Healthcare Industry Legal Alert: Federal Judge Finds that OFCCP Has Jurisdiction Over Three Hospitals

Executive Summary: The Office of Federal Contract Compliance Programs (“OFCCP”) has jurisdiction over three hospitals that provided medical services to federal employees who were members of an HMO, according to Judge Paul L. Friedman of the United States District Court for the District of Columbia. The hospitals, located in Pittsburgh, contracted with a prime contractor, the UPMC Health Plan, which had a contract with the federal government to provide medical services to federal employees. Despite the fact that the hospitals did not have an EEO clause in their contracts, and contrary to the arguments that the hospitals raised, the court found that each of the hospitals was a subcontractor that performed services necessary to the performance of the prime contract. Accordingly, even though the hospitals never consented to be bound by OFCCP’s requirements, the court found that OFCCP had jurisdiction over each of the hospitals. UMPC Braddock, et al. v. Seth D. Harris, Civil Action No. 09-1210 (PLF)(D.D.C. 3-30-13).