TRICARE: DOL Announces 5-Year Moratorium on Affirmative Action Compliance Audits

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Previous Health Law Updates reported on the efforts of the U.S. Department of Labor (DOL) to apply equal employment opportunity mandates to providers that subcontract to provide healthcare services for TRICARE beneficiaries. The DOL had successfully litigated the issue and was moving full speed ahead with compliance audits conducted by the Office of Federal Contract Compliance Programs (OFCCP).

In a stunning reversal, on May 7, 2014, the DOL announced a five-year moratorium on the enforcement of affirmative action obligations against TRICARE subcontractors. In addition, open compliance proceedings will be closed within 30 business days of the DOL’s announcement.

The moratorium covers:

  • Healthcare entities that participate in TRICARE only as subcontractors;
  • Healthcare entities that participate in TRICARE as subcontractors and as subcontractors under any Medicare program;
  • Healthcare entities that participate in TRICARE as subcontractors and as subcontractors under the Federal Employee Health Benefits Program; and
  • Healthcare entities that participate in TRICARE as subcontractors and as subcontractors under any other federal health program.

Healthcare entities that are TRICARE subcontractors but hold prime contracts with an agency of the federal government, and TRICARE subcontractors who have separate, nonhealthcare-related federal subcontracts will continue to be subject to OFCCP jurisdiction and compliance audits.

The DOL has announced plans to work with the TRICARE subcontractor community to provide greater clarity regarding its affirmative action obligations. This suggests that during the moratorium period the DOL may use other persuasive means to encourage compliance. Still, the DOL’s announcement should allow for a collective sigh of relief among the TRICARE subcontractor community.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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