Compliance Update: Understanding the OFCCP and TRICARE Decision

In an example of its continued focus on the healthcare industry, the OFCCP filed a lawsuit against a Florida hospital claiming justification in cases where a facility performs services under a contact with TRICARE, the health care program serving Uniformed Service members and retirees. In this case, Humana Military Healthcare Services, Inc. (HMHS) was contracted to provide networks of health care providers for TRICARE beneficiaries. Florida Hospital then signed a “Hospital Agreement” with HMHS, to become a participating network hospital and provide health care services for beneficiaries eligible for benefits under the contract between HMHS and TRICARE. The Administrative Law Judge (ALJ) found as a result of this arrangement, Florida Hospital is a covered subcontractor and must grant OFCCP access to its facilities, and otherwise permit the agency to conduct and complete a compliance review.

The OFCCP has not indicated whether it will consider Florida Hospital to be a binding precedent and certainly the case will be appealed, however TRICARE network and any other government sponsored healthcare program providers should review their contracts with any healthcare maintenance entities or insurers, and evaluate whether to comply with federal contractor and subcontractor obligations. A comprehensive review of the impact of this decision is available through one of Berkshire’s legal partners here.

For more information, contact Berkshire Associates at 800.882.8904 or email bai@berkshireassociates.com.