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Whistleblower Claims under the Patient Protection and Affordable Care Act: An Emerging Concern for Employers and Insurers

The ACA contains whistleblower protection provisions that could spark an increase in claims filed with OSHA, the EEOC and the DOL.
By: | March 2, 2015 • 6 min read


For years, retaliation claims have been the bane of many employers’ existence. Under Title VII, these claims have risen 72 percent from 22,278 charges filed with the Equal Employment Opportunity Commission (EEOC) in 2005 to 38,539 charges in 2013. While many employers are aware of EEOC retaliation investigations, less are likely to be aware that the Occupational Safety & Health Administration (OSHA), as part of the United States Department of Labor (DOL), is also tasked with investigating and enforcing the whistleblower provisions of more than 20 federal statutes. This includes the politically charged Patient Protection and Affordable Care Act (ACA) passed by Congress in 2010 and now commonly referred to as “ObamaCare.”

Although the number of complaints investigated by OSHA pales in comparison to those investigated by the EEOC, the numbers are clearly on the rise. In 2005, 1,934 whistleblower complaints were filed with OSHA. By 2014, that number had grown to 3,060; close to a 60 percent increase. In February, the Obama administration released its proposed 2015 budget seeking a 10 percent increase in the DOL’s budget — some of which will likely go to enforcing whistleblower laws. It is also worth noting that in 2014, OSHA was seeking to add 47 new positions to investigate whistleblower claims before its budget was finalized.

Although most employers are aware that the ACA may dramatically affect the way they provide health insurance benefits to their employees, few may recognize that the ACA also establishes whistleblower protections for employees who voice concern or complain about their employer’s reaction to the ACA. Section 1588 of the ACA created 29 U.S.C. § 218c which provides that no employer shall discharge or discriminate against any employee with respect to his or her compensation, terms, conditions, or other privileges of employment, because the employee has engaged in activity protected by the ACA.

The list of protected activity under the ACA is not limited and Congress intended that the statute be broadly interpreted to encompass many activities. Such protected activities include:

  • providing information related to an actual ACA violation to the employer or government agency
  • providing information relating to any act or omission the employee reasonably believes to be a violation of the ACA to the employer or government agency
  • assisting an employer or governmental agency in the investigation of an actual or purported violation of the ACA
  • providing testimony concerning an actual or purported violation of the ACA
  • refusing to participate in or objecting to any policy or procedure that the employee reasonably believes to be in violation of the ACA
  • receiving a tax credit under Section 36B of the Internal Revenue Code of 1986 or a tax subsidy under section 1402 of the ACA

The law protects employees or potential employees from an adverse employment action because of their protected activities. Examples of adverse employment actions that an employee, or potential employee, may claim caused them harm include, but are not limited to, termination, failing to hire, demotion, blacklisting, failing to promote, intimidation or harassment, disciplining, a reduction in pay or hours, the denial of overtime pay, and/or the reassignment of work responsibilities or duties.

As we know, the passage and implementation of the ACA was met with a great deal of political controversy from members of both political parties as well as confusion on the part of the public as to what the ACA meant for them. This controversy and confusion are, for employers, likely to lead to a growing number of whistleblower claims.

On one hand, many employers are likely confused as to their obligations under the ACA and may implement policies, practices or procedures in an effort to comply with the ACA’s mandates which, in fact, violate the ACA or which an employee believes violates the ACA. Based on their confusion or misguided understanding, those same employers may unwittingly create a whistleblower claim after reacting to that employee’s complaints.

On the other hand, the political objections to the ACA have been so significant that it would not be surprising to find some employers, vehemently opposed to the ACA, trying to stretch the boundaries of the requirements of the law. In doing so, they may enact policies or procedures that employees believe violate the ACA and lead them to file complaints about their employer’s activities – acts which could prompt those same employers to respond with an adverse employment action. Further, some employees may, due to their own personal politics, be so motivated to see the ACA succeed that they may regularly and loudly voice complaints about even the slightest perceived violation, which again may lead their employers to take action in violation of the ACA’s whistleblower protections.

SponsoredContent_AlliedWorld“The cost of litigating and defending complaints being investigated by multiple governmental agencies… could be significant and have an impact on employers and their insurers.”

— Kevin M. Fisher, Assistant Vice President, employment practices and governmental claims, Allied World

Plaintiff’s attorneys may also find ACA retaliation claims more appealing when compared to traditional Title VII claims, as recent United Supreme Court rulings have made those traditional claims more difficult to prove. In 2013, the U.S. Supreme Court issued its decision in Univ. of Texas Southwestern Medical Center v. Nassar, finding that in Title VII cases, plaintiffs must show that the causal link between their injury and the wrongful act is so close that the injury would not have occurred “but for” the act. This standard, theoretically, should make it much more difficult for plaintiffs to prove their Title VII retaliation claims.

The ACA, however, carries a very different, and much lower, burden on plaintiffs while also imposing a higher burden on employers to rebut the employee’s claims. Known as a “contributing factor” statute, the ACA provides that if an employee shows by a preponderance of the evidence that their protected activity was only a contributing factor in the employer’s adverse employment action, and the employer cannot show by clear and convincing evidence that they would have acted in the same way absent the protected activity, the employee should prevail. This lower burden may make ACA whistleblower claims much more attractive to plaintiff’s attorneys.

Employees who are successful in their complaints will be entitled to reinstatement as well as the recovery of front pay, back pay, compensatory damages for emotional distress, and interest. As with many employment law statutes, employees will also be able to recover their attorneys’ fees.

While there will likely be liability exposure in some of these claims, there will be the potential for large defense costs exposure on all of them. It would not be surprising to see plaintiffs file ACA whistleblower claims with OSHA while they also, and separately, file traditional retaliation or discrimination claims with the EEOC or claims under the Fair Labor Standards Act with the DOL. The cost of litigating and defending complaints being investigated by multiple governmental agencies and then, potentially, being litigated in federal court could be significant and have an impact on employers and their insurers.

While there has been no dramatic increase in the number of ACA whistleblower complaints to date, we are likely to see many more in the years to come as more and more employers become subject to the ACA’s coverage mandates. The impact to employers and insurers based on the liability and defense cost exposures of these claims will need to be considered by the broker and underwriting communities as we move forward.

Kevin M. Fisher is an assistant vice president employment practices and governmental claims with Allied World. The opinions expressed in this article belong solely to Mr. Fisher and are not necessarily shared by Allied World. Visit alliedworldinsurance.com for more information.


This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Allied World. The editorial staff of Risk & Insurance had no role in its preparation.

Allied World is a global provider of innovative property, casualty and specialty insurance and reinsurance solutions.

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.


That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.


Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]