On November 21, 2024, the HHS Office of the Inspector General (OIG) issued Advisory Opinion 24-09.  The opinion relates to a proposal by a municipal ambulance service to begin billing health insurances for treatment-in-place (TIP) services.

The Requestor historically did not charge patients or their insurance when it would respond to a 911 call and treat the patient at the scene.  The Requestor indicated that it was considering the implementation of a charge for TIP services furnished in connection with a 911 response.  This charge would be based on the level of care furnished to the patient at the scene, and would not exceed the amounts the Requestor currently charged for the same level of service furnished in connection with an ambulance transport.  The Requestor indicated that it would impose this charge for all forms of third-party health insurance (i.e., it would bill both Federal health care programs and commercial insurers); however, the Requestor stated that it would not charge uninsured patients for TIP services.  Under the proposed arrangement, the requestor would also agree to accept payment from a patient’s health insurance as payment-in-full, i.e., the Requestor would waive any cost-sharing amounts imposed by the patient’s health insurance.

For background purposes, there currently exists a safe harbor to the Federal anti-kickback statute (AKS) for cost-sharing waivers for emergency ambulance services[1].  To qualify for protection under the safe harbor, certain conditions must be met.  These include requirements that: (1) the ambulance provider or supplier be owned and operated by a state, a political subdivision of a state, or a recognized tribal organization, (2) the ambulance provider or supplier provide “emergency responses,” (3) the ambulance provider or supplier offers the reduction or waiver on a uniform basis to all of its residents or tribal members, or to all individuals transported, and (4) that the ambulance provider or supplier not claim the waived amounts as bad debt for payment purposes under a Federal health care program.  It is the requirement that the waiver be offered on a uniform basis to “all individuals transported” that created the potential need for the advisory opinion.

In other words, the Requestor was attempting to clarify whether the safe harbor was limited to ambulance transports, or whether the OIG would be willing to extend the protections of the safe harbor to all ambulance services, including TIP service.

As part of its analysis, the OIG first determined that the proposed arrangement would result in remuneration in the form: (1) cost-sharing waivers for TIP services covered by patients with commercial insurers and a handful of Medicare Advantage plans that currently cover TIP services and (2) services provided at no charge to patients that lack health insurance.  The OIG further determined that this remuneration would implicate both the Federal anti-kickback statute (AKS) and the prohibition on beneficiary inducements.  To reach this conclusion, the OIG noted that the cost-sharing waivers might induce Federal health care program beneficiaries to elect to receive other EMS services from the Requestor.  The OIG then determined that the proposed arrangement would not qualify under any of the existing safe-harbors.  Specifically, the OIG determined that the proposed arrangement would not fall under the existing safe harbor for emergency ambulance services because TIP services are not currently covered under the Medicare Program or the majority of State Medicaid Programs.  The OIG further noted that, even if a State Medicaid Program did cover TIP services, the arrangement would still not qualify for the safe harbor because the safe harbor currently only covers ambulance transportation services.  

While not qualifying for protection under an existing safe harbor, the OIG nonetheless determined that the proposed arrangement carried little risk of fraud or abuse.  The OIG based this determination on several factors.  First, the cost-sharing waiver would be applied to all patients receiving TIP services, regardless of their insurance.  Second, because neither Medicare nor the majority of State Medicaid Programs currently cover TIP services, the arrangement would not result in any meaningful costs being incurred Federal health care programs.  By contrast, the OIG noted that the arrangement might reduce Federal health care program expenditures, by avoiding the need for ambulance transportation and subsequent hospital care.  Third, even in those states where Medicaid paid for TIP services, the arrangement was unlikely to increase utilization of EMS services.  Finally, the OIG determined that the cost-sharing waivers were unlikely to “meaningfully affect” a patient’s decision to use the Requestor for further ambulance services, noting that patients’ future EMS usage is more likely to be impacted by other factors, including the patient’s location and the decisions made by a 911 dispatcher.  For these reasons, the OIG issued a favorable advisory opinion.

The advisory opinion is notable because it is the first time the OIG has addressed the issue of cost-sharing waivers unrelated to an actual ambulance transport.  As part of its opinion, the OIG acknowledged the potential benefits of TIP services, including their potential to decrease overall Federal health care program expenditures.  The opinion also suggests that the OIG does not view TIP services as creating new compliance risks distinct from those raised by ambulance transportation in general.  Thus, the opinion suggests that if the Medicare Program were to extend its ambulance benefit package to include TIP services at some point in the future, the OIG would likely be open to extending the current safe harbor to cover TIP services as well.

[1] 42 C.F.R. §1001.953(k)(4).