We wanted to answer a question we just received about whether the E-Verify federal contractor rule applies to organizations that accept Medicare reimbursements.  In general, the rule only applies to certain federal contracts awarded on or after September 8, 2009, that contain a performance period longer than 120 days and a value above $100,000. Contracts awarded after this date must include the “E-Verify clause” requiring the contractor to participate in E-Verify.

Unfortunately, the issue of whether Medicare reimbursements qualify under this definition has not been specifically addressed in the E-Verify federal contractor regulation and the DHS has declined to offer specific guidance. In a document published earlier this year, DHS wrote “[t]he question of whether a contract is subject to the Federal Acquisition Regulations (FAR) and amendments requiring use of E-Verify for federal contractors awarded qualifying federal contracts is specific to the terms of the contract.”

If we look to the rule, however, it seems clear that the E-Verify requirement was intended to apply to procurement contracts in which a federal agency is acquiring supplies or services for use by the federal government. Under the Medicare program, however, the Medicare beneficiary acquires care from a provider of his or her choice, which is then reimbursed by the federal government. Based on this reasoning, it is possible that an organization receiving such reimbursements will not be subject to the E-Verify requirement. As always, it’s best to discuss these matters with your internal contract experts or the contracting federal agency.