The Health Resources & Services Administration (HRSA) has announced that it will begin distributing Phase 4 General Distribution Payments on Thursday, December 16, 2021. According to HRSA, approximately 75% of all Phase 4 applications have now been processed. HRSA indicated that the remaining 25% of applications require additional review under its risk mitigation and cost containment safeguards.
HRSA further indicated that it began distributing American Rescue Plan (ARP) Rural Payments on November 23, 2021. As of December 14, 2021, HRSA has indicated that it has processed approximately 96% of ARP applications. The ARP allocated a total of $8.5 billion to health care providers who serve rural Medicare, Medicaid and CHIP patients. HRSA indicated that it will distribute $7.5 billion of these funds in its initial distribution.
To the extent a provider was determined to be eligible for either a Phase 4 payment or an ARP Rural Payment, the provider will receive both an email notification and a paper letter with additional details on these payments. This will include the individual amounts attributed to any subsidiary TINs submitted as part of their application. To the extent HRSA determined that you were not eligible for a Phase 4 payment, the email notice will provide an explanation for why you were determined to be ineligible. These email notices will be sent to the email address provided in the Phase 4 application. Providers selected for additional review will receive email notification as soon as HRSA completes its review process, which it indicated would be completed in “early 2022.”
AAA members are encouraged to look for this email. If you have not received an email notification, we would suggest that you check your spam filter, as several of our members have indicated that the email was flagged as “spam” by their email system.
On August 26, 2021, the Centers for Medicare and Medicaid Services (CMS) announced its proposed timeline for the national expansion of the Prior Authorization Model for Repetitive, Scheduled Non-Emergent Ambulance Transports (RSNAT). The formal notice appeared in the Federal Register on August 27, 2021.
In December 2014, the Centers for Medicare and Medicaid Services (CMS) implemented a prior authorization model for payment of repetitive, scheduled non-emergent ambulance transportation. Under this Model, ambulance suppliers are required to seek and obtain prior authorization for the transportation of repetitive patients beyond the third round-trip in a 30-day period. Absent prior authorization, the Medicare Administrative Contractors (MACs) are required to subject further claims to prepayment review.
The Model was initially implemented in three states: New Jersey, Pennsylvania, and South Carolina. These “Year 1” states were selected based on relatively high per-capita expenditures on RSNAT. The Model was subsequently expanded in January 2016 to five additional states (Delaware, Maryland, North Carolina, Virginia, and West Virginia) and to District of Columbia. These “Year 2” states were selected based on their inclusion in the same MAC Jurisdiction as one or more of the Year 1 states.
The purpose of the RSNAT Model was to test whether prior authorization would be effective in reducing Medicare expenditures on RSNAT, without adversely impacting beneficiary access to medically necessary services. CMS engaged Mathematica, a public health care research firm, to study the impact of prior authorization on ambulance utilization in the demonstration states. Mathematica issued several reports that concluded that the Model was effective in reducing Medicare expenditures without any measurable impact on the quality of care available to Medicare beneficiaries.
On November 23, 2020, CMS published a notice in the Federal Register indicating that it intended to expand the Prior Authorization Model to all remaining states and U.S. territories. However, citing the current Public Health Emergency, CMS elected not to set a timeline for that national expansion.
The current notice announces that timeline for national expansion
CMS has indicated that the RSNAT Model will be expanded into new states on the following timeline:
|Expansion Date||Affected States|
|December 1, 2021||Arkansas, Colorado, Louisiana, Mississippi, New Mexico, Oklahoma, and Texas|
|Not earlier than
February 1, 2022
|Alabama, California, Georgia, Hawaii, Nevada, Tennessee, American Samoa, Guam, and the Northern Mariana Islands|
|Not earlier than
April 1, 2022
|Florida, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, Wisconsin, Puerto Rico, and the U.S. Virgin Islands|
|Not earlier than
June 1, 2022
|Connecticut, Indiana, Maine, Massachusetts, Michigan, New Hampshire, New York, Rhode Island, and Vermont|
|Not earlier than
August 1, 2022
|Alaska, Arizona, Idaho, Kentucky, Montana, North Dakota, Ohio, Oregon, South Dakota, Utah, Washington, and Wyoming|
An analysis of the proposed timeline suggests that CMS has elected to expand the RSNAT Model based on existing Medicare Administrative Contractor (MAC) Jurisdictions. For example, each of the states slated to be included in the December 1, 2021 expansion fall within MAC Jurisdiction H. This MAC Jurisdiction is administered by Novitas Solutions, Inc. Novitas also administers MAC Jurisdiction L, which has been operating under the RSNAT Model since 2014. Thus, CMS likely selected MAC Jurisdiction H for the first stage of the national expansion due to Novitas’ experience in administering the RSNAT Model.
The second stage of the national expansion will occur no earlier than February 1, 2022. This stage will include all states and territories located in MAC Jurisdiction J and MAC Jurisdiction E. MAC Jurisdiction J is administered by Palmetto GBA, LLC, which has been administering the RSNAT Model in MAC Jurisdiction M since 2014. MAC Jurisdiction E is administered by Noridian Healthcare Solutions, LLC. This will be Noridian’s first experience with the RSNAT Model.
The third stage of the national expansion will occur no earlier than April 1, 2022. This stage will include all states and territories located in MAC Jurisdiction 5 (Wisconsin Physicians Service Government Health Administrators), MAC Jurisdiction 6 (National Government Services, Inc.), and MAC Jurisdiction N (First Coast Service Options, Inc.)
The fourth stage of the national expansion will occur no earlier than June 1, 2022. This stage will include all states and territories located in MAC Jurisdiction 8 (Wisconsin Physicians Service Government Health Administrators) and MAC Jurisdiction K (National Government Services, Inc.).
The final stage of the will occur no earlier than August 1, 2022. This stage will include all states and territories located in MAC Jurisdiction 15 (CGS Administrators, LLC) and MAC Jurisdiction F (Noridian Healthcare Solutions, LLC).
Outreach and Education
With the formal announcement of CMS’ timeline for the national expansion of the RSNAT Model, the American Ambulance Association will be increasing its educational efforts related to prior authorization. This will include webinars and other educational materials on the technical elements of the prior authorization process, the importance of third-party documentation, as well as basic best practices related to the transportation of repetitive patients. We encourage all members that may be impacted by the expansion of prior authorization to take advantage of these educational materials.
The American Ambulance Association wants to remind our members that the deadline to submit your initial report on your use of HHS Provider Relief Funds is fast approaching. Any ambulance provider or supplier that received more than $10,000 in aggregate funds from the first two rounds of General Distribution funding will need to submit a report on their use of such funds by September 30, 2021. This initial report will detail the expenditure of PRF funds through June 30, 2021.
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). As part of that Act, Congress allocated $100 billion to the creation of a “CARES Act Provider Relief Fund,” which will be used to support hospitals and other healthcare providers on the front lines of the nation’s coronavirus response. An additional $75 billion was allocated as part of the Paycheck Protection Program and Health Care Enhancement Act, with subsequent legislation adding further amounts to this fund. In total, the Provider Relief Fund (PRF) will distribute $178 billion to health care providers and suppliers to fund healthcare-related expenses or to offset lost revenue attributable to COVID-10.
To date, HHS has distributed approximately $148.4 billion through three rounds of General Distribution funds ($92.5 billion) and multiple smaller Targeted Distributions. A portion of the PRF is also being used to reimburse health care providers for the costs of testing, treating, and vaccinating the uninsured.
Summary of Final Reporting Requirements
On June 11, 2021, HHS issued its final PRF Reporting Requirements. Under these new guidelines, health care providers will be required to report for any “Payment Received Period” in which they received one or more PRF payments that, in the aggregate, exceed $10,000. Providers meeting this threshold for any Payment Received Period will report on their use of such funds during the corresponding “Reporting Time Period.”
The following table sets forth the applicable Payment Received Periods and corresponding Reporting Time Periods. The table also sets forth the deadline to use funds received within each Payment Receiving Period.
|Period||Payment Received Period||Deadline for use of Funds||Reporting Time Period|
|1||April 10, 2020 – June 30, 2020||June 30, 2021||July 1, 2021 – September 30, 2021|
|2||July 1, 2020 – December 31, 2020||December 31, 2021||January 1, 2022 – March 31, 2022|
|3||January 1, 2021 – June 30, 2021||June 30, 2022||July 1, 2022 – September 30, 2022|
|4||July 1, 2021 – December 31, 2021||December 31, 2022||January 1, 2023 – March 31, 2023|
PRF payments received in the first two rounds of General Distribution funding will fall within the first reporting period. PRF payments received in the third round of General Distribution funding will fall within either the second or third reporting periods, depending on when the funds were actually received.
As a result, ambulance providers and suppliers that received more than $10,000 in the aggregate from the first two rounds of General Distribution funding will need to submit an initial report during the 90-day period starting on July 1, 2021. This initial report will detail all expenditures of PRF funds through June 30, 2021.
Ambulance providers and suppliers that received between $10,001 and $499,999 in aggregated PRF funds during each Payment Received Period are required to report on their use of such funds in two categories: (1) General and Administrative Expenses and (2) Health Care Related Expenses. Ambulance providers and suppliers that received $500,000 or more in aggregated PRF funds during each Payment Received Period will be required to submit more detailed information for each of these general categories.
Specific Instructions Related to Reporting of Lost Revenues
The American Ambulance Association has received numerous questions from members regarding the appropriate methodology to report lost revenues attributable to the coronavirus. Specifically, many members have inquired as to the appropriate methodology for calculating their lost revenues.
HHS has indicated that health care providers must report their lost revenues using one of three methodologies:
Based on HHS guidance, it appears that the default methodology is to measure the difference between actual patient care revenues for each calendar quarter during the applicable period. The provider will also be asked to further break down patient care revenues by applicable payer. In basic terms, the first methodology will compare: (i) your actual calendar year 2019 patient care revenues to (ii) your actual calendar year 2020 patient care revenues. The A.A.A. suggests that all members start by conducting this basic revenue analysis. To the extent your lost revenues in 2020 equal or exceed (in combination with your increased expenses, if any) the total PRF funds received during the first Payment Received Period, no additional revenue analysis is required.
In some instances, you may find that your actual revenue losses for calendar year 2020 do not fully offset the PRF funds received during the First Payment Received Period. In that event, it may be beneficial to conduct a separate revenue analysis using the budgeted vs. actual methodology. Note: you are only eligible to use this methodology to the extent you had a formal budget approved prior to March 27, 2020.
This methodology is likely to be beneficial to ambulance providers or suppliers that, pre-pandemic, were projecting significant revenue growth in calendar year 2020. For example, consider the case of a hypothetical “ABC Ambulance Service, Inc.” ABC Ambulance had $1 million in patient care revenues in calendar year 2019. However, in November 2019, the company signed an agreement to be the preferred provider of a major hospital system in its service area. As a result, the company was projecting significant revenue growth in calendar year 2020. Specifically, when it created its 2020 budget in December 2019, it projected that its patient care revenues would rise to $1.5 million in 2020.
When the pandemic hit in mid-March 2020, the company saw a significant slowdown in its transport volume. Like many ambulance providers, it saw its transport volume rebound somewhat in the 3rd and 4th quarters of 2020. As a result, it ended the year with $1.2 million in patient care revenues.
A revenue analysis using the default methodology would show an increase in revenues, i.e., its revenues increased by $200,000 over 2019. However, its 2020 actual revenues were $300,000 less than it projected in its 2020 budget. Using this second methodology, the company would be able to claim $300,000 in lost revenues to offset against its PRF funds.
Please note that any ambulance provider or supplier using this second methodology will be required to submit additional documentation with its initial PRF report. Specifically, you will be required to submit a copy of the 2020 budget relied upon to show the lost revenue, together with an attestation from its CEO, CFO, or other authorized official attesting to the fact that this budget was formally established prior to March 27, 2020.
HHS will also permit ambulance providers or suppliers to utilize an alternative methodology created by the entity for calculating their lost revenues. However, to utilize an alternative methodology, the provider or supplier will be required to submit additional documentation explaining not only the methodology, but also the justification for why this methodology was reasonable. HHS has indicated that providers or suppliers electing to use an alternative methodology will face an increased risk of audit. As a good rule of thumb, the use of an alternative methodology is likely to limited to situations where the EMS agency’s business is extremely seasonal, or where there was some major change in their operations during the 2020 calendar year (e.g., a partial sale of the company, a large acquisition, etc.).
Further Information Related to PRF Reporting
HHS updated its instructions for how ambulance providers and suppliers should complete their PRF Reporting obligations. These updated instructions start on Page 4 of the Revised Reporting Requirements.
HHS also recently updated its Frequently Asked Questions (FAQs) associated with the PRF Reporting Program.
Section 1834(l)(3)(B) of the Social Security Act mandates that the Medicare Ambulance Fee Schedule be updated each year to reflect inflation. This update is referred to as the “Ambulance Inflation Factor” or “AIF”.
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 2021, the federal Bureau of Labor Statistics (BLS) has calculated that the CPI-U has increased by 5.39%.
CMS has yet to release its estimate for the MFP in calendar year 2022. However, assuming CMS’ projections for the MFP are similar to last year’s projections, the number is likely to be in the 0.4% range.
Accordingly, the AAA is currently projecting that the 2022 Ambulance Inflation Factor will be approximately 5.0%.
Cautionary Note Regarding these Estimates
Members should be advised that the BLS’ calculations of the CPI-U are preliminary, and may be subject to later adjustment. The AAA further cautions members that CMS has not officially announced the MFP for CY 2022. Therefore, it is possible that these numbers may change. The AAA will notify members once CMS issues a transmittal setting forth the official 2022 Ambulance Inflation Factor.
On April 16, 2021, CMS published a notice on the MLNConnects webpage announcing the passage of the Act to Prevent Across-the-Board Direct Spending Cuts, and for Other Purposes. The law, enacted on April 14, 2021 extends the suspension of the Medicare “sequester” through December 31, 2021.
In anticipation of the legislation’s passage, CMS announced on March 30, 2021 that it had instructed its Medicare Administrative Contractors (MACs) to hold Medicare Fee-For-Service claims with dates of service on or after April 1, 2021. With the passage of the bill, CMS further indicated that it has instructed its MACs to release any claims currently being held, and to reprocess any claims paid with the sequester applied. CMS indicated that no action is required on the part of health care providers and suppliers.
CMS Increases Medicare Payment for COVID-19 Vaccinations
By Brian S. Werfel, Esq.
On March 15, 2021, the Centers for Medicare and Medicaid Services (CMS) announced that it would be increasing the Medicare payment amount for administrations of the COVID-19 vaccines.
The original Medicare reimbursement rate depended, in part, on whether the vaccine being administered required a two-dose regimen (as is the case for the Pfizer-Biontech and Moderna vaccines), or a single dose (Johnson & Johnson vaccine). For vaccinations that require a two-dose regime, CMS initially paid: (1) $16.04 for the administration of the first dose and (2) $28.39 for the administration of the second dose. For vaccines that require only a single dose, Medicare paid $28.39 for the administration of that single dose.
Effective for vaccinations administered on or after March 15, 2021, CMS has increased these payments to $40 per administration. Thus, the total reimbursement for a vaccine requiring a single dose will be $40, while the total reimbursement for a vaccine requiring a two-dose regimen will be $80.
On October 8, 2020, the Centers for Medicare and Medicaid Services (CMS) issued a Fact Sheet setting forth the repayment terms for advances made under the Medicare Accelerated and Advance Payments Program (AAPP). These changes were mandated by the passage of the Continuing Appropriations Act, 2021 and Other Extensions Act, which was enacted on October 1, 2020.
On March 28, 2020, CMS expanded the existing Accelerated and Advance Payments Program to provide relief to Medicare providers and suppliers that were experiencing cash flow disruptions as a result of the COVID-19 pandemic, and associated economic lockdowns. Under the AAPP, Medicare providers and suppliers were eligible to receive an advance of up to three months of their historic Medicare payments. These advances are structured as “loans,” and are required to be repaid through the offset of future Medicare payments.
CMS began accepting applications for Medicare advances in mid-March 2020, before ending the program in late April following the passage of the CARES Act. CMS ultimately approved more than 45,000 applications for advances totaling approximately $100 billion, before it suspended the program in late April 2020.
Under the pre-existing terms of the AAPP, repayment through offset was required to commence on the 121st day following the provider or supplier’s receipt of the advance funds. The program also called for a 100% offset until all advanced funds had been repaid.
Revised Payment Terms
Under the revised payment terms announced by CMS, providers and suppliers will not be subject to recoupment of their Medicare payments for a period of one year from the date they received their AAPP payment. Starting on the date that is one year from their receipt of the AAPP payment, repayment will be made out of the provider’s or supplier’s future Medicare payments. The schedule for such repayments will be as follows:
To the extent there remains an outstanding AAPP balance after that 17 month period (i.e., 29 months after the date the provider or supplier received its AAPP payment, the provider or supplier will receive a letter setting forth their remaining balance. The provider or supplier will have 30 days from the date of that letter to repay the AAPP balance in full. To the extent the AAPP balance is not repaid in full within that 30-day period, interest will begin to accrue on the unpaid balance at a rate of 4%, starting from the date of the letter.
Medicare providers and suppliers are also permitted to repay their accelerated or advance payments at any time by contacting their Medicare Administrative Contractor.
On August 25, 2020, the Centers for Medicare and Medicaid Services (CMS) published an interim final rule with a comment period titled “Medicare and Medicaid Programs, Clinical Laboratory Improvement Amendments of 1988 (CLIA), and Patient Protection and Affordable Care Act; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency.” The interim final rule sets forth a number of new requirements designed to limit the COVID-19 exposure and to prevent the spread of COVID-19 within nursing homes.
Specifically, the interim final rule requires skilled nursing and other long-term care facilities to test residents and staff for COVID-19. The frequency of such testing is based on the positivity rate in which the facility is located, and can require COVID-19 testing as frequently as twice per week. Regardless of the frequency of required COVID-19 tests, facilities must also screen all staff, residents, and persons entering the facility for the signs and symptoms of COVID-19.
These requirements extend to individuals that provide services to nursing homes under arrangements, including health care personnel rendering care to residents within the facility. In subsequent guidance, CMS clarified that these testing and screening requirements apply to EMS personnel and other health care providers that render care to residents within the facility. However, in that same guidance, CMS indicated that EMS personnel must be permitted to enter the facility provided that: (1) they are not subject to a work exclusion as a result of to an exposure to COVID-19 or (2) showing signs or symptoms of COVID-19 after being screened.” CMS further indicated that “EMS personnel do not need to be screened so they can attend to an emergency without delay.”
In plain terms, CMS has created an affirmative obligation on nursing homes to ensure that any individual that provides services under a contractual arrangement with the nursing home comply with these testing and screening requirements. CMS has expressly waived the screening requirements for EMS personnel responding to medical emergencies at a nursing home. However, CMS has not specifically addressed the testing and screening requirements applicable to EMS personnel responding to nursing homes in non-emergency situations.
The A.A.A. is aware that a handful of State Health Agencies have issued their own guidance on this issue. The A.A.A. is also aware that individual nursing homes have started to require proof that EMS personnel have been tested for COVID-19 prior to allowing these individuals to enter the nursing home in a non-emergency situation.
EMS agencies may already be subject to state and local testing mandates. EMS agencies may also have their own internal policies that require employees to be periodically tested for COVID-19. As a result, there exists the potential for conflict where these existing testing policies conflict with the testing requirements of your local nursing homes.
The A.A.A. has been engaged in an ongoing conversation with CMS on these issues since the issuance of the interim final rule in August. As part of that conversation, the A.A.A. pushed for the exclusion of EMS personnel from the screening requirement when responding to medical emergencies, which was included in the recent CMS guidance document. The A.A.A. also continues to push for additional funding for COVID-19 testing for EMS agencies. CMS has recognized that the frequent testing of health care workers is essential to reducing the spread of the novel coronavirus. CMS has allocated funding for these purposes to other industries, including hospitals and nursing homes. As front-line health care workers, EMS agencies should have similar access to testing funds. The A.A.A. will continue to push for funding equity for the EMS industry.
In the interim, we strongly encourage our members to work with their state associations and other stakeholders to advocate for reasonable rules related to testing on the state and local levels. To the extent the applicable state or local agency has determined the appropriate frequency for the testing of EMS personnel responding to medical emergencies, those rules should also apply to EMS personnel responding to scheduled transports and other non-emergencies that start or end at a nursing home. Requiring more frequent testing in these situations would impose an undue burden on EMS agencies that provide these services. More frequent testing may also prove counterproductive, as it may discourage EMS agencies that cannot meet these higher requirements from responding in these situations. We also encourage our members to continue to push for state and local funding for the testing of their employees.