83.21

OPINION NO. 83-21

An inquiry has been presented concerning whether a nurse in the Long Term Care Unit of the Medical Assistance Compliance Administration in the Department of Health and Mental Hygiene (DHMH) may have outside employment as a clinical nurse in an acute care medical facility, either directly or through an agency.

This opinion request resulted from the Requestor's disclosure on an Ethics Commission Financial Interest Exception Disclosure Form of affiliations with the University of Maryland Hospital and Staffbuilders, Inc. Though the disclosure was not of a financial interest required to be disclosed on this form, it raises issues under the outside employment provisions of the Public Ethics Law (Article 40A, Annotated Code of Maryland, the Ethics Law). The disclosure has thus been treated as a request for exception under the very similar outside employment exception regulations (COMAR 19A.02.01).

The Requestor is a medical professional employed in the State's medical assistance program (Medicaid). This program, which is funded largely through federal funds, is established in Title 15 of the Health-General Article, Annotated Code of Maryland. It is a program designed to "provide comprehensive medical or other health care for indigent individuals or medically indigent individuals or both...." The Secretary of DHMH is authorized to contract with insurance companies, health practitioners, hospitals and other entities or individuals for the provision of care to eligible program recipients. These providers of care are reimbursed for their services through invoices submitted in accordance with reimbursement regulations established by DHMH. The Law provides for review of the health care provided, by private groups appointed by the DHMH Secretary, as well as by a compliance unit within the Department, and the reimbursements are also monitored by DHMH. There are both civil and criminal penalties for fraudulent or improper medical assistance activities by providers.

The Medical Assistance Compliance Administration (MACA) is the group under the DHMH Assistant Secretary for Medical Care Programs that is responsible for monitoring the health care providers. The Long Term Care Unit is the unit within MACA that deals with provider facilities and individuals involved with nursing home care, intermediate and skilled nursing facilities, home health services, and day care and personal care. The Unit contracts with private entities to provide first level monitoring of providers, and employees in the Unit then review and evaluate the reports generated by these contractors. The Requestor is a nurse who works with a social worker in monitoring home health, day care and personal care services. Since most of the services provided are nursing based, she is responsible as a medical professional to evaluate invoices to assure that the providers have met medical criteria. These include, for example, criteria relating to the number of visits and the amount and nature of supplies used. The Requestor does not deal with acute care providers, nor is she involved with nursing homes that could be based at or affiliated with an acute care provider.

The Requestor has part-time outside employment providing clinical nursing services to acute care hospitals. She indicates, first, that she is on the roster of the University of Maryland Hospital. She is called by them if they have a need for nursing services on a particular shift. She provides direct "hands on" patient care at whatever location within the Hospital to which she is assigned. She has worked there relatively regularly on weekends and is paid directly by the Hospital. The Requestor also indicates that she is listed on the roster of Staffbuilders, Inc. She says that if work is not available at University Hospital, she contacts Staffbuilders as to whether it needs a nurse for assignment to any shifts at its client facilities. She has limited her availability through Staffbuilders to acute care facilities only, and may be assigned a shift at any of several hospitals in the Baltimore area. She pays no fee to the agency; she is paid by the agency, however, and not directly by the hospital. The rate of pay varies from hospital to hospital.

Staffbuilders is an entity that serves as an employment agency for several types of medical services, including provision of nurses and other personnel to acute care facilities and nursing homes. It is also a home health agency and employs individuals involved in personal care and home health care services. For these activities it must be licensed by DHMH, and is also a provider of care being directly reimbursed under the Medicaid program. Its activities under these areas of the Medicaid program are subject to review by the Requestor and her unit. She indicates that she is responsible for doing these reviews as to medical issues, as the social worker with whom she works is not qualified to do the medical evaluations.

The facts presented here raise issues under §3-103(a) of the Ethics Law, which contains two outside employment prohibitions. The strict prohibition in subsection (a)(1)(i) bars employment with an entity that has or is negotiating a contract with an employee's agency or is under the agency's or the employee's authority. The inconsistent employment prohibition in subsection (a)(1)(ii) bars any other employment that would impair the individual's impartiality or independence of judgement. The Requestor's circumstances involve two employment situations. In our view, the first, with University Hospital, is not covered by the strict prohibition. The Hospital, as part of the University of Maryland, is a State agency, and under our Opinion No. 81-7 would not be viewed as an entity for purposes of §3-103(a)(1)(i).1

However, in our Opinion No. 82-37, we concluded that the inconsistent employment bar of subsection (a)(1)(ii) could be applied in secondary State employment situations, "where there are clear personal and organizational conflicts intended to be addressed by the Ethics Law that cannot be controlled by the personnel and administrative systems." We subsequently applied this principle, barring the continued service by an individual on a local Board of Social Services, if the individual obtained regular employment within the Social Services Department. The issue with regard to the Requestor's University Hospital employment is thus whether it is related to or impacts on her DHMH duties so as to raise the kinds of concerns identified by the Commission in its earlier Opinions. She does not appear to have any responsibility in her official duties for acute care facilities such as University Hospital (though the Hospital is of course subject to review of its Medicaid activities by other individuals in the Health Services Review Division). Nor would her duties at the Hospital seem likely to bring her into contact with her agency. We therefore conclude that the Requestor's employment with the University Hospital, as described to us, would not be inconsistent employment as contemplated under §3-103(a)(1)(ii) of the Ethics Law.

Staffbuilders, however, is a private entity that we believe comes within the strict proscription of subsection (a)(1)(i), as it is both licensed by DHMH and contracts with it under the Medicaid program. In addition, the acute care facilities in which the Requestor is placed are also significantly regulated by DHMH and participate substantially in the Medicaid program. The Requestor indicates that in addition to being a licensed nurse, she must meet Staffbuilder qualifications; she is also paid by the entity and not directly by the hospitals where she is placed. We believe that these circumstances require a conclusion that she is employed by Staffbuilders for purposes of §3-103(a)(1)(i),2 and that this provision would apply to bar the employment unless an exception is granted pursuant to the introductory language of §3-103(a)(1).

We have issued exception regulations implementing the provision in §3-103(a) that its prohibitions apply "except as permitted by regulation of the Commission...where such employment does not create a conflict of interest or appearance of conflict...." These regulations are set forth in full in COMAR 19A.02.01, and basically set out several criteria designed to establish that the relationship between the private activity and official duties is so remote that a conflict or appearance of conflict is unlikely. The criteria include, for example, consideration of whether the employee's duties significantly impact on the outside employer, whether the employee is supervised by a person who impacts the employer or is in the unit of his agency that impacts the employer, and whether the circumstances surrounding the situation would create a conflict or an appearance of conflict.

While we do not believe that application of these criteria raises issues with regard to the Requestor's direct employment with acute care hospitals, we are concerned with several questions presented as to her Staffbuilders affiliation. This entity is directly within the Requestor's review authority, at least as to its home health and personal care medical assistance, and is significantly impacted by her supervisors and her DHMH unit. Further, the Requestor is in a unit of her agency that is charged with the very sensitive duty of monitoring providers of care in the State's medical assistance program. Some officials in her agency have also expressed concern about appearance of conflict issues presented by her affiliation with Staffbuilders. Under these circumstances we are unable to conclude that the relationship between her official position and her Staffbuilders employment is sufficiently remote to allow exception from the §3-103(a)(1)(i) prohibition. We therefore advise her that she may accept direct outside employment (as described) with acute care hospitals and with University Hospital, but may not have employment affiliations with agencies such as Staffbuilders that are providers of care under her authority and that of the MACA.

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

Date: July 27, 1983

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1 Except as expressly cited to the Maryland Register, all Opinion references are to Ethics Commission Opinions published in COMAR Title 19A.

2 For a discussion of a situation where an affiliation with a referral agency was treated as employment, see Commission Opinion No. 83-7.