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Legal Counsel

Legal Counsel: Guide to Providing Free (or Discounted) Transportation to Patients

Many people who require treatments for chronic wounds are elderly patients with limited mobility. Some of these patients live in areas that require significant travel to the wound clinic, such as a rural community. Many of these patients may not be able to drive themselves, do not have easy access to public transportation, and/or cannot find someone to drive them to their appointments for treatment on a regular basis. 

For some of these patients, skilled nursing home health services are an option. However, for many patients, the level of wound care required will go beyond the scope of the visiting nurse agency and instead require treatment by a specialist in an outpatient setting. Until recently, a wound care provider or clinic may have avoided arranging for free or discounted transportation to bring these patients to their facilities for treatment. This hesitancy most likely would have been based on the concern of possibly running afoul of the federal Anti-Kickback Statute (AKS).

Over time, the Office of Inspector General (OIG) has issued numerous advisory opinions regarding the permissibility of the provision of free or discounted transportation services applicable to many types of specific transportation situations. 

However, to address the transportation issue for the healthcare provider/supplier community as a whole, in December 2016 the OIG published a safe harbor to the AKS regarding the provision of complimentary or discounted transportation. This transportation safe harbor became effective Jan. 6, 2017 [Code of Federal Regulations 1001.952(bb)] and permits a provider or clinic to offer free or discounted local transportation that will not be considered remuneration under the AKS, if specific criteria are met. This article will discuss these criteria in further detail.


As has been previously discussed in Legal Counsel articles, the AKS makes it illegal to offer, ask for, or receive remuneration – which includes essentially anything of value – in exchange for referrals of federal healthcare program business. The law thus prohibits not only the giving of or receiving of cash in exchange for using or recommending goods or services, but also bestowing or accepting non-cash benefits, including transportation services, that provide value to the practitioner or the clinic. The penalties for violations of the AKS are steep, running up to $50,000 per violation (plus three times the amount of the improper remuneration), as well as potential prison terms. 


If a healthcare provider chooses to provide free or discounted transportation, the transportation must be within 25 miles of the provider’s office or clinic (or within 50 miles of the provider or clinic if the patient resides in a rural area). The patient must be an “established patient” of the provider or clinic, and the transportation must be for the patient to obtain medically necessary items and/or services. According to the OIG, an established patient is a person who has selected and initiated contact to schedule an appointment with a provider or supplier, or who previously has attended an appointment with the provider or supplier. The transportation may include travel to the provider or clinic location for the patient to obtain treatment and/or services, as well as the return trip to the patient’s home. Any transportation provided cannot be air, luxury, or ambulance-level transportation. All costs of the transportation services must be given at the sole expense of the provider or clinic, and the costs cannot be shifted to any federal healthcare program, other payer, or any other individual.

The safe harbor also requires that the availability of any free or discounted transportation services must be documented in the provider or clinic’s policy. This transportation policy has to be applied uniformly and consistently by the provider or clinic, and the provision of the transportation cannot be based on (or related to) the past or anticipated volume or value of federal healthcare program business. The safe harbor also sets strict requirements regarding the marketing of the free or discounted transportation services. The provider or clinic is not permitted to publicly market or advertise the free or discounted local transportation services. This means that the provider or clinic cannot, for example, note the availability of the free or discounted services in any marketing materials, nor can any associated marketers discuss the provision of free or discounted transportation when conducting marketing activities for (or on behalf of) the provider or clinic. The provider or clinic has to ensure there is no marketing of healthcare items and services while the patients are being transported, and the transportation drivers are prohibited from marketing healthcare items or services at any time. Finally, the provider or clinic offering the transportation must pay the drivers or others arranging for the transportation in a manner that is not based on each patient that is transported. 

A provider or clinic can also offer a shuttle service, which is defined by the OIG as a vehicle that runs on a set route and on a set schedule, if, as with the regular transportation services, the shuttle is not air, luxury, or ambulance-level transportation and the service is limited to the same mileage criteria as noted for regular transportation services. The provider or clinic is also subject to all the same marketing prohibitions for shuttle transportation services as set forth for regular transportation services. However, the provider or clinic is permitted to post routes and details regarding the schedule of the shuttle services. As with the regular transportation services, the drivers or others arranging for the shuttle services cannot be paid on a per-patient-transported basis.


Providers and clinics are now permitted to provide free or discounted transportation services to help their patients obtain wound care treatment, but the provision of the transportation services is subject to stringent requirements. In order to obtain the benefit of the transportation safe harbor, providers and clinics must be certain that all of the enumerated safe harbor criteria are met before arranging for or providing free or discounted transportation services. Just as with other risk areas and safe harbor requirements, providers and suppliers are recommended to implement policies and procedures for the provision of these types of services, and to ensure that their key players are educated as well. 

James R. Ravitz and Rachel Hold-Weiss are attorneys with Arent Fox LLP, a law firm based in Washington, D.C.

Legal Counsel
James R. Ravitz & Rachel Hold-Weiss
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