Professional Service Agreement

We May Finally Know Whether Being a Tricare Provider Makes One a Federal Contractor

December 10, 2018

The U.S. Department of Labor (DOL) recently announced plans to clarify application of federal anti-discrimination requirements on health care providers with Tricare enrollment agreements. The DOL and Tricare providers have long been at odds over whether a Tricare enrollment agreement made one a federal “subcontractor” and thus subject to the Office of Federal Contract Compliance Program (OFCCP), the DOL office that monitors and enforces federal anti-discrimination laws. The OFCCP took the position that Tricare providers were federal subcontractors by virtue of the enrollment agreement, and as such, they were obligated to audit for compliance with equal opportunity and affirmative action obligations applicable to federal contractors. Facing mounting criticism, and in the aftermath of a lawsuit, the OFCCP issued a 5-year moratorium on enforcement activities and closed its open cases effective May 7, 2014. The OFCCP intends to publish a proposed rule in April of 2019. We recommend all employers that are or might think they are federal contractors contact SESCO to ensure compliance with OFCCP regulations.