UPMC Braddock v. Perez

Case Updates

The U.S. Chamber urged the D.C. Circuit to reject the Office of Federal Contract Compliance Programs' (OFCCP) assertion of jurisdiction over hospitals who participate in the health care delivery system for federal employees. For decades, these hospitals have not been considered federal contractors and therefore have not been subject to OFCCP's numerous additional administrative regulations on federal contractors. In this case, however, the Department of Labor review board “overturned decades of regulations and federal agency practices” and expanded OFCCP's jurisdiction to reach such hospitals. The Chamber argued that requiring hospitals to meet these new administrative burdens will impose significant costs on providers and, accordingly, increase health costs to employers and detrimentally impact the level and type of benefits provided to employees. The Chamber also argued that the Department of Labor improperly used adjudication, rather than notice-and-comment rulemaking, to advance its new theory of jurisdiction. As the Chamber noted in its brief, “[t]he unintended impact of imposing these new burdens on already highly regulated health care providers will also undoubtedly result in higher health care costs for patients, fewer resources available for improving patient care, and possibly even decreased HMO coverage options for [federal health care plan] participants.”