The final "safe harbor" regulation on ambulance restocking was published by the OIG in the Federal Register on December 4, 2001. The regulations, which become effective on January 3, 2002, establish "safe harbors" under the Federal Anti-Kickback Statute to permit, under certain conditions, the replenishing of drugs, linens and supplies by hospitals to ambulance services. There are some significant changes from the proposed regulations published last year.

In brief, the safe harbor regulation permits the restocking only of ambulances that are used for emergencies. It does not permit restocking of strictly non-emergency ambulances. In addition, the OIG has defined an "emergency" ambulance as one that responds to emergencies on the average of three times per week. It will not be necessary that restocking be limited to emergency calls, as long as the ambulance is an "emergency" ambulance under this "three times per week" standard.

These additional standards apply under the restocking safe harbor:

1. Under no circumstances may both the hospital and the ambulance provider bill for the replenished items;

2. All parties must otherwise comply with all applicable Federal health care program payment and coverage requirements;

3. The ambulance provider, OR the hospital (or both), must maintain records of the restocked items (this may include a patient care report or trip sheet which shows the items used. This was a suggestion incorporated into the final regulations by the OIG as a result of the comments submitted by Page, Wolfberg & Wirth, LLC. The OIG has implemented numerous other aspects to the recordkeeping requirements, including a requirement that the records be maintained for 5 years.);

4. The restocking arrangement must not take the volume or value of patient referrals into account;

5. The restocking program must meet the requirements for one of the following:

(a) General replenishing - where the receiving facility restocks ambulance providers on an equal basis within certain categories (i.e., nonprofit ambulance services; all ambulance services, or only those ambulance providers which do not charge for their services. Hospitals may exclude certain categories of providers altogether from their restocking program) and the restocking program must be conducted "publicly" (that is, the receiving facility must post a public notice of their restocking practices or it must be done pursuant to a regional EMS council plan or protocol);

(b) Fair Market Value Replenishing - where the ambulance provider pays the receiving facility fair market value for its restocked drugs and supplies; OR

(c) Government Mandated Restocking - where the restocking program is undertaken in accordance with a state or local statute, ordinance or regulation.

First responder programs will also be eligible for restocking under the final safe harbor regulations.

The final restocking regulations are unfortunately a good deal more complex than the proposed safe harbor, and should be reviewed carefully by hospitals, EMS systems, EMS councils, and their respective attorneys, to ensure that their individual restocking arrangements comply with these new anti-kickback safe harbors. Page, Wolfberg & Wirth, LLC is the leading national EMS, ambulance and medical transportation industry law firm and of course stands ready to assist our clients, including public, private and non-profit ambulance services, hospitals, health care systems, government agencies and others -- as well as new clients -- which may require assistance in navigating and implementing these new regulations.