CMS Announces Ambulance Inflation Update for 2018

On October 27, 2017, CMS issued Transmittal 3893 (Change Request 10323), which announced the Medicare Ambulance Inflation Factor (AIF) for calendar year 2018.

The AIF is calculated by measuring the increase in the consumer price index for all urban consumers (CPI-U) for the 12-month period ending with June of the previous year. Starting in calendar year 2011, the change in the CPI-U is now reduced by a so-called “productivity adjustment”, which is equal to the 10-year moving average of changes in the economy-wide private nonfarm business multi-factor productivity index (MFP). The MFP reduction may result in a negative AIF for any calendar year. The resulting AIF is then added to the conversion factor used to calculate Medicare payments under the Ambulance Fee Schedule.

For the 12-month period ending in June 2017, the federal Bureau of Labor Statistics (BLS) has calculated that the CPI-U has increased 1.6%.

In Transmittal 3893, CMS indicated the CY 2018 MFP will be 0.5%. Accordingly, CMS indicated that the Ambulance Inflation Factor for calendar year 2018 will be 1.1%.

Transmittal 3893 can be downloaded from the CMS website.