Does the CEO have to be a W-2 employee?

We have an Interim CEO. Does that individual have to be a W-2 employee, or can they be contracted as a 1099 contractor?

As described in Chapter 11-Key Management Staff in the Health Center Program Compliance Manual, HRSA requires the Project Director/CEO position to be directly employed by the health center and report to the governing board. As transitions in health centers occur, the Project Director/CEO position must be directly employed and not be a contractor. A health center can have an Interim Project Director/CEO, but that individual must be a W-2 employee. During an Operational Site Visit (OSV), a health center can demonstrate compliance by presenting one of the following: 

  1. W-2
  2. Employment Agreement
  3. Pay Stub, or 
  4. Some other type of document that supports direct employment by the health center. 

 

The health center determines which document to provide during the OSV.

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February 17th, 2025

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