37.401 Policy
Source: FAR 37.401 on acquisition.gov
Nonpersonal health care services contracts must clearly establish independent contractor status, require medical liability insurance, and ensure government protection from liability.
Overview
FAR 37.401 establishes the policy for agencies entering into nonpersonal health care services contracts with physicians, dentists, and other health care providers. The regulation ensures that such contracts clearly define the independent contractor relationship, limit government control over professional medical decisions, and require contractors to assume liability and maintain adequate medical liability insurance. It also mandates that these requirements flow down to any subcontractors providing health care services under the contract.
Key Rules
- Nonpersonal Health Care Services Contract Declaration
- Contracts must explicitly state they are nonpersonal health care services contracts and that the contractor is an independent contractor.
- Government Oversight Limitation
- The government may evaluate service quality but cannot control professional medical judgments or decisions.
- Contractor Indemnification
- Contractors must indemnify the government for any liability arising from their acts or omissions during contract performance.
- Medical Liability Insurance Requirement
- Contractors must maintain medical liability insurance at levels acceptable to the contracting officer and consistent with local standards for the specialty.
- Subcontractor Flow-Down
- Contractors must ensure subcontracts include the requirements of FAR clause 52.237-7, including insurance provisions.
Responsibilities
- Contracting Officers: Ensure contracts include all required statements and clauses, verify insurance coverage, and enforce flow-down requirements.
- Contractors: Clearly acknowledge independent contractor status, maintain required insurance, indemnify the government, and ensure subcontract compliance.
- Agencies: Oversee contract compliance and limit involvement to administrative and quality evaluation, not professional medical decisions.
Practical Implications
- This policy protects the government from liability and clarifies the independent status of health care providers.
- Contractors must be diligent in maintaining insurance and managing subcontracts.
- Failure to comply can result in contract disputes, liability exposure, or loss of contract eligibility.
Agencies may enter into nonpersonal health care services contracts with physicians, dentists and other health care providers under authority of http://uscode.house.gov/view.xhtml?req=granuleid%3AUSC-prelim-title10-chapter221&saved=%7CZ3JhbnVsZWlkOlVTQy1wcmVsaW0tdGl0bGU0MC1jaGFwdGVyMzctZnJvbnQ%3D%7C%7C%7C0%7Cfalse%7Cprelim&edition=prelim" target="_blank">10 U.S.C. chapter 221 and http://uscode.house.gov/view.xhtml?req=granuleid%3AUSC-prelim-title41-chapter33&saved=%7CZ3JhbnVsZWlkOlVTQy1wcmVsaW0tdGl0bGU0MC1jaGFwdGVyMzctZnJvbnQ%3D%7C%7C%7C0%7Cfalse%7Cprelim&edition=prelim" target="_blank">41 U.S.C. chapter 33, Planning and Solicitation. Each contract shall-
(a) State that the contract is a nonpersonal health care services contract, as defined in 37.101, under which the contractor is an independent contractor;
(b) State that the Government may evaluate the quality of professional and administrative services provided, but retains no control over the medical, professional aspects of services rendered (e.g., professional judgments, diagnosis for specific medical treatment);
(c) Require that the contractor indemnify the Government for any liability producing act or omission by the contractor, its employees and agents occurring during contract performance;
(d) Require that the contractor maintain medical liability insurance, in a coverage amount acceptable to the contracting officer, which is not less than the amount normally prevailing within the local community for the medical specialty concerned; and
(e) State that the contractor is required to ensure that its subcontracts for provisions of health care services, contain the requirements of the clause at 52.237-7, including the maintenance of medical liability insurance.