On October 25 we reported that the Department of Labor’s Administrative Review Board (the ARB), in a divided opinion, rejected the argument that the Office of Federal Contract Compliance Programs (“OFCCP”) had jurisdiction over Florida Hospital of Orlando based solely on the hospital’s participation in TRICARE. We also noted that the decision unfortunately left open some questions as to whether some TRICARE arrangements could subject a participant to OFCCP’s jurisdiction.
On November 13, 2012, OFCCP filed a motion before the ARB asking it to reconsider its decision. In addition, in a supporting brief filed at the same time, OFCCP gave notice that, notwithstanding the ARB’s decision in Florida Hospital, OFCCP “intends to continue to schedule and attempt to review hospitals because they are TRICARE network providers.”
In other words, if the ARB denies the motion for reconsideration, OFCCP will be looking for a new test case to take to litigation. This is bad news for health care providers that had audits placed on hold by OFCCP pending the resolution of the Florida Hospital case. OFCCP may seek to re-open at least some of these audits, leaving the providers to face a tough choice between conceding jurisdiction, in spite of the shaky basis for OFCCP’s assertion of authority, or engaging in expensive litigation over the issue.