Robert Newland: OFCCP v Florida Hospital – Lessons for all the Contractor Community

As some of you may know by now, a favorable ruling to the OFCCP by an Administrative Law Judge creates an interesting enforcement environment for medical institutions, but also the contractor community in general.

Medical institutions that are part of medical services contracts or subcontracts with the federal government are likely to be viewed by the OFCCP as within their jurisdiction. In other words – say you are a medical services provider in an insurance company network and said company has federal contracts to provide medical care, then you will likely be viewed as “covered”. The ALJ has made clear that you are unlikely to be covered by AA obligations, only in the event where an insurance carrier has federal contract for “insurance services” (not medical care). It seems that the devil is in details of the language in the actual contract.

And while at first glance it may seem likely that insurance carriers may try to steer away from the language that creates AA obligations, it is also possible that the federal government may push for that language now that the Florida Hospital v OFCCP gives them their second beachhead in a few years in the battle to extend OFCCP coverage to the healthcare industry. Given the current economic environment, the healthcare industry may have little choice but to accept this, if they want to get the much needed business.

It is not new that the OFCCP wants to create a more proactive and aggressive agency. As such, don’t be surprised to see the OFCCP going after other industries that claim to be outside their jurisdiction. For now, if you are involved in a healthcare organization, you probably want to take a closer look at your contracts with insurance providers and contact the insurance companies to review their contracts with federal agencies – are the contracts crafted in a language that creates an obligation to provide insurance or medical care?

If you are part of one of those contracts where the language indicates that the deliverable between the company and the federal agency is to provide medical care, you will be better off by preparing an Affirmative Action Program.

For questions about your status as a federal contractor or how to prepare an Affirmative Action Program, don’t hesitate to call at 800-707-9250 Ext. 246, email me at Rnewland@AffirmativeActionServices.com, or visit our website:
www.AffirmativeActionServices.com.