Florida Hospital of Orlando received good news on Friday when the Administrative Review Board (ARB) found in their favor and concluded OFCCP could not subject the hospital to a compliance review. While this decision answers the outstanding question of OFCCP jurisdiction for Florida Hospital, it is by no means establishes a blanket exemption for others, keeping many healthcare industry employers in limbo.
In its highly anticipated decision the ARB concluded Florida Hospital was not subject to OFCCP jurisdiction based on application of the recently passed National Defense Authorization Act for Fiscal Year 2012 (NDAA). The NDAA expressly exempts from OFCCP jurisdiction medical providers who participate in the Department of Defense TRICARE program, DoD’s health care program for active and retired military personnel. As the ARB pointed out, the exemption, while applicable, is narrowly tailored to capture only a certain type of TRICARE contract (those that require establishment and management of a network of providers).
The ARB acknowledged that OFCCP’s review of jurisdiction for those in the industry remains on a “case by case” basis. Because of the specific requirement of the TRICARE contract at issue in this case, the ARB concluded Florida Hospital was not subject to OFCCP jurisdiction. By way of translation, this means “just because Florida Hospital is exempt doesn’t mean you will be exempt too.”
So what do you do now?
While the Florida Hospital decision certainly shines some light on the issue of OFCCP jurisdiction for healthcare employers, the waters remain muddy . . . and likely will continue to be murky for the foreseeable future.
Thus, it is important for employers in the healthcare industry to evaluate the basis for OFCCP jurisdiction. You should undertake to identify and review the sources of federal revenue received by your institution to determine whether in light of all of the developments in this area in the past year you are a covered contractor or subcontractor.