Author: Kathy Lester

Update on HHS OIG Reports on Ambulance Services

Written by Kathy Lester on December 20, 2018. Posted in Member Advisories, Member-Only, News, Reimbursement.

Update on HHS Office of the Inspector General Reports on Ambulance Services

The HHS Office of the Inspector General (OIG) released an update to the Work Plan as the year comes to a close. There are no new projects specific to ambulance services, but the update does provide a summary of three projects that have been completed or are in progress.

Medicare Part B Payments for Ambulance Services Subject to Part A Skilled Nursing Facility Consolidated Billing Requirements (expected release 2019). In this work, the OIG seeking to determine whether ambulance services paid by Medicare Part B were subject to Part A SNF consolidated billing requirements. The OIG will also assess the effectiveness of edits in CMS’s Common Working File to prevent and detect Part B overpayments for ambulance transportation subject to consolidated billing. Prior OIG reports have identified high error rates and significant overpayments for services subject to SNF consolidated billing.
Ambulance Services – Supplier Compliance with Payment Requirements (partially completed; remainder expected release 2019). Prior OIG work has found that Medicare made inappropriate payments for advanced life support emergency transports. The OIG seeks to determine whether Medicare payments for ambulance services were made in accordance with Medicare requirements.

The first report of this project found that Medicare made improper payments of $8.7 million to providers for nonemergency ambulance transports to destinations not covered by Medicare, including the identified ground mileage associated with the transports. The report identified that the majority of the improperly billed claim lines (59 percent) were for transports to diagnostic or therapeutic sites, other than a physician’s office or a hospital, that did not originate from SNFs.

In this report, the OIG recommended that the CMS: (1) direct the Medicare contractors to recover the portion of the $8.7 million in improper payments made to providers for claim lines that are within the claim-reopening period; (2) for the remaining portion of the $8.7 million, which is outside of the Medicare reopening and recovery periods, instruct the Medicare contractors to notify providers of potential improper payments so that those providers can exercise reasonable diligence to investigate and return any identified similar improper payments, and identify and track any returned improper payments; (3) direct the Medicare contractors to review claim lines for nonemergency ambulance transports to destinations not covered by Medicare after the audit period and recover any improper payments identified; and (4) require the Medicare contractors to implement nation-wide prepayment edits to ensure that payments to providers for nonemergency ambulance transports comply with Federal requirements.

The third report is linked to a case study of the closure of the Rosebud Hospital Emergency Department. Rosebud is an Indian Health Service (IHS) hospital that discontinued emergency services. The closure of the Rosebud emergency department (ED) followed a notice of intent by the CMS to terminate Rosebud Hospital from the Medicare program. Representatives of the Rosebud Sioux Tribe raised concerns to OIG about the Rosebud ED closure and linked that closure to several patient deaths that occurred during ambulance transports to other facilities when emergency care was unavailable locally. In response to these concerns, the OIG seeks to examine factors considered and procedures involved in IHS’s decisions to close and later reopen the Rosebud ED. The OIG will also assess IHS’s management, coordination, and communication related to the closure and will identify lessons learned that IHS could apply to similar situations in the future. The report was expected to be published in 2018, but has not as of this date.

The AAA continues to monitor the OIG work plan and engage as appropriate with key officials. Our goal is to provide educational background to address any misunderstandings or incorrect assumptions that may exist.

Rural Health Day Advocacy Update

Written by Kathy Lester on November 15, 2018. Posted in Advocacy Priorities, Government Affairs, Legislative, Member Advisories, Member-Only, News, Regulatory, Reimbursement.

Happy National Rural Health Day! Thank you to all of the ambulance service providers who work hard providing life-saving treatment in rural areas every day.

In part of our ongoing advocacy efforts, the AAA sent a letter today to the Rural Caucuses in the United States Senate and House of Representatives. Addressed to leadership of the caucuses, Sen. Pat Roberts (R-KS), Sen. Heidi Heitkamp (D-ND), Rep. Adrian Smith (R-NE), and Rep. Tim Walz (D-MN), this in-depth letter highlights the critical work that our members do every day around the country and raises important issues affecting the industry. Issues covered in the letter include:

Stabilizing the Ambulance Fee Schedule

Make the add-ons permanent and build them into the base rate
Use new data from the ambulance cost collection program to ensure reimbursement is adequate going forward
New data should be used to assess the problems with the current ZIP-code methodology for determining rural and super-rural services

Ambulance Fee Schedule Reform

Proposed alternative models for rural ambulance services
Encouraging Congress to look at alternative destination options for ambulance service providers

Recognizing Ambulance Services as Providers of Health Care

Moving non-fire-based ambulance services from suppliers to providers under Medicare

The letter also highlights some of the burdensome regulations facing ambulance service providers that the AAA has recommended Congress address through its Red Tape initiative. These include:

Removing Unnecessary Regulatory Burdens:

Reduce the burdens created by the Physician Certificate Statement
Simplify the 855B Ambulance Enrollment Form
Address burdensome requirements of the patient signature on claims and the strict application of the revocation of billing authority

This letter from the AAA to Congressional leaders is just one part of the AAA’s ongoing effort to educate Congress on the crucial role ambulance service providers play in America’s healthcare system. The AAA wants Congress to know that in many rural areas of the country, ambulances are the medical safety net, yet face extreme challenges to staying in business thanks to below cost reimbursement and burdensome regulations. The AAA will continue to pursue this list of priorities with our members next year and going forward.

Read the Full Letter

Again, Happy Rural Health Day to our members – thanks for all that you do!

If you have any questions about our letter or rural advocacy, please contact us:

Questions?: Contact Us

If you have questions about the legislation or regulatory initiatives being undertaken by the AAA, please do not hesitate to contact a member of the AAA Government Affairs Team.

Tristan North – Senior Vice President of Government Affairs
tnorth@ambulance.org | (202) 802-9025

Ruth Hazdovac – AAA Senior Manager of Federal Government Affairs
rhazdovac@ambulance.org | (202) 802-9027

Aidan Camas – Manager of State & Federal Government Affairs
acamas@ambulance.org | (202) 802-9026

Thank you for your continued membership and support.

MedPAC Examines Beneficiary Use of Emergency Departments

Written by Kathy Lester on October 9, 2018. Posted in Medicare, Member Advisories, Member-Only, Regulatory, Reimbursement.

During its October meeting, the Medicare Payment Advisory Commission (MedPAC), reviewed Medicare’s current policies related to non-urgent and emergency care, as these topics relate to the use of hospital emergency departments (EDs) and urgent care centers (UCCs). The Commission is examining this topic because the use of ED services in recent years has grown faster than that of physician offices. At the same time, the share of ED visits that are coded as high acuity has increased.

The Commission is exploring Medicare beneficiaries’ use of EDs and UCCs for non-urgent services. In addition, the Commission is analyzing ED coding to determine if the increase in coding high-acuity visits reflects real change in the patients treated in EDs. This slide deck shows the potential savings Medicare could realize if beneficiaries shift certain care to the UCC setting.

During the meeting, the staff sought feedback from Commissioners for developing next steps. This topic will likely continue to be addressed in future meetings.

From the perspective of ambulance payment reform, the observations made by the Commissioners and staff would also seem to support incorporating scope-appropriate ambulance services in the context of community paramedicine or treatment at the scene with referral. While additional work needs to be done by the ambulance community before these services can be incorporated into the Medicare reimbursement program, discussions like the one at MedPAC last week, show the importance of getting the details right so that ambulance services can be part of new payment models likely to be considered.

The American Ambulance Association is leading the effort with the Medicare program to develop appropriate models that account for the cost of providing services through sustainable reimbursement rates, rather than the use of temporary grants. We are also focused on ensuring services align with the scope of practice laws. Led by the Payment Reform and the Medicare Regulatory Committees, our efforts include regular meetings and discussions with leaders at the Centers for Medicare & Medicaid Services, as well as key Members of Congress. Follow us on Facebook and Twitter to learn more about our ongoing efforts.

CMS Launches Outreach Effort to Ambulance Providers & Suppliers

Written by Kathy Lester on October 3, 2018. Posted in Cost Data Collection, Member Advisories, News.

As part of the Bipartisan Budget Act of 2018 (BBA 2018), the Congress instructed CMS to develop a cost collection system to collect cost and revenue data related to the provision of ambulance services. Ambulance services are defined by federal law to include all levels of emergency and non-emergency services.

CMS is in the first phase of this process. The Congress instructed the Agency to engage with stakeholders before specifying through notice and comment rulemaking the data collection system. By law, CMS is required to specify the final system by December 31, 2019. CMS must also identify the first group of providers and suppliers selected for the first representative sample by that date as well. It appears that the goal is to have the contractor develop a proposal before the 2019 rulemaking cycle which will begin next summer.

To engage with the stakeholders, CMS, through its contractor the RAND Corporation, is reaching out providers and suppliers to learn more about the costs and revenues associated with providing ambulance services.

During the American Ambulance Association’s annual meeting earlier this month, CMS through the RAND Corporation, convened a focus group where they selected several AAA members who were able to talk directly with the contractor. The discussion centered around characteristics of ambulance services that matter for determining costs. The group also talked about how data is currently captured at the state and local levels, as well as how data is tracked within ambulance services. There was also a lot of discussion about the importance of standardizing data elements and not relying upon different state or local definitions, which could confound the data and make it impossible to compare costs across states.

As we have reported previously, it is critically important that the data collected through this process is standardized and reflects the actual cost of providing ambulance services. It is important to make sure that the data is useable not only for supporting the ambulance add-ons after they next expire in 2023, but also to help implement broader reforms and innovative payment models.

CMS is now reaching out to others in the industry. If you receive an email or a phone call from RAND Corporation, please respond.

If you have questions about, or would like assistance with regard to, this project, please contact Tristan North at tnorth@ambulance.org.

CMS Non-Emergency Ambulance Transport Open Door Forum 7/26

Written by Kathy Lester on July 25, 2018. Posted in Medicare, Member Advisories, Member-Only, News, Regulatory.

CMS Issues Data Elements and Templates for Non-Emergency Ambulance Transports (NEAT): Open Door Forum for
Thursday, July 26, 2018 Just Announced

As part of its Patients Over Paperwork Project, the Centers for Medicare & Medicaid Services (CMS) Provider Compliance Group (PCG) has been hosting quarterly listening sessions and reviewing the Request for Information submissions. The American Ambulance Association has been actively engaged in these efforts, highlighting the recommendations we submitted to CMS and the House Ways & Means Committee last year. These recommendations included suggestions as to how CMS could streamline regulatory requirements to eliminate duplicative requirements and reduce regulatory burdens. In addition to these efforts, CMS has been working to standardize documentation data elements and establish templates that providers and suppliers can use to help make the current documentation processes less burdensome as well.

On July 24, CMS released draft documentation-related clinical data elements and clinical templates that could be used for the Physician Certification Statement, Progress Notes, and Prior Authorization requests. View the Documents. These documents are not intended to change current law.

CMS also announced yesterday that it will discuss the templates on a Special Open Door Forum which is scheduled for July 26 at 2-3 pm ET. The call-in information is:

Participant Dial-In Number: 1-(888)-989-4575
Conference ID: 3068545

We have shared our concern about the short notice about the call and CMS has indicated it will continue to take comments on the documents after the call as well. The AAA is in the process of reviewing these documents closely and will develop a written comment letter to provide to CMS after the call on Thursday. We welcome input from all our members as part of this process.

While these new documents may be helpful for many services, the AAA also remains committed to move its recommendations which would result in some changes in the PCS and other ambulance provider and supplier requirements.

Physician Fee Schedule Proposed Rule 2018

Written by Kathy Lester on July 13, 2018. Posted in Cost Data Collection, Government Affairs, Medicaid, Member Advisories, Member-Only, News, Reimbursement.

On Thursday, July 12, the Centers for Medicare & Medicaid Services (CMS) released the “Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2019; Medicare Shared Savings Program Requirements; Quality Payment Program; and Medicaid Promoting Interoperability Program” Proposed Rule (Proposed Rule).

As you know, the American Ambulance Association worked closely with the Congress to ensure passage of the Bipartisan Budget Act of 2018 (BBA) (Pub. L. 115-123, enacted on February 9, 2018). The BBA not only extended the ambulance add-ons for 5 years, but also authorized a cost collection system that would not be overly burdensome on ambulance providers and suppliers, but would provide sufficient information ideally to support the permanent extension of the add-ons and set the basis for new payment models, including alternative destinations, treatment/assessment without transport, and community paramedicine.

After passage of the BBA, the AAA engaged immediate with CMS to ensure the smooth implementation of these provisions. Those contacts resulted in guidance earlier this year implementing the add-ons retroactively to January 1, 2019.

Consistent with the statute and already-released guidance, the Proposed Rule extends the three add-ons: the 2 percent urban, 3 percent rural, and 22.6 percent super-rural add-ons. The Proposed Rule would codify the extension of the add-ons through December 31, 2022.

The Proposed Rule would implement the increase in the reduction in rates for non-emergency ambulance transports to/from dialysis facilities for services furnished on or after October 1, 2018. The 10 percent reduction applies for these transports furnished during the period beginning on October 1, 2013 and ending on September 30, 2018. The reduction will increase to 23 percent to conform the regulations to the statutory requirement for services furnished on or after October 1, 2018.

CMS does not request any information about the cost collection system in the Proposed Rule, but has been soliciting comments and recommendations through informal provider/supplier calls. Additionally, the AAA has been in regular contact with CMS on the structure, design, and data elements to ensure the successful implementation of this critically important system as well.

Collecting Data for the Future

Written by Kathy Lester on February 16, 2018. Posted in Cost Survey, Reimbursement.

Collecting Data for the Future: Understanding the New Statutory Cost Collection Requirement

By Kathy Lester, JD, MPH, Lester Health Law PLLC

On February 9, the President signed into law the Bipartisan Budget Act of 2018 which thankfully included a five-year extension of the ambulance add-ons. Along with the add-ons extension, the Congress included language requiring the Centers for Medicare and Medicaid Services (CMS) to develop and implement a new cost data collection system for ambulance service providers and suppliers. While cost collection may sound difficult, the process outlined in the new authority strikes the appropriate balance and will minimize the burden on ambulance service providers and suppliers, while allowing the federal government to collect meaningful data that can be used to address the inadequate reimbursement rates and modernize Medicare ambulance payment policies.

Knowing some time ago that the industry would need to provide CMS with cost information, the AAA for the past six years has been working with The Moran Company, a well-respected health care analytical firm in DC, on the best way to collect ambulance cost data. Most recently, the AAA Payment Reform Committee has been working with the cost collection experts at The Moran Company to identify the data elements that CMS would need to collect to establish accurate information about the cost of providing ground ambulance services. We have also developed educational materials that we will share with Members to help ensure a smooth transition into this system.

General

The core components of the new cost collection system for providers and suppliers of ground ambulance services are:

A requirement that the Secretary of Health and Human Services, through notice-and-comment rulemaking, must develop a data collection system to collect: (1) cost; (2) revenue; (3) utilization; and (4) other information determined appropriate by the Secretary;
This system may use a cost survey; and
The data collect should include information: (1) needed to evaluate the extent to which costs are related to payment rates; (2) on the utilization of capital equipment and ambulance capacity; and (3) on different types of ground ambulance services furnished in different geographic locations and low population density areas.

Representative Sample

Under the statute, the Secretary must select a representative sample of providers and suppliers from whom to collect data. The sample will be determined based on the type of providers and suppliers (such as those that are part of a governmental organization, fire, hospital-based, etc) and the geographic locations (such as urban, rural, and low-population density areas). An individual provider or supplier (defined most likely by National Provider Identifier) may not be requested to submit data in two consecutive years, to the extent practicable.

Reporting Requirements

A provider or supplier selected to report data must do so in the form and manner and at the time specified by the Secretary. If a provider or supplier that has been selected to report does not do so, then the provider or supplier may be subject to a 10 percent payment reduction, unless the hardship exemption applies. Providers or suppliers that are penalized may seek a review of the application of the penalty. The Secretary does have the authority to take into consideration certain hardships as to why a provider or supplier was unable to submit their data and waive the penalty.

Modification Over Time

The Secretary may revise the system over time.

Public Availability of the Data

The Secretary will provide the information collected available through the CMS Website, similar to the process used for other data CMS collects.

MedPAC Report

In addition, the language includes a study/studies from the Medicare Payment Advisory Commission (MedPAC). MedPAC is required to issue at least one report, and potential subsequent reports, on the following:

An analysis of the information submitted by providers and suppliers through the data collection system;
An analysis of any burden on providers and suppliers associated with the data collection system;
A recommendation as to whether information should continue to be submitted through such data collection system or if it should be revised;
The adequacy of payments for ground ambulance services;
Geographic variations in the cost of furnishing ground ambulance services; and
Other information determined appropriate by the Commission.

Timeline

The Secretary must implement the data collection system according to the following timeline:

The AAA will continue to keep you informed as the development and implementation of the ambulance cost data collection system moves forward.

12/31/2019	Specify the data collection system Identify providers and suppliers that would be required to submit information for the representative sample
2020 – 2024	Collect data each year from a representative sample of providers and suppliers
2022	First year a provider or supplier that has been asked to submit data and has not sufficiently submitted the data may be subject to a 10 percent payment reduction.
2023	MedPAC report due
2025+	Collect data as the Secretary determines appropriate but no less often than once every 3 years

The AAA will continue to work with The Moran Company and other experts to make sure data collection system works for all ambulance service providers and suppliers and leads to information that the industry needs to move toward making the add-ons permanent and modernizing the benefit to include new payment models, including transports to alternative destinations, treatment with referral and no transport, and mobile integrated health.

Alert: Medicare Increases Will Expire For Now: What You Need to Know

Written by Kathy Lester on December 27, 2017. Posted in Advocacy Priorities, Government Affairs, Member Advisories, News, Reimbursement.

While the Congress succeeded in passing the Republican tax bill and keeping the federal government open with a short-term continuing resolution that included a temporary extension for the State Children’s Health Insurance Program (CHIP), it did not act upon the several Medicare extenders that expire on December 31, 2017. This extenders package includes the ambulance add-ons for urban, rural, and super-rural areas, as well as a moratorium on therapy caps, extenders for hospitals, and several other extenders important to other Medicare providers.

Despite the fact that the Congress left town, there is still strong bipartisan support for reinstating these extenders – including the ambulance extenders – early in January 2018. The most likely time frame will be for the extenders to be added to the next government funding legislation, which must be passed by January 19.

First, do not panic. As you may have already heard, CMS is telling providers and suppliers that the add-ons will expire at the end of the month. Technically that is true. The Agency is simply stating the obvious; but no one should imply from such statements that the Congress will not fix them or not make them retroactive. Historically, CMS has followed this pattern of indicating the add-ons have expired until legislation extending the add-ons has passed both chambers of Congress and the President has signed the bill into law. CMS will make similar statements relative to the other Medicare extenders as well.

Second, prepare. To the extent you are able to do so, you may hold your claims. Medicare requires providers to files claims no later than 12 months after the date when the services were provided. (See Medicare: File a Claim; see also section 6404 of the Affordable Care Act). While this may not work for all claims, holding claims will reduce the number that would have to be reprocessed once the add-ons become law. If CMS believes at some point the legislation will pass, it may also break with its own precedent and indicate that has asked the contractors to hold claims for a short period of time as well. It did this in 2014 when it discovered errors in a final fee schedule rule. Once the claims are processed, so long as the add-ons have been extended by law, the add-on dollars will appear in the reimbursement amounts sent to providers and suppliers.

Third, retroactivity can be expensive, but CMS can mitigate the costs. CMS did this most recently in May of 2017. Then, CMS announced that it would implement the retroactive extension of a transitional payment for durable medical equipment suppliers by having the contractors automatically reprocess claims from the period when the transitional payment was made retroactive. This approach reduced the burden on providers and suppliers by eliminating the need to resubmit claims.

Despite the fact that there are ways to mitigate the problem, the American Ambulance Association (AAA) remains deeply concerned that the Congress did not extend the add-ons before they left for the holidays. We understand that for ambulance services across the country receiving timely payments from Medicare can be the difference between being able to make payroll or not. Having the dollars from the add-ons is also crucial to ensuring adequate cash flow. Therefore, while we advise you to think through your options and take the steps that best meet your needs and the needs of your employees, patients, partners, and businesses, we also ask that you reach out to the Congress and let them know how important it is to get the add-ons extended as early in January as possible. Make your voice heard by going to the AAA’s grassroots page. There you can send an email or reach out through social media to your Members of Congress. We need everyone, including your employees, patients, and others who support high quality ambulance services, to reach out today.

Write to Your Members of Congress

The AAA will continue our direct efforts on Capitol Hill to make sure these add-ons are extended and overly burdensome new requirements are not placed on ambulance services. With your help, we can get the add-ons extended. For more information please visit https://ambulance.org/advocacy/.

ACA Repeal & Reform – What it Means (Part Two)

Written by Kathy Lester on March 20, 2017. Posted in Government Affairs, Member Advisories.

By: Tristan North and Kathy Lester, JD, MPH

This is the second part of a two part Member Advisory by Tristan North and Kathy Lester on ACA Repeal & Reform. Read Part One: ACA Repeal & Reform – What It Means for Ambulance Services (Pt. 1).

The remainder of this alert provides more detail about the House legislation, as well as key bills that have been introduced in the Senate. It also provides background on the process to date.

House Legislation, The American Health Care Act (AHCA)

While three House Committees have referred the ACHA to the full House, over the weekend it became clear that there Speaker Paul Ryan (R-WI) will entertain amendments to the current text. As these agreements become available, we will provide an updated analysis.

The AHCA seeks to redefine the ACA in significant ways. First, it would repeal the penalties related to the individual and employer mandates. It would allow insurance companies to apply a 30 percent late-enrollment surcharge on individual and small group market applicants who have not had coverage in the previous 63 days. It would phase out the Medicaid expansion program, shifting it to a per capita cap model. It would also eliminate many of the taxes implemented under the ACA. It would delay implementation of the “Cadillac Tax” on high cost health plans until 2025. It would repeal the cost sharing subsidies program.

The AHCA would retain certain popular ACA provisions, including allowing children to stay on their parents’ insurance until age 26 and requiring insurers to cover people with pre-existing conditions.

Some additional highlights of the plan include:

Establishing a temporary Patient and State Stability Fund to “lower patient costs and stabilize State markets.” Dollars from the fund could be used to:
- Provide assistance to high-risk individuals who do not have access to health insurance coverage offered through an employer.
- Provide incentives to appropriate entities to enter into arrangements with the State to help stabilize premiums.
- Reduce the cost of providing health insurance coverage in the individual and small group market for otherwise high-cost individuals.
- Promote participation in the individual and small group markets in the State and increasing available health insurance options.
- Promote access to preventive services, dental care services, and mental health and substance use disorder services.
- Provide payments, directly or indirectly, to health care providers for the provision of certain health care services.
- Provide assistance to reduce consumer out-of-pocket costs for individuals enrolled in health insurance coverage in the State.
Eliminates presumptive eligibility determinations for Medicaid.
Decreases mandatory Medicaid income eligibility level from 133 percent of the federal poverty level (FPL) to 100 percent, effective Dec. 31, 2019.
Provides $10 billion total over five years for FMAP payments to non-expansion States that adjust the payment amounts otherwise provided to health care providers for services furnished to Medicaid enrollees.
Increases the basic limit on aggregate health savings account (HSA) contributions to equal the maximum limit on the amount of the annual deductible and out-of-pocket expenses of a high deductible health plan beginning in 2018.
Repeals current actuarial value standards related to the ACA metal levels of coverage, effective for plan years 2020 and beyond.
Eliminates the Disproportionate Share Hospital (DSH) payment cuts.
Repeals Prevention and Public Health Fund funding for FY 2019 and beyond.
Provides $422 million in funding for FY 2017 for the Community Health Center Fund, which makes grants to Federally-Qualified Health Centers (FQHCs).

The Congressional Budget Office (CBO) estimates that the AHCA will reduce the deficit by $337 billion. CBO predicts that by 2018, 14 million more people would join the ranks of the uninsured under the AHCA. This number would reach the 24 million by 2026, when “an estimated 52 million people would be uninsured, compared with 28 million who would lack insurance that year under current law.” CBO also predicts that while there would be an initial 15 to 20 percent increase in premiums in 2018, average premium amounts would drop to 10 percent compared to current law. CBO indicates that Medicaid expenditures would fall by $880 billion over 10 years and 14 million fewer Americans would be enrolled in Medicaid by 2026.

The American Medical Association (AMA), AARP, the American Hospital Association (AHA), the Federation of American Hospitals, the Association of American Medical Colleges, the American Nurses Association, the American College of Physicians oppose the AHCA. Other organizations have expressed serious concern, including the American Health Care Association (nursing homes) and the American Academy of Family Physicians. America’s Health Insurance Plans (AHIP) has expressed concerns, but is open to compromise.

Senate ACA Reform Legislation

It is more difficult to anticipate how the Senate will react to the House legislation. However, it is likely that Senate Republicans will support at least some of the following reform ideas:

HSAs could be paired with health insurance plans that have high deductibles and low premiums. Republicans favor HSAs because they generally shift a greater amount of financial responsibility to the beneficiary. HSA could be designed to include tax-free contributions, growth of savings, and medical expense withdrawals.

High-risk pools. While policies to address the problem of the risk pools could take many forms, there have been focused efforts to remove individuals with pre-existing conditions from the general pool of health insurance to lower the premiums for the young and healthy. Some States have attempted to implement high-risk pools in the past; however, previous iterations have been expensive.

Medicaid reform. Republicans remain concerned about the expense of the Medicaid program and have suggested per-capita grants, which would allocate a set amount of money per enrollee in the state.

Tax credits for health insurance. Republicans prefers to use tax credits to help people buy insurance rather than keep the ACA’s subsidies. Several proposals have been discussed, including age-adjusted credits or credits based on number of family members.

While there may be an effort to amend the House’s AHCA, there is at least one Senate bill that has earned some attention. Sens. Bill Cassidy (R-LA) and Susan Collins (R-ME) introduced “The Patient Freedom Act” earlier this year. It would replace the current Exchange structure and allow States to select from one of three alternatives for providing coverage to its citizens.

First, States could re-implement the ACA coverage they have been relying upon, if the think it is working for them. States could continue to receive federal premium tax credits, cost-sharing subsidies, and Medicaid dollars, to the extent that such subsidies do not exceed a certain limit. Second, States could enact a new market-based system that would retain popular ACA provisions, such as protecting those with pre-existing conditions. They could continue to receive funding equal to 95 percent of federal premium tax credits and cost-sharing subsidies, as well as the federal match for Medicaid expansion. States could choose to receive funds in the form of per beneficiary grants or advanced refundable tax credits, but in both cases, funds would be deposited in a Roth Health Savings Account (HSA), meaning the money would go directly to the patient. Third, States could decide not to take any federal assistance and design and oversee the insurance market without federal intervention.

This legislation also seeks to curb high costs medical expenses and includes a broad provision seeks to ensuring access to emergency services without excessive charges for out-of-network services. AAA and our members are working to explain the unique nature of ambulance services to avoid this provision inappropriately being applied to ground ambulance services.

It is likely that other proposals will arise in the Senate and that the Senate Finance Committee will develop a proposal that could amend the AHCA or take a different path. We will provide you with more information as the proposals develop.

Process for Repeal and Reform

Republicans intend to address repeal and replace through three actions. First, the Congress passed the 2017 Budget Reconciliation legislation to repeal key structural pieces of the ACA. The second set of actions are being undertaken by the Trump Administration, which is making changes to the ACA through the administrative or regulatory process. Third, congressional Republicans are now in the process of moving a second piece of legislation later in the year that would address the specifics of the replace.

With passage of the FY2017 Budget Resolution (S.Con.Res. 3), Congressional Republicans took the first step to repealing the ACA. On January 12, the Senate voted 51 to 48 in favor of a FY2017 Budget, which included the budget framework for repealing the ACA. The House followed suit on January 13 by a vote of 227 to 198. While not binding or needing the signature of the President, the passage of the FY2017 Budget provides authority to the House and Senate committees of jurisdiction to move forward on the provisions of a FY2017 Budget Reconciliation package. The Reconciliation package is binding and would be sent to President Trump for his signature. This would actually repeal the ACA.

Congressional Republicans are using the budget reconciliation process, as it only requires a simple majority in the Senate to pass. Senate Democrats can therefore not filibuster the package unlike most legislation that requires 60 votes to end debate. This is the same process Democrats used back in 2010 to pass portions of the ACA.

During the week of March 6, the House Energy & Commerce and Ways & Means Committee passed their respective sections of repeal in replace as part of the FY2017 Budget Reconciliation package which has been named the American Health Care Act (AHCA). On March 16, the House Budget Committee combined the sections and approved the package. The House Rules Committee is expected to meet on the rules debate by Wednesday with the full House expected to consider the bill on March 23. Passage of the bill is likely but not certain as some more conservative as well as more moderate members of the Republican Caucus are expected to join with possibly all Democrats in opposition to the bill. Several more moderate as well as conservative Republican Senators have also voiced concerns leaving in doubt whether the bill can pass the Senate.

Repealing the ACA is actually much easier than passing a second piece of legislation later to address the specifics of the replacement. Much of the ACA replacement package is subject to a point of order and can’t be included in a Budget Reconciliation bill because such a package can only be used for provisions that increase or reduce the budget. So Republicans will need the support of eight Senate Democrats to pass a second replacement package. All this will ensure a very intense next few months or longer as repeal and replacement moves forward.

Administrative Actions

As noted, another critical piece of the three-step process of repealing and replacing/refining the ACA comes from the Trump Administration. One of President Trump’s first actions after being sworn in as the 45^th President of the United States was to issue an Executive Order to federal agencies to “waive, defer, grant exemptions from, or delay the implementation of any provision or requirement [of the Affordable Care Act]…that would impose a fiscal burden on any State, or a cost, fee, tax, penalty, or regulatory burden on an individual.” The Executive Order also directs agencies to provide relief to the states, as well as “waive” regulations or costs on “makers of medical devices, products, or medications.”

Although the Executive Order does not legally halt any of the policies from continuing in its current state, such as the individual mandate or the medical device excise tax, it does give a clear signal from the new Trump Administration on its intent to dismantle the ACA quickly, without waiting for Congress. The Order does confirm that the new Administration will follow the Administrative Procedure Act, which requires federal agencies to go through a formal rulemaking process to implement major changes.

Soon after, the Administration released one of its first proposed rules, entitled “Marketplace Stabilization.” Overall, the rule proposes a series of modifications to the Marketplaces that align with requests made by issuers in an attempt to keep them in the Marketplaces. (Please see the March 1, 2017, Member Advisory for more details about this proposed rule)

More recently, Secretary of the Department of Health and Human Services (HHS) Tom Price and Centers for Medicare and Medicaid Services (CMS) Seema Verma sent a letter to State Governors describing their plans for the Medicaid Program (Please see the March 17 Member Advisory for more details about this letter).

There are several other ways that the Secretary and Administrator can dismantle the ACA without Congressional intervention. These include:

Stopping enforcing the individual mandate. In coordination with Treasury Department, the Secretary could limit or stop the collection of the penalty for those without health insurance.

Modifying hardship waivers. The Secretary has significant discretion in defining what constitutes “hardship” when granting exemption to the individual mandate penalty and could expand this definition to grant more exemptions.

Limiting or eliminating women’s preventive services. The Secretary could expand the Hobby Lobby exemption available to religious organizations, nonprofits, and closely-held for-profit corporations; exclude contraception from the list of women’s preventive services; or entirely eliminate coverage of women’s preventive services.

Narrowing regulations on EHBs. The ACA establishes 10 EHB categories, but the Secretary has the authority to issue regulations that would permit insurers to more narrowly define what it means to cover the categories. Similarly, the Secretary could adjust revise or eliminate the requirements related to defining EHBs by referencing benchmark plans.

Restricting special enrollment periods. The Secretary could establish additional requirements for those trying to sign up outside of the open enrollment period, such as requiring more documentation.

Approving different 1115 waivers for Medicaid. As evidenced in the recent letter to State Governors, the Secretary and Administrator have already signaled that they are likely to approve different Medicaid waivers than were provided during the Obama Administration.

We will keep you posted of new developments on repeal and replace of the Affordable Care Act.

Administration’s Proposed Rule on Marketplace Stabilization

Written by Kathy Lester on March 1, 2017. Posted in Government Affairs, Medicaid, Medicare, Member Advisories, Member-Only, Private Insurance, Regulatory.

The Centers for Medicare & Medicaid Services (CMS) has released the “Marketplace Stabilization Proposed Rule” (Proposed Rule). Overall, the rule proposes a series of modifications to the Marketplaces that align with requests made by issuers in an attempt to keep them in the Marketplaces. The background section of the Proposed Rule emphasizes the concerns of issuers and the Agency’s interest in making sure that consumers have more plan options for 2018. Comments are due March 7.

While ambulance services are not directly mentioned, the Proposed Rule could affect the ability of individuals in the marketplace to enroll and remain enrolled in plans. Another provision that could impact the ambulance industry is the proposal to rely more upon the States to enforce the network adequacy requirements of the ACA.

Changes to Open Enrollment/Special Enrollment Periods

CMS proposes to tighten the enrollment rules in several ways. First, the Proposed Rule would change the open enrollment period to November 1 – December 15 to “increase the incentives for individuals to maintain enrollment in health coverage and decrease the incentives for individuals to enroll only after they discover they require services.”^[1] Individuals may still be eligible for a special enrollment period that would allow them to enroll outside of these dates.

CMS would increase the States’ pre-enrollment verification from 50 percent to 100 percent beginning June 1, 2017, and require consumers’ enrollment requests to be “pended” until verification is complete. CMS encourages State-based Exchanges to adopt a similar policy. The Proposed Rule would also limit the ability of existing Exchange enrollees to change plan metal levels during the coverage year. It would allow Exchanges to require enrollees that qualify for a special enrollment period because of a dependent to be add only to the current Qualified Health Plan (QHP) or allow the enrollee and the new dependent to enroll in another QHP within the same level of coverage.[2]

The Proposed Rule would also require that if an enrollee or the dependent is not enrolled in a silver level QHP and becomes newly eligible for cost-sharing reductions and qualifies for the special enrollment periods, the Exchange may allow the enrollee and dependent to enroll in only a QHP at the silver level.[3] CMS also proposes a new restriction that would allow the Exchange only to allow an enrollee and dependents who qualify for remaining special enrollment periods to make changes to their enrollment in the same QHP or to change to another QHP within the same level of coverage, if other QHPs at that metal level are available.[4]

CMS would allow consumers to start their coverage one month later than their effective date would ordinarily have been, if the special enrollment period verification process results in a delay in their enrollment such that they would be required to pay two or more months of retroactive premium to effectuate coverage or avoid termination for non- payment. [5]

Additionally, CMS would permit the issuer to reject an enrollment for which the issuer has a record of termination due to non-payment of premiums unless the individual fulfills obligations for premiums due for previous coverage.

The Proposed Rule also expresses concern that some consumers not seeking coverage until they are married. CMS proposes that if consumers are newly enrolling in QHP coverage through the Exchange through the special enrollment period for marriage, at least one spouse must demonstrate having had minimum essential coverage for 1 or more days during the 60 days preceding the date of marriage. There is a special rule for individuals who may not have been living in the United States prior to their marriage.[6]

The Proposed Rule would also significantly limit the use of the exceptional circumstances special enrollment period. In previous years, this special enrollment period has been used to address eligibility or enrollment issues that affect large cohorts of individuals where they had made reasonable efforts to enroll, but were hindered by outside events. If the proposal were adopted, CMS would apply a more rigorous test for future uses of the exceptional circumstances special enrollment period, including requiring supporting documentation where practicable. It would grant this special enrollment period only if provided with sufficient evidence to conclude that the consumer’s situation was truly exceptional and in instances where it is verifiable that consumers were directly impacted by the circumstance, as practicable.[7]

CMS is also exploring ways to incentivize consumers to maintain continuous coverage.

These proposed special enrollment changes would not apply to special enrollment periods under the Small Business Health Options Program (SHOP).[8]

Network Adequacy

CMS proposes changes to the oversight of network adequacy requirements to “affirm the traditional role of States in overseeing their health insurance markets while reducing the regulatory burden of participating in Exchanges for issuers.”[9]

CMS proposes to rely on State reviews for network adequacy in States in which an FFE is operating, provided the State has a sufficient network adequacy review process, rather than performing a time and distance evaluation. Beginning in plan year 2018, it would defer to the States’ reviews in States with the authority that is at least equal to the “reasonable access standard” and means to assess issuer network adequacy, regardless of whether the Exchange is a State-based Exchange or federally facilitated, and regardless of whether the State performs plan management functions.

In States without the authority or means to conduct sufficient network adequacy reviews, CMS would rely on an issuer’s accreditation (commercial or Medicaid) from an HHS-recognized accrediting entity. HHS has previously recognized 3 accrediting entities for the accreditation of QHPs: the National Committee for Quality Assurance, URAC, and Accreditation Association for Ambulatory Health Care. An unaccredited issuer would have to submit an access plan.

Interpretation of the Guaranteed Availability Requirement

CMS proposes revising the interpretation of the guaranteed availability requirement to allow issuers to apply a premium payment to an individual’s past debt owed for coverage from the same issuer enrolled in within the prior 12 month. CMS argues this change is necessary to “remov[e] economic incentives individuals may have had to pay premiums only when they were in need of health care services and to encourag[e] individuals to maintain continuous coverage throughout the year and prevent gaming.”[10]

De Minimis Variation in the Actuarial Values

CMS proposes increasing the de minimis variation in the actuarial values (AVs) used to determine metal levels of coverage for the 2018 plan year to “allow issuers greater flexibility in designing new plans and to provide additional options for issuers to keep cost sharing the same from year to year.”[11]

Essential Community Providers

CMS proposes allowing issuers to use a write-in process to identify essential community providers (ECPs) who are not on the HHS list of available ECPs for the 2018 plan year; and lower the ECP standard to 20 percent (rather than 30 percent).^[12]

[1] CMS Patient Protection and Affordable Care Act; Market Stabilization Proposed Rule.

[2]Id.

[3]Id.

[4]Id.

[5]Id.

[6]Id.

[7]Id.

[8]Id.

[9]Id.

[10]Id.

[11]Id.

[12]Id.

CMS Moratoria Update

Written by Kathy Lester on August 3, 2016. Posted in Government Affairs, Medicaid, Medicare, Member Advisories, Member-Only, Regulatory.

The Centers for Medicare & Medicaid Services Lifts Moratoria on Enrollment of Part B Emergency Ground Ambulance Suppliers in All Geographic Locations; Moratoria for Part B Non-Emergency Ground Ambulance Suppliers Extended

Effective July 29, the Centers for Medicare & Medicaid Services (CMS) has lifted the temporary moratoria in all geographic locations for Part B emergency ground ambulance suppliers. Beginning in 2013, CMS placed moratoria on Medicare Part B ground ambulance suppliers in Harris County, Texas, and surrounding counties (Brazoria, Chambers, Fort Bend, Galveston, Liberty, Montgomery, and Waller). In February 2014, CMS announced it would add six more months to these moratoria and add Philadelphia, Pennsylvania, and surrounding counties (Bucks, Delaware, and Montgomery), as well as the New Jersey counties of Burlington, Camden, and Gloucester. Since that date, CMS extended the moratoria four additional times, most recently in February of this year.

CMS considers qualitative and quantitative factors when determining if there is a high risk of fraud, waste, and abuse in a particular area and whether or not it should establish a moratorium. If CMS identifies an area as posing an increased risk to the Medicaid program, the State Medicaid agency must impose a similar temporary moratorium as well. CMS also consults with the Office of the Inspector General (OIG) within the Department of Health and Human Services (HHS) and the Department of Justice (DOJ) when identifying potential areas and providers/suppliers that should be subject to a temporary moratorium. Finally, CMS also considers whether imposing a moratorium would have a negative impact on beneficiary access to care. In areas where there is a temporary moratorium, the policy does not apply to changes in practice location, changes to provider/supplier information (e.g., phone number, address), or change in ownership. Temporary moratoria remain in place for six months, unless CMS extends the policy through notice in the Federal Register.

CMS may lift a moratorium at any time if the President declares an area a disaster under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, if circumstances warranting the imposition of a moratorium have abated, if the Secretary of HHS has declared a public health emergency, or if, in the judgment of the Secretary of HHS, the moratorium is no longer needed. After a moratorium is lifted, providers/suppliers previously subject to it will be designated to CMS’s “high screening level” for six months from the date on which the moratorium was lifted.

CMS has announced it will lift the moratoria on new Part B emergency ambulance suppliers in all geographic locations because the Agency’s evaluation has shown the primary risk of fraud, waste, and abuse comes from the non-emergency ambulance supplier category and that there are potential access to care issues for emergency ambulance services in the areas with moratoria. New emergency ambulance suppliers seeking to enroll as Medicare suppliers will be subject to “high risk” screening. If enrolled, these suppliers will be permitted to bill only for emergency transportation services. They will not be permitted to bill for non-emergency services.

The moratoria remain in place for Medicare Part B non-emergency ground ambulance suppliers for all counties in which moratoria already are in place in New Jersey, Pennsylvania, and Texas.

MedPAC Issues June 2016 Report to the Congress

Written by Kathy Lester on June 24, 2016. Posted in Finance, Government Affairs, Medicare, Member Advisories, Member-Only, Regulatory.

MedPAC Issues June 2016 Report to the Congress with Chapter on Improving Efficiency and Preserving Access to Emergency Care in Rural Areas

Medicare Payment Advisory Commission (MedPAC or the Commission) has issued its June 2016 Report to the Congress. The June report includes recommended refinements to Medicare payment systems and identifies issues affecting the Medicare program, broader changes in health care delivery, and the market for health care services.

Chapter 7 focuses on preserving access to emergency care in rural areas. The Commission recognizes that access to inpatient and emergency services in rural areas is threatened because of the dwindling populations. Declining populations can lead to fewer hospital admissions and reduced efficiencies that can create financial and staff problems for hospitals. The Report notes that “[d]eclining volume is a concern because low-volume rural hospitals tend to have worse mortality metrics and worse performance on some process measures.” In addition, “low-volume CAHs have the difficult job of competing with each other for a shrinking pool of clinicians who want the lifestyle of operating an outpatient practice during the day, covering inpatient issues that arise at night, and covering the emergency department.”

Under current policies, most rural hospitals are critical access hospitals (CAHs). They receive a cost-based payment for providing inpatient and outpatient services to Medicare beneficiaries. To receive these payments, a hospital must maintain acute inpatient services. In rural areas, many small towns do not have a sufficient population to support such a model. Yet eliminating these services would mean giving up the supplemental payments that their hospitals receive through the CAH cost-based payment model.

The hospital prospective payment system serves as the payment model for other hospitals. Rural providers receive supplemental payments, which are also linked to providing inpatient services.

MedPAC highlights the concerns with cost-based payment models:

Cost-based payments do not direct payments toward isolated hospitals having the greatest financial difficulty, but rather reward hospitals in high-income areas with higher non-Medicare margins by providing them with higher Medicare payments.

Cost-based payments encourage providers to expand service lines with high Medicare and private-payer shares rather than primarily focus on services that are needed on an emergency basis.

Cost-based models reduce the incentive for hospitals to control their costs, which can lead to unnecessary growth in capital costs, despite declining volumes.

In light of these challenges, MedPAC sets forth a two of options that would give isolated rural hospitals the option of converting to an outpatient-only model while maintaining their special payment arrangements. These models seek to ensure access to essential services:

Establishing a 24/7 emergency department model; and
Adopting a clinic with ambulance services model.

Under the 24/7 emergency department model, the hospital would be paid under the outpatient prospective payment rates and would receive an annual grant/fixed payment from Medicare to cover the standby costs associated with 24/7 emergency services. The current supplemental payments would be redirected to support this annual grant/fixed payment amount. If a hospital chose to use inpatient beds as skilled nursing facility (SNF) beds, it would be reimbursed under the Medicare SNF prospective payment system. The hospital could be required to use the fixed payment for emergency standby capacity, ambulance service losses, telehealth capacity, and uncompensated care in the emergency department.

Under the clinic and ambulance model, hospitals could convert their existing inpatient facilities into primary care clinics. These clinics would be “affiliated” with an ambulance service. Medicare would pay the prospective rates for primary care visits and ambulance transports. Medicare would provide an annual grant/fixed payment to support the capital costs of having a primary care practice, the standby costs of the ambulance service, and uncompensated care costs.

The Commission recognizes that the “low population density would also make it difficult to retain primary care providers and support an ambulance service.” It could also be difficult to describe the exact level of primary care and ambulance access that is required to receive the fixed Medicare payment.

MedPAC reiterates its position that “supplemental payments beyond the standard PPS rates should be targeted to isolated rural providers that are essential for access to care.” Thus, it states that a program to support stand-alone emergency departments should be limited to facilities that are a minimum distance in road miles from the nearest hospital.

The GAO Releases New Report on Claims Review Programs, Recommending Additional Prepayment Review Authority and Written Guidance on Calculating Savings from Prepayment Review

Written by Kathy Lester on May 17, 2016. Posted in Government Affairs, Medicare, Member Advisories, Reimbursement, Talking Medicare.

On Friday, May 13, the Government Accountability Office (GAO) publicly released a new Medicare report entitled, “Claim Review Programs Could Be Improved with Additional Prepayment Reviews and Better Data,” which it shared with the Congress and the Centers for Medicare & Medicaid Services (CMS) in April. The report is addressed to the Senate Finance Committee Chairman Orrin Hatch (R-UT) in response to his request.

The Report examines:

1. The differences, if any, between prepayment and post-payment reviews, and the extent to which the contractors utilize these types of reviews;

2. The extent to which the Medicare claim review contractors focus their reviews on different types of claims; and

3. CMS’s cost per review and the amount of improper payments identified by the claim review contractors per dollar paid by CMS.

In compiling the Report, the GAO reviewed Administration documents, interviewed CMS officials, Recovery Auditors (RAs), and Medicare Administrative Contractors (MACs). The GAO also interviewed representatives from 10 Medicare provider/supplier organizations that have experienced claim reviews on both a pre- and post-payment review basis. The AAA worked the GAO by participating in a telephone interview and providing written comments.

The GAO examined three types of contractors – the RAs, the MACs, and the Supplemental Medicare Review Contractor (SMRC). These contractors are responsible for reviewing claims that are at high risk of improper payment and claims that pose the greatest financial risk to Medicare. Only MACs conduct both pre- and post-payment reviews. RAs and the SMRC conduct only post-payment reviews, but RAs did participate in a pre-payment review demonstration project. RAs are paid on a contingent basis from recovered overpayments. During the demonstration, RAs were paid contingency fees based on claim denial amounts.

In its review, the GAO found that few differences exist between pre- and post-payment reviews, but noted that pre-payment reviews “better protect Medicare funds.” The GAO found that CMS is not always able to collect overpayments from post-payment reviews and that post-payment reviews require more administrative resources than pre-payment reviews.

The provider/supplier organizations highlighted two issues that need to be resolved with regard to pre-payment review audits. First, they identified that the option to hold discussions with RAs before payment determinations are made in the context of post-payment reviews can be helpful. These discussions are not part of the pre-payment review process; nor are they part of the MAC process. CMS indicated that it is not practical to have such an option in these contexts because of the timing requirements.

Second, the providers/suppliers noted that pre-payment reviews create cash flow burdens, in light of the appeals process. When appealing a post-payment review, providers/suppliers retain their Medicare payments through the first two rounds of review. If the denial is overturned at a higher level, CMS must pay back the recovered amount with interest accrued. However, for pre-payment reviews, providers/suppliers do not receive payment and CMS does not provide interest on the dollars withheld if the provider/supplier wins on appeal.

MACs have traditionally relied upon post-payment review. MACs will also use post-payment reviews to analyze billing patterns to inform other review activities, such as future pre-payment reviews and educational outreach. CMS has encouraged MACs to perform extrapolation, especially for providers/suppliers that submit large volumes of low-dollar claims with high improper payment rates.

The SMRC reviews often include studies to develop sampling methodologies or other policies that could be rolled out more broadly in the future.

The GAO also found that different contractors focused on different claims during 2013 and 2014. RAs focused on inpatient claim reviews primarily. RAs have the discretion to select the claims they review and the GAO stated that “their focus on reviewing inpatient claims is consistent with the financial incentives associated with the contingency fees they receive, as inpatient claims generally have higher payment amounts compared to other claim types.” The GAO also found that RA claim reviews had higher average identified improper payment amounts per post-payment claim review relative to other claim types in 2013 and 2014. For the upcoming contracts, CMS has indicated that it will more closely monitor RAs to ensure that they are reviewing all types of claims. For DME claims in particular, CMS has increased the contingency fee percentage paid to the RAs for DME, home health agencies, and hospice claims.

In contracts, MAC claim reviews focused primarily on physician and DME claims. DME claims accounted for 29 percent of their reviews in 2013 and 26 percent in 2014, while representing 22 percent of total improper payments in fiscal year 2013 and 16 percent of improper payments in fiscal year 2014. DME claims also had the highest rates of improper payments in both years.

Physician claims is a broadly used term that includes labs, ambulances, and individual physician.

The SMRC focused its claim reviews on studies that CMS directs the contractor to conduct. In 2013, the SMRC reviews focused on outpatient and physician claims, but in 2014 the focus shifted to home health agency claims and certain DME suppliers.

The GAO concluded that both RAs and SMRC generated savings for CMS, but unreliable data prevented comparing these results to those of MACs. CMS paid the RAs an average of $158 per review; the RAs averaged $14 in identified improper payments per dollar paid by CMS in both 2013 and 2014. CMS paid the SMRC an average of $256 per review, and the SMRC averaged $7 in identified improper payments per dollar paid in 2013 and 2014. The higher SMRC costs related to the study costs and extrapolation.

CMS lacks reliable MAC cost and savings data. CMS does not collect reliable data on claim review funding and does not have consistent data on identified improper payments. While CMS has established ways to collect this information, some MACs are not reporting it. MACs also use different methods to calculate and report savings.

The GAO recommended that CMS take two actions:

• In order to better ensure proper Medicare payments and protect Medicare funds, CMS should seek legislative authority to allow the RAs to conduct prepayment claim reviews.

• In order to ensure that CMS has the information it needs to evaluate MAC effectiveness in preventing improper payments and to evaluate and compare contractor performance across its Medicare claim review program, CMS should provide the MACs with written guidance on how to accurately calculate and report savings from prepayment claim reviews.

CMS did not agree with the first recommendation, stating that it has a strategy to move away from “pay and chase” using different policies, such as prior authorization initiatives and enhanced provider enrollment screening. CMS concurred with the second recommendation.

The Importance of Ambulance Cost Survey Data

Written by Kathy Lester on November 9, 2015. Posted in Cost Survey, Government Affairs, Legislative, Member Advisories, Member-Only, Regulatory, Reimbursement.

By Kathy Lester, JD, MPH | Updated November 9, 2015

Tomorrow is in your hands today. This statement is especially true when we think about the evolution of ambulance services. Today, care once reserved for the hospital setting is now delivered at the scene, resulting in better patient outcomes. Yet, despite these advances, the Medicare payment system lags behind. Current rates are based upon a negotiated rulemaking process that did not take the cost of providing services into accounts. While many in the industry strive to further expand the delivery of high-quality care, the inflexibility of the current payment system makes it difficult to compensate the next generation of ambulance service providers appropriately.

To prepare for tomorrow, ambulances services must act today. The AAA has taken a leadership role by setting the groundwork needed to reform the payment system so that it recognizes the continued evolution of ambulance services. The two game changers are (1) designating ambulance suppliers as “providers” of care; and (2) implementing a federal data collection system.

“Emergency care has made important advances in recent decades: emergency 9-1-1 service now links virtually all ill and injured Americans to immediate medical response; organized trauma systems transport patients to advanced, lifesaving care within minutes; and advances in resuscitation and lifesaving procedures yield outcomes unheard of just two decades ago.”
–Institute of Medicine: Emergency Medical Services at a Crossroads (2007)

Provider Status

Being deemed a “provider” rather than a “supplier” is the first step toward recognizing the clinical component of ambulance services and appropriately incorporating ambulance services into the broader health care coordination and reform discussions.

Under current law, the term provider refers to hospitals, skilled nursing facilities (SNFs), outpatient rehabilitation facilities, home health agencies, ambulatory surgical centers, end-stage renal disease facilities, organ procurement organizations, and clinical labs. Durable medical equipment entities and ambulance services are designated as suppliers.

When ambulance services were first added to the Medicare benefit, the primary services provided were transportation. As noted already, transportation is only one component of the services provided. The deliver of health care services today make ambulances more like other Medicare providers than suppliers.

Achieving this designation is the first step toward having the federal government recognizing the value of the health care services provided by ambulances.

Cost Collection

The second game changer involves collecting cost data from all types and sizes of ambulances services in all areas of the country. Current Medicare rates are not based on cost. As the Government Accountability Office has recognized in two separate reports, these rates do not cover the cost of providing services to beneficiaries. While the Congress has extended the ambulance add-ons year after year, the lack of a permanent fix makes it difficult to plan. There is also the risk of the add-ons not being extended at some point. In addition, the rates take into account only at the most general level the health care being provided.

In the American Taxpayer Relief Act (ATRA), the Congress required the Centers for Medicare and Medicaid Services (CMS) to issue a report evaluating the ability to use current hospital cost reports to determine rates and also to assess the feasibility of obtaining cost data on a periodic basis from all types of ambulance services. Knowing of the strong Congressional interest in obtaining additional cost information, the AAA began working with The Moran Company (a consultant organization with expertise in Medicare cost reporting) to develop recommendations as to how cost data could be most efficiently and effectively collected. The AAA shared these recommendations with CMS and the contractor developing the report. The final report, released in October, supports the AAA’s work and states:

Any cost reporting tool must take into account the wide variety of characteristics of ambulance providers and suppliers. Efforts to obtain cost data from providers and suppliers must also standardize cost measures and ensure that smaller, rural, and super-rural providers and suppliers are represented.

The next step in the process is to provide CMS with direction and authority to implement the AAA’s cost survey methodology. In brief, the methodology would:

Require all ambulance services to report to CMS demographic information, such as organizational type (governmental agency, public safety, private, all volunteer, etc), average duration of transports, number of emergency and nonemergency transports. CMS would use this data to establish organization categories so that the data collected aligns with the type of organization providing it.
Require all ambulance services to report cost data, such as labor costs, administrative costs, local jurisdiction costs, through a survey process. During any survey period, CMS would identify a statistically valid sample of ambulance services in each category to be surveyed. These services would have to provide the data or be subject to a five percent penalty. Those ambulance services that provide data will not be asked to do so again until every service in its organization category has submitted the data.

As part of this process, the AAA has begun developing a common language for reporting these data. This work will ensure that the information is collected in a standardized manner. The AAA will also provide assistance to services that may need extra help in completing the surveys.

This information can then be aggregated and used to evaluate the adequacy of Medicare payments and support additional coverage policies. Most importantly, it will allow policy-makers, the AAA, and other stakeholders to reform the current Medicare ambulance payment system so that it incorporates the health care services currently being provided and those that will be in the future.

Conclusion

In order to be prepared for the reimbursement structures of tomorrow, ambulance services need to be designated a providers and recognized for the health care they provide. They also need to participate in a standardized cost collection program that will provide accurate data in the least burdensome way possible. The AAA is leading the effort to help ambulance services prepare for tomorrow.

Prior Auth Expansion to MD, DE, DC, NC, VA, WV

Written by Kathy Lester on October 26, 2015. Posted in Medicare, Member Advisories, Member-Only, Reimbursement.

CMS Announces Expansion of Prior Authorization Program for Repetitive Scheduled Non-Emergent Ambulance Transports

October 26, 2015

CMS has announced that consistent with the requirements of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), it will expand the current prior authorization demonstration program for repetitive scheduled non-emergent ambulance transports beginning on January 1, 2016, to Maryland, Delaware, the District of Columbia, North Carolina, Virginia, and West Virginia. The current demonstration program is operating in three states (New Jersey, Pennsylvania, and South Carolina).

The demonstration seeks “to test whether prior authorization helps reduce expenditures, while maintaining or improving quality of care, using the established prior authorization process for repetitive scheduled non-emergent ambulance transport to reduce utilization of services that do not comply with Medicare policy.”

The Agency reiterates that the prior authorization process does not create new clinical documentation requirements. Requesting a prior authorization is not mandatory, but CMS encourages ambulance services to submit a request for prior authorization to their MACs along with the relevant documentation to support coverage. If an ambulance service does not request prior authorization, by the fourth round-trip in a 30-day period, the claims will be stopped for pre-payment review.

To be approved, the request must meet all applicable rules and policy, as well as any local coverage determination requirements. The MAC will “make every effort” to review and decide on the request within 10 business days for an initial submission. If an ambulance service requests a subsequent prior authorization after a non-affirmative decision, the MAC will try to review and decide upon the subsequent request within 20 business days. Ambulance services may also request an expedited review.

If granted, the prior authorization may affirm a specified number of trips within a specific amount of time. The maximum number of trips is 40 round trips within a 60-day period.

Member Advisory: CMS Releases the ICD-10 Crosswalk

Written by Kathy Lester on October 9, 2015. Posted in Government Affairs, Medicaid, Medicare, Member Advisories, Member-Only, Regulatory, Reimbursement.

By Kathy Lester, JD, MPH | AAA Healthcare Regulatory Consultant | October 9, 2015

At the end of last week, CMS posted the ICD-10 crosswalks for medical conditions for ambulance services. The documents can be found here, under the Other Guidance section at the bottom of the webpage.

In creating the crosswalk files, CMS relied upon a program developed by 3M, ICD-10 CTT. The files provide comprehensive crosswalks for both primary and alternative specific codes and are intended to supplement the existing Medical Conditions List.

The AAA has been working with CMS for the past year to create an official document that addresses the medical condition codes upon which some of the Medicare contractors rely for billing and auditing purposes.

While we are pleased that CMS has recognized the need for a crosswalk, we are concerned that the documents posted are a literal crosswalk of the previous ICD-9 list. This document can also be found on the Ambulance Service Center webpage. This approach, which incorporates all potential ICD-10 codes, has resulted in a large number of codes being included in the crosswalk. Some of these codes are inappropriate to use because they require diagnostic skills that extend beyond the scope of ambulance personnel.

The AAA has developed a more streamlined list of condition codes that eliminates those codes that are inappropriate for ambulance services to use.

We continue to work with CMS to refine its crosswalk to ensure that it is useful to ambulance services throughout the country.