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CMS Issues Proposed Rule for Calendar Year 2016

On July 8, 2015, the Centers for Medicare and Medicaid Services (CMS) published a display copy of a proposed rule titled “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2016”.  The proposed rule makes a number of changes to the Medicare Physician Fee Schedule.  It also makes certain changes to the Medicare Ambulance Fee Schedule.  These proposed changes are summarized below.

CMS is soliciting comments on numerous aspects of the proposed rule.  All comment letters should reference File Code: CMS-1631-P.  To be considered, comments must be submitted on or before the close of business on September 8, 2015.

Read the full proposed rule.

The proposed rule will appear in the Federal Register on July 15, 2015.

Technical Corrections to Reflect Extension of Temporary Adjustments for Ground Ambulance Services

Section 203 of the Medicare Access and CHIP Reauthorization Act of 2015 (Pub. L 114-10) provided for an extension of the temporary adjustments for ground ambulance services through December 31, 2017.  CMS is proposing to amend the regulations at 42 C.F.R. §414.610 to reflect this extension.

Specifically, CMS is proposing the following changes:

  • Urban/Rural
    The regulation, 42 C.F.R. 414.610(c)(1)(ii) would be amended to reflect the extension of the 2% increase for urban and 3% increase for rural transports through December 31, 2017.
  • Super Rural Temporary Adjustments
    The regulation, 42 C.F.R. 414.610(c)(5)(ii) would be amended to reflect the extension of the 22.6% increase for ground transports that originate in an area designated as “super rural” through December 31, 2017.

As noted above, the extension of these temporary adjustments was done pursuant to legislation passed by Congress.  CMS characterized its proposed change as being “self-implementing,” and requiring no substantive exercise of discretion on the part of CMS.

Proposed Change to Geographic Area Delineations

As part of the 2015 Physician Fee Schedule Final Rule (November 13, 2014), CMS updated its data for determining whether a zip code was designated as “urban” or “rural” for the purposes of payment under the Medicare Ambulance Fee Schedule.  This new information incorporated: (1) revised delineations from the Office of Management and Budget (OMB) that incorporate 2010 Census data and (2) the most recent modifications of the Rural-Urban Commuting Area codes.  CMS previously relied upon OMB delineations based on 2000 Census data and Census population estimates for 2007 and 2008.  These changes have been in effect since January 1, 2015.

In the current proposed rule, CMS is clarifying its implementation of the revised OMB delineations, and “reproposing” the implementation of these criteria for calendar year 2016 and subsequent calendar years.

Revised OMB Delineations

The OMB delineations set forth definitions for Metropolitan Statistical Area (MSA), Micropolitan Statistical Areas and Combined Statistical Areas.  Under the revised standard, an MSA is defined to be a Core-Based Statistical Area (CBSA) with at least one urbanized area that has a population of at least 50,000. A Micropolitan Statistical Area was defined as having at least one urban cluster with a population of at least 10,000 but less than 50,000. Counties that do not qualify for inclusion in a CBSA were deemed “outside Core-Based Statistical Areas.”

CMS is proposing to continue implementation of the revised OMB delineations for calendar year 2016 and subsequent calendar years.

Revised RUCA Codes

Rural-Urban Commuting Area (RUCA) codes are used to identify “rural census tracts” that otherwise fall within an MSA.  Medicare regulations provide that such rural census tracts will be treated as “rural” for purposes of payment under the Medicare Ambulance Fee Schedule.

RUCA codes use urbanization, population density and daily commuting data to categorize every census tract in the country on a scale from 1.0 to 10.0.  Areas with RUCA levels of 1.0 to 3.0 are designated as “Metropolitan areas,” areas with RUCA levels of 4.0 to 6.0 are designated as “Micropolitan areas,” RUCA levels of 7.0 to 9.0 are designated as “Small town areas,” with RUCA levels of 10.0 being designated as “Rural areas.”

Historically, CMS has designated any census tract with a RUCA level of 4.0 or higher as “rural” for payment purposes under the Medicare Ambulance Fee Schedule.  In the current proposed rule, CMS is reiterating that it will continue to treat as “rural” any census tract within an MS that has a RUCA level of 4.0 or higher.

Impact of Changes to Geographic Area Delineations

CMS indicated that there are currently 42,925 ZIP codes in the United States.  According to its estimate, approximately 95.22% of ZIP codes were unaffected by the changes that went into effect January 1, 2015.  This includes all ZIP codes previously designated as “super rural.”  However, 451 ZIP codes (1.05% of all ZIP codes) have shifted from urban to rural, with 1,600 ZIP codes (3.73%) shifting from rural to urban.

Ohio had the most ZIP codes shift from urban to rural (54 ZIP codes or 3.63% of all ZIP codes in the state).  West Virginia saw the most ZIP codes shift from rural to urban (149 ZIP codes or 15.92% of all ZIP codes in the state).  The proposed rule contains a chart (Table 16, located on page 313 of the PDF version of the rule) that breaks down the changes for all states and territories.

CMS indicated that it considered a delay in implementing the payment changes that result from these new geographic area delineations prior to issuing the 2015 Physician Final Rule.  However, CMS determined that such a delay would be inappropriate.  In the current proposed rule, CMS reiterated its belief that an implementation delay would be inappropriate.

Proposed Change to Ambulance Staffing Requirement 

CMS is proposing to revise the regulations related to the staffing of ambulance services.  Currently, the regulations at 42 C.F.R. §410.41 require an ambulance to be staffed with at least 2 people, at least one of whom must be certified as an EMT and who must be legally authorized to operate all lifesaving and life-sustaining equipment on board the vehicle.  For ALS vehicles, there is a further requirement that one of the two staff members must be certified as a paramedic or EMT to perform one or more ALS services.

CMS is proposing to require that ambulance providers must also meet all applicable state and local laws related to the staffing of vehicles.  CMS indicated that these changes are intended to address jurisdictions that impost more stringent requirements on ambulance providers (e.g., a requirement that both staff members be certified as EMTs).

CMS indicated that the proposed change was prompted, in part, by a report from the HHS Office of the Inspector General, which expressed concern over the fact that the current regulations do not set forth licensure or certification requirements for the second crew member.  The OIG indicated that federal prosecutors were finding that the lack of a federal requirement related to the second crew member made it difficult for them to prosecute individuals that purchased or falsified documentation related to their credentials.  The change would permit federal prosecutors to charge these individuals with violating federal regulations, in addition to any applicable state violation.

Proposed Change to Definition of “Basic Life Support” Services

Finally, CMS is proposing to revise the definition of “Basic Life Support” Services that appears in 42 C.F.R. §414.605.  That definition currently reads as follows: 

Basic life support (BLS) means transportation by ground ambulance vehicle and medically necessary supplies and services, plus the provision of BLS ambulance services. The ambulance must be staffed by an individual who is qualified in accordance with State and local laws as an emergency medical technician-basic (EMT-Basic). These laws may vary from State to State. For example, only in some States is an EMT-Basic permitted to operate limited equipment on board the vehicle, assist more qualified personnel in performing assessments and interventions, and establish a peripheral intravenous (IV) line. 

CMS is proposing to delete the last sentence.  The sentence has been part of the definition since the regulations implementing the Medicare Ambulance Fee Schedule were first established in 2002.  CMS indicated its concern that changes in state law over the course of time may result in this sentence no longer accurate reflecting relevant state laws.  CMS stated its belief that the examples were unnecessary to convey the definition of BLS for coverage and payment purposes.

The AAA will craft a comment letter on the proposed rule which we will distribute to all AAA members.

Centers for Medicare and Medicaid Services (CMS), Medicare, Physician Fee Schedule, RUCA

Brian Werfel

Brian S. Werfel, Esq. is a partner in Werfel & Werfel, PLLC, a New York based law firm specializing in Medicare issues related to the ambulance industry. Brian is a Medicare Consultant to the American Ambulance Association, and has authored numerous articles on Medicare reimbursement, most recently on issues such as the beneficiary signature requirement, repeat admissions and interrupted stays. He is a frequent lecturer on issues of ambulance coverage and reimbursement. Brian is co-author of the AAA’s Medicare Reference Manual for Ambulance, as well as the author of the AAA’s HIPAA Reference Manual. Brian is a graduate of the University of Pennsylvania and the Columbia School of Law. Prior to joining the firm in 2005, he specialized in mergers & acquisitions and commercial real estate at a prominent New York law firm. Werfel & Werfel, PLLC was founded by David M. Werfel, who has been the Medicare Consultant to the American Ambulance Association for over 20 years.

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