OIG Report on Overpayments For Non-Emergency Transports

OIG Report – Overpayments For Non-Emergency Ambulance Transports To Non-Covered Destinations The Office of the Inspector General released its report “Medicare Improperly Paid Providers for Non Emergency Ambulance Transports to Destinations Not Covered by Medicare“. In sum, the OIG reviewed claims that Medicare paid for 2014 – 2016 non-emergency ambulance transports. The review focused on transports to non-covered destinations. OIG found that $8,633,940 was paid by Medicare for non-emergency ambulance transports under codes A0425 (ground mileage), A0426 (ALS non-emergency) and A0428 (BLS non-emergency) during this period of time. The review was based solely on the claims and not based on a medical review or interviews of providers. The claims that should not have been paid were to the following destinations: 59% – to diagnostic or therapeutic sites other than a hospital or physician’s office, that did not originate at a SNF. 31% – to a residence or assisted living facility (and not meeting the origin/destination requirement).  6% – to the scene of an acute event.  4% – to a destination code not used for ambulance claims or where no destination modifier was used. <1% – to a physician’s office. OIG recommended (and CMS agreed) that CMS: Notify the Medicare Administrative...

This content is available only to AAA members.
Log In or Register

Summary of September 2017 Ambulance Open Door Forum

On September 14, 2017, CMS held its latest Open Door Forum. As usual, it started with a few announcements, as follows: “Locality” Rule – On 6/16/17 CMS issued Transmittal 236, to amend the Benefit Policy Manual, Chapter 10, section 10.3.5 to give Medicare Administrative Contractors discretion to determine the “locality”. This is for the issue of the nearest appropriate facility. ALS Assessment – The same Transmittal also amended section 30.1.1 to indicate that if an ALS assessment is performed, then the ALS emergency base rate shall be paid, even if there is no ALS intervention. Multiple Patient Transports – On 9/1/17, CMS issued Transmittal 3855 to restore to its Claims Processing Manual, Chapter 15, section 30.1.2 instructions for multiple patients transported in the same vehicle. This is not a change in policy. The section was inadvertently omitted from the Internet Only Manual. Temporary Adjustments – The 2%, 3% and 22.6% temporary adjustments for ground ambulance transports originating in urban, rural and super-rural areas will expire 12/31/17, unless legislation is enacted. Later on the call, they indicated that they are aware of a legislative initiative in Congress that includes this issue (S.967, H.R. 3236).        Following these announcements, a Q &...

This content is available only to AAA members.
Log In or Register

Court Decision Overpayment Determination Statistical Sampling

Maxmed is a home health agency. In 2011, Medicare reviewed a sample of 40 claims involving 22 Medicare beneficiaries and determined that all but one were not medically necessary. The sample was extrapolated to their universe of claims, resulting in an overpayment of $773,967. The Administrative Law Judge invalidated the extrapolation methodology, but the Medicare Appeals Council reversed and Maxmed appealed to Federal District Court, where it lost. Maxmed then appealed claiming: the extrapolation was invalid because the contractor failed to document the random numbers used in the sample and how they were selected. a valid random sample must be for claims that are “defined correctly and independent” and here the same Medicare beneficiary had multiple claims in the sample. On June 22, 2017, the U.S. Court of Appeals, Fifth Circuit, found the extrapolation and sampling methodology used was proper. The decision, Maxmed Healthcare Inc. v. Price, is just the latest in a recent line of decisions making it harder and harder to challenge statistical sampling and extrapolation of overpayments....

This content is available only to AAA members.
Log In or Register

Medicare “Locality” Rule & ALS Assessment

“Locality” Rule – MAC Discretion – Since the inception of the CMS Internet Only Manual (in 2003), the Benefit Policy Manual 100-02, Chapter 10, section 10.3.5 has always defined “Locality” as: The term “Locality” with respect to ambulance service means the service area surrounding the institution to which individuals normally travel or are expected to travel to receive hospital or skilled nursing services. An example is then listed to indicate that the ambulance transportation to either of two large metropolitan hospitals that regularly provide services to the small community where the emergency arose would be covered destinations. On June 16, 2017, CMS issued Transmittal 236 to add the following at the end of the paragraph before the example: The MAC’s have the discretion to define locality in their service areas. Effectively, there is no change as Carriers and Intermediaries (now MACs) have always had discretion to determine the “locality” around each facility. Often, they did this with mileage edits, e.g. in an urban area, they may have set a parameter of 15 miles, but in a rural area, they have allowed a much larger area. Nevertheless, it is a good time to ask your MAC for their definitions of the localities in...

This content is available only to AAA members.
Log In or Register

CMS – MLN Ambulance Transports Booklet

CMS has issued an MLN Ambulance Transports Booklet. The booklet (36 pages) can be downloaded here. One section of the Booklet that you might want to keep handy involves Free-Standing Emergency Departments. Specifically, on page 15, CMS states the following: Freestanding Emergency Department (ED) If a freestanding ED is provider based (a department of the hospital), the ambulance transport from the freestanding ED to the hospital is not a separately payable service under Part B if the beneficiary is admitted as an inpatient prior to ambulance transport. For more information about criteria for coverage of ambulance transports separately payable under Part B or as a packaged hospital inpatient service under Part A, refer to Chapter 10, Section 10.3.3, of the Medicare Benefit Policy Manual. This may be useful, along with the Manual section cited, when you have a free-standing ED that is part of a hospital and they call for transports to the main building for the patient to be admitted, but the hospital lists the time of admission as being prior to the time of your transport. When the hospital admits the patient prior to your transport, the hospital becomes responsible for the ambulance charges. It may be useful to show the hospital...

This content is available only to AAA members.
Log In or Register

OIG Releases Final Rule Revising Safe Harbor

Office of the Inspector General – Final Rule – Revisions to the Safe Harbors for Waiving Coinsurance, et.al On December 7, 2016, the Office of the Inspector General published a Final Rule (81 Federal Register 88368) and will be effective January 6, 2017. The Final Rule includes technical corrections to the existing Safe Harbor for referral services, a new Safe Harbor for waiver of patient cost-sharing for emergency ambulance services, a new Safe Harbor for free or discounted local transportation services, and an amendment to the definition of “remuneration” for purposes of the Civil Monetary penalties for beneficiary inducements.  Since the Final Rule covers many issues that pertain to other providers and suppliers, such as pharmacies, outpatient hospital, Federally Qualified Health Centers, Medicare Advantage Plans, etc., this Member Advisory will focus on the two issues that impact ambulance services and transportation. Safe Harbor – Cost Sharing Reductions for Emergency Ambulance Services In recent years, we have seen a number of OIG Advisory Opinions that permitted public EMS entities to waive the cost-sharing obligations of Medicare beneficiaries in specified circumstances. The OIG is now adding these as a “Safe Harbor”. The regulation, at 42 C.F.R 1001.952, will protect certain reductions or...

This content is available only to AAA members.
Log In or Register

CMS Announces 2017 Inflation Factor

The Centers for Medicare and Medicare Services (CMS) issued Transmittal 3625 officially announcing that the inflation factor for payments under the Medicare ambulance fee schedule for 2017 will be 0.7%. The calculation for determining the Medicare ambulance inflation factor is as follows: Consumer Price Index – Urban (which is the change in the CPI-U from June to June) minus the non-farm business multi-factor productivity adjustment (MFP) as projected by the Secretary of HHS (10-year average). The CPI-Urban for 2017 is 1.0% with a MFP of 0.3% which equals the 0.7% inflation factor. As part of the Affordable Care Act, a productivity adjustment is subtracted from the CPI-Urban for the final inflation update....

This content is available only to AAA members.
Log In or Register

Prior Authorization Expansion Delay

Prior Authorization – Repetitive Non-Emergencies – Expansion Delay CMS has notified the American Ambulance Association that the expansion of Prior Authorization for repetitive non-emergencies, to the states not already on Prior Authorization, will not be implemented January 1, 2017. The reason for the delay is that, pursuant to Section 515(b) of the Medicare Access and CHIP Reauthorization Act (MACRA), CMS must make determinations as to whether: (1) Prior Authorization for repetitive non-emergencies saves money, (2) it adversely affects quality of care and (3) it adversely impacts access to care. These studies are being conducted and are expected to show the program saves money without adversely affecting quality or access to care. For those of you in states currently not under Prior Authorization, it is highly recommended that you still prepare for it to be implemented, even though it will not be implemented January 1, 2017.  You should still ensure that these patients meet the requirements for medical necessity by reviewing your documents, obtaining documents from facilities, conducting assessments of repetitive patients, implementing internal procedures and processes, etc. For those of you in states already under Prior Authorization for repetitive non-emergencies, there is no impact.  Your program continues.

Novitas – Denials

This advisory is for members who have Novitas as their Medicare Administrative Contractor. On August 17, 2016, Novitas called me to let me know that they are seeing many ambulance claims denied due solely to the diagnosis codes that are listed on claims. Novitas requires a minimum of two ICD-10 codes, as follows: A primary diagnosis code that describes the patient’s medical condition at the time of transport, AND A secondary diagnosis code that reflects the patient’s need for the ambulance at the time of transport. The list of primary ICD-10 codes was published by Novitas in their Ambulance Local Coverage Article A54574. While the ICD-10 codes in A54574 are not the only codes that will be accepted, it is highly recommended that you use one of those as your primary code, whenever possible. Novitas also requires a secondary “diagnosis code”. This list is in their Ambulance Local Coverage Determination (LCD) Policy L35162. That has the four “Z” codes, at least one of which must be used as the secondary diagnosis code: Z74.01 – Bed Confined Z74.3 – needs continuous supervision (includes EKG) Z78.1 – physical restraints (patient safety, danger to self/others) Z99.89 – dependence on enabling machines (includes IV fluids, active airway...

This content is available only to AAA members.
Log In or Register

Prior Authorization Pilot Program – Status Update

CMS released preliminary data on the impact of the prior authorization demonstration program on Medicare payments for ambulance services.  This data is limited to the three states (NJ, PA, and SC) that were included in the demonstration program’s first year. CMS noted that it has observed a dramatic decrease in expenditures for repetitive non-emergency ambulance transports since the program’s implementation.  CMS released the following data for the first 10 months of the program (i.e. December 2014 – September 2015), comparing that data to the first 11 months of 2014: Payments for repetitive non-emergency ambulance transportation in these states averaged $5.4 million per month, down from nearly $18.9 million per month prior to the program’s implementation. This is a reduction of more than 70%. In the states that were not part of the demonstration program, payments have decreased very slightly for the 10 months in 2014 and are very similar to the payments in the 11 months prior to the program beginning in SC, NJ and PA. 18,367 prior authorization requests were received and finalized by Medicare’s contractors. Of these, 6,430 (35.0%) were approved. CMS is closely monitoring these results to evaluate its effectiveness. Here is the full status update....

This content is available only to AAA members.
Log In or Register

Medicaid Waivers to End Coverage of Non-Emergency Transportation

By David M. Werfel, Esq | AAA Medicare Consultant Updated February 16, 2016 Federal law requires that state Medicaid programs cover necessary transportation to and from health care providers in order to ensure access to care. However, as a result of Medicaid expansion under the Affordable Care Act and cost increases, recently, a few states have asked CMS to waive the requirement for non-emergency transportation so they can end coverage of non-emergency transportation. CMS granted waivers to Iowa and Indiana. Pennsylvania received permission, but the subsequent change in the governor’s office altered the state’s expansion plans and state officials ultimately chose not to use it. Arizona has a pending request to provide prior authorization. When Iowa was granted the waiver, a beneficiary survey was conducted to determine the impact on access to care. The survey found some beneficiaries with incomes under the poverty level did not have transportation to or from a healthcare visit. Other beneficiaries said a lack of transportation could prevent them from getting a physical exam in the coming year. However, CMS stated the cases of negative impact were not statistically significant enough to discontinue the waiver. As a result of the complaints, Sen. Ron Wyden (D-OR) (more…)

CMS Announces 2016 Inflation Factor

The Centers for Medicare and Medicare Services (CMS) has officially announced that the inflation factor for payments under the Medicare ambulance fee schedule for 2016 will be negative .4% (-0.4%). As part of the Affordable Care Act, a productivity adjustment has been part of the calculation for the last several years which for 2016 has resulted in a negative update. The calculation for determining the Medicare ambulance inflation factor is as follows: Consumer Price Index – Urban (which is the change in the CPI-U from June to June) minus the non-farm business multi-factor productivity adjustment (MFP) as projected by the Secretary of HHS (10-year average). The CPI-Urban for 2016 is 0.1% with a MFP of 0.5% which equals negative .4%. The AAA had projected an inflation factor of negative .5%....

This content is available only to AAA members.
Log In or Register

Summary of CMS Ambulance Open Door Forum of November 5, 2015

By David M. Werfel, Esq. | Updated November 6, 2015 On November 5, 2015, the Centers for Medicare and Medicaid Services (CMS) conducted its latest Ambulance Open Door Forum.  As usual, CMS started with announcements, which were as follows: As required under the Medicare Access and CHIP Reauthorization Act (HR 2), the pilot program for prior authorization for non-emergency repetitive patients will be expanded to Delaware, the District of Columbia, Maryland, North Carolina, Virginia and West Virginia, effective January 1, 2016.  A Special Open Door Forum on the topic will be held by CMS on November 10, 2015 from 12:30 to 1:30 pm. (Link to PDF). Payment Policies On October 30, CMS released the final rule on changes in CY 2016 to the Medicare ambulance fee schedule.  The final rule will be published in the Federal Register on November 16, 2015.  The rule finalizes the following: The 2% urban, 3% rural and 22.6% super rural adjustments have been extended through December 31, 2017. Urban/Rural Designations – CMS will continue in 2016 and thereafter with the current geographic designations of urban and rural that were implemented on January 1, 2015. CMS also stated the Agency is further reviewing those zip codes...

This content is available only to AAA members.
Log In or Register

Redeterminations/Reconsiderations: Scope of Review Limited

CMS published MLN Matters article number SE1521, which states: “For redeterminations and reconsiderations of claims denied following a post-payment review or audit, CMS has instructed MACs and QICs to limit their review to the reason(s) the claim or line item at issue was initially denied.” What this means is that if you have an audit and a claim is denied for a reason, e.g. not medically necessary, then when you appeal that denial, the MAC cannot deny the claim for a different reason, e.g. signature not legible. The same applies to a denial in the Redetermination decision as the QIC cannot deny for a different reason than what was stated in the original denial. Thus, the Redetermination decision and the Reconsideration decision are limited to the original reason for the denial. This went into effect for Redetermination and Reconsideration requests received by a MAC or QIC on or after August 1, 2015. It does not apply to denials that result from failing to submit requested documentation needed to process the claim. It also does not apply to denials from pre-payment reviews....

This content is available only to AAA members.
Log In or Register

Ambulance Open Door Forum, April 22, H.R. 2

CMS held its latest Ambulance Open Door Forum on April 22. It started with the following two announcements: – H.R. 2 was signed into law extending the temporary ambulance adjustments through December 31, 2017. The adjustments are 2% (urban pick-ups), 3% (rural) and 22.6% (super rural). – For free standing facilities, use the “P” modifier if the facility is not part of the hospital and use “H” if it is hospital-based. Following these announcements, there was a Question and Answer period. Most of the questions were not answered on the call and the caller was asked to submit their questions to CMS, or was told to ask their Medicare Administrative Contractor or was told to appeal the denied claim referenced in their question. A few were answered, as follows:

Prior Authorization Issues – South Carolina

Based on implementation issues involving the Prior Authorization program for repetitive patients inSouth Carolina, Brian and I had a conference call with representatives of CMS and Palmetto on Friday January 9, 2015. Three main issues were discussed, as follows: 1. Legal Representative Payee – There was confusion concerning repetitive patients that had a Legal Representative Payee. These are patients who can not conduct their own affairs and have a form on file at the Social Security Administration for someone else to be their legal representative. When ambulance companies submitted for Prior Authorization for these patients, they were told thePrior Authorization did not apply for the patient. Palmetto posted their policy for these patients on their web site. Unfortunately, you will not know right away which patients have a legal representative payee. Most likely you will not know until you receive a rejection of the Prior Authorization request. Therefore, until you have been told a repetitive patient has a legal representative payee, file with Palmetto for the priorauthorization. Once you are told the patient has a legal representative payee, then submit claims, just as you would for non-repetitive patients, i.e. do not continue to try to obtain prior approval or a (more…)