A Band-Aid At Best: OFCCP Offers Temporary And Limited Relief To TRICARE Providers

by Polsinelli

The Department of Labor's (DOL) Office of Federal Contract Compliance Programs (OFCCP) enforces laws imposing affirmative action and equal employment opportunity obligations on all federal contractors and subcontractors. For years, the OFCCP has attempted to assert jurisdiction over the health care industry.

In a recent letter to members of Congress, Secretary of Labor Thomas E. Perez announced that the OFCCP will issue a directive with a five year moratorium on its enforcement activities involving TRICARE medical providers and will close any open or scheduled compliance evaluations of those providers. Secretary Perez's announcement came in response to a bill introduced in Congress that would prevent the OFCCP from asserting jurisdiction over health care providers on the basis of federal health program participation. (H.R. 3633) On April 1, following Secretary Perez's announcement, the DOL Administrative Law Judge dismissed the OFCCP's complaint against Florida Hospital of Orlando, which was a high profile case that had been pending since 2010 in which the OFCCP asserted jurisdiction over the hospital on the basis of its TRICARE subcontracts.

Only Temporary Relief

Although this announcement offers temporary relief to health care providers whose sole basis for OFCCP jurisdiction is TRICARE, Secretary Perez's letter does not provide any indication that the OFCCP is relinquishing its claim of jurisdiction over the health care industry. Moreover, this announcement does not change the jurisdictional status of health care providers who hold other prime contracts with the government or subcontractors with non-TRICARE federal subcontracts.

The New Initiative

Under this new initiative, the OFCCP will:

  • Issue a directive establishing a five-year moratorium on enforcement activities involving TRICARE subcontractors;
  • Administratively close all open and scheduled compliance evaluations for TRICARE subcontractors;
  • Provide information and training to TRICARE subcontractors on affirmative action plans, recordkeeping, and applicant tracking systems;
  • Conduct webinars on the OFCCP's jurisdiction and federal contractor and subcontractor obligations; and
  • Convene listening sessions so that TRICARE providers may inform the OFCCP of the unique issues they face in complying with the requirements imposed on federal contractors and subcontractors.

The announcement specifically states the moratorium does not:

  • Cover TRICARE subcontractors' obligation to refrain from discrimination as complaints of discrimination will still be investigated.
  • Extend to 1) holders of other prime federal contracts or 2) holders of other covered subcontracts besides TRICARE subcontracts.

Issues Not Addressed

Secretary Perez's announcement does not address some important jurisdictional issues in the health care industry:

  • Whether the moratorium extends to health care providers that receive funding through Federal Employees Health Benefits Program (FEHBP). In OFCCP v. UPMC Braddock, the OFCCP brought an action alleging that health care providers who had an HMO contract to provide health care services to FEHBP participants were federal subcontractors subject to the OFCCP's jurisdiction. In UPMC Braddock v. Harris, the United States District Court for the District of Columbia upheld the OFCCP's jurisdiction over the hospital on the basis of the FEHBP HMO contract. The case is on appeal to the appeals court.
  • Whether the OFCCP will attempt to assert jurisdiction over health care providers receiving federal funding from Medicare Parts C and D. The OFCCP has taken the position that Medicare Parts A and B are federal financial assistance, not federal contracts giving the OFCCP jurisdiction. The OFCCP has indicated that Parts C and D, however, are potentially covered federal contracts and subcontracts.


While the moratorium is good news for many TRICARE providers, the OFCCP is not abandoning its position that TRICARE providers may be subcontractors subject to its jurisdiction. The OFCCP is also not abandoning its efforts to assert jurisdiction over the health care industry on the basis of other covered federal contracts and subcontracts. During the moratorium, the OFCCP will work with other government entities to clarify the status of health care providers participating in the TRICARE program and FEHBP.

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.

© Polsinelli | Attorney Advertising

Written by:


Polsinelli on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.