Health Law Daily Discounted EMS training for local firefighters would not trigger sanctions
Tuesday, January 14, 2020

Discounted EMS training for local firefighters would not trigger sanctions

By Jeffrey H. Brochin, J.D.

Although the provision of free or below-market services to actual or potential referral sources is a suspect arrangement that may violate the federal anti-kickback statute, the OIG concluded that the Requestor’s specific arrangement posed a low risk of fraud.

The provision of discounted emergency medical services (EMS) to firefighters would not violate the anti-kickback statute, the HHS Office of Inspector General (OIG) concluded in an advisory opinion responding to an inquiry from the operator of a nonprofit hospital. The OIG considered several factors, including the fact that the contract with the city expressly disclaimed referrals to the hospital, in ruling that the arrangement posed a low risk for violating the statute, and therefore, was not one for which administrative sanctions would be imposed (OIG Advisory Opinion, No. 20-01January 8, 2020).

Training Facility part of charitable mission. A nonprofit health care system with locations throughout its metropolitan area, offers as part of its charitable mission, a variety of community benefit programs. Included in its programs is the operation of a state-of-the-art Training Facility designed to provide hands-on clinical training to health care professionals seeking to refine existing clinical skills and to acquire new skills. A range of health care providers may train at the Training Facility, and the Requestor certified that no other hospital within their metropolitan area has a comparable facility or offers similar training opportunities that allow emergency personnel to train in conditions that simulate complex rescue scenarios.

Discounts for training sessions. The Requestor offers a discount on certain costs for sessions at the Training Facility. To determine whether a session qualifies for the discount, the Requestor first evaluates whether the session educates health care providers who have a direct impact on patient care in the community. This analysis informs whether the training session is consistent with the Requestor’s nonprofit charitable mission and its statutorily required duties to provide community benefits and charity care. The Requestor also considers whether the session constitutes an education-related cost under the state’s statutory definition of community benefits. If both criteria are met, a training session is eligible for a discount equal to the fixed costs for the session.

Fire Department provides ambulance service. The local Fire Department is run by the municipality and operates the city’s emergency medical services (EMS) system that provides emergency medical care and transportation in the city. To furnish those services, the Fire Department uses paramedics who must be certified by the state and must meet credentialing standards. Given those certification and credentialing requirements, the Fire Department seeks out training opportunities for its paramedics. The Fire Department also maintains a fleet of ambulances that handle hospital transports. Significantly, a city ordinance stipulates that only the Fire Department may operate emergency ambulances for the purposes of furnishing emergency ambulance services within city.

Arrangement with the city. The Fire Department has used the Training Facility since 2014 for purposes of training its emergency personnel, and the Requestor concluded that the training sessions qualified for the Training Facility discount. The arrangement was formally memorialized in a written agreement that expressly disclaimed any referral requirements and which recited that the offer and amount of the Training Facility discount was not tied directly or indirectly to the volume or value of referrals between the Fire Department and Requestor. The Requestor further certified that there have been no statistically significant changes to the Fire Department’s transports to Requestor, and the Fire Department’s protocols with respect to hospital-destination decisions have not been substantively modified since Requestor began offering the Training Facility discount.

Specter of impropriety. The OIG’s position on the provision of free or below-market items or services to actual or potential referral sources is longstanding and clear: such arrangements are suspect and may violate the federal anti-kickback statute, depending on the circumstances. The Requestor’s provision of the Training Facility discount to a current and future referral source implicates the anti-kickback statute. However, after considering several factors, some of which are recited below, the OIG determined that the Requestor’s arrangement with the city presented a low risk of fraud and abuse under the anti-kickback statute.

Factors taken into consideration. The OIG noted that the arrangement posed little risk of overutilization or increased costs to any federal health care program, based on the Requestor’s having certified that the only medical transportation services the Fire Department provides are emergency transport services. Neither the number of federal health care program beneficiaries who require such services from the Fire Department nor the treatment these patients may receive at a hospital is related to the existence or implementation of the arrangement.

Several other factors in combination were also found to sufficiently mitigate the risk that the Fire Department would steer patients to the Requestor as a result of the arrangement. For example, as required by the state’s licensure regulations, the Fire Department’s medical director developed, approved, and implemented specific protocols for Fire Department personnel to follow when selecting destinations for emergency ambulance transports, that require hospital-destination decisions to be based on objective standards, and those protocols were not substantively modified since the arrangement commenced. In addition, the written agreement expressly disclaimed any referral requirements, and the Requestor certified that the offer and amount of the Training Facility Discount provided under the arrangement were not tied directly or indirectly to the volume or value of referrals between the parties. Also, since the arrangement commenced, there were no statistically significant changes to the Fire Department’s transports to the Requestor.

Based on the foregoing, the OIG concluded that although the arrangement could potentially generate prohibited remuneration under the anti-kickback statute if the requisite intent to induce or reward referrals of federal health care program business were present, the OIG would not impose administrative sanctions on the Requestor under sections 1128(b)(7) or 1128A(a)(7) of the Social Security Act in connection with the arrangement.

MainStory: TopStory OIGAdvisoryOpinions CMSNews AntikickbackNews BillingNews CoPNews ProgramIntegrityNews ProviderNews

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