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2016 Ambulance Ride-Alongs

Written by Tristan North on . Posted in Government Affairs, Legislative, Member Advisories.

The AAA 2016 Congressional Ride-Along Toolkit is now available.

Congress adjourned on July 15 for their August congressional recess with members of Congress returning home to their districts and states.  This is the perfect opportunity for you to educate your members of Congress about those issues, in particular Medicare ambulance relief and reform, which are important to your operation.  The most effective way to deliver these key messages is to host your member of Congress or their staff on a tour of your operation and an ambulance ride-along.  If you cannot host a tour and ride-along, we strongly encourage you to arrange local meetings with your members of Congress during August. The AAA has made the process of arranging a ride-long or scheduling a meeting easy for you with our 2016 Congressional Ride-Along Toolkit.

While the current temporary Medicare ambulance relief increases don’t expire unit December 31, 2017, meet with your members of Congress now to gain their support for making the relief permanent.  Also, there is a potential opportunity this year to make progress on provisions to change our status from “suppliers” to “providers” of health care services and to direct CMS to collect ambulance cost data.  Enactment of these two provisions is necessary to set the stage for future reform of the Medicare fee schedule and reimbursement for services other than a transport.  During the tours or meetings, please therefore request your members of Congress to cosponsor the Medicare Ambulance Access, Fraud Prevention and Relief Act (S. 377, H.R. 745) and support moving the provider status and cost data provisions of the bill this year.

Everything you need to arrange the ride-along or schedule a meeting is included on the AAA Website.

Email the AAA at info@ambulance.org if you need any assistance.

AAA Submits Testimony on Access to Emergency Medications

Written by Tristan North on . Posted in Government Affairs, Legislative.

On July 12, the House Energy and Commerce Subcommittee on Health held a hearing on “Strengthening our National Trauma System.”  As part of the hearing, the Subcommittee heard from witnesses about the Preserving Patient Access to Emergency Medications Act (H.R. 4365).  The AAA strongly supports H.R. 4365 which would ensure that EMS personnel can continue to administer controlled substances to patients. The AAA submitted written testimony for the hearing record which can be accessed here and read below.

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The American Ambulance Association (AAA) thanks the Chairman, Ranking Member, and Members of the Subcommittee on Health for holding a hearing to consider proposals to improve and strengthen the national trauma system. The AAA represents hundreds of ambulance services across the United States that participate in emergency and nonemergency health care and medical transportation. The Association serves as a voice and clearinghouse for ambulance services, and views prehospital care not only as a public service, but also as an essential part of the total public health care system. To that end, we urge Congress to pass the Protecting Patient Access to Emergency Medications Act of 2016 (H.R. 4365) by Congressman Hudson (R-NC). This legislation is necessary to ensure that patients in need of emergency medical care have access to life-saving medications.

A longstanding practice has allowed Emergency Medical Services (EMS) practitioners to administer and deliver controlled substances under the oversight of physicians through directional guidelines known as standing orders. The use of standing orders allows EMS personnel who are the often the entry point into the health care system to administer potentially life-saving drugs as quickly as possible to patients in emergency situations. However, the Drug Enforcement Administration has determined that the Controlled Substances Act as currently written prohibits EMS personnel from administering such medications to patients through standing orders. This endangers lives by limiting access to emergency medications that seriously ill or injured patients may need.

Congressman Hudson’s legislation would remedy this situation by clarifying that EMS agencies are allowed to use standing orders from their medical director to administer controlled substances to patients. Codifying this current practice will ensure that EMS practitioners and patients do not see any disruption in the provision of emergency care. H.R. 4365 would also permit EMS agencies to register directly with the DEA; require each EMS agency to have one or more medical directors; allow a single registration for an EMS agency, not a separate registration for each location; and update requirements for EMS agencies’ receipt, storage, and tracking of controlled substances.

The unique nature of mobile emergency medical services sets us apart from other health care services governed by the Controlled Substances Act. H.R. 4365 is needed to ensure that regulatory oversight to prevent abuse of controlled substances does not threaten the provision of time-sensitive emergency medical care to those with critical injuries and illnesses. The AAA respectfully requests that the Committee move expeditiously to support this vital legislation so that our nation’s EMS practitioners can care effectively for patients in need.

Supreme Court Clarifies Liability of Federal Contractors

Written by Brian Werfel on . Posted in Judicial.

Supreme Court issues a decision clarifying  under Implied False Certification Theory

On June 16, 2016, the Supreme Court issued a decision that clarifies the liability of federal contractors, including health care providers that participate in the Medicare or Medicaid programs, under the False Claims Act for implied frauds.  Writing for a unanimous court, Justice Clarence Thomas held in Universal Services v. United States ex rel. Escobar that the so-called “implied false certification theory” can serve as the basis for False Claims Act liability in situations where a federal contractor has submitted claims for payment, and where the contractor makes specific representations regarding the services it has provided but fails to disclose the contractor’s non-compliance with one or more material requirements that make those representations otherwise misleading.  The Court further held that liability under the False Claims Act does not turn on whether the noncompliance related to a requirement that had been expressly designated as a condition for payment.

The case involved Universal Health Services, Inc., and its subsidiary Arbour Counseling Services.  Arbour operated a mental health facility in Lawrence, Massachusetts.  For the period from 2004 through 2009, Arbour provided mental health counseling services to Yarushka Rivera, a Massachusetts Medicaid beneficiary.  In May 2009, Rivera had an adverse reaction to a medication that a purported doctor at Arbour had prescribed after diagnosing her as suffering from bipolar disorder.  In October 2009, Rivera had a seizure and died.  At the time of her death, she was 17 years old.

Following Rivera’s death, a counselor employed by Arbour indicated to Rivera’s mother and stepfather that only a handful of Arbour employees were actually licensed mental health professionals.  Further investigation revealed that only 1 of the 5 professionals that had treated Rivera was properly licensed.  The practitioner that diagnosed Rivera as bipolar had identified herself as a Ph.D; however, it turns out that her degree was from an unaccredited Internet college, and that the State of Massachusetts had rejected her application to be licensed as a psychologist.  The individual that prescribed the medication that ultimately led to Rivera’s death held herself out to be a psychiatrist, when in fact she was a nurse who lacked the authority to prescribe medications.  21 other Arbour employees were found to have lacked the proper licensures to provide counseling services.

In 2011, the mother and stepfather filed a qui tam alleging that Universal Health had violated the False Claims Act under an implied false certification theory of liability.  Specifically, they alleged that Universal Health had made representations that its services were provided by specific types of professionals, but failed to disclose the numerous violations of the Massachusetts Medicaid Program’s regulations pertaining to staff qualifications and licensing.

The federal district court granted Universal Health’s motion to dismiss the complaint.  While local precedent had previously embraced the implied false certification theory of liability, the district court held that liability could not be established because none of the regulations Arbour was alleged to have violated constituted a condition of payment.  The First Circuit Court of Appeals reversed the lower court.

The Supreme Court agreed to hear the case to resolve the disagreement among the Circuit Courts over the validity of the implied false certification theory of liability.  In his decision, Justice Thomas noted that the Seventh Circuit had expressly rejected the theory.  Other Circuit Courts had accepted the theory, but limited its application to cases where the defendant failed to disclose violations of expressly designated conditions of payment.  Finally, some Circuit Courts had held that the condition of payment need not be expressly designated as such to establish False Claims Act Liability.

The Court first held, in no uncertain terms, that the implied false certification theory can, under certain circumstances, provide a basis for liability under the False Claims Act.  The Court emphasized that common-law fraud has long encompassed certain misrepresentations by omission.  To establish False Claims Act liability, the Court determined that two conditions must be satisfied: (1) the claim must not merely request payment, but must also make specific representations about the goods or services provided and (2) the parties’ failure to disclose its noncompliance with material statutory, regulatory, or contractual requirements must render those representations misleading.

The Court then turned to Universal Health’s contention that, even if one accepts the implied certification theory, its application must be limited to misrepresentations about express conditions of payment.  Justice Thomas rejected this interpretation, noting that nothing in the statute suggested that an express condition of payment was relevant to determining whether a claim was false or fraudulent.  However, the Court failed to adopt the expansive ruling offered by the federal government, namely that any omission made in connection with a request for payment could trigger False Claims Act liability.  Instead, the Court adopted a relatively narrow view of those omissions that could establish liability, focusing primarily on the concept of “materiality.”  Essentially, the Court held that the omission would only trigger liability if its proper disclosure was outcome determinative.  In other words, the omission would be considered material if its proper disclosure would have likely resulted in the claim being denied.

A number of commentators have suggested that the Court’s ruling expands the scope of potential False Claims Act liability.  This is undoubtedly true for contractors (including health care providers) that operate within the Seventh Circuit’s jurisdiction (Illinois, Indiana, and Wisconsin), which previously rejected the implied false certification theory.  However, the impact of the Court’s ruling on other parts of the country will be more nuanced.  In some important respects, the creation of the new materiality requirement may limit the instances in which the government can establish False Claims Act Liability.

To see how this decision could be applied to the EMS industry, consider the following hypotheticals:

  • An ambulance provider submits a claim to Medicaid for a medically necessary transport; however, it is known at the time that the claim is submitted that the EMT that drove the ambulance had allowed his state EMT certification to lapse.
  • An ambulance provider submits a claim to Medicare for a medically necessary transport. The patient had previously been transported by the same ambulance provider, and the ambulance provider had obtained a valid lifetime signature authorization signed by the patient.  The ambulance provider checked the appropriate box on the electronic claim for to indicate that they had a valid signature for the patient on file.  However, during the interim period between the two transports, a legal guardian had been assigned to handle the patient’s affairs.  The legal guardian took the unusual step of notifying the ambulance that she had been appointed the patient’s guardian, and expressly revoked the prior lifetime signature authorization.  The guardian further indicated that she preferred to make future decisions regarding payment authorization on a case-by-case basis.

The first hypothetical is a close parallel to the facts of the actual case before the Court.  Applying the Court’s reasoning, False Claims Act liability would hinge on whether the omission of the fact that the EMT’s certification had lapsed was material.  In other words, if the court feels that the State Medicaid Program would have likely rejected the claim had the lapse in certification been properly disclosed, then liability under the False Claims Act liability might exist.  If, however, the State was likely to have treated the lapse as a minor technical violation but not something worthy of denying the claim, then False Claims Act liability would not exist.  Note: in the actual case, the State of Massachusetts investigated Arbour’s misconduct, and decided the appropriate action was a nominal fine, and not the recoupment of its Medicaid payments.

The second hypothetical is a bit more complex.  There is no question that the failure to disclose that the lifetime signature had been revoked was an omission.  It could also be argued that its omission was misleading, i.e., by not disclosing that the lifetime signature had been revoked, the provider was suggesting that it had the patient’s affirmative consent to the submission of the claim, when in fact it did not.  The question is whether the omission was material to Medicare’s decision to pay the claim.  On the one hand, the Medicare regulations do make compliance with the patient signature requirement an express condition for payment.  One the other hand, Medicare permits that requirement to be satisfied in multiple ways, several of which do not require the patient’s affirmative consent.  In the hypothetical, the patient had a legal guardian, which strongly suggests that he or she would have been incapable of signing at the time of transport anyway.  Wat if the ambulance provider subsequently obtained a valid form of secondary verification?  What if the ambulance provider subsequently obtained verbal consent from the legal guardian to the submission of the claim?  Would Medicare be likely to deny the claim on the basis of not complying with the strict documentation standards of the signature requirement, even though the patient (through his or her guardian) has no objection to the submission of the claim?

Only time will tell how future courts interpret this material standard.  Stay tuned.

MedPAC Issues June 2016 Report to the Congress

Written by Kathy Lester on . 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.

 

AAA Issues Response to GAO Claims Report

Written by Tristan North on . Posted in Medicare, Member Advisories, Regulatory.

On May 13, the Government Accountability Office (GAO) issued a report entitled “Claim Review Programs Could Be Improved with Additional Prepayment Reviews and Better Data“. In the report, the GAO recommended that CMS be provided legislative authority to allow Recovery Auditors to use prepayment claims reviews to address improper Medicare payments. CMS fortunately disagreed with the GAO on the recommendation and cited better options such as prior authorization to address potentially improper payments.

The AAA has now issued a Formal Statement in response to the GAO report noting the problems with prepayment claims review for ambulance services and promoting the better alternative of prior authorization for nonemergency BLS transports of dialysis patients. The statement is in follow up to our Member Advisory providing an in-depth review of the report. Please feel free to share the statement if you receive questions about the report.

On June 26, 2015, the AAA had participated in a conference call with the GAO officials conducting the report in which AAA representatives had pushed for recommendations in line with our statement. The AAA will continue to advocate for policies to address improper payments that address the issue but are also the least burdensome to AAA members and help ensure our ability to continue to provide high-quality emergency and nonemergency ambulance services to patients.

Indian Health Service Issues Final Rule on Payments to Non-Contracted Providers

Written by Brian Werfel on . Posted in Government Affairs, Medicare, Member Advisories, Talking Medicare.

On March 21, 2016, the Indian Health Service (IHS), an agency with the Department of Health and Human Services, issued a final rule with comment period titled “Payment for Physician and Other Health Care Professional Services Purchased by Indian Health Programs and Medicare Charges Associated with Non-Hospital-Based Care.” This final rule will change the way the Indian Health Service pays for Purchased/Referred Care (PRC), formerly known as Contract Health Services (CHS). The provisions of this final rule will become effective on May 20, 2016.

Under current regulations, payment for PRC services is based on rates established by arms-length negotiations between the physician or other health care provider (including ambulance providers and suppliers) and the IHS, Tribe, Tribal Organization or urban Indian organizations (collectively referred to hereinafter as I/T/U programs). In the absence of an agreement, the health care provider is generally paid its full billed charges.

Provisions of Final Rule

The final rule amends the regulations at 42 C.F.R. 136.1 e. seq. to provide that payment for PRC services will now be based on Medicare payment methodologies. Specifically, payments would generally be set at the lowest of: (1) the amount provided for such service under the applicable Medicare fee schedule or Medicare waiver, (2) the amount negotiated with a specific provider or its agent, or the amount negotiated by a repricing agent, if applicable, or (3) the rate for such service paid by the health care provider’s or supplier’s “Most Favored Customer” (MFC). For these purposes, IHS has indicated that the MFC rate will be evidenced by commercial price lists or paid invoices and other related pricing and discount data.

While the previous paragraph sets forth the general rate-setting regime, a number of important exceptions will apply. First, any negotiated rate between the parties must be equal to or better than the provider’s or supplier’s MFC rate. The AAA is interpreting this requirement to require the provider or supplier to offer better (i.e. lower pricing) to the I/T/U program than it offers to any nongovernmental entities, including insurance plans. However, IHS indicated that this restriction would not apply to the extent the I/T/U program determines that the negotiated rate is otherwise fair and reasonable, and is otherwise in the best interests of the I/T/U (as determined by the I/T/U). Second, in the event that no agreement exists, and the Medicare Fee Schedule amount is greater than the provider’s or supplier’s MFC rate (i.e. the provider or supplier has voluntarily elected to accept a rate lower than the corresponding Medicare allowable from at least one nongovernmental entity), then the rate may not exceed the MFC rate, but may be lower than the MFC rate.

The final rule can be viewed in its entirety here.

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 . 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.

CMS Releases Medicare Provider Utilization and Payment Data for CY 2014 for Ambulance Suppliers, Physicians and Other Part B Organizations

Written by Brian Werfel on . Posted in Government Affairs, Medicare, Member Advisories, Reimbursement, Talking Medicare.

On May 5, 2016, CMS publicly released the “Medicare Provider Utilization and Payment Data: Physician and Other Supplier Public Use File,” which provides information on the services and procedures provided to Medicare beneficiaries by ambulance suppliers, physicians and other healthcare provider groups.  The data file is based on calendar year 2014 data. This release follows on last year’s release of payment data for calendar year 2012.

The database lists all individual and organizations providers by National Provider Identifier (NPI), and provides information on utilization, total payments and submitted charges.  It can also be searched by Healthcare Common Procedure Coding System (HCPCS) code and place of service.

The Public Use File can be obtained here. Please note that you will need to download the desired file and then import it into an appropriate database or statistical software program.  CMS is indicating that Microsoft Excel is not sufficient for these purposes, and that importing it into Excel may result in an incomplete loading of data.

A number of news organizations have already created searchable databases that will allow you to search the CY 2012-2013 data by physician/organizational name, provider specialty, city, state, etc.  It is expected that these news organizations will be updating their websites to incorporate the CY 2014 data in the coming weeks. The searchable database created by the Wall Street Journal can be accessed here.

New Member Benefit: StateTrack

Written by Aidan Camas on . Posted in Government Affairs, Legislative, Member-Only, Regulatory.

Introducing the AAA’s newest member benefit, StateTrack, powered by CQ Roll Call. StateTrack will give AAA members the ability to easily track crucial legislation and regulations in one state or all of them as well as the Federal Government.

StateTrack Map

AAA StateTrack

StateTrack will show you a map of the entire United States. Click on the state you are interested in tracking and you will see a list of all regulations and legislation impacting the following areas:

► Affordable Care Act
► Ambulance
► Community Paramedicine
► EMT
► Medicaid
► Medicare
► Mobile Integrated Health
► Paramedic

Click on the key words above to narrow down your search to only legislation and regulations that contain those terms.

Members will be able to view the full text of each piece of legislation as well as edits that have been made to the text, bill number, status of the bill and the representative who introduced it. StateTrack will make it easier for AAA members to keep track of legislation and regulations on the state level that could have enormous impacts on their ambulance services. States that are white, are either out of session or do not have any pending legislation or regulations that fall under the AAA search criteria.

Please contact Aidan Camas at acamas@ambulance.org if you have any questions.

HHS Office of Civil Rights Announces Phase 2 HIPAA Audit Review Program

Written by Brian Werfel on . Posted in Medicaid, Medicare, Regulatory, Reimbursement, Talking Medicare.

On March 21, 2016, the Office for Civil Rights of the Department of Health and Human Services announced Phase 2 of its HIPAA Audit Program.  The Health Information Technology for Economic and Clinical Health Act (HITECH) required HHS to perform periodic audits of covered entities and business associates to assess their compliance with the HIPAA Privacy, Security and Breach Notification Rules.  These rules are enforced by the HHS Office for Civil Rights (OCR).

Background on Phase 1

In 2011, OCR implemented a pilot audit program to assess the controls and processes covered entities have adopted to meet their HIPAA obligations.  The pilot audit program was conducted in three phases.  OCR first developed a set of audit protocols that it would use to evaluate covered entities’ compliance.  This protocol was then tested using a limited number of audits.   The final step involved using the revised audit protocols on a larger number of covered entities.  Ultimately, 115 covered entities were selected for review, and all audits were concluded by December 31, 2012.

Phase 2

Phase 2 of the HIPAA Audit Program will focus on the policies and procedures adopted and employed by entities to meet the requirements of the Privacy, Security, and Breach Notification Rules.  OCR has indicated that these audits will be conducted primary through desk audits (i.e., document submissions), although by a limited number of on-site audits will also be conducted.

Unlike Phase 1, which focused exclusively on covered entities, OCR is indicating that Phase 2 will involve audits of both covered entities and their business associates.

As with the initial pilot audit program, Phase 2 will consist of several stages.  The first stage involves verification of a covered entity’s or business associate’s address and contact information.  A sample address verification letter can be viewed by clicking here.  OCR has indicated that emails will be sent to entities requesting accurate contact information for the entity.  OCR will then transmit a “pre-audit questionnaire” to the entity.  These questionnaires will be used to gather data about the size, type, and operations of potential auditees.  Based on this data, OCR will create potential audit subject pools.

Note: OCR has indicated that if an entity fails to respond to OCR’s request to validate its contact information and/or fails to return the pre-audit questionnaire, OCR will use publicly available information about the entity to create its audit subject pool.  As a result, an entity that fails to respond may still be selected for audit and/or compliance review.  OCR is specifically reminding entities to check their email “junk” or “spam” folders for any communications from OCR.

Once OCR has developed its audit subject pools, it will randomly select auditees from these pools.  Auditees will then be notified by OCR of their participation.  OCR has indicated that the first set of audits will focus on covered entities, with a subsequent round of audits focused on business associates.  These audits will focus on compliance with specific requirements of the Privacy, Security, or Breach Notification Rules.  Auditees will be notified of the scope of their audit in a document request letter.  Both of these rounds will be desk audits.  OCR indicated that all desk audits will be completed by the end of December 2016.

A third round of on-site audits will take place after the completion of the desk audits, and will examine a broader scope of requirements under HIPAA.  OCR further indicated that desk auditees may also be subject to on-site audits.

If an entity is selected for audit, OCR will notify them by email.  The email will introduce the OCR audit team, explain the audit process, and discuss OCR’s expectations in greater detail.  The email notification letter will also include initial requests for documentation.  OCR has indicated that it will expect entities to respond to these documentation requests within ten (10) business days.  Documents will be submitted through a new secure online portal.  Once received, OCR’s auditors will review the submitted information and inform the entity of its draft findings.  The entity will then have ten (10) business days to respond with written comments, if any.  OCR will then review the entity’s comments and issue a final audit report within thirty (30) business days.

OCR has indicated that the audits are primarily intended as a compliance improvement activity.  OCR will use aggregated data to better understand compliance with respect to particular aspects of the HIPAA rules.  The goal being to understand what types of technical assistance and/or corrective actions would be most helpful.  In other words, OCR is indicating that the goal of these audits is to improve its understanding of the state of compliance, and not to penalize specific companies for violations.  However, OCR indicated that should an audit reveal a serious compliance issue, OCR may initiate a further compliance review of the company.

OCR indicated that it will not post a list of the audited entities, nor will its findings be available in a format that would clearly identify the audited entity.  However, OCR noted that audit notification letters and other information regarding these audits may be discoverable under the Freedom of Information Act (FOIA).

Additional information from OCR regarding the Phase 2 HIPAA Audit Program can be obtained by clicking here.

CMS Implements Cycle 2 Revalidation Program

Written by Brian Werfel on . Posted in Government Affairs, Medicaid, Medicare, Regulatory, Reimbursement.

By Brian S. Werfel, Esq. AAA Medicare Consultant

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CMS recently announced the start of its Cycle 2 Revalidation Program. This program affects all enrolled Medicare providers and suppliers.

In Cycle 1, which was conducted from 2011 through 2015, the so-called “trigger” to revalidate was a formal request to do so by your Medicare Administrative Contractor (MAC). For Cycle 2, CMS is adopting a new approach. CMS will be assigning revalidation due dates, i.e., dates by which the provider or supplier must revalidate. These due dates will be the last day of a particular calendar month. These due dates are based on the provider’s or supplier’s last successful revalidation or the date of the provider’s or supplier’s initial enrollment with Medicare. In other words, providers or suppliers that last revalidated in 2011 are likely to have new revalidation due dates in 2016, providers or suppliers that revalidated in 2012 are likely to have 2017 due dates, etc. The first set of due dates is May 31, 2016.

CMS has indicated that it will notify providers or suppliers by email within 2-3 months of their due date. These emails will include the following subject line: Urgent: Medicare Provider Enrollment Revalidation Request. If the email is returned as undeliverable, the MAC is instructed to send a paper revalidation notice to at least two of your reported addresses: correspondence address, special payments address, or primary practice address.

Providers or suppliers will be permitted to submit revalidations up to 6 months prior to their scheduled due date. Revalidations can be submitted either on paper or by using the online Provider Enrollment, Chain, and Ownership System (PECOS).

If a provider or supplier fails to submit a timely revalidation packet, CMS has indicated that the entity’s Medicare billing privileges will be deactivated. The entity will be required to submit a complete enrollment application to “reactive” its billing privileges. However, CMS has indicated that no payments will be made for services provided during the interim period.

If you have not received an email from your MAC asking that you revalidate, it is likely that your revalidation due date is more than 3 months out, or has not even been assigned. However, it is possible that the requests to revalidate may have been sent to invalid email addresses, or may have been routed to your email “spam” folder. It is also possible that paper revalidation notices may have been sent to obsolete physical addresses.

For these reasons, the AAA is strongly encouraging members to check the CMS revalidation webpage. That webpage includes a lookup tool that you can use to determine whether your organization has been assigned a revalidation due date. Currently, CMS has assigned due dates through the end of October 2016. Providers and suppliers that have yet to be assigned due dates will display as “TBD”. You can also download the entire list of currently enrolled providers and suppliers into an Excel spreadsheet. This option may be particularly helpful for organizations that bill under multiple Medicare PTANs (which can have separate revalidation due dates) and for billing agents that intend to assist their clients with the revalidation process.

In sum, the new process appears to be a vast improvement over how revalidations were handled during Cycle 2. Assuming things work as intended, AAA members should have a minimum of 2 months prior notice of the need to revalidate, and potentially up to 6 months prior notice. This should be more than enough time to submit the revalidation and avoid any potential disruptions to your ability to bill Medicare.

FDA Issues First Responder Drug Dispenser Guidance

Written by Tristan North on . Posted in Government Affairs, Operations, Professional Standards, Regulatory.

In accordance with the Drug Supply Chain Security Act of 2013, the FDA issued regulations last year to require drug dispensaries to build an electronic system to identify and track the distribution of drugs. Many small dispensaries do not have the ability currently to electronically trace small quantities of drugs. The AAA became concerned that hospital and other small dispensers would no longer provide first responders with critical drugs in fear of not being compliant with the new regulations. The AAA joined a coalition of dispensaries, pharmacists and others that also had concerns with the new regulations.

As a result of the efforts of the coalition and the AAA, we were able to delay enforcement of the requirements until today, March 1. The AAA then worked directly with the FDA to educate them about the unique nature that small dispensaries sometimes play in restocking certain ambulance service providers. Upon learning of these transactions, the FDA shared our concerns and worked quickly to release the guidance.

The guidance states that the FDA will not take action against drug dispensaries in providing drugs to first responders if the dispensary follows certain basic recording keeping policies. The agency will also not take any action against the first responder. The guidance is entitled “Requirements for Transactions with First Responders under Section 582 of the Federal Food, Drug, and Cosmetic Act — Compliance Policy Guidance for Industry“.

CMS Publishes Medicare Fee-for-Service Provider & Supplier Lists

Written by Tristan North on . Posted in Government Affairs, Medicaid, Medicare, News.

Earlier today, AAA representatives participated on an invitation-only stakeholder call in which CMS announced the availability of two new public data sets. The first data set shows through an interactive map the availability and use of services provided to Medicare beneficiaries by ground ambulance suppliers and home health agencies. The second data set is a list of Medicare fee-for-service (FFS) providers and suppliers currently approved to bill Medicare. CMS just released the two data sets to the public.

The first data set, the Moratoria Provider Services and Utilization Data Tool, includes interactive maps and a data-set that shows national, state, and county-level provider and supplier services and utilization data that can be used by CMS to determine which geographic and health service areas might be considered for a moratorium on new provider and supplier enrollments. The data provides the number of Medicare providers and suppliers servicing a geographic region, identifies moratoria regions at the state and county levels, and identifies the number of people with Medicare benefits who use a specific health service in that region. The data can also be used to reveal service levels related to the number of providers and suppliers in a geographic region. Utilization data and geographic regions for these services can be easily compared using interactive maps.

You can access the Moratoria Provider Services and Utilization Data Tool at: https://data.cms.gov/moratoria-data
The provider/supplier enrollment data set can be accessed at: https://data.cms.gov/public-provider-enrollment

CMS Issues Final Rule on the Reporting and Return of Medicare Overpayments

Written by Brian Werfel on . Posted in Government Affairs, Medicaid, Medicare, Member-Only, Regulatory, Reimbursement.

On February 12, 2016, the Centers for Medicare and Medicaid Services (CMS) issued a final rule titled “Medicare Program; Reporting and Returning Overpayments.”  This final rule would implement Section 6402(a) of the Affordable Care Act, which imposed a 60-day requirement on Medicare providers and suppliers to report and return overpayments.  The provisions of this final rule will go into effect on March 16, 2016.

The final rule implements changes that were first proposed as part of a February 16, 2012 proposed rule.  The final rule can be viewed in its entirety by clicking here.

Background

Section 6402(a) of the Affordable Care Act requires health care providers and suppliers to report and return a Medicare overpayment within 60 days of the date such overpayment is “identified”.  Any overpayment not returned within this timeframe would become an “obligation” under the False Claims Act.  As a result, any ambulance service that is found to have knowingly retained an overpayment beyond the 60 day period could be subject to False Claims Act liability.  In addition, violations may also subject an ambulance company to civil monetary penalties and possible exclusion from the Medicare program.

Provisions of Proposed Rule

Definition of an “Overpayment”

In the final rule, CMS defined an overpayment as “any funds that a person has received or retained under title XVIII of the Act to which the person, after applicable reconciliation, is not entitled under such title.”  CMS noted that this definition is mirrors the definition of an overpayment that appeared in Section 6402(a) of the Affordable Care Act.
CMS cited examples of certain common overpayments in the proposed rule, including:

  • Payments for non-covered services;
  • Payments in excess of the applicable Medicare allowable
  • Errors and nonreimbursable expenditures included on a cost report;
  • Duplicate payments; and
  • Payment from Medicare when another payor had primary responsibility.

For ambulance providers and suppliers, another common area of overpayments would be payment for excessive mileage.

Note: in the final rule, CMS clarified that, in instances where the paid amount exceeds the appropriate payment to which a provider or supplier is entitled, the “overpayment” would be limited to the difference between the amount that was paid and the amount that should have been paid.  For example, if the overpayment was the result of a claim incorrectly being billed as an ALS emergency, rather than a BLS emergency, the overpayment is not the entire amount of Medicare’s payment.  Rather, the overpayment is limited to the difference in Medicare’s payment for the two base rates.

When an Overpayment has been “Identified”

In its proposed rule, CMS indicated that an overpayment would be “identified” if the ambulance provider or supplier: (1) had actual knowledge of the existence of the overpayment or (2) acted in reckless disregard or deliberate ignorance of the existence of the overpayment.  CMS indicated that this definition was intended to prevent providers and suppliers from deliberately avoiding activities that might uncover the existence of potential overpayments, such as self-audits and outside compliance checks.

CMS further stated its belief that the Proposed Rule would, in some instances, place an affirmative burden on providers and suppliers to investigate whether a potential overpayment exists.  Specifically, CMS indicated that “in some cases, a provider or supplier may receive information concerning a potential overpayment that creates an obligation to make a reasonable inquiry to determine whether an overpayment exists.”  If the provider or supplier then fails to reasonably inquire, it could be found to have acted with reckless disregard or deliberate ignorance.

In the final rule, CMS indicated that an overpayment will be deemed to have been identified to the extent “a person has, or should have through the exercise of reasonable diligence, determined that the person has received an overpayment and quantified the amount of the overpayment.”

Thus, the final rule makes two important changes to the standard of when an overpayment is identified.  The first change is to clarify that an overpayment has not been identified unless and until the provider or supplier is able to quantify the amount of the overpayment.

The second change was to remove the language related to “reckless disregard” and “deliberate ignorance”.  CMS replaced these terms with a standard of “reasonable diligence”.  Under the new standard, an overpayment is identified on the date you can actually quantify the size of the overpayment, or the date on which you would have been able to quantify the overpayment had you proceeded with reasonable diligence to investigate the possibility of an overpayment.  For these purposes, CMS indicated that reasonable diligence would be established to the extent you can demonstrate a timely, good faith investigation of any credible report of a possible overpayment.  Note: CMS indicated that an investigation should take no more than 6 months from the date of receipt of credible information, except in extraordinary circumstances.

To see the impact of these changes, consider the following scenario:

You receive an anonymous report on your compliance hotline that a recent change to your billing software has resulted in the mileage for all Medicare claims being rounded up to the next whole number (as opposed to being submitted with fractions of a mile).  Based on this report, you begin an investigation, and quickly come to the conclusion that the anonymous report is correct.  However, it requires an addition 4 months to review every claim submitted to Medicare since that software change, and to calculate the actual amounts you were overpaid.

Under the standard first proposed by CMS, it was unclear whether the 60-day clock to return over payment started on the day you confirmed the software problem, or whether you have time to look at your entire claims universe to calculate the actual amounts you were overpaid.  By contrast, under the standard set forth in the final rule, it is clear that the overpayment would not be “identified” until you can quantify the actual amounts you had been overpaid.  In the above example, you completed your investigation within 6 months, meaning you would have satisfied the new “reasonable diligence” standard.  Therefore, assuming you make a timely report and refund of the amounts you were overpaid, you would have no liability under the False Claims Act.

Situations in Which a Provider or Supplier would have a Duty to Inquire

In the proposed rule, CMS provided some examples of situations where a provider or supplier would be deemed to have received a credible information regarding a potential overpayment, including the following situations:

  • Where a review of billing records indicates that you were incorrectly paid a higher rate for certain services;
  • Where you learn that the patient died prior to the date of service on a claim that has been submitted for payment;
  • Where you discover that the services were provided by an unlicensed or excluded individual;
  • Where an internal audit discovers the presence of an overpayment.
  • Where you are informed by a government agency of an audit that discovered a potential overpayment, and where you fail to make a reasonable inquiry;

In the final rule, CMS confirmed its belief that official findings from a government agency (or its contractors) would constitute credible evidence of a potential overpayment, and would therefore trigger a provider’s or supplier’s obligation to conduct an investigation with reasonable diligence.  If the provider or supplier ultimately agrees with the Medicare contractor’s findings, it would qualify as having “identified” an overpayment, which would trigger the 60-day period for reporting and refunding that overpayment.  CMS further indicated that when the provider confirms the audit’s findings, the provider or supplier may be deemed to have credible evidence of additional overpayments (i.e., claims presenting the same issues, but which fall outside the contractor’s audit period) that may require further investigation.   CMS did agree, however, that where the provider or supplier elects to appeal the contractor’s findings, it would be reasonable to hold off on conducting an investigation into similar claims until such time as the overpayment identified by the Medicare contractor has worked its way through the administrative appeals process.

Counting 60-Day Period

In the final rule, CMS indicated that the 60-day period for reporting and returning the overpayment would start on the date the overpayment is first identified (i.e., the date the overpayment is first quantified following a reasonably diligent inquiry.  However, in the event a person fails to conduct a reasonably diligent inquiry, the 60-day period will be deemed to run from the date the provider or supplier first received a credible report of a possible overpayment (assuming the provider or supplier was, in fact, overpaid).

Process for Reporting Overpayments

In its February 2012 proposed rule, CMS had indicated that it would require ambulance providers and suppliers to report and return overpayments using the existing process for voluntary refunds.  At that time, CMS also proposed that the overpayment report contain 13 required elements, including a brief statement of the reason for the overpayment, and a description of the steps the provider or supplier intended to take to ensure that the same error would not occur again.  At the time, CMS further indicated that it would develop a uniform reporting form that would replace the various forms currently in use by its Medicare contractors.

In the final rule, CMS abandoned this formulaic approach to the reporting of overpayments.  Instead, CMS elected to permit providers or suppliers to use any of the following to report an overpayment:

  • An applicable claims adjustment;
  • Credit balance;
  • Self-Reported Refund; or
  • Any other reporting process set forth by the applicable Medicare contractor.

In addition to the processes currently used by Medicare contractors, providers or suppliers can also satisfy the reporting obligations of the final rule by making a disclosure under the OIG’s Self-Disclosure Protocol or the CMS Voluntary Self-Referral Disclosure Protocol.  Note: these processes are generally reserved for situations that involve something more than an isolated billing error.

When reporting an overpayment that was calculated using a statistical sampling methodology, CMS indicated that the provider or supplier must describe the actual process used to obtain a statistically valid sample, and the extrapolation methodology used.

Statute of Limitations

In the final rule, CMS adopted a 6-year “lookback period”.  CMS further clarified that this lookback period is measured from the date the provider or supplier identifies the overpayment.  As a result, an overpayment must be reported and returned only to the extent the overpayment is identified within 6 years of the date the overpayment was received.  Overpayments identified beyond the 6-year lookback period would not be subject to the new regulations.

The 6-year lookback period represents a substantial reduction from the 10-year lookback period originally proposed by CMS.  That 10-year period was intended to coincide with the outer limit of the statute of limitations for False Claims Act violations.  However, after considering comments from healthcare providers and suppliers, CMS agreed that a 6-year lookback period was more appropriate.  CMS noted that the change would significantly reduce the burden these new regulations imposed on providers and suppliers.

Change to Regulations Governing Reopenings

To facilitate the reporting and refunding of overpayments under these new regulations, CMS elected to revise its rules regarding reopenings.  CMS will now permit its Medicare Administrative Contractors (MACs) to reopen an initial determination (i.e., a paid claim) for the purpose of reporting and returning an overpayment.

While seemingly minor, this change is needed to ensure that Medicare’s payment files properly reflect that an overpayment has been refunded.  Otherwise, it would be possible for a claim that had previously been refunded to be selected by a Medicare auditor for postpayment review.  This could lead to the auditor attempting to recoup amounts that had previously been voluntarily refunded.

CMS Releases Ambulance Cost Data Collection Report

Written by Tristan North on . Posted in Cost Survey, Government Affairs, Medicare, Member Advisories, Member-Only, News, Reimbursement.

The Centers for Medicare and Medicaid Services (CMS) has released its report on the feasibility of collecting cost data from ambulance service providers.  Under the American Taxpayer Relief Act of 2012, Congress directed CMS to conduct the report entitled “Evaluation of Hospitals’ Ambulance Data on Medicare Cost Reports and Feasibility of Obtaining Cost Data from All Ambulance Providers and Suppliers”. The report can be accessed here.

The report states that due to the diverse nature of our industry with a majority of providers being small entities, traditional mandatory ambulance cost reporting is not feasible.  While it does not make a recommendation on a data collection system, the report highlights the work of the AAA with The Moran Company and will be helpful in our push for a survey approach to collecting ambulance cost data.  Here is AAA’ summary of the report, AAA Summary of CMS Acumen Cost Analysis.

The survey approach to collecting ambulance cost data is a major component of the Medicare Ambulance Access, Fraud Prevention and Reform Act (S. 377, H.R. 745) which would make the current Medicare ambulance increases permanent.  The data collected through the survey would help the AAA make data-driven recommendations to the Congress and CMS on future changes to the Medicare ambulance fee schedule.

The contractor, Acumen, who developed the report, was also asked to look to see if cost data submitted by hospital-based ambulance service providers would be helpful.  Acumen determined that the data submitted varied significantly and thus was not useful.

For questions about the AAA efforts on cost data collection, please contact AAA Senior Vice President of Government Affairs Tristan North at tnorth@ambulance.org.

CMS Announces 2016 Inflation Factor

Written by David Werfel on . Posted in Government Affairs, Member Advisories, Member-Only, Regulatory.

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%.

The Importance of Ambulance Cost Survey Data

Written by Kathy Lester on . 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.

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

Written by David Werfel on . Posted in Government Affairs, Medicaid, Medicare, Member Advisories, Member-Only, Regional Workshops, Regulatory.

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 which are a RUCA 2 or 3 and have a portion that include a rural census tract.  The Agency will issue possible changes in a proposed rule.  This review was requested by the AAA and should result in more urban zip codes being designated as rural.
  • Vehicle/Staff – For Medicare purposes, a BLS vehicle must include at least a driver and an EMT-Basic.  However, the vehicle/staff must also meet all state and local rules.

ICD-10 – CMS published an ambulance crosswalk from ICD-9 codes to ICD-10 codes.  Also, the condition codes list is only a guide and using one of the codes does not guarantee coverage.

Meeting at the AAA

  • Rogers spoke at the AAA Workshop on Prior Authorization held at the AAA headquarters on October 2.  He thanked the AAA for inviting him as a speaker.
  • Rogers mentioned one of the issues he discussed at the AAA headquarters was the transportation of psychiatric patients. Dr. Rogers indicated that his opinion is that when patients are in a “psychiatric hold”, that the psychiatric hold, by itself, does not constitute Medicare coverage for an ambulance.  He indicated that coverage would exist if there was IV, EKG, medications administered, etc., but that possible elopement was not enough for coverage.  Dr. Rogers’s statement was his individual opinion.  The AAA does not agree with that opinion and we will be following up with Dr. Rogers and CMS on the matter.
  • Rogers stated another issue discussed at the AAA headquarters was on the proper level of service being determined at the time of dispatch. He stated that it was his opinion that Medicare should reimburse for the level of service dispatched.

Healthcare Marketplace – individuals can apply for health coverage through the marketplace from November 1, 2015 to January 31, 2016 through healthcare.gov.

Medicare Open Enrollment – CMS announced the Open Enrollment period has begun for Medicare beneficiaries to select their plan.

The question and answer period followed the announcements.  As usual, several resulted in the caller being asked to e-mail their question to CMS.  Questions concerning the prior authorization program were asked but the callers were told the questions would be answered on the Special Open Door Forum for prior authorization that will be held on November 10.  Answers to questions asked were as follows:

  • Medicare does not cover an ambulance transport of a psych patient, as the patient can be transported safely by other means, such as by law enforcement.
  • When physicians and facilities do not provide records needed for prior authorization, the ambulance provider may have to choose discontinuing transportation of that patient.
  • The denial rate for ICD-10 codes is the same as it was for ICD-9 codes.
  • No solution was offered for situations where the SNF uses 911 to call for an ambulance that they know is not needed.
  • When Medicaid pays and takes back its payment more than a year after the date of service, due to the patient receiving retroactive Medicare eligibility, Medicare can be billed.

No date was given for the next Ambulance Open Door Forum, other than the November 10 date for the Special Open Door Forum on the expansion of prior authorization.

Member Advisory: CMS Releases the ICD-10 Crosswalk

Written by Kathy Lester on . 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.

Member Advisory: Follow Up Regarding Recent OIG Report on Questionable Billing Practices for Ambulance Suppliers

Written by Brian Werfel on . Posted in Government Affairs, Member Advisories, Member-Only, Regulatory.

HHS OIG Analysis Part 2 of 2 – Read Part One of the Analysis

October 1, 2015

Yesterday, the American Ambulance Association summarized a report from the Department of Health and Human Services Office of the Inspector General (OIG) on certain questionable billing practices by ambulance suppliers.

In this report, the OIG indicated that 1 in 5 ambulance providers had engaged in one or more of the following “questionable billing” practices”:

  • Billing for a transport without a Medicare service being provided at either the origin
  • Billing for excessive mileage for urban transports
  • Billing for a high number of transports per beneficiary
  • Billing using compromised beneficiary ID numbers
  • Billing for an inappropriate or unlikely transport level
  • Billing for a beneficiary that is being shared among multiple ambulance suppliers
  • Billing for transports to/from a partial hospitalization program

In this member advisory, I want to devote additional attention to the questionable billing practice the OIG referred to as “inappropriate or unlikely transport levels”.

The OIG identified 268 out of the 15,614 ambulance suppliers reviewed (2%) that had questionable billing based on the percentage of claims submitted with inappropriate or unlikely combinations of transport levels and destinations.  The OIG summarized its findings as follows:

“We identified two types of transports billed with inappropriate combinations of destinations and transport levels. First, we identified emergency transports that suppliers indicated were to a destination other than a hospital or the site of a transfer between ground and air transports. We also identified specialty care transports that suppliers indicated were to or from destinations other than hospitals, SNFs, or transfer sites.”

The OIG went on to state that a high percentage of an ambulance supplier’s transports with inappropriate or unlikely transport levels (given the destination) could be indicative of “upcoding”.  The OIG identified 268 ambulance suppliers that had particularly high numbers of claims submitted with unlikely or inappropriate transport levels/destinations combinations.  These ambulance suppliers submitted 3% or more of their claims with these suspect combinations, compared to less than 1% for most ambulance suppliers.  The OIG identified 19 companies that used a suspect combination on more than 25% of their claims.

Since the publication of the OIG’s report, the AAA has received numerous inquiries from members asking for guidance on how they can identify whether their company is at risk for submitting claims with these suspect combinations.  Unfortunately, there is no easy answer to that question.  However, based on my experience, I can offer the following general guidelines:

  1. Define the types of claims that would potentially be problematic. The OIG identified two distinct categories of suspect combinations.  The first involves emergency transports.  The OIG indicated that a claim would presumably not qualify for payment of an emergency base rate to the extent the patient was being transported to somewhere other than a hospital or an intercept site (i.e., the “I” modifier).  In other words, the OIG is looking at claims billed for an emergency base rate (HCPCS Codes A0427 or A0429) with a destination modifier that is either an “R” (Residence), “N” (Skilled Nursing Facility), “E” (Other Custodial Facility), “J” (Free-Standing Dialysis Facility).  The second category involved specialty care transports (SCT).  To qualify as SCT, a transport must be “interfacility”, which CMS has defined to be transports between hospitals (including hospital-based dialysis facilities), skilled nursing facilities, or any combination thereof.  Therefore, the OIG would consider a claim to be suspect if the origin or destination modifier was an “R”, “N”, “E”, or “J”.
  2. Investigate the claim submission edits within your billing system. Having defined the types of claims that the OIG would consider suspect, I suggest that you investigate the claims submission edits within your billing system.  Specifically, you want to see whether there is anything currently in place that would make it impossible for you to submit a claim with any of these suspect combinations.  For example, would your billing system prevent you from submitting the following claim:  A0427 HR?  This may require you to attempt to submit test claims with each possible combination to see whether your billing software would reject any or all of these combinations.
  3. To the extent these claim submission edits are not already in place, you should investigate whether your billing software permits you to create them. Assuming your billing system does not currently have edits in place to prevent the submission of claims with these suspect combinations, you want to investigate whether these types of edits can be added.  Many billing software products have optional submission edits that you can enable for certain payers.  Other products may permit you to create specialized edits for these purposes.  You may want to contact your billing vendor to ask whether there is any way to put these edits in place for your Medicare claims.  Assuming your software has the capability of putting these edits in place, it almost certainly makes sense to do so, in order to eliminate the possibility of submitting claims with these suspect combinations going forward.

The suggestions listed in paragraphs #1 and #2 above address the issue of whether it was possible for your company to have inadvertently submitted claims with any of these suspect combinations.  Even if you determine that it was theoretically possible for you to have submitted claims with any of these suspect combinations, it does not necessarily follow that any such claims were actually submitted.  Most ambulance companies have numerous controls in place to guard against inadvertent mistakes in the coding/billing of claims.  For example, while many billing software products permit an ambulance coder to duplicate an earlier transport for the patient, many companies elect not to use this functionality, preferring instead to code each claim from scratch.  This removes one possible mechanism by which these types of inadvertent errors can occur.  Moreover, even if it a claim was submitted with a suspect combination, it does not necessarily follow that the claim was paid by Medicare.  Your Medicare contractor may have its own edits in place to deny claims submitted with these suspect combinations.  Finally, even if a claim was accidentally submitted with a suspect combination and paid by the Medicare contractor, it is possible that you may have caught the error at the time you posted Medicare’s payment.  Assuming that you properly refunded the incorrect payment at that time, there is no need for further concern.

Conclusion

Ambulance supplier should attempt to determine whether their billing software was designed in such a way as to prevent these suspect combinations from being submitted to Medicare.  To the extent you are confident that it is impossible for these claims to be submitted to Medicare, there is nothing further that needs to be done.

To the extent an ambulance supplier determines that their current billing software edits do not make it impossible for such claims to be submitted to Medicare, they should determine whether the necessary edits could be implemented on a go forward basis.  The ambulance supplier will also need to make an organizational determination on whether to investigate its past claims universe.  This determination should be made in consultation with the company’s legal advisers.  Your legal advisers will also guide you on the steps that should be taken if you discover that you remain paid for any claims with any of these suspect combinations.

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