83.07

OPINION NO. 83-7

An advisory opinion has been requested as to whether a part-time social worker with a county health department may be affiliated as a private practitioner with the Family Life Center, a private health service entity that takes referrals from her agency.

This request is presented by a Social Worker II (the Requestor) employed on a two day per week basis at the Outpatient Mental Health Clinic (the Clinic) of the Howard County Health Department. Her primary responsibilities are the provision of clinical counseling services to families, individuals, children, and other clients. She also participates in team meetings. The Requestor also, along with the rest of the professional staff (approximately six, plus several psychiatrists), takes her turn at being "on call." Under this intake system, the professionals in the office take turns being responsible for taking all incoming calls on a given day. This process involves the staff person's talking to the prospective clients, evaluating their problems and resources, and making a decision as to referral to another source or treatment within the Clinic.

Referral decisions involve considerable discretion and judgment by the intake personnel, and are based on a variety of criteria. The nature of the problem is an initial key criteria. For example, referrals may be made to another agency, such as the alcohol clinic, if the patient's problem is primarily within the scope of the other agency's program. Another factor may be the patient's resources. The Clinic's limited capabilities are generally directed to persons who have no insurance, or who have little funds for payment, and also individuals who are eligible for medical assistance. Clients who have insurance or other private sources of funding are generally referred to other treatment services. Another criteria for referral could be the size of the Clinic's waiting list and the need for timeliness in responding to a particular patient.

Referrals are made to many different sources, including other agencies, acute care hospitals, private practitioners, and private counseling agencies. There is no formal system for qualifying these referral sources, though the Clinic maintains a sizable resource book identifying the various mental health services available in the area. The Family Life Center is one of the Clinic's referral sources. It is a private non-profit entity described by its Executive Director as "an alternate model mental health service," whose purpose is to provide general mental health services, except for psychiatric care. The Center is not required to be licensed and is not otherwise regulated by the Department of Health and Mental Hygiene, though there is a contract between the Clinic and the Center regarding psychiatric training and in-service consultation. The Clinic has its own facility and, in addition to providing counselors to patients, it provides some direct counseling and also has community outreach programs.

The Center's major function is its counseling program, which involves its maintenance of a roster of qualified practitioners in the mental health area. To be on the roster, individuals must be approved as meeting certain experience and training requirements. Also, the Center selects its therapists based on a goal of having a broad spectrum of specialties represented on its roster. A potential client for counseling services is interviewed by a Center staff person who evaluates the problem and makes a referral to a therapist based on the person's needs and time requirements. The Center has a sliding fee scale, and the allowable fee determined by it at the time of the referral must be accepted by the therapist. Twenty-five percent of the fee is returned to the Center and seventy-five percent is retained by the therapist as his fee. The Center provides building space and other administrative services to its counselors and requires monthly billing reports and termination reports. Peer consultation groups and inservice seminars are also conducted and evaluations of services received are solicited from the clients. The Center serves approximately 1,400--1,500 new clients per year.

This request presents outside employment issues under §3-103(a) of the Public Ethics Law (Article 40A, §3-103(a), Annotated Code of Maryland, the Ethics Law) as well as participation issues under §3-101. Section 3-103(a)(1)(i) bars outside employment by officials or employees with any entity that contracts with or is under the authority of their agency, or is subject to the authority of the official or employee. Subsection (a)(1)(ii) further prohibits any other employment that would impair an individual's impartiality or independence of judgment. Since the Center has a contract with the Howard County Health Department, it is our view that the Requestor's affiliation with it would be barred by §3-103(a)(1)(i) if that affiliation is viewed as an employment relationship.

In considering the character of outside affiliations for purposes of §3-103(a)(1) we have consistently held that the substantive aspect of the relationship should control. (See for example, Opinions No. 80-4; No. 82-12; and No. 82-45.) We note the Requestor's indication that she merely accepts referrals from the Center and that she has a client/therapist relationship with the client, who pays the fees directly. We note also, however, that the Center has substantial qualifying requirements; it provides space, administrative support, and other services to its therapists; it establishes fees; and it requires termination and other reports. Thus, the Center serves as more than a "middleman" referral agency, and must be viewed differently than we considered the referring entity in our Opinion No. 82-36. 1. Here, though the Center may not control the substantive aspects of provision of therapy to a particular client, it has significant other involvement with the Requestor's provision of services. We therefore conclude that her affiliation with it must be viewed as an employment relationship for purposes of §3-103(a)(1)(i).

The Requestor's service on the Center's roster would therefore be barred by this section unless it comes within the exception provision set forth in the introductory language of the section. This language, which is implemented in Commission regulations at COMAR 19A.02.01, provides that the prohibition applies, "except...where such employment does not create a conflict of interest or appearance of conflict." This exception provision was added to the Ethics Law in 1981 partly based on the recommendation of the Commission that flexibility be added to the absolute prohibitions in §3-103(a), to avoid situations where a violation would result from purely technical application of the elements of §3-103(a) even where there is no conflict or appearance of conflict between the private interest or employment and official duties. In developing exception criteria implementing the employment portion of this provision (COMAR 19A.02.01), we sought to define circumstances where the relationship between an employee's official duties and private employment are so remote that the possibility of a conflict of interest or the appearance of conflict is unlikely.

If all of these regulatory standards of remoteness are met then the employment would be allowable, despite the existence of authority or contractual links between an individual's State and private employers. The criteria include findings that:

A. The State duties do not significantly impact on the outside employer or a contract between the outside employer and the agency.

B. The employee is not directly supervised by a person whose duties significantly impact on the outside employer or a contract between the outside employer and the agency.

C. The employee does not supervise a person whose duties significantly impact on the outside employer or a contract between the outside employer and the agency.

D. The employee is not affiliated with the specific unit in the agency that exercises authority over or contracts with the outside employer.

E. The employee has complied with other relevant sections of the Ethics Law.

F. The outside employment involves no non-ministerial duties significantly relating to the agency's authority over the employer.

G. The employee's private duties do not involve negotiating or carrying out a contract between the agency and the outside employer (except for broad fixed reimbursement contracts involving no discretionary decisions).

H. The private compensation is not directly funded by the State contract.

I. The specific employment circumstances do not otherwise create a conflict of interest or the appearance of a conflict.

We have reviewed the Requestor's proposed affiliation with the Center in light of these criteria, and we do not believe that the situation here justifies application of the exception to allow this employment, especially in view of her responsibilities in the Clinic's intake process. Item A, for example, would allow the exception only where an employee's duties do not significantly impact on the outside employer. Other items deal with the employee's service in the agency unit and under the supervision of agency personnel impacting on the outside employer. Also, as discussed below, the Requestor's participation in intake and referral matters involving the Center raises questions under the Ethics Law's §3-101 disqualification provisions and application of item E (regarding compliance with other relevant sections of the Ethics Law).

Given these circumstances and the existence of issues under so many of the criteria, we do not believe it is appropriate to conclude that the specific employment circumstances "do not otherwise create a conflict of interest or the appearance thereof" (see Item I of the criteria), or, as a general matter, that the relationship between the Center and the Requestor's official duties is so remote that a conflict of interest or appearance of conflict is unlikely. We therefore conclude that an exception may not be granted here to allow the Requestor's affiliation with the Center.

We wish to further express our view that this situation raises more than just a technical question under §3-103(a)(1)(i), recognizing that the same kinds of considerations addressed under the exception criteria would apply in evaluating the inconsistent employment provisions of §3-103(a)(1)(ii). Thus, even if there were no Center/Clinic contract resulting in technical application of the §3-103(a)(1)(i) prohibition, it is probable that the activity would be barred by application of the more general inconsistent employment bar in subsection (a)(1)(ii).2 Moreover, given the Requestor's involvement in the intake process, we are concerned that §3-101 of the Law would also work to prohibit her relationship with the Center. This section prohibits an official or employee from participating in a non-ministerial way in any matter that involves as a party an entity with which the official is employed. Under the facts presented here, the Center would be a party to referrals made to it from the Clinic, and the Requestor's referral actions would constitute non-ministerial participation.3

In our view, §3-101(a)(2) must thus be viewed as prohibiting her participation in such matters. Though §3-101 is a disqualification provision rather than an absolute bar to an employment or other relationship, we believe that this is a situation where the need to disqualify could also result in barring the employment as a practical matter. If the Center is viewed as a significant and important resource, it may be unacceptable to the Clinic and the Department to deny its availability to clients who contact the Clinic on a day when the Requestor is responsible for doing intake, and cannot participate in matters involving the Center.

Under all of these circumstances, we believe that the provisions of the Ethics Law, including the specific prohibitions of §3-103(a)(1)(i), as well as the more general provisions in §3-101 and §3-103(a)(1)(ii), work to prohibit the Requestor from having the proposed affiliation with the Center while she continues her present employment with the Mental Health Clinic.

Herbert J. Belgrad, Chairman
    Reverend John Wesley Holland
    Betty B. Nelson
    Barbara M. Steckel

Date: March 17, 1983

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1 This Opinion involved the inclusion of a Human Relations Commission Hearing Examiner on the Labor Relations Panel of the American Arbitration Association. As all aspects of the relationship between the arbitrator and the using entity, including fees, were directly negotiated apart from the Association, we did not treat the Hearing Examiner's activity as employment with the Association.

2 See our Opinion No. 81-28 for a more detailed discussion of §3-103(a)(1)(ii).

3 See Opinions No. 82-24 and No. 80-17 for discussions of the terms "matter" and "participate".