Chapter 21: Federal Tort Claims Act (FTCA) Deeming Requirements

In this chapter:

• Authority
• Requirements
• Demonstrating compliance
• Related considerations

Authority

Section 224(g)-(n), 224(q) of the PHS Act (42 U.S.C. 233(g)-(n) and (q)); and 42 CFR Part 6

Requirements

In order to obtain deemed Public Health Service employment status under sections 224(g)-(n) of the PHS Act¹ for themselves and for their “covered individuals,”² Health Center Program awardees and subrecipients (including those defined as subrecipients under the Health Center FTCA Medical Malpractice Program regulations),³ hereafter referred to as a “health center” in this chapter, must submit for approval by HRSA an annual deeming application that demonstrates the health center:

• Has implemented appropriate policies and procedures to reduce the risk of malpractice and the risk of lawsuits arising out of any health or health-related functions performed by the health center
• Has reviewed and verified the professional credentials, references, claims history, fitness, professional review organization findings, and license status of its physicians and other licensed or certified health care practitioners
• Has no history of claims under section 224 of the PHS Act or, if such a history exists, fully cooperates with the Attorney General in defending against any such claims, and takes any necessary steps to assure against such claims in the future
• Will fully cooperate with the Attorney General and other applicable agencies in providing required information under section 224 of the PHS Act

Note: A health center’s deemed employment status⁴ does not imply FTCA coverage in all cases, as health center providers must also comply with statutory individual eligibility requirements, and covered actions must be taken within the scope of deemed PHS employment. When FTCA matters become the subject of litigation, the U.S. Department of Justice and the Federal courts may assume significant roles in certifying or determining whether or not a given activity falls within the scope of employment for purposes of FTCA coverage. For more information, review the FTCA Health Center Policy Manual (PDF - 406 KB).

Demonstrating compliance

A health center would demonstrate compliance with the FTCA requirements by providing documentation in its annual deeming application, in the form and manner prescribed by HRSA, and consistent with (but not necessarily limited to) the following:

Credentialing and privileging / quality improvement and quality assurance

1. The health center is currently compliant with all of the credentialing and privileging requirements of Chapter 5: Clinical Staffing and all requirements within Chapter 10: Quality Improvement/Assurance prior to the deeming determination.

Risk management

1. The health center has and currently implements an ongoing health care risk management program to reduce the risk of adverse outcomes that could result in medical malpractice or other health or health-related litigation and that requires the following:
   • Risk management across the full range of health center health care activities
   • Health care risk management training for health center staff
   • Completion of quarterly risk management assessments by the health center
   • Annual reporting to the health center board which includes: completed risk management activities; status of the health center’s performance relative to established risk management goals; and proposed risk management activities that relate and/or respond to identified areas of high organizational risk
2. The health center has risk management procedures that address the following areas for health center services and operations:
   • Identifying and mitigating the health care areas/activities of highest risk within the health center’s HRSA-approved scope of project, including but not limited to tracking referrals, diagnostics, and hospital admissions ordered by health center providers
   • Documenting, analyzing, and addressing clinically-related complaints and “near misses” reported by health center employees, patients, and other individuals
   • Setting and tracking progress related to annual risk management goals
   • Developing and implementing an annual health care risk management training plan for all staff members based on identified areas/activities of highest clinical risk for the health center (including, but not limited to, obstetrical procedures and infection control) and any non-clinical trainings appropriate for health center staff (including HIPAA medical record confidentiality requirements)
   • Completing an annual risk management report for the board and key management staff
3. The health center provides reports to the board and key management staff on health care risk management activities and progress in meeting goals at least annually, and provides documentation to the board and key management staff showing that any related follow-up actions have been implemented.
4. The health center has a health care risk management training plan for all staff members and documentation showing that such trainings have been completed by the appropriate staff, including all clinical staff, at least annually.
5. The health center designates an individual(s) (for example, a risk manager) who oversees and coordinates the health center’s health care risk management activities and completes risk management training annually.

Claims management

1. The health center has a claims management process for addressing any potential or actual health or health-related claims, including medical malpractice claims, that may be eligible for FTCA coverage. In addition, this process ensures:
   • The preservation of all health center documentation related to any actual or potential claim or complaint (for example, medical records and associated laboratory and x-ray results, billing records, employment records of all involved clinical providers, clinic operating procedures)
   • Any service-of-process/summons that the health center or its provider(s) receives relating to any alleged claim or complaint is promptly sent to the HHS Office of the General Counsel, General Law Division, per the process prescribed by HHS and as further described in the FTCA Health Center Policy Manual
2. The health center has a designated individual(s) who is responsible for the management and processing of claims-related activities and serves as the claims point of contact.
3. The health center informs patients using plain language that it is a deemed Federal PHS employee⁵ via its website, promotional materials, and/or within an area(s) of the health center that is visible to patients.
4. If a history of claims under the FTCA exists, the health center can document that it:
   • Cooperated with the Attorney General, as further described in the FTCA Health Center Policy Manual
   • Implemented steps to mitigate the risk of such claims in the future

Related considerations

The following points describe areas where health centers have discretion with respect to decision-making or that may be useful for health centers to consider when implementing these requirements:

• The health center determines how to obtain its health care risk management training (for example, through one of HRSA’s national cooperative agreements or technical assistance contracts) and which trainings to require for covered individuals and the individual(s) designated with risk management responsibilities (for example, risk manager).
• The health center determines what other types of liability coverage to obtain, such as private “gap” or “tail” insurance, directors and officer insurance, and general liability insurance, for activities that may not be eligible for FTCA coverage.
• The health center determines how to conduct and document the completion of quarterly risk management assessments.
• With the exception of health centers that use volunteer health professionals, as to which requirements are prescribed by law,⁶ the health center determines how to inform patients that it is a deemed Federal Public Health Service employee.

Footnotes

^1. The text of section 224 of the PHS Act may be found at: 42 USC 233: Civil actions or proceedings against commissioned officers or employees. 

^2. “Covered individuals” is defined by the FTCA Health Center Policy Manual (PDF - 406 KB) to mean “governing board members, officers, employees, and certain individual contractors.” The term does not include volunteer health professionals of deemed health centers, who may be deemed as PHS employees under section 224(q), and as to whom an individual deeming application is required.

^3. Subrecipient, as used in this chapter means, as described in 42 CFR 6.2, an entity that receives a Federal award or a contract from a covered entity to provide a full range of health services on behalf of the covered entity. Covered entity means an entity as described in 42 CFR 6.3 which has been deemed by the Secretary, in accordance with 42 CFR 6.5, to be covered by 42 CFR Part 6.

^4. Deemed employment status extends to covered individuals based on evidence of their relationship with the covered entity (i.e., officer, governing board member, health center employee, qualified individual contractor, or volunteer health professional), pursuant to section 224(g)-(n) and (q) of the PHS Act, and 42 CFR Part 6. Volunteer health professionals may receive deemed employment status based on individual applications by the sponsoring, deemed health center. Whether a specific activity is covered by the FTCA will also require a determination or certification that the activities at issue occurred within the scope of deemed PHS employment.

^5. For example: “This health center receives HHS funding and has Federal Public Health Service (PHS) deemed status with respect to certain health or health-related claims, including medical malpractice claims, for itself and its covered individuals.” For more information, see Federal Tort Claims Act (FTCA) website.

^6. Section 224(q)(2)(D) of the PHS Act.