARE health service provider is not under the jurisdiction of the OFCCP. The ARB reversed the Administrative Law Judges’ ruling and dismissed the OFCCP complaint.
While this is great news for those with TRICARE contracts, health services organization would be wise to seek counsel as to how the affirmative action laws may apply to them. The OFCCP, in this case and others, has shown that it is serious about asserting its authority over hospitals and medical providers that it believes to be in its jurisdiction.
If you’d like to read other commentary about OFCCP v. Florida Hospital of Orlando, visit the sites below:
- ARB Rejects OFCCP’s Claim of Jurisdiction Based on Florida Hospital’s TRICARE Participation
- Ruling on Government Contractors and TRICARE Leaves Unanswered Questions
- Victory For Employers in Dismissal Of OFCCP’S Case Against Florida Hospital; Some Health Care Providers Will Not Be Subject to OFCCP Jurisdiction
