Health Law Pointers - Volume XVI, No. 2


As a public service, we are pleased to present this issue of our health law newsletter addressing the legal concerns of health practitioners. The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers. In some jurisdictions, newsletters such as this may be considered: Attorney Advertising.

If you know of others who may wish to subscribe to this free publication, please feel free to forward it. If you wish to subscribe or unsubscribe, please send an e-mail or call the Editor, Lawrence M. Ross, at (716) 849-8900.

Alert for Employers: Handbooks and Workplace
Rules Require Attention in Light of NLRB Decisions
By: Kinsey A. O’Brien, Associate

Subscribers, I hope this edition of Health Law Pointers finds you well. As you may be aware, in the last few years the National Labor Relations Board (NLRB) has been actively scrutinizing social media, confidentiality, and other workplace policies for what it perceives as violations of the National Labor Relations Act (NLRA). In the medical context, the NLRA applies to hospitals, medical and dental offices, and other health care organizations with a gross annual volume of $250,000 or more ($100,000 or more for nursing homes and visiting nursing associations). If your practice falls within the NLRA’s jurisdiction, it is important for you to revisit your handbooks and workplace rules to ensure NLRA compliance.

Under Section 7 of the NLRA, employees have the right to discuss terms and conditions of their employment, including wages, benefits, and working conditions. Employees may have these discussions in nearly any forum (including online) with each other, third parties, or the public generally. Using these principals, the NLRB has applied increased scrutiny to workplace rules and employee handbooks, taking the position that just maintaining a rule which could chill NLRA rights is a violation, even if the rule is not enforced in an inappropriate way. Policies requiring employees to keep wages confidential or prohibiting negative statements about the employer will be found unlawful.

Most recently, the NLRB has taken a broad interpretation of Section 7 and has struck down many common, seemingly benign policies. Simple provisions, such as rules requiring “courtesy,” “positivity,” and “professionalism,” are now deemed impermissible. For example:

  • On April 1, 2014, the NLRB held in Hills and Dale General Hospital that a policy requiring employees to represent the company “in a positive and professional manner in every opportunity” was unlawful.
  • In December 2013, Laurus Technical Institute held a “no gossip” policy unlawful.
  • But, on February 28, 2014, the NLRB held that prohibiting “insubordination to a manager or lack of respect and cooperation with fellow employees or guests,” including “displaying a negative attitude that is disruptive to other staff or has a negative impact on guests” was lawful because it was sufficiently tied to the workplace and legitimate employer concerns.


In addition, the NLRB has emphasized ambiguity, taking the position that an ambiguous, vague, or open ended policy can be read as infringing on NLRA rights. The NLRB cases indicate that providing concrete examples of impermissible conduct can resolve ambiguity. However, so-called savings clauses (“nothing in this policy is designed to or should be interpreted as infringing on NLRA rights”) will not cure an otherwise “ambiguous” policy.

            Of course, there is one major caveat to all of this. On June 26, 2014, the United States Supreme Court decided NLRB v. Noel Canning, which held that President Obama’s “recess appointments” to the NLRB were invalid. As a result, all NRLB actions and cases after the appointments in January 2012, up until the appointees were eventually confirmed by the Senate on July 30, 2013, are void. This includes some major cases on social media and workplace rules which paved the way for the decisions discussed above, such as:

  • Costco, which found a policy prohibiting employees from electronically posting statements which might damage the company unlawful;
  • Karl Knauz Motors, which invalidated an employer’s “courtesy” policy; and
  • Hispanics United of Buffalo, which held that an employer violated the NLRA by firing employees for comments made on Facebook.


The NLRB will now have to reconsider these cases and issue new rulings. However, we do not believe the NLRB will be changing its stance on the application of Section 7 any time soon. While the cases decided during the time of the invalid appointments must be reconsidered, the NLRB has the same membership as it did when the cases were decided. Accordingly, we expect the re-decided cases to come down the same as the original rulings. So the bottom line for employers is to review their workplace policies and employee handbooks now!

We understand that it may be confusing and frustrating to reconcile these at times varying rulings and to know how to protect your practice in the face of these NLRB requirements. We can assist you in evaluating your handbook and other policies and drafting compliant provisions. Please contact Ann E. Evanko or Kinsey A. O’Brien at (716) 849-8900. We would be happy to assist you in complying with these new rules.

Payer Contract Peculiarities
Most practitioners are familiar with the concept and purpose of a Participating Provider Agreement but remain blissfully unaware of the requirements imposed by these contracts.  Set forth below are eleven questions that each practitioner should know about his or her payer contracts.
1.  Are you required by the terms of the contract to participate in all health care coverage or network delivery or education programs offered with respect to the provision of covered services to covered persons?
2.  Is the payer required to offer you an opportunity to participate in any new program?
3.  What procedure, if any, must be followed to notify the payer of your new medical office location in order to be properly credentialed at that site?
4.         What other changes in your practice trigger a notification requirement?
P  Telephone Number            P  Ownership         
P  Business Addresses            P  Closing your panel to new patients and/or referrals
P  Office Hours                      P  Insurance coverage
5.         Does the contract dictate when the patient physician relationship begins?
6.         What procedures, if any, must be followed to discharge a patient from the practice?
7.         Who bears the risk of loss in the event a person is determined by the payer to be ineligible to receive covered services after the date of service?
8.         Are you entitled to notice and a reasonable opportunity to cure any breach of the payer’s policies and procedures prior to a decision by the payer to withhold payment to you?
9.         When are you required to notify the payer of any inquiry, investigation or audit by a hospital, payer, government agency or licensing agency regarding your professional activities?
a)  Initiation of Inquiry/investigation/audit/proceeding
b)  Release of Preliminary Findings
c)  Imposition of Sanction
d)  Final Determination, following appeal
10.  Does the contract include a “morals” change?
11.  For how long must you retain medical and/or financial records pertaining to the care rendered to your patients?

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