PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

JOHN G. ROBB,

Plaintiff-Appellant,

v. No. 95-1317

UNITED STATES OF AMERICA,

Defendant-Appellee.

Appeal from the United States District Court

for the Eastern District of Virginia, at Norfolk.

Rebecca B. Smith, District Judge.

(CA-94-302)

Argued: January 29, 1996

Decided: March 29, 1996

Before WILKINSON, Chief Judge, HAMILTON, Circuit Judge,

and BLAKE, United States District Judge for the

District of Maryland, sitting by designation.

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Affirmed by published opinion. Judge Blake wrote the opinion, in

which Chief Judge Wilkinson and Judge Hamilton joined.

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COUNSEL

ARGUED: Judith M. Cofield, SHUTTLEWORTH, RULOFF,

GIORDANO & KAHLE, P.C., Virginia Beach, Virginia, for Appellant. Anita K. Henry, Assistant United States Attorney, OFFICE OF

THE UNITED STATES ATTORNEY, Norfolk, Virginia, for Appellee.

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OPINION

BLAKE, District Judge:

Plaintiff-Appellant John Robb ("Robb") appeals from the district

court's dismissal of a portion of his Federal Tort Claims Act

("FTCA"), 28 U.S.C. §§ 1346(b), 2671-2680, claim against the

United States. Robb argues that the United States is liable for the

alleged negligence of two physicians, Doctors John F. Stroy and

Richard O'Hagan, who failed to diagnose a cancerous lesion on his

lung. Dr. Stroy, a family practitioner, was employed by Franklin,

Green, and Jamaludeen, Ltd. ("F.G.J."), a provider of primary care

medical services which had entered into a Partnership Memorandum

of Understanding ("MOU") with the United States Air Force. Under

the MOU, F.G.J. agreed to provide primary care services at the 1st

Medical Group, Langley Air Force Base in Langley, Virginia. Dr.

O'Hagan, a diagnostic radiologist, was employed by Dr. Leo P.

O'Connell. Dr. O'Connell contracted with the Air Force to provide

radiology services for the 1st Medical Group. The district court held

that Drs. Stroy and O'Hagan were independent contractors with, and

not employees of, the United States. Accordingly, it dismissed this

portion of Robb's claim against the United States for lack of subject

matter jurisdiction. We agree with the conclusion of the district court

and affirm.

I.

The facts in this appeal are essentially undisputed. The relationship

between the United States and the allegedly negligent physicians may

be summarized as follows.

On December 23, 1988, the Air Force entered into an MOU with

F.G.J., the employer of Dr. Stroy. Under the MOU, F.G.J. was to provide primary care medical services to CHAMPUS beneficiaries at the

1st Medical Group at Langley Air Force Base.1 The MOU was to last

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1 The Civilian Health and Medical Program of the Uniformed Service

("CHAMPUS") was established by Congress pursuant to the Dependents' Medical Care Act, 10 U.S.C. § 1071 et seq., to provide medical

and dental benefits to dependents of active-duty and former members of

the military.

 2
two years, but the parties renewed the agreement on July 3, 1990. The

renewed agreement remained effective from July 3, 1990 through

June 30, 1992. Dr. O'Connell, the employer of Dr. O'Hagan, executed a service contract with the United States Air Force to perform

radiology services for the 1st Medical Group at Langley. The contract

was in effect from October 1, 1989 through September 1, 1994.

On November 5, 1990, following a fall, Robb received a medical

work-up at the F.G.J. Partnership Clinic at Langley Air Force Base

at which Dr. John F. Stroy examined Robb and ordered a chest x-ray.

Robb's chest was x-rayed the following day, and the film was read

and interpreted by Dr. Richard O'Hagan. Dr. O'Hagan failed to locate

a mass in Robb's lungs, noting in his report: "The lungs are expanded

and free of infiltrate," and "NEGATIVE CHEST."

Over the following three years, Robb was examined by four activeduty military practitioners specializing in ophthalmology, optometry,

dermatology, and surgery. The surgeon's examination of Robb was

related to pain resulting from gallstones. None of these specialists

examined Robb for problems of the neck or lung, and none identified

the tumor. On March 24, 1993, Robb commented to an Air Force

physician about a lump in his neck. The physician took a chest x-ray

and thereafter diagnosed Robb's lung cancer.

On March 16, 1994 Robb filed a complaint in the United States

District Court for the Eastern District of Virginia alleging negligence

on the part of the United States, its agents and employees. The United

States then filed a motion to dismiss and for summary judgment.

After briefing and oral argument, a United States Magistrate Judge

recommended that the complaint against the United States be dismissed insofar as it alleged negligence on the part of Drs. Stroy and

O'Hagan because he determined that the physicians were independent

contractors rather than employees of the United States. The magistrate

judge recommended denial of the motion for summary judgment with

respect to any claims predicated on the acts or omissions of activeduty personnel. In an order dated September 23, 1994, the district

judge adopted the magistrate judge's recommendation in its entirety.

On February 1-2, 1995, a trial was conducted before the district judge

on Robb's remaining claims regarding the alleged negligence of the

active-duty personnel. On February 2, 1995, the court granted the

 3
United States's motion for judgment as a matter of law regarding the

alleged negligence of the active-duty personnel, thus dismissing the

remainder of the action on the merits.

Robb has appealed the dismissal of the action against the United

States relating to Drs. Stroy and O'Hagan under two theories. First,

Robb argues that Drs. Stroy and O'Hagan are employees of the

United States and not independent contractors for the purposes of the

FTCA. Second, while he does not appeal the judgment of dismissal

related to the active-duty personnel, he argues that the alleged negligence of Drs. Stroy and O'Hagan should be imputed to the United

States under Virginia's continuing treatment rule. Robb argues that

the failure by the active-duty medical practitioners to diagnose his

cancer after the original examination by Drs. Stroy and O'Hagan was

a continuation of that alleged negligence, and the United States

should be liable for that continuing failure to diagnose.

II.

The district court dismissed Robb's claim, to the extent that it

relied on the alleged negligence of Drs. Stroy and O'Hagan, for lack

of subject matter jurisdiction.2 Joint Appendix ("J.A.") at 300. The

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2 Where the challenged conduct in an FTCA action was performed by

an independent contractor, the district court must dismiss the action for

want of subject matter jurisdiction. The jurisdictional grant for FTCA

actions provides, in part:

Subject to the provisions of chapter 171 of this title [Tort claims

procedure], the district courts . . . shall have exclusive jurisdiction of civil actions on claims against the United States, for

money damages . . . for injury or loss of property, or personal

injury or death caused by the negligent or wrongful act or omission of any employee of the Government while acting within the

scope of his office or employment, under circumstances where

the United States, if a private person, would be liable to the

claimant in accordance with the law of the place where the act

or omission occurred.

28 U.S.C. § 1346(b) (emphasis supplied). See also Williams v. United

States, 50 F.3d 299, 304-05 (4th Cir. 1995) (district court has no subject

matter jurisdiction to hear FTCA claim arising out of the actions of an

independent contractor); Fed. R. Civ. P. 12(b)(1).

 4
dismissal of an action under Rule 12(b)(1) is a matter of law reviewed

de novo. Williams v. United States, 50 F.3d 299, 304 (4th Cir. 1995);

Tillman v. Resolution Trust Corp., 37 F.3d 1032, 1034 (4th Cir.

1994).

The FTCA contains a limited waiver of the United States's sovereign immunity, allowing a plaintiff to sue the United States for damages in compensation for injuries resulting from certain torts of

employees of the government acting within the scope of their employment. 28 U.S.C. § 1346(b). An "`[e]mployee of the government'

includes officers or employees of any federal agency, members of the

military or naval forces of the United States, . . . and persons acting

on behalf of a federal agency in an official capacity, temporarily or

permanently in the service of the United States." Id. § 2671. The term

"federal agency" explicitly excludes "any contractor with the United

States." Id. Therefore, Congress has not waived the sovereign immunity of the United States for injuries resulting from the actions of

independent contractors performing work for the government. See

United States v. Orleans, 425 U.S. 807, 814 (1976).

The FTCA, as a waiver of sovereign immunity, is strictly construed, and all ambiguities are resolved in favor of the sovereign. See

United States v. Nordic Village, Inc, 503 U.S. 30, 33 (1992);

Williams, 50 F.3d at 305. Accordingly, the independent contractor

exception to the waiver of sovereign immunity has been construed

broadly. See Lurch v. United States, 719 F.2d 333, 338 (10th Cir.

1983), cert. denied, 466 U.S. 927 (1984). Although state law governs

the substantive duties of the United States under the FTCA, 28 U.S.C.

§ 1346(b), whether a person is a contractor or an employee is determined under federal law. See Logue v. United States, 412 U.S. 521,

528 (1973); Berkman v. United States, 957 F.2d 108, 112 (4th Cir.

1992).

The test employed for distinguishing between a contractor and an

employee for FTCA purposes was developed by the Supreme Court

in Logue and Orleans. In Logue , a federal prisoner hanged himself

while being held in a county jail. The surviving parents of the prisoner sued the United States under the FTCA alleging that the negligence of employees and agents of the government was the proximate

cause of their son's death. Logue, 412 U.S. at 522-23. The county jail

 5
was one of hundreds that had contracted with the Federal Bureau of

Prisons to provide for the safekeeping, care, and subsistence of federal prisoners. The Logue Court concluded that the employees of the

county jail were independent contractors and not employees of the

United States. In reaching this conclusion, the Court cited approvingly from the opinion of the court below, which had read the FTCA

contractor exemption as incorporating the common-law distinction

between contractors and employees or agents. Primarily, this distinction turns on "the absence of authority in the principal to control the

physical conduct of the contractor in performance of the contract." Id.

at 527. Guided by this standard, the Court examined the statute which

authorized the contracts with county jails, as well as the contract

itself. The Court concluded that the jail was an independent contractor

because the United States had no authority to "physically supervise

the conduct of the jail's employees." Id. at 530. The Court reached

this conclusion despite the jail's obligation to comply with a variety

of rules governing prisoner care and discipline, communications with

attorneys, visitation privileges, mail, medical services, and employment. The authority of the United States to enter the jail for the purpose of inspection and evaluation did not alter the result. Id. at 529-

30.

The Orleans Court built on the principles established in Logue. In

Orleans, a father sued the United States under the FTCA for injuries

sustained by his minor child in an automobile accident. The accident

occurred in a private automobile which was being used by a community action agency to transport children from an outing sponsored by

one of its affiliates. The community action agency was funded by the

federal Office of Economic Opportunity ("OEO"), was required to

comply with federal standards and regulations, conducted only programs formulated and funded by the federal government, and suffered

an OEO funding lapse pending the selection of a new chairman of the

governing board. Orleans, 425 U.S. at 811. In determining whether

the community action agency was a contractor with, or an agent of,

the United States, the Orleans court stated that: "the question here is

not whether the community action agency receives federal money and

must comply with federal standards and regulations, but whether its

day-to-day operations are supervised by the Federal Government." Id.

at 815. As in Logue, the outcome in Orleans did not turn on the ability of the United States to compel compliance with standards, rules,

 6
and regulations. Rather, it was the inability of the OEO to supervise

day-to-day operations that led to the conclusion that no employment

relationship existed. The Court stated that "[a]lthough such regulations are aimed at assuring compliance with goals, the regulations do

not convert the acts of entrepreneurs--or of state governmental

bodies--into federal governmental acts." Orleans, 425 U.S. at 816.

This court and others have had occasion to apply the principles of

Logue and Orleans to private physicians working under contractual

relationships with medical facilities operated by the United States.

One of the earliest of these cases was Wood v. Standard Products Co.,

671 F.2d 825 (4th Cir. 1982), in which this court was confronted with

"the question whether a `contract physician' of the United States Public Health Service (PHS), who had treated medically the plaintiff . . .

was an `employee' of the United States, for whose alleged negligence

the United States was liable under the [FTCA]." Id. at 826 (footnote

omitted). The district court in Wood observed that, because of the

nature of their work, physicians can not be subject to external control

of their medical judgment. Because no physician may ethically relinquish control of his or her medical judgment, the district court held

that the proper application of the Logue and Orleans control test to

physicians must focus on "those areas of medical service that may be

supervised and controlled." Wood v. United States, 494 F. Supp. 792,

799 (E.D. Va. 1980), rev'd, 761 F.2d 825 (4th Cir. 1982). Specifically, the district court directed its attention to whether the United

States "retained and exercised significant authority over the nontreatment areas" of the physician's work. Id. This court rejected the

approach of the district court because we found no reason why "the

controlling principle as stated in Logue and Orleans is inapplicable to

contracts governing the rendering of medical services by a physician."

Wood, 671 F.2d at 831. The district court improperly focused its control analysis on "the peripheral, administrative details which were

incidental to the rendering of medical services" and not on "the control over the performance of the medical services" as Logue and

Orleans require. Id. The Wood court concluded that, when examining

the extent of the principal's control over the purported employee, "the

real test is control over the primary activity contracted for and not the

peripheral, administrative acts relating to such activity." Id. at 832.

 7
The Wood court did not conclude, however, that a physician must

always be deemed an independent contractor simply because of the

necessity that a physician exercise independent professional judgment

in providing medical treatment to his or her patients.3 Nor did the

court limit its inquiry to the parties' stipulation"that the PHS . . . does

not exercise control over or dictate the day-to-day medical judgment

of [the physician] in his provision of medical services." Id. at 830

(internal quotations marks omitted) (emphasis in original). Rather, the

court examined a variety of factors relevant to the relationship

between the parties.4 In addition to noting PHS's lack of control of

the physician's medical judgment, the Wood court considered: (1) that

the physician under the contract was referred to as a "contract physician," (2) that the physician was to provide"outpatient" care, (3) general statements concerning the manner and quality of service required

under the contract, (4) the lack of control by the government over the

prescription of drugs and medical supplies, (5) the authority of the

physician to make referrals, (6) contractual requirements for office

hours and the ability of the physician to decline to see patients, (7)

the physician's responsibility to provide office space, support staff,

supplies, and equipment, (8) the percentage of the physician's total

practice which was devoted to activities under the contract, (9) the

nature of the compensation to the physician, including method (fee

schedule) and rates (similar to the physician's usual fees), (10) PHS

recordkeeping requirements, (11) prescribed methods of verifying

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3 For example, physicians may be deemed employees of the government for FTCA purposes because they were hired pursuant to an act of

Congress which designates them as such. See e.g. , 38 U.S.C. § 7316

(providing that suit against the United States may be the exclusive remedy for malpractice by physician employees of the government); 38

U.S.C. § 7405 (authorizing the Secretary of Veterans Affairs to "employ"

a variety of medical professionals); see also Ezekiel v. Michel, 66 F.3d

894, 903 (7th Cir. 1995) (observing that the application of the strict control test to physicians employed by the government pursuant to § 7316

would, in many cases, defeat Congress's intent to immunize these workers because physicians are typically deemed independent contractors

under that test); Quilico v. Kaplan, 749 F.2d 480, 485 (7th Cir. 1984).

4 In conducting its inquiry, the Wood court noted that "the contract and

its terms in fixing the relationship of the offending party are critical," to

distinguishing between an independent contractor and an employee.

Wood, 671 F.2d at 829.

 8
patient eligibility for treatment, and (12) the extent of PHS's review

of the physician's offices. Id. at 830 & n.10.5

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5 Several of these factors considered by the Wood court are discussed

in the Restatement (Second) of Agency § 220(2). Section 220 addresses

the liability of a principal for the torts of a servant and provides a helpful

discussion of the distinction between a servant and an independent contractor in this context. Section 220(2) provides, in full:

In determining whether one acting for another is a servant or an

independent contractor, the following matters of fact, among others, are considered:

(a) the extent of control which, by the agreement, the

master may exercise over the details of the work;

(b) whether or not the one employed is engaged in a distinct occupation or business;

(c) the kind of occupation, with reference to whether, in

the locality, the work is usually done under the direction of

the employer or by a specialist without supervision;

(d) the skill required in the particular occupation;

(e) whether the employer or the workman supplies the

instrumentalities, tools, and the place of work for the person

doing the work;

(f) the length of time for which the person is employed;

(g) the method of payment, whether by the time or by

the job;

(h) whether or not the work is a part of the regular business of the employer;

(i) whether or not the parties believe they are creating

the relation of master and servant; and

(j) whether the principal is or is not in business.

Restatement (Second) of Agency § 220(2). The Restatement has been

cited with approval in other private physician FTCA cases. See Broussard v. United States, 989 F.2d 171, 175 (5th Cir. 1993); Leone v. United

States, 910 F.2d 46, 49, 50 (2d Cir. 1990), cert. denied, 499 U.S. 905

(1991).

 9
Analyzing these facts, the Wood court had little difficulty in holding that the physician was an independent contractor. Subsequent

decisions of the courts of appeals have reached similar results. The

circuits have consistently held that physicians either in private practice or associated with an organization under contract to provide medical services to facilities operated by the federal government are

independent contractors, and not employees of the government for

FTCA purposes. See Carrillo v. United States, 5 F.3d 1302 (9th Cir.

1993); Broussard v. United States, 989 F.2d 171 (5th Cir. 1993);

Leone v. United States, 910 F.2d 46 (2d Cir. 1990), cert. denied, 499

U.S. 905 (1991); Lilly v. Fieldstone, 876 F.2d 857 (10th Cir. 1989);

Lurch v. United States, 719 F.2d 333 (10th Cir. 1983), cert. denied,

466 U.S. 927 (1984); Bernie v. United States, 712 F.2d 1271 (8th Cir.

1983).

Underlying the uniform results of these cases, however, is some

uncertainty regarding the proper test to be applied in FTCA cases

involving contract physicians. Robb directs this court to a multifactored approach discussed in Lilly v. Fieldstone. In Lilly, the Tenth

Circuit addressed the concerns about the autonomy of physicians discussed by the district court in Wood and several courts following Wood.6

Rather than examining the extent of control the government may

exercise over medical decisions, the Lilly court stated that the proper

course is to identify evidence bearing on the parties' intention "to

make the professional an employee subject to other forms of control

which are permissible." Lilly, 876 F.2d at 859. The court reasoned

that a physician may become an employee by intent and agreement

without the requirement that the physician surrender control of vital

decisions related to patient care. In attempting to determine the intent

of the parties, the Lilly court considered a variety of factors including

whether the physician was authorized to see patients at his office as

well as at the hospital, whether he charged the same fees to the government and private patients, whether he or the government was the

primary supplier of office space and supplies, whether the doctor

retained exclusive control over patients and records, whether he

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6 See e.g., Ezekiel, 66 F.3d at 902; Broussard, 989 F.2d at 175;Lurch,

719 F.2d at 337.

 10
worked under a contract with the government, and whether he was

required to maintain regular office hours as a consultant.7

We are not persuaded that there is any need to adopt a test different

from that used in Wood for determining the employment status of private physicians in FTCA cases. Indeed, many of the factors considered by the Wood court are substantially similar to the factors

discussed in Lilly and the factors outlined in § 220(2) of the Restatement (Second) of Agency.8 Application of the control test, which

properly includes analysis of the contractual relationship between the

government and the allegedly negligent physician, is supported by

precedent in this circuit and is consistent with the guidance provided

by the Supreme Court in Logue and Orleans.

III.

A.

We turn now to the MOU between Dr. Stroy's employer, F.G.J.,

and the United States. Pursuant to the MOU, F.G.J. was required to

provide practitioners and sufficient support personnel "in order to

function as a stand alone clinic." J.A. at 34 (MOU ¶ B(2)(n)).

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7 Prior to reviewing the factors it deemed relevant in making the independent contractor determination, the Lilly court noted that the district

court in that case had applied a test from Norton v. Murphy, 661 F.2d

882 (10th Cir. 1981). It is this test to which Robb directs our attention.

The factors from this test include: (1) the intent of the parties, (2)

whether the United States controls only the end result or may also control

the manner and method of reaching the result, (3) whether the person

uses her own equipment or that of the United States, (4) whether the

United States provides liability insurance, (5) whether the United States

pays social security tax, (6) whether federal regulations prohibit federal

employees from performing such contracts, and (7) whether the individual has authority to subcontract to others. See Lilly, 876 F.2d at 859 (citing Norton, 661 F.2d at 884-85). The court in Lilly did not apply the

Norton criteria as such, instead focusing primarily on evidence which

manifested the intent of the parties regarding the status of the physician.

See Bird v. United States, 949 F.2d 1079, 1086-87 (10th Cir. 1991)

(describing the Lilly court's treatment of Norton).

8 The text of § 220(2) is set forth in note 5, supra.

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Although located inside the Langley Air Force Hospital, the F.G.J.

Clinic was a distinct entity. A sign informed visitors that they were

entering the F.G.J. Partnership Clinic, the employees of the Clinic

wore civilian clothes and name tags identifying themselves as F.G.J.

employees, and no military personnel worked in the clinic. Id. at 49

(Affidavit of Colonel George Belcher, Former Chief of Hospital Services at Langley Air Force Base ("Belcher Aff.")).9 No F.G.J.

employee received any compensation directly from the United States.

Id. at 48. Pursuant to the MOU, all compensation to F.G.J. came in

the form of CHAMPUS prevailing rate fees. F.G.J. was required to

"[p]rovide full professional liability insurance covering acts or omission [sic] of [F.G.J. and any support personnel] not covered by 10

U.S.C. § 1089."10 Id. at 33 (MOU ¶ B(2)(b)). Finally, it is undisputed

that the United States exercised no control over the day-to-day medical judgment of F.G.J. including treatment, diagnosis, and referral for

treatment. Id. at 48 (Belcher Aff.).

Robb first argues that the MOU's statement of purpose provides

evidence that the parties intended F.G.J. and its employees to be

employees of and not independent contractors with the United States.

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9 The district court properly considered the affidavit of Colonel Belcher

in ruling on the Rule 12(b)(1) motion. In evaluating whether it has subject matter jurisdiction to hear a case, a district court may consider evidence outside the pleadings. Williams, 50 F.3d at 304.

10 Paragraph C(7) of the MOU provides in full: "The hospital's liability

for actions of its employees (hospital staff and Military Department practitioners, but excluding participating health care entities) is governed by

Title 10, United States Code, Section 1089." The"hospital" is shorthand

for the 1st Medical Group at Langley Air Force Base, and the term "participating health care entity" includes individual practitioners provided

by F.G.J. J.A. 32 (MOU ¶ A(1)).

This liability provision of the MOU refers to the Medical Malpractice

Immunity Act, better known as the Gonzales Act. See 10 U.S.C. § 1089.

The Gonzales Act provides medical malpractice immunity to medical

employees of the armed forces, Department of Defense, Armed Forces

Retirement Home, Central Intelligence Agency, and the National Guard

if engaged in training or duty. This section makes the FTCA the exclusive remedy for victims of medical malpractice committed by these medical employees of the government.

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This statement provides: "The purpose of this agreement is to integrate specific Hospital and CHAMPUS program resources to provide

primary care services for CHAMPUS beneficiaries at 1st Medical

Group, Langley AFB." Id. at 32 (MOU ¶ A(2)). Furthermore, the

cover page of the MOU indicates that the Air Force entered into the

partnership with F.G.J. "to improve patient access to Primary Care

Services at the 1st Medical Group." Id. at 31. We are not persuaded

that the Air Force's intention to consolidate resources, and presumably thereby increase the efficiency of health care delivery, suggests

that the parties intended that F.G.J.'s employees become employees

of the United States. Robb provides no reasons why we should conclude otherwise.

Robb next argues that we should conclude that an employeremployee relationship was created with F.G.J. because it was the government's shortage of medical personnel that required it to seek these

services through private contractors. A similar argument was

advanced and rejected in Logue. The Logue Court stated: "If this were

to be the law, the exclusion of contractors from the definition of `Federal agency' in § 2671 would be virtually meaningless, since it would

be a rare situation indeed in which an independent contractor with the

Government would be performing tasks that would not otherwise be

performed by salaried Government employees." Logue, 412 U.S. at

532.

Robb also suggests that the inability of F.G.J. to subcontract or

assign the contract without the prior consent of the government

reflects an employer-employee relationship. See J.A. at 34-35 (MOU

§ (C)(1)). As authority for this proposition, Robb directs our attention

to Norton v. Murphy, 661 F.2d 882 (10th Cir. 1981), in which the

Tenth Circuit appeared to rely, in part, on a contractor's authority to

subcontract to others to support its holding that a driver who had

entered into a contract with the United States to deliver the mail was

an independent contractor. See id. at 885. While we might imagine

cases in which the authority to subcontract supports an inference that

an independent contractor relationship exists, we are not persuaded

that the absence of authority to subcontract here should give rise to

an inference that an employer-employee relationship exists. At most,

F.G.J.'s inability to subcontract implies that the Air Force has manifested its consent to receive only the services of F.G.J. However,

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there is no provision of the contract requiring government approval

of F.G.J.'s individual practitioners. Under these facts, therefore, we

ascribe little if any weight to this factor in making our determination.

Robb next argues that the review provisions of the MOU authorize

the Air Force to control the day-to-day operations of F.G.J. and its

employees. The MOU provides that the Medical Group commander

shall "[r]eview past and current performance of, determine qualifications of (including review of liability insurance coverage), and select

potential participating health care entities." Id. at 32 (MOU ¶ B(1)(a)).

Under the MOU, the term "participating health care entity" designates

F.G.J. and the individual practitioners provided by F.G.J. Id. at 32

(MOU ¶ A(1)). The authority of the government to review the performance of and determine the qualifications of F.G.J.'s practitioners

does not support Robb's position that these physicians were employees of the government. This provision amounts to nothing more than

a standard quality assurance clause by which the government reserves

the right to determine whether it is satisfied with the services it is purchasing under the contract. As we stated in Berkman, "we cannot

accept the suggestion that a contractor loses its independence and

becomes an `employee' of the government in every case in which the

government writes into the contract sufficient procedural safeguards

to ensure compliance with the terms of the agreement." Berkman, 957

F.2d at 114. The other feature of this provision, however, indicates

that the Air Force retained the right to "select potential [individual

practitioners]" of F.G.J. This type of authority is consistent with an

employee-employer relationship. Cf. Broussard , 989 F.2d at 176

(observing that the government did not hire the physician in that

case); Lurch, 719 F.2d at 338 (noting that the authority of a university

to choose which physicians would fulfill the university's obligations

under a contract with the Veteran's Administration was "not consonant with a traditional employer-employee relationship" between the

V.A. and the physician). In this case, however, there is no dispute that

all F.G.J. employees were selected, hired, and paid at the discretion

of F.G.J. J.A. at 46 (Belcher Aff.). It is significant that the Air Force

did not specifically request that Dr. Stroy be hired by F.G.J., although

it arguably retained the authority to determine who was to work in the

clinic.

Robb correctly notes that certain other provisions of the MOU support his argument that Dr. Stroy was an employee of the government.

 14
Under the MOU, the Air Force was required to "[p]rovide facilities,

diagnostic and therapeutic services, and equipment and supplies necessary for the proper care and management of patients under this

agreement to the extent available and authorized for that facility." Id.

at 33 (MOU ¶ B(1)(c)). The MOU also required the Air Force to

"[p]rovide administrative support to participating health care entities

and individual practitioners to the extent available and authorized for

that facility." Id. at 33 (MOU ¶ B(1)(d)). The Air Force was also

required to provide a nursing liaison "to assist with orientation of

Nursing support personnel and insure compliance with[sic] Nursing

Quality Assurance Program." Id. at 33 (MOU ¶ B(1)(i)). Moreover,

F.G.J. was required under the MOU to "[u]se all available Air Force

resources: that is, specialty consultations, other existing partners,

ancillary services, and equipment and supplies for the optimal care of

patients under this agreement." Id. at 34 (MOU ¶ B(2)(g)). In distinguishing between an employee and an independent contractor, one

factor to be considered is "whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person

doing the work." Restatement (Second) of Agency§ 220(2)(e); see

also Lilly, 876 F.2d at 860 (independent contractor physician "maintained a private off-base office").

Viewing the entirety of the MOU and the parties' practices under

it, however, we conclude that Dr. Stroy was acting as an independent

contractor while working for F.G.J. While some provisions of the

agreement are consistent with an employment relationship, we can not

ignore the clear expression of intent in the MOU to establish an independent contractor relationship. The parties contemplated that F.G.J.

would run a "stand alone clinic," albeit with equipment provided by

the United States. The employees of F.G.J. were neither selected nor

paid directly by the Air Force, and F.G.J.'s compensation was based

on CHAMPUS rate fees. Moreover, the Air Force appeared to contemplate that its physicians would be immune from liability under the

Gonzales Act, while F.G.J. agreed to provide full insurance coverage

for the malpractice of its physicians. These factors, combined with the

lack of control over Dr. Stroy's individual medical judgment, are

more than sufficient to establish his independent contractor status.

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B.

In order to determine the potential liability of the United States for

the acts and omissions of Dr. O'Hagan, we now turn to the contract

between his employer, Dr. O'Connell, and the government. That

agreement explicitly provided that the services rendered by Dr.

O'Connell would be rendered "in the capacity[of] an independent

contractor."11 Moreover, the contract provided that Dr. O'Connell

would be solely liable for any liability producing act or omission by

himself, his agents or employees. In a related provision, the contract

required Dr. O'Connell to maintain at least $1,000,000 of insurance

for liabilities incurred while performing the contract. J.A. at 52 (Service Contract, Part I, ¶ 5). All employees of Dr. O'Connell were "selected, hired and paid at the discretion of Leo. P. O'Connell," without

receiving any compensation directly from the Air Force. Finally, the

United States exercised no control over day-to-day activities related

to interpreting radiologic film. Id. at 48-49 (Belcher Aff.).

The only arguably significant element of control over Dr.

O'Connell came in the form of an oversight provision pursuant to

which the Air Force reserved the right to "evaluate both [the] quality

of professional and administrative services rendered, including, for

example, the professional judgements, [sic] diagnosis [sic] or specific

medical treatments." Id. at 52 (Service Contract, Part I, ¶ 5). Robb

cites this provision as evidence that the Air Force has reserved the

right to control the exercise of professional judgment of Drs.

O'Connell and O'Hagan thereby creating an employer-employee relationship. This interpretation is misguided for two reasons. First, the

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11 While not dispositive of the matter, this provision demonstrates that

the parties did not believe an employer-employee relationship was created by the contract. See Restatement (Second) of Agency § 220(2)(i)

(relevant to distinguishing between an employee and an independent

contractor is "whether or not the parties believe they are creating the

relation of master and servant"); see also Lilly, 876 F.2d at 859 (discussing the intent of the parties to create an independent contractor relationship); Kramer v. United States, 843 F. Supp. 1066, 1072 (E.D. Va. 1994)

(discussing intent of the parties and the right of the government to

receive the benefit of its bargain in shifting the risk of loss from itself to

the doctor).

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authority reserved to the Air Force is the right "to evaluate [the] quality of . . . services rendered," not the right to control the professional

decisions of the physicians. This provision, like the one contained in

the MOU with F.G.J. discussed above, is merely a quality assurance

clause not inconsistent with the conclusion that Dr. O'Connell is an

independent contractor. Second, the cited language must be viewed in

context. The passage isolated by Robb appears immediately following

the passage which provides that "the services rendered by the physician are rendered in the capacity [of] an independent contractor," and

immediately preceding the passage which states that"[t]he contractor

shall be solely liable for any liability producing act or omission, by

[sic] contractor, its agents, or employees, and expressly agrees to

indemnify the government against all liability or loss." Id.

Robb next argues that evidence of control by the government may

be inferred from the provision of the service contract requiring Dr.

O'Connell "to return all films and examination[sic] to the MTF

[Medical Treatment Facility] where they will remain the property of,

and subject to the exclusive control of the U.S. Government." Id. at

53 (Service Contract, Part II, ¶ 7). Far from providing evidence of

control, this provision, if anything, supports the government's position that Dr. O'Connell's practice is separate and distinct from the Air

Force.

Robb points out that the government was required to provide certain equipment and services for the performance of Dr. O'Connell's

duties under the contract, suggesting the existence of an employeremployee relationship. The provisions of the contract cited by Robb

indicate that the government agreed to provide use of the radiology

department, office space and associated equipment, a variety of support personnel services, forms, and office supplies. Id. at 54 (Service

Contract, Part IV, ¶¶ 1-5)). Robb, however, fails to cite an earlier portion of the contract which provides that Dr. O'Connell was required

to "furnish[ ] all labor, transportation, consultation, teaching report,

[sic] equipment, material, supplies, and supervision except as noted

in PART IV." Id. at 52 (Service Contract, Part I, ¶ 1). Read together,

this allocation of resources supports the government's position that

Dr. O'Connell and his staff were providing services as independent

contractors. The Air Force was required to make available a radiology

facility and some associated resources, but Dr. O'Connell agreed to

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provide all other "equipment, material, and supplies" to perform his

services. See Restatement (Second) of Agency§ 220(2)(e). Furthermore, it is uncontroverted that, while the contract authorized Dr.

O'Connell's access to the Langley facility for film reading, this rarely

if ever happened. J.A. at 49 (Belcher Aff.).

Finally, Robb argues that the explicit reservation of the right of the

government to refer patients to civilian practitioners is evidence that

Dr.O'Connell was an employee of the government. Again, if relevant

at all, this factor appears to favor the government's position. Rather

than showing that the government controlled the professional judgment of Dr. O'Connell, this provision is an example of an area in

which the government has withheld discretionary authority and, to

that extent, obviated the need for supervision.

We conclude that Dr. O'Hagan was acting as an independent contractor while working for Dr. O'Connell under the service contract

with the Air Force. The contract explicitly identified Dr. O'Connell

as an independent contractor, Dr. O'Connell agreed to assume sole

liability for the acts and omissions of himself and his employees, and

Dr. O'Connell was required to buy liability insurance to cover the risk

he assumed. Dr. O'Connell selected and paid Dr. O'Hagan directly,

he was required to provide most of the necessary equipment for performing under the contract, and almost none of the film reading

occurred at the Langley facility. As with Dr. Stroy, the combination

of these factors and the government's lack of control over Dr.

O'Hagan's daily medical judgments render him an independent contractor.

IV.

Robb argues that, even if Drs. Stroy and O'Hagan are independent

contractors, the United States should be held liable for their alleged

negligence pursuant to Virginia's continuing treatment rule. The continuing treatment rule, under Virginia law, tolls the two-year statute

of limitations in certain malpractice actions. Under the rule, the statute of limitations begins to run, not at the time of the initial act of

malpractice, but rather at the termination of a substantially uninterrupted course of improper examination or treatment by the same physician for the same or a related illness or injury. See Grubbs v. Rawls,

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235 Va. 607, 369 S.E.2d 683 (1988); Farley v. Goode, 219 Va. 969,

252 S.E.2d 594 (1979).

Robb's reliance on this doctrine is misplaced. There is no suggestion in this case that Robb's claim was time barred. Rather, Robb is

attempting to attribute negligence to the active-duty personnel who

had no connection with the initial act of alleged negligence. Moreover, Robb has not appealed the district court's judgment finding no

negligence on the part of the active-duty personnel. The doctrine of

continuing treatment is simply not applicable to the facts of this case.12

V.

For the foregoing reasons, the order of the district court granting

the government's motion to dismiss for lack of subject matter jurisdiction is

AFFIRMED.

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12 Robb alleges that "at no time did [he] know (or have any way of

knowing) whether a contractor or an active duty physician was assigned

to treat [him]." By this we take Robb to be arguing that the government

is equitably estopped from denying liability for the actions of F.G.J. In

light of the facts set forth elsewhere in this opinion and Robb's failure

to allege even a single act of affirmative misconduct on the part of the

government we reject this claim. See United States v. Agubata, 60 F.3d

1081, 1083 (4th Cir. 1995), cert. denied, ___ U.S. ___, 1995 WL 647999

(U.S. Feb. 20, 1996); Kramer, 843 F. Supp. at 1072-73.

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