The OIG is especially interested in the comments and suggestions the ambulance industry and affiliated providers may have regarding this draft CPG. The OIG recognizes that the ambulance industry is made up of entities of enormous variation: Some ambulance companies are large, many are small; some are forprofit, many are notforprofit; some are affiliated with hospitals, many are independent; and some are operated by municipalities or counties, while others are commercially owned. Consequently, this guidance is not intended to be a onesizefitsall guide on ambulance supplier compliance programs. Rather, like the previous OIG CPGs, this guidance is intended as a helpful tool for those entities that are considering establishing a voluntary compliance program, or for those that have already done so and are seeking to analyze, improve or expand existing programs.\3\ As with the OIG's previous guidance, the guidelines discussed in this CPG are not mandatory. Nor do they represent an allinclusive document containing all the components of a compliance program. Other OIG outreach efforts, as well as other Federal agency efforts to promote compliance, can also be used in developing a compliance guidance.
\3\ To date, the OIG has issued compliance program guidance for the following nine industry sectors: (1) Hospitals; (2) clinical laboratories; (3) home health agencies; (4) durable medical equipment suppliers; (5) thirdparty medical billing companies; (6) hospices; (7) Medicare+Choice organizations offering coordinated care plans; (8) nursing facilities; and (9) individual and small group physician practices. The guidances listed here and referenced in this document are available on the OIG website at www.oig.hhs.gov in the Fraud Prevention and Detection section.

A. Scope of the Compliance Program Guidance

This guidance focuses on compliance measures related to services furnished primarily to the Medicare program, and to a limited extent, other Federal health care programs. (See, e.g., section IV for a brief discussion of Medicaid
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ambulance coverage.) Issues related to private payor claims and services covered by private payors may also be covered by an ambulance supplier compliance program if the supplier so desires.

B. Basic Elements of a Compliance Program

While information and guidance furnished in this CPG may form the basic framework for developing a compliance program, this guidance is not by itself a compliance program. The basic components that have become accepted as the building blocks of an effective compliance program are: (1) Developing compliance policies and procedures; (2) designating a compliance officer or contact person(s); (3) conducting appropriate training and education; (4) conducting internal monitoring and reviews; (5) responding appropriately to detected offenses and developing corrective actions; (6) developing open lines of communication; and (7) enforcing disciplinary standards through well publicized guidelines. The components of a compliance program are briefly discussed below with a more indepth discussion in section II of this CPG.

1. Development of Compliance Policies and Procedures

The ambulance supplier should develop and distribute written standards of conduct, as well as written policies and procedures, which promote the ambulance supplier's commitment to compliance and address specific areas of potential fraud or abuse. These written policies and procedures should be reviewed periodically (e.g., annually) and revised as appropriate to ensure they are current and relevant. (See section II.A.1 of this CPG for a more indepth discussion of the development of policies and procedures.)

2. Designation of a Compliance Officer

The ambulance supplier should designate a compliance officer and other appropriate bodies (e.g., a compliance committee) charged with the responsibility for operating and monitoring the organization's compliance program. The compliance officer should be a highlevel individual in the organization who reports directly to upper management, such as the chief executive officer or Board of Directors. The OIG recognizes that an ambulance supplier may tailor the job functions of a compliance officer position by taking into account the size and structure of the organization, existing reporting lines, and other appropriate factors.

3. Education and Training Programs

Compliance programs must include as a key element the regular training and education of employees and other appropriate individuals. Training content should be tailored appropriately and should be delivered in a way that will maximize the chances that the information will be understood by the target audience. This CPG discusses training in more detail in section II.A.2.

4. Internal Monitoring and Reviews

Ambulance suppliers should develop and use appropriate monitoring methods to detect and identify problems, and to help reduce the future likelihood of problems. Claims and system reviews are a common internal monitoring method and are discussed in greater detail in section II.A.3 of this CPG.

5. Responding Appropriately to Detected Misconduct

Ambulance suppliers should develop policies and procedures directed at ensuring that the organization responds appropriately to detected offenses, including the initiation of appropriate corrective action. An organization's response to detected misconduct will vary based on the facts and circumstances of the offense. However, the response should always be appropriate to resolve and correct the situation in a timely manner. The organization's compliance officer, and legal counsel in some circumstances, should be involved in situations when serious misconduct is identified.

6. Developing Open Lines of Communication

Ambulance suppliers should create and maintain a process, such as a hotline or other reporting system, to receive and process complaints and to ensure effective lines of communication between the compliance officer and all employees. Further, procedures should be adopted to protect the anonymity of complainants, where the complainant desires to remain anonymous, and to protect whistleblowers from retaliation. 7. Enforcing Disciplinary Standards Through WellPublicized Guidelines

Ambulance suppliers should develop policies and procedures to ensure that there are appropriate disciplinary mechanisms and standards that are applied in an appropriate and consistent manner. These policies and standards should address situations in which employees or contractors violate, whether intentionally or negligently, internal compliance policies, applicable statutes, regulations, or other Federal health care program requirements.\4\

Developing and implementing a compliance program may require significant resources and time. An individual ambulance supplier is best situated to tailor compliance measures to its own organizational structure and financial capabilities. In addition, compliance programs should be reviewed periodically to account for changes in the health care industry, Federal health care statutes and regulations, relevant payment policies and procedures, and identified risks.
\4\ The term ``Federal health care programs'' is applied in this CPG as defined in 42 U.S.C. 1320a7b(f), which includes any plan or program that provides health benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government (i.e., through programs such as Medicare, Federal Employees' Compensation Act, Black Lung, or the Longshore and Harbor Workers' Compensation Act) and any State health plan (e.g., Medicaid, or a program receiving funds from block grants for social services or child health services). Also, for purposes of this CPG, the term ``Federal health care program requirements'' refers to statutes, regulations, rules, requirements, directives, and instructions governing the Medicare and other Federal health care programs.

Accordingly, the OIG has attempted to take into consideration the Centers for Medicare and Medicaid Services' (CMS) recent adoption of the fee schedule for payment of ambulance services. The CMS's ambulance fee schedule is the product of a negotiated rulemaking process and will replace the current retrospective, reasonable cost reimbursement system for providers and the reasonable charge system for suppliers of ambulance services.\5\ As appropriate, the OIG may update or supplement this CPG to address new identified risk areas following the implementation of the ambulance fee schedule.
\5\ The CMS's final ambulance fee schedule was published in the Federal Register on February 27, 2002 (67 FR 9100) and went into effect on April 1, 2002.
II. Elements of a Compliance Program for Ambulance Suppliers

Like other sectors of the health care industry, most ambulance suppliers are honest suppliers trying to deliver quality ambulance transportation services. However, like other health care industry sectors, the ambulance industry has seen its share of fraudulent and abusive practices. The OIG has reported and pursued a number of different fraudulent practices in the ambulance transport field involving, among others:

To help reduce the incidence and prevalence of fraudulent or abusive conduct, an ambulance supplier should consider the following guidance and adapt the OIG's suggestions to conform with any unique ambulance supplier elements.

A. Evaluation and Risk Analysis

It is prudent for ambulance suppliers conducting a risk analysis to begin by performing an evaluation of internal operations as well as factors that affect such operations (e.g., Federal health care program requirements). In many cases, such evaluation will result either in the creation and adoption of written policies and procedures or the revision thereof. The evaluation process may be simple and straightforward or it may be fairly complex and involved. For example, an evaluation of whether an ambulance supplier's existing written policies and procedures accurately reflect current Federal health care program requirements is straightforward. However, an evaluation of whether an ambulance supplier's actual practices conform to its policies and procedures may be more complex and require several analytical evaluations to determine whether system weaknesses are present. Even more complex is an evaluation of an ambulance supplier's practices when there are no preexisting written policies and procedures and the subsequent analysis of whether the particular supplier's practices comply with applicable statutes, regulations, and other program requirements.

The evaluation process should furnish ambulance suppliers with a snapshot of their strengths and weaknesses and thus assist providers in recognizing areas of potential risk. We suggest that ambulance suppliers evaluate a variety of practices and factors, including their policies and procedures, employee training and education, employee knowledge and understanding, claims submission process, coding and billing, accounts receivable management, documentation practices, management structure, employee turnover, contractual arrangements, changes in reimbursement policies, and payor expectations.

1. Policies and Procedures

Because policies and procedures represent the written standard for daily operations, an ambulance supplier's policies and procedures should describe the normal operations of an ambulance supplier and the applicable rules and regulations. Further, written policies and procedures should go through a formal approval process within the organization and should be evaluated on a routine basis, and updated as needed, to reflect current ambulance practices (assuming these practices are appropriate and comport with the relevant statutes, regulations, and program requirements). In addition, ambulance suppliers should review policies and procedures to ensure that they are representative of actual practices. For example, an ambulance supplier's policy for reviewing ambulance call reports (ACR) should not state that it will review 100 percent of its ACRs, unless the ambulance supplier is capable of performing and enforcing such comprehensive reviews. If certain policies and practices become genuinely impractical, we recommend that such policies and procedures be updated to reflect alternative, acceptable practices that conform to legal and regulatory requirements.

2. Training and Education

Ensuring that a supplier's employees and agents receive adequate education and training is essential to minimizing risk. Employees should clearly understand what is expected of them, and for what they will be held accountable. Suppliers should also document and track the training they provide to employees and pertinent personnel.

An ambulance supplier should consider offering two types of compliance training: compliance program training and jobspecific training. If an ambulance supplier is implementing a formal compliance program, employees should be trained on the elements of the program, the importance of the program to the organization, the purpose and goals of the program, what the program means for each individual, and the key individuals responsible for ensuring that the program is operating successfully. Compliance program education should be available to all employees, even those whose job functions are not directly related to billing or patient care.

Ambulance suppliers should also train employees on specific areas with regard to their particular job positions and responsibilities, whether or not as part of a formal compliance plan. The intensity and the nature of the specific training will vary by employee type. Training employees on the job functions of other people in the organization may also be an effective training tool. Such appropriate crosstraining improves employees' overall awareness of compliance and job functions, thereby increasing the likelihood that an individual employee will recognize noncompliance. Training should be provided on a periodic basis to keep employees current on ambulance supplier requirements, including, for example, the latest payor requirements. Ambulance suppliers should conduct or make available training for employees at least yearly and more often as needed.

Generally, employees who attend interactive training better comprehend the material presented. Interactive training offers employees the chance to ask questions and receive feedback. When possible, ambulance suppliers should use ``real'' examples of compliance pitfalls provided by personnel with ``real life'' experience, such as emergency medical technicians and paramedics.

The OIG is cognizant that offering interactive, live training often requires significant personnel and time commitments. As appropriate, ambulance suppliers may wish to consider seeking, developing, or using other innovative training methods. Computer or internet modules may be an effective means of training if employees have access to such technology and if a system is developed to allow employees to ask questions. The OIG cannot endorse any commercial training productit is up to each ambulance supplier to determine if the training methods and products are effective and appropriate.

Whatever form of training ambulance suppliers provide, the OIG also recommends that employees complete a post compliance training test or questionnaire to verify comprehension of the material presented. This will allow a supplier to assess the effectiveness and quality of its training materials and techniques. Additionally, training materials should be updated as appropriate and presented in a manner that is understandable by the average trainee. Finally, the OIG suggests that the employees' attendance at, and completion of, training be tracked and appropriate documentation maintained.
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3. Assessment of Claims Submission Process

Ambulance suppliers should conduct periodic claims reviews to verify that a claim ready for submission, or one that has been submitted and paid, contains the required, accurate, and truthful information required by the payor. An ambulance claims review should focus, at a minimum, on the documentation present in the ACR, the medical necessity of the transport as determined by payor requirements, the coding of the claim, the copayment collection process, and the subsequent payor reimbursement. The claims reviews should be conducted by individuals with experience in coding and billing and they should be familiar with the different payors' coverage and reimbursement requirements for ambulance services. The reviewers should be independent and objective in their approach. Claims reviewers who analyze claims that they themselves prepared or supervised often lack sufficient independence to accurately evaluate the claims submissions process and the accuracy of individual claims. Additionally, the appearance of a lack of independence may also hinder the effectiveness of a claims review.

Depending on the purpose and scope of a claims review, there are a variety of ways to conduct the review. The claims review may focus on particular areas of interest (i.e., coding accuracy) or it may include all aspects of the claims submission and payment process. The universe \6\ from which the claims are selected will comprise the area of focus for the review. Once the universe of claims has been identified, an acceptable number of claims should be randomly selected. Because the universe of claims will vary as will the variability of items in the universe, the OIG cannot specify a generally acceptable number of claims for purposes of a claims review. However, the number of claims sampled and reviewed should sufficiently ensure that the results are representative of the universe of claims from which the sample was pulled.
\6\ The term ``universe'' is referred to in this CPG to mean the generally accepted definition used when performing a statistical analysis. Specifically, the term ``universe'' means the total number of sampling units from which the sample was selected.

Ambulance suppliers should not only monitor identified errors, but also evaluate the source or cause of the errors. For example, an ambulance supplier may identify through a review a certain claims error rate. Upon further evaluation, the ambulance supplier may determine that the errors were a result of inadequate documentation. Further evaluation may reveal that the documentation deficiencies involve a limited number of individuals who work on a specific shift. It is the ambulance supplier's responsibility to identify such weaknesses and to promptly correct them. In this example, at a minimum, additional employee training would be required along with the repayment of any identified overpayment. Such a detailed and logical process of analysis will make claims reviews useful tools for identifying risks, correcting weaknesses, and preventing future occurrences of errors.

Ambulance suppliers should also consider using a baseline audit to develop a benchmark from which to measure performance. This audit will establish a consistent methodology for selecting and examining records in future audits. It is helpful to chart and track the results of each of the audits to document progress. The results of each subsequent audit will indicate whether further actions are appropriate. Comparing audit results from different audits will generally yield useful results only when the audits analyze the same or similar information and when matching methodologies are used. For example, results of audits of a supplier's compliance with the physician certification statement requirements for nonemergency transports and a supplier's compliance with ambulance and vehicle licensure cannot be readily compared. The trending information may need to be broken out and separately analyzed to track compliance.

As part of its compliance efforts, an ambulance supplier should document (i) how often audits or reviews are conducted and (ii) the information reviewed for each audit. In addition, the results of such reviews should be compared to previous findings to determine if a problem persists or if the supplier's corrective actions are working. The ambulance supplier should not only use internal benchmarks, but should utilize external information, if available, to establish benchmarks (e.g., data from other ambulance suppliers, associations, or from carriers). Additionally, risk areas may be identified from the results of the audits.

If, as a result of the audit, a material deficiency is identified that could be a potential criminal, civil, or administrative violation, the ambulance supplier may disclose the matter to the OIG via the Provider SelfDisclosure Protocol.\7\ The Provider SelfDisclosure Protocol was designed to allow providers/suppliers to disclose voluntarily potential violations in their dealings with the Federal health care programs.
\7\ The OIG encourages that providers/suppliers police themselves, correct underlying problems, and work with the Government to resolve any problematic practices. The OIG's Provider SelfDisclosure Protocol, published in the Federal Register on October 30, 1998 (63 FR 58399), sets forth the steps, including a detailed audit methodology, that may be undertaken if suppliers wish to work openly and cooperatively with the OIG. The Provider Self Disclosure Protocol is open to all health care providers and other entities and is intended to facilitate the resolution of matters that, in the provider's reasonable assessment, may potentially violate Federal criminal, civil, or administrative laws. The Provider SelfDisclosure Protocol is not intended to resolve simple mistakes or overpayment problems. The OIG's SelfDisclosure Protocol can be found on the OIG web site at www.oig.hhs.gov. a. PreBilling Review of Claims

As a general matter, ambulance suppliers should review claims on a prebilling basis to identify errors before claims are submitted. If there is insufficient documentation to support the claim, the claim should not be submitted for payment until it is determined by a responsible person within the organization that the appropriate, adequate documentation exists to support the claim. Prebilling reviews also allow suppliers to review the medical necessity of their claims before they are submitted for reimbursement. If, as a result of the prebilling claims review process, a pattern of claim submission or coding errors is identified, the ambulance supplier should develop a responsive action plan (see section II.C), which would include a plan to ensure that overpayments are identified and repaid.

b. Paid Claims

In addition to a prebilling review, a review of paid claims may be necessary to determine error rates and quantify overpayments and/or underpayments. The postpayment review may help ambulance suppliers in identifying billing or coding software system problems. Any overpayments identified from the review should be promptly returned to the appropriate payor in accordance with payor policies.

c. Claims Denials

Ambulance suppliers periodically should review their claims denials from payors to determine if denial patterns exist. If a pattern of claims denials is detected, the patterns should be evaluated to determine the cause and appropriate course of action. Employee education regarding proper
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documentation, coding, or medical necessity may be appropriate. If an ambulance supplier believes its carrier or payor is not adequately explaining the basis for its denials, the ambulance supplier should seek clarification in writing.

4. System Reviews and Safeguards

Periodic review and testing of a supplier's coding and billing systems are also essential to detect system weaknesses. One reliable systems review method is to analyze in detail the entire process by which a claim is generated, including how a transport is documented and by whom, how that information is entered into the supplier's automated system (if any), coding and medical necessity determination protocols, billing system processes and controls, including any edits or data entry limitations, and finally the claims generation, submission, and subsequent payment tracking processes. A weakness or deficiency in any part of the supplier's system can lead to improper claims, undetected overpayments, or failure to detect system defects.

Each ambulance supplier should have computer or other system edits to ensure that minimum data requirements are met. For example, documentation of ambulance transports must now indicate the point of pickup of the beneficiary. Under CMS's new fee schedule for ambulance services, each transport claim that does not have an originating zip code listed should be ``flagged'' by the system. Other edits should be established to detect improper claims, such as emergency codes used when the destination is something other than an emergency room. A systems review is especially important when documentation or billing requirements are modified or when an ambulance supplier changes its billing software or claims vendors. As appropriate, ambulance suppliers should communicate with their carrier when they are implementing significant changes to their system to alert the carrier to any unexpected delays, or increases or decreases in claims submissions.

Ambulance suppliers have the responsibility of ensuring that their electronic or computer billing systems are not automatically inserting information that is not supported by the documentation of the medical or trip sheets (e.g., whether physician signature was obtained). Billing systems targeting optimum efficiency may be set with defaults to indicate, for example, that a physician's signature was obtained following an emergency room transport. Conversely, if information is automatically inserted onto a claim submitted for reimbursement, and that information is false, the ambulance supplier's claims will be false. If a required field on a claim form is missing information, the system should flag such a claim prior to its submission.

5. Sanctioned Suppliers

Federal law prohibits Medicare payment for services furnished by an excluded individual, such as an excluded ambulance crewmember. Accordingly, with respect to its existing employees and contractors, ambulance suppliers should periodically (at least yearly) check the OIG's and General Services Administration's (GSA) web sites to ensure that they do not employ or contract with individuals or entities that have been recently convicted of a criminal offense related to health care or who are listed as debarred, excluded or otherwise ineligible for participation in Federal health care programs. Additionally, ambulance suppliers should query the OIG and GSA exclusion and debarments lists before they employ or contract with new employees and new contractors. The OIG and GSA websites are listed at www.oig.hhs.gov and www.arnet.gov/epls respectively, and contain specific instructions for searching the exclusion and debarment databases.\8\
\8\ Ambulance suppliers should read the OIG's September 1999 Special Advisory Bulletin, entitled ``The Effect of Exclusion From Participation in the Federal Health Care Programs,'' published in the Federal Register on October 7,1999 (64 FR 58851) and is located at www.oig.hhs.gov/frdalrt, for more information regarding excluded individuals and entities and the effect of employing such
individuals or entities.

B. Identification of Risks

This ambulance CPG discusses many of the areas that the ambulance industry, the OIG, and CMS have identified as common risks for many ambulance suppliers. Apart from the risks identified in this CPG, ambulance suppliers of all types (e.g., small, large, rural, emergency, nonemergency) should identify if they have any unique risks attendant to their business relationships or processes. An ambulance supplier may have certain unique characteristics that will affect its risk areas. For example, small, rural notforprofit ambulance suppliers may identify risk areas different from those of a large, forprofit ambulance chain that competes with multiple other ambulance suppliers. This CPG may not identify or discuss all risks that an ambulance supplier may itself identify. Moreover, the CPG may ascribe more or less risk to a particular practice area than an ambulance supplier would encounter based on its own internal findings and circumstances. Because there are many different types of risk areas, ambulance suppliers should prioritize their identified risks to ensure that the various areas are addressed appropriately.

To stay abreast of risks affecting the ambulance and other health care industries, the OIG recommends that ambulance suppliers review OIG publications regarding ambulance services, including OIG Advisory Opinions, OIG Fraud Alerts, Office of Evaluations and Inspections (OEI) reports, and Office of Audit Services (OAS) reports, all located on the OIG's web site at www.oig.hhs.gov. A review of industry specific trade publications will also help ambulance suppliers stay current on the industry changes. Ambulance suppliers, like others in the health care industry, should devote the necessary resources to ensure compliance with relevant requirements. Effective internal controls will help to prevent or reduce instances of mistakes, errors, fraud and/or abuse. C. Response to Identified Risks

Following an ambulance supplier's process of evaluation and identification of its risks, a reasonable response should be developed to address appropriately identified risk areas. Determining how identified problems respond to corrective actions may require continual oversight. However, developing timely and appropriate responsive actions demonstrates to an ambulance supplier's employees and other interested parties (e.g., payors, the OIG, etc.) its level of commitment to address problems and concerns.

Ambulance suppliers should develop protocols and reasonable timeframes for responding to identified problems. Ambulance suppliers can identify in advance and through a written protocol how certain situations will be addressed, including the internal reporting obligations and involvement, if appropriate, of legal counsel. Such response protocols should include a monitoring process by which the issue will be revisited on an as needed basis.
III. Specific Fraud and Abuse Risks Associated with Medicare Ambulance Coverage and Reimbursement Requirements

Ambulance suppliers should, at a minimum, review and understand applicable ambulance coverage requirements. Ambulance suppliers that are not complying with applicable requirements should take appropriate prompt corrective action to follow the
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standards set forth. The new Medicare ambulance fee schedule covers seven levels of service including Basic Life Support (BLS), Advanced Life Support, Level 1 (ALS1), Advanced Life Support, Level 2 (ALS2), Specialty Care Transport, Paramedic ALS Intercept, Fixed Wing Air Ambulance, and Rotary Wing Air Ambulance.\9\ Generally, Medicare Part B covers ambulance transports if applicable vehicle and staff requirements, medical necessity requirements, billing and reporting requirements, and origin and destination requirements are met. Medicare Part B will not pay for ambulance services if Part A has paid directly or indirectly for the same services (e.g., a transport from a skilled nursing facility to a hospital).
\9\ The Negotiated Rulemaking Committee on the Medicare Ambulance Services Fee Schedule used the National EMS Education and Practice Blueprint as the basis for defining the levels of ambulance service.

A. Medical Necessity

There have been a number of transportation fraud cases against the Medicare and Medicaid programs involving medically unnecessary transport. Consequently, medical necessity is a risk area that should be addressed in an ambulance supplier's compliance program. Medicare Part B covers ambulance services only if the beneficiary's medical condition contraindicates another means of transportation. The medical necessity requirements vary depending on the status of the ambulance transport (i.e., emergency transport vs. nonemergency transport). If the medical necessity requirement is met, Medicare Part B covers ambulance services when a beneficiary is transported:

1. Upcoding

Notwithstanding local or state ordinance requirements regarding ambulance staffing and allALS mandated services,\10\ ambulance suppliers should use caution to bill, at the appropriate level, for services actually provided. The Federal Government has prosecuted a number of ambulance cases involving upcoding from BLS to ALS related to both emergency and nonemergency transports. In 1999, for example, an OIG investigation determined that an ambulance supplier was not only billing for ALS services when BLS services were provided, but the ambulance supplier did not employ an ALS certified individual to perform the necessary ALS services. This supplier paid civil penalties and signed a 5year Corporate Integrity Agreement (CIA).
\10\ Payment for ALS transports provided at the BLS level will be phased in over CMS's ambulance fee schedule transition period. 2. NonEmergency Transports

There have also been a number of Medicare fraud cases involving (i) nonemergency transports to noncovered destinations and (ii) transports that were not medically necessary. An OIG OEI report \11\ issued in December 1998 found that a high number of nonemergency transports for which Medicare claims were submitted were medically unnecessary as defined by Medicare's criteria.\12\ The report indicated, for example, that certain surveyed patients had been sitting unaided in a chair the day of and the day after the ambulance transport. Another patient was found sitting in a wheelchair when the ambulance arrived and refused assistance to get back to bed. These patients did not meet the Medicare coverage criteria for nonemergency transports and could have been transported by means other than by ambulance.
\11\ OIG Report, OEI099500412 is available on the OIG's web site at www.oig.hhs.gov/oei. \12\ Medicare's ambulance fee schedule identifies nonemergency transport as appropriate if the beneficiary is bed confined and it is documented that the beneficiary's medical condition is such that other methods of transportation are contraindicated, or if his or her medical condition, regardless of bedconfinement, is such that transportation by ambulance is medically required. In determining whether a beneficiary is bedconfined, the following criterial must be met: (1) The beneficiary is unable to get up from bed without assistance; (2) the beneficiary is unable to ambulate; and (3) the beneficiary is unable to sit in a chair or wheelchair. 42 CFR 410.40(d).

In addition, an August 2001 report \13\ conducted by the OIG's OAS at the request of a Medicare Part B carrier, determined that an ambulance supplier received significant overpayments. For example, of the 100 trip sheets reviewed by the OIG, 99 of the trip sheets did not indicate whether the beneficiary was bedconfined.
\13\ August 20, 2001, OIG Report, A030100001 is available on the OIG's web site at www.oig.hhs.gov/oas.

There are instances when an ambulance supplier receives a call for assistance or transport of a patient who does not meet the medical necessity requirements. Due to various patient care and liability reasons, ambulance suppliers often transport patients who do not appear to meet Medicare's nonemergency medical necessity requirements. If an ambulance supplier determines that a transport is not covered by Medicare, the ambulance supplier should attempt to obtain a signed Advanced Beneficiary Notice (ABN) from the Medicare beneficiary. As part of the ABN process, the ambulance supplier should explain to the beneficiary that the service may not be covered by Medicare, in which case the patient will be responsible for payment of the transport and other noncovered services.

Under no circumstances should ambulance suppliers intentionally mischaracterize the condition of the patient at the time of transport in an effort to claim inappropriately that the transport was medically necessary under Medicare coverage requirements. In instances where it is not clear whether the service will be covered by Medicare, the ambulance provider should nonetheless appropriately document the condition of the patient and maintain records of the transport. Scheduled and Unscheduled Transports

Because of the potential for abuse in the area of nonemergency transports, Medicare has criteria for the coverage of nonemergency scheduled and unscheduled ambulance transports. For example, physician certification statements (PCS) should be obtained by an ambulance supplier to verify that the transport was medically necessary.\14\ The PCSs should provide adequate information on the transport provided for each individual beneficiary and each PCS must be signed by an appropriate physician or other appropriate health care
professional.\15\ Presigned and/or mass produced PCSs are not acceptable because they increase the opportunity for abuse. \14\ CMS (formerly the Health Care Financing Administration (HCFA)) Program Memorandum B0009 describes different options for ambulance suppliers having difficulty obtaining PCSs. See 42 CFR 410.40(d)(3)(iii), (iv). For beneficiaries not under the direct care of a physician, whether they reside at home or in a facility, a PCS is not required. Id. Sec. 410.40(d)(3)(ii).

\15\ 42 CFR 410.40(d).

Medicare does not cover transports for routine doctor and dialysis appointments when beneficiaries do not meet the Medicare medical necessity requirements. For example, Medicare does not normally pay for nonemergency scheduled or unscheduled ambulance transportation to a physician's office from a personal residence or nursing facility when a [[Page 39022]]
patient is able to ambulate. Similarly, ambulance services that are rendered for convenience or because other methods of more appropriate transportation are not available, do not meet Medicare's medical necessity requirements and claims for such services should not be submitted to Medicare for payment. For example, an ambulance provider was required to pay over $1 million dollars to the Federal Government and enter into a CIA with the OIG for billing for medically unnecessary ambulance trips and for noncovered ambulance trips to doctors' offices.

B. Documentation, Billing, and Reporting Risks

Currently, the HCFA 1491 or 1500 forms are the approved forms for requesting Medicare payment for ambulance services. Inadequate or faulty documentation is a key risk area for ambulance suppliers. The compilation of correct and accurate documentation (whether electronic or hard copy) is generally the responsibility of all the ambulance personnel, including the dispatcher who receives a request for transportation, the personnel transporting the patient, and the coders and billers submitting claims for reimbursement. When documenting a service, ambulance personnel should not make assumptions or inferences to compensate for a lack of information or contradictory information on a trip sheet, ACR, or other medical source documents.\16\
\16\ On December 28, 2000, the Department of Health and Human Services (HHS) released its final rule implementing the privacy provisions of the Health Insurance Portability and Accountability Act of 1996. The rule became effective in April 2001, and regulates access, use, and disclosure of personally identifiable health information by covered entities (health providers, plans, and clearinghouses). Guidance on an ambulance supplier's compliance with the HHS Privacy Regulations is beyond the scope of this CPG; however, it will be the responsibility of ambulance suppliers to comply. Most health plans and providers must comply with the rule by April 14, 2003. In the meantime, many organizations are considering and analyzing the privacy issues.

To ensure that adequate and appropriate information is documented, an ambulance supplier should gather and record, at a minimum, the following:

The appropriate diagnosis and procedure codes (e.g., ICD9, HCPCS/ CPT) should be used when submitting claims for reimbursement. The codes reported on the ambulance trip sheets or claim forms should be selected to describe most accurately the illness, injury, signs or symptoms associated with the patient and transport. Although ICD9 codes are universally known as diagnosis codes, coders use them to describe signs and symptoms.\17\ Coders are taught that the patient's condition should be coded to the highest level of certainty and specificity. Diagnostic code information should not be based on past medical history or prior conditions, unless such information also specifically relates to the patient's condition at the time of transport.
\17\ Only licensed physicians and certain other licensed practitioners can make determinations on a patient's diagnosis.

False or uncertain diagnoses should never be added to the trip sheets or claims to justify reimbursement. If there is a question on the proper code to use when coding from the trip sheet or preparing a bill that cannot be appropriately resolved within the organization's proper chain of command, the ambulance supplier should seek guidance, in writing, from its local carrier. In addition to obtaining written guidance, ambulance suppliers should maintain documentation of communication with its carrier. If the ambulance supplier experiences difficulty in obtaining clarification, it should submit with the claim a narrative explaining the issue and the basis for the selected choice. Copies of any carrier correspondence should be appropriately maintained by the ambulance supplier.
2. Origin/Destination RequirementsLoaded Miles \18\
\18\ Loaded miles refers to the number of miles that the patient is physically on board the emergency vehicle.

Medicare only covers transports for the time that the patient is physically in the ambulance. Effective January 1, 2001, ambulance suppliers must furnish the ``point of pickup'' zip code on each ambulance claim form.\19\ Under the new Medicare ambulance fee schedule, the point of pickup will determine the mileage payment rate as well as whether a rural adjustment factor will be applied to the base rate. The ambulance supplier should document the address of the point of pickup to verify that the zip code is accurate.
\19\ HCFA Program Memorandum Transmittal AB00118, issued on November 30, 2000.

The ambulance crew should accurately report the mileage traveled from the point of pickup to the destination. Medicare covers ambulance transports to the nearest available treatment facility. If the nearest facility is not appropriate (e.g., because of traffic patterns or lack of equipment), the beneficiary should be taken to the next closest and appropriate facility. If a beneficiary requests a transport to a facility other than the nearest appropriate facility, the ambulance supplier should inform the patient that he or she may be responsible for payment of the additional mileage incurred.

3. Multiple PayorsCoordination of Benefits

Ambulance suppliers should make every attempt to determine whether Medicare, Medicaid, or other Federal health care programs should be billed as the primary or as the secondary insurance. Claims for payment should not be submitted to more than one payor, except for purposes of coordinating benefits (e.g., Medicare as secondary payer). Section 1862(b)(6) of the Social Security Act (42 U.S.C. 1395y(b)(6)) states that an entity that knowingly, willfully, and repeatedly fails to provide accurate information relating to the availability of other health benefit plans shall be subject to a civil monetary penalty (CMP).

The OIG recognizes, particularly for ambulance suppliers that may have incomplete insurance information from a transported patient, that there are instances when the secondary payor is not known or cannot be determined before the ambulance transportation claim is submitted. In such situations, if it is determined that an inappropriate or duplicate payment is received, the payment should be refunded to the appropriate payor in a timely manner. Accordingly, ambulance suppliers should develop a system to track and quantify credit balances to return overpayments when they occur.
C. Medicare Part A Payment for ``Under Arrangements'' Services

In certain instances, including transports for patients of a SNF, hospital or CAH, Medicare Part A covers ambulance transports. Ambulance suppliers that provide such inpatient transports ``under arrangements'' should not bill Medicare for these transports. Medicare reimburses the facility under
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the Part A payment for the patient's entire Part A stay, including any predischarge ambulance transports. Thus, ambulance suppliers should not submit a claim to Medicare Part A or B for a service that was provided under arrangement with a Part A provider. In addition, all such arrangements should be carefully reviewed to ensure that there is no violation of the antikickback statute, as more fully described in section V of this CPG.

IV. Medicaid Ambulance Coverage

The Medicaid program, a joint Federal and State health insurance program, provides funds for health care providers and suppliers that perform or deliver medically necessary services for eligible Medicaid recipients. Medicaid regulations, to which ambulance suppliers must adhere, vary depending on the applicable State regulations. However, two Federal regulations form the basis for all Medicaid reimbursement for transportation services and ensure a minimum level of coverage for transportation services. All States that receive Federal Medicaid funds are required to assure transportation for Medicaid recipients to and from medical appointments (42 CFR 431.53). Federal regulations further define medical transportation and describe costs that can be reimbursed with Medicaid funds (42 CFR 440.170(a)).

In short, Medicaid often covers ambulance transports that are not typically covered by Medicare, such as coverage of transports in wheelchair vans, cabs and ambulettes. The State Medicaid Fraud Control Units and Federal law enforcement have pursued many fraud cases related to transportation services billed to Medicaid programs. Ambulance suppliers should review the Medicaid regulations governing their State or service territories to ensure that any billed services meet applicable Medicaid requirements.
V. Kickbacks and Inducements

A. What Is the AntiKickback Statute?

The antikickback statute prohibits the purposeful payment of anything of value (i.e., remuneration) in order to induce or reward the generation of Federal health care program business, including Medicare and Medicaid business.\20\ (See section 1128B(b) of the Social Security Act (42 U.S.C. 1320a7b).) It is a criminal prohibition that subjects violators to possible imprisonment and criminal fines. In addition, violations of the antikickback statute may give rise to CMPs and exclusion from the Federal health care programs. Both parties to an impermissible kickback transaction may be liable: the party offering or paying the kickback and the party soliciting or receiving it. The key inquiry under the statute is whether the parties intend to pay, or be paid, for referrals. An ambulance supplier should neither make nor accept payments intended to generate Federal health care program business.
\20\ In addition to Medicare and Medicaid, the Federal health care programs include, but are not limited to, TRICARE, Veterans Health Care, Public Health Service programs, and the Indian Health Services. [20]:

B. What Are the ``Safe Harbors''?

The Department has promulgated ``safe harbor'' regulations that describe payment practices that do not violate the antikickback statute, provided the payment practice fits squarely within a safe harbor. The safe harbor regulations can be found at 42 CFR 1001.952 and on the OIG web page at http://www.dhhs.gov/progorg/oig/ak/index.htm#. The safe harbor regulations are voluntary regulations. Thus, failure to comply with a safe harbor does not mean that an arrangement is illegal. Rather, arrangements that do not fit must be analyzed under the anti kickback statute on a casebycase basis to determine if there is a violation. To minimize the risk of a violation, ambulance suppliers should structure arrangements to take advantage of the protection offered by the safe harbors. Among the safe harbors potentially relevant to ambulance suppliers are the safe harbors for space and equipment rentals, personal services and management contracts, discounts, employees, price reductions offered to health plans, shared risk arrangements, and ambulance restocking arrangements.\21\ \21\ 42 CFR 1001.952 (b), (c), (d), (h), (i), (t), (u) and (v). [21]:

C. What Is ``Remuneration'' for Purposes of the Statute?

Under the antikickback statute, ``remuneration'' means virtually anything of value. A prohibited kickback payment may be in paid cash or inkind, directly or indirectly, covertly or overtly. Almost anything of value can be a kickback, including, but not limited to, money, goods, services, free rent, meals, travel, gifts, and investment interests. Paying for referrals need not be the only or primary purpose of a payment; as courts have found, if any one purpose of the payment is to induce or reward referrals, the statute is violated. (See section 1128B of the Social Security Act (42 U.S.C. 1320a7b).)

D. Who Is a Referral Source for Ambulance Suppliers?

Any person or entity in a position to generate Federal health care program business for an ambulance supplier is a potential referral source. Typically, these sources include, but are not limited to, governmental ``911'' or comparable emergency medical dispatch systems, private dispatch systems, first responders, hospitals, nursing facilities, assisted living facilities, home health agencies, physician offices and patients.

E. For Whom Are Ambulance Suppliers Sources of Referrals?

In some circumstances, ambulance suppliers furnishing ambulance services may be sources of referrals (i.e., patients) for hospitals, other receiving facilities, and second responders. Ambulance suppliers that furnish other types of transportation, such as ambulette or van transportation, may also be sources of referrals for other providers of Federal heath care program services, such as physician offices, diagnostic facilities, and certain senior centers. In general, ambulance suppliers, particularly those furnishing emergency services, have relatively limited abilities to generate business for other providers or inappropriately steer patients to certain emergency providers.
F. How Can Ambulance Suppliers Avoid Risk Under the AntiKickback Statute?

Because of the gravity of the penalties under the antikickback statute, ambulance suppliers are strongly encouraged to consult with experienced legal counsel about any financial relationships with potential referral sources. In addition, ambulance suppliers should review OIG guidance related to the antikickback statute, including advisory opinions, fraud alerts and Special Advisory Bulletins. Ambulance suppliers concerned about particular existing or proposed arrangements may obtain binding advisory opinions from the OIG.\22\ \22\ The procedures for applying for advisory opinions are set forth at 42 CFR part 1008 and on the OIG web page at
www.oig.hhs.gov/advopn/index.htm. All OIG advisory opinions are published on the OIG web page. Several published opinions involve ambulance arrangements and may provide useful guidance for ambulance suppliers. These include OIG Advisory Opinions 976, 983, 987, 98 13, 991, 992, 995, 007, 009, 0011, 0110, 0111, 0112, 0118, 022 and 023.

Ambulance suppliers should exercise common sense when evaluating existing
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or prospective arrangements under the antikickback statute. One good rule of thumb is that all arrangements for items or services between potential referral sources should be fair market value in an arm's length transaction not taking into account the volume or value of existing or potential referrals. For each arrangement, ambulance suppliers should carefully and accurately document how fair market value is determined (e.g., by market comparables, open competitive bidding, cost basis, etc.). Discounts should be accurately reflected and appropriately disclosed on all claims and cost reports filed with the Federal health care programs, and accurate and complete records should be kept of all discount arrangements. Ambulance suppliers should consult the safe harbor for discounts (42 CFR 1001.952(h)) when entering into discount arrangements.

Another good rule of thumb is that ambulance suppliers should exercise caution when selling services to purchasers who are also in a position to generate Federal health care program business for the ambulance supplier (e.g., skilled nursing facilities that purchase ambulance services for private pay and Part A patients, but refer Part B and Medicaid patients to the ambulance supplier). Any link or connection between the price offered to the seller and referrals of Federal program business will implicate the antikickback statute. In other words, ambulance suppliers should not offer purchasers with Federal health care program business a price that is lower than the price they would charge a purchaser with a comparable volume of business and no Federal health care program referrals.

A third good rule of thumb is that an ambulance supplier should not offer or provide gifts, free items or services, or other incentives of greater than nominal value to referral sources and should not accept such gifts and benefits from parties soliciting referrals from the ambulance supplier. In general, token gifts used on an occasional basis to demonstrate good will or appreciation (e.g., logo key chains, mugs or pens) will be considered to be nominal in value.
G. Are There Particular Arrangements to which Ambulance Suppliers Should be Alert?

Ambulance suppliers should review the following arrangements with particular care: \23\
\23\ This list of arrangements is intended to be illustrative, not exhaustive, of potential areas of risk under the antikickback statute.

1. Arrangements for Emergency Medical Services (EMS)

Contracts with cities or other EMS sponsors for the provision of emergency medical services may raise antikickback concerns. Ambulance suppliers should not offer anything of value to cities or other EMS sponsors in order to secure an EMS contract, nor should they condition an EMS contract on obtaining nonEMS ambulance business.\24\ While cities and other EMS sponsors may charge ambulance suppliers amounts to cover the costs of services provided to the suppliers, they should not solicit inflated payments in exchange for access to EMS patients, including access to dispatch services under ``911'' or comparable systems.
\24\ In general, ambulance suppliers may offer cities or other municipal entities free or reduced cost services for uninsured, indigent patients.

2. Arrangements With Other Responders

It many situations, it is common practice for a paramedic intercept or other first responder to treat a patient in the field, with a second responder transporting the patient to the hospital. In some cases, the first responder is in a position to influence the selection of the transporting entity. While fair market value payments for services actually provided by the first responder are appropriate, inflated payments by ambulance suppliers to generate business are prohibited, and the Government will scrutinize such payments to ensure that they are not disguised payments to generate calls to the transporting entity.

3. Arrangements With Hospitals and Nursing Facilities

Because hospitals and nursing facilities are key sources of non emergency ambulance business, ambulance suppliers need to take particular care when entering into arrangements with such institutions. (See, in particular, the second rule of thumb described above.) 4. Arrangements With Patients

Arrangements that offer patients incentives to select particular ambulance suppliers may violate the antikickback statute, as well as the CMP law prohibition against giving inducements to Medicare and Medicaid beneficiaries.\25\ Potentially prohibited areas include, but are not limited to, routine waivers of copayments, \26\ ``insurance programs'' offering patients purported coverage for the ambulance supplier's services only, and free goods and services. Ambulance suppliers may waive copayments based on good faith individualized assessments of financial need, so long as the availability of financial hardship waivers is not advertised.\27\
\25\ The CMP law prohibits giving anything of value to a Medicare or Medicaid beneficiary that the giver knows, or should know, is likely to influence the beneficiary to choose a particular practitioner, provider, or supplier of items or servi

FOR FURTHER INFORMATION CONTACT

Sonya Castro (202) 619-2078 or Joel Schaer (202) 6191306, Office of Counsel to the Inspector General.