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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.

Prior Authorization Pilot Program – Status Update

Written by David Werfel on . Posted in Medicare, Member Advisories, Member-Only.

CMS released preliminary data on the impact of the prior authorization demonstration program on Medicare payments for ambulance services.  This data is limited to the three states (NJ, PA, and SC) that were included in the demonstration program’s first year.

CMS noted that it has observed a dramatic decrease in expenditures for repetitive non-emergency ambulance transports since the program’s implementation.  CMS released the following data for the first 10 months of the program (i.e. December 2014 – September 2015), comparing that data to the first 11 months of 2014:

  • Payments for repetitive non-emergency ambulance transportation in these states averaged $5.4 million per month, down from nearly $18.9 million per month prior to the program’s implementation. This is a reduction of more than 70%.
  • In the states that were not part of the demonstration program, payments have decreased very slightly for the 10 months in 2014 and are very similar to the payments in the 11 months prior to the program beginning in SC, NJ and PA.
  • 18,367 prior authorization requests were received and finalized by Medicare’s contractors. Of these, 6,430 (35.0%) were approved.

CMS is closely monitoring these results to evaluate its effectiveness. Here is the full status update.

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.

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

Written by Kathy Lester on . 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.

Preliminary Calculation of 2016 Ambulance Inflation Update

Written by Brian Werfel on . Posted in Medicare, Member Advisories, Member-Only, Reimbursement.

Section 1834(l)(3)(B) of the Social Security Act mandates that the Medicare Ambulance Fee Schedule be updated each year to reflect inflation. This update is referred to as the “Ambulance Inflation Factor” or “AIF”.

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

For the 12-month period ending in June 2015, the federal Bureau of Labor Statistics (BLS) has calculated that the CPI-U has increased by 0.12%.

CMS has yet to release its estimate for the MFP in calendar year 2016. However, assuming CMS’ projections for the MFP are similar to last year’s projections, the number is likely to be in the 0.6% range.

Accordingly, the AAA is currently projecting that the 2016 Ambulance Inflation Factor will be approximately ~0.5%.

Members should be advised that the BLS’ calculations of the CPI-U are preliminary, and may be subject to later adjustment. The AAA further cautions members that CMS has not officially announced the MFP for CY 2016. Therefore, it is possible that these numbers may change. However, at this point in time, it appears likely that the 2016 AIF will result in a decrease in Medicare payments for air and ground ambulance services.

The AAA will notify members once CMS issues a transmittal setting forth the official 2016 Ambulance Inflation Factor.

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.

Member Advisory: OIG Issues 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 1 of 2 – Read Part Two of the Analysis

On September 29, 2015, the Department of Health and Human Services Office of the Inspector General (OIG) issued a report titled “Inappropriate Payments and Questionable Billing for Medicare Part B Ambulance Transports” (OEI-09-12-00351).  The report, conducted by the Office of Evaluation and Inspections (OEI), looked at claims data for 7.3 million ambulance transports furnished during the first half of 2012.  The OIG reviewed this claims data to determine whether claims were billed appropriately to the Medicare program.

Summary of the OIG’s Findings

The OIG determined that Medicare paid $24.2 million in the first half of 2012 for ambulance transports that did not meet certain program requirements for payment.  The OIG identified an additional $30.2 million paid for transports for which the beneficiary did not receive Medicare services at either the pick-up or drop-location, or anywhere else.  Finally, the OIG determined that 1 in 5 ambulance suppliers met certain criteria that indicated they may have engaged in questionable billing practices.  According to the OIG, more than half of all questionable transports were provided to beneficiaries residing in 4 metropolitan areas.

Detailed OIG Findings

Medicare paid $24.2 million for ambulance transports that did not meet certain Medicare requirements justifying payment.  This included transports to a non-covered destination, as well as transports to a covered destination but where the level of service was inappropriate. 

The OIG determined that Medicare paid $17.4 million for ambulance transports to non-covered destinations.  This amount also include return trips following treatment at the non-covered destination.  These transports represented 0.6% of all Medicare payments during the first half of 2012.

The OIG indicated that transports to a physician’s office were the most common type of non-covered destination.  Payments for transports to and from a physician’s office accounted for $8.7 million in improper payments.  Medicare also paid $5.8 million for transports of beneficiaries to and from community mental health centers or psychiatric facilities (other than duly-licensed psychiatric hospitals).  Other transports to non-covered destinations included independent laboratories, diagnostic or therapeutic sites (i.e., “D” modifiers), non-SNF nursing facilities, long-term care and hospice facilities.

The OIG determined that Medicare paid $7 million for transports with inappropriate combinations of the level of service billed and the type of destination.  This included $4.3 million in payments for specialty care transports (SCT) where either the origin or destination was something other than a hospital, SNF, or intercept site.  The majority of these inappropriate SCT transports involved transports between the patient’s SNF or residence and a free-standing dialysis facility.  The OIG also determined that Medicare paid $2.7 million for emergency transports where the destination was not a hospital.

Medicare paid $30.2 million for ambulance transports for which the beneficiary did not receive Medicare services at any origin or destination. 

The OIG identified $30.2 million in payments for ambulance transports where the beneficiary did not appear to receive any Medicare services at either the origin or destination within 1 day of the date of transport.  To account for the possibility that the ambulance supplier may have submitted a claim with the wrong origin or destination, the OIG only flagged a claim as questionable if its records determined that the beneficiary did not receive Medicare services at any other facility type within 1 day of the transport.  The OIG stated its belief that, since there was no record of the beneficiary receiving Medicare services at or close to the date of transport, the OIG believed that it was likely that Medicare inappropriately paid for the ambulance transports.  The OIG did note the possibility that these transports occurred during an inpatient hospital or SNF stay, and therefore may have been the responsibility of the inpatient facility.  These transports represented 1.1% of all Medicare payments during the first half of 2012.

The OIG determined that 1 in 5 ambulance suppliers had questionable billing

As part of the methodology used for this report, the OIG developed a set of 7 measure that it believed could be evidence of questionable billing practices.  These seven measures were:

  1. No Medicare service provided at either the origin or destination – The OIG believes that a high percentage of an ambulance supplier’s for which the beneficiary did not receive Medicare services at either the origin or destination could be indicative of either: (a) billing for transports to non-covered destinations or (b) billing for transports that were not provided.
  2. Excessive mileage for urban transports – The OIG believes that high average mileage for transports within an urban area could be indicative of either: (a) billing for more miles than the ambulance supplier actually drove or (b) billing for mileage beyond the nearest appropriate facility.
  3. High number of transports per beneficiary – The OIG believes that a high average of per-beneficiary transports could be indicative of billing for transports that were not medically necessary.
  4. Compromised Beneficiary Number – The OIG believes that a high percentage of an ambulance supplier’s transports provided to beneficiary with compromised beneficiary ID numbers could be indicative of billing for transports that were not medically necessary, or which were not provided.
  5. Inappropriate or unlikely transport level – The OIG believes that a high percentage of an ambulance supplier’s transports with inappropriate or unlikely transport levels (given the destination) could be indicative of “upcoding”.
  6. Beneficiary sharing – The OIG believes that when multiple ambulance suppliers all provide dialysis transports to the same beneficiary that it could be evidence of the misuse of a beneficiary’s ID number, or it could be evidence that the beneficiary is shopping his or her ID number for kickbacks.
  7. Transports to or from partial hospitalization programs – The OIG believes that transports to and from a partial hospitalization program (PHP) is unlikely to be medically necessary because beneficiary’s that meet Medicare’s coverage requirements for PHP services generally do not qualify for ambulance transportation.

The OIG indicated that 21% of ambulance suppliers met one of the seven measures it developed for identifying questionable billing practices.  17% of ambulance suppliers met only 1 of the 7 measures, while 4% met 2-4 of these measures.  No ambulance suppliers met more than 4 of these measures.

The OIG identified 2,038 out of the 15,614 ambulance suppliers reviewed (13%) that had questionable billing based on the percentage of their transports where the beneficiary did not receive Medicare services at either the origin or destination.  The OIG flagged an ambulance supplier’s billing as questionable if 3% or more of its transports involved situations where no Medicare service was billed at the destination.  46 ambulance suppliers had 95% or more of their transports involve situations where the beneficiary did not receive Medicare services at either the origin or destination.  By contrast, the median for all ambulance suppliers was zero transports where the beneficiary did not receive services at either the origin or destination.

The OIG identified 642 out of the 15,614 ambulance suppliers reviewed (4%) that had questionable billing based on the average mileage they billed for beneficiaries residing in urban areas.  The OIG indicated that the typical ambulance supplier average 10 miles for an urban transport.  By contrast, the average mileage for the 642 suppliers identified by the OIG was 34 miles.  The OIG identified 48 suppliers with an average urban mileage of more than 100 miles.

The OIG identified 533 out of the 15,614 ambulance suppliers reviewed (3%) that had questionable billing based on the average number of transports per beneficiary.  Beneficiaries transported by the typical ambulance supplier that provided dialysis transports received an average of 4 ambulance transports during the first 6 months of 2012.  Beneficiaries transported by the 533 suppliers identified by the OIG received an average of 21 transports during the first half of 2012.

The OIG identified 358 out of the 15,614 ambulance suppliers reviewed (2%) that had questionable billing based on the percentage of their transports that were associated with compromised beneficiary ID numbers.  In studying this measure, the OIG excluded ambulance suppliers that did not bill for any transports involving the use of compromised beneficiary ID numbers.  Among those suppliers that billed any transports that involved the use of a compromised ID number, only 1% of the typical supplier’s involved the compromised ID numbers.  The 358 suppliers identified by the OIG used a compromised ID number for at least 7% of their claims.  31 suppliers used a compromised ID number for more than 95% of their submitted claims.

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 unlikely or inappropriate transport levels and destinations.  For the typical supplier that billed any claims with an inappropriate combination of transport level and destination, these claims accounted for less than 1% of all claims submitted in the first half of 2012.  For the 268 suppliers identified by the OIG, these claims accounted for more than 3% of all claims submitted in the first half of 2012.  The OIG identified 19 suppliers that used an inappropriate or unlikely combination on at least 25% of the claims they submitted during the first half of 2012.

Finally, the OIG noted that the ambulance suppliers that tested “positive” for any of the questionable billing practices it identified were disproportionately likely to provide BLS non-emergency transports (including dialysis).  The OIG noted that BLS non-emergency transports accounted for only 36% of transports billed by providers that did not meet any of its questionable billing measures, while BLS non-emergency transports accounted for 65% of all claims submitted by those suppliers it identified as having at least one questionable billing practice.

More than half of questionable ambulance transports were provided to beneficiaries residing in 4 metropolitan areas

The OIG determined that questionable billing was concentrated in the metropolitan areas of Houston, Los Angeles, New York, and Philadelphia.  These 4 areas accounted for 18% of all ambulance transports during the first half of 2012, but 52% of all questionable transports.  Collectively, these areas accounted for $104 million of the $207 million in Medicare payments for “questionable” ambulance transports during the first half of 2012.

The OIG also determined that, on average, ambulance suppliers that provided transports to beneficiaries in these 4 metropolitan areas transported more Medicare beneficiaries and received more in Medicare payments than suppliers in other metropolitan areas.  For example, the average ambulance supplier in Los Angeles received a total of $105,696 in Medicare payments, compared with an average of $16,137 in Medicare payments per supplier in other metropolitan areas.  The numbers in NY ($85,606), Philadelphia ($56,667), and Houston ($34,951) were also far in excess of the national average.

OIG’s Recommendations

In this report, the OIG makes a number of recommendations to CMS to reduce the number of inappropriate payments and questionable billing practices.  These recommendations include:

  1. Expanding the temporary moratoria on new enrollments to additional metropolitan area. The OIG is recommending that CMS consider whether the existing moratoria (in place in Houston and Philadelphia) should be expanded to NY and Los Angeles.CMS concurred with this recommendation, and stated that it will continue to monitor these geographic areas, and will impose additional temporary moratoria if warranted.
  2. Require ambulance suppliers to include the National Provider Identifier (NPI) of the certifying physician on non-emergency claims that require a certification. The OIG is recommending that when a physician certification is required (e.g., for dialysis transports), that the physician’s NPI be listed on the claim.  The OIG notes that the NPI of the ordering physician is already required for laboratory and DME claims.  The OIG also recommended that the physician’s NPI be listed on PCS forms.CMS concurred with the recommendation, and indicated that it will explore the best way to implement this recommendation.
  3. Implement new claims processing edits, or improve existing edits, to prevent inappropriate payments for ambulance transports. The OIG is recommending that CMS update its edits to prevent payment: (a) for transports to non-covered destinations and (b) for transports with inappropriate combinations of the destination and the level of service billed (e.g., emergency transports to a patient’s residence).CMS partially concurred with the recommendation, but indicated that it wanted to review the data on the claims identified by the OIG in the report before taking any actions.
  4. Increase CMS’ monitoring of ambulance billing. The OIG is recommending that CMS continue to monitor the billing of ambulance claims using the measures of questionable billing that the OIG developed.CMS appeared to concur with the recommendation, indicating that it would continue its current monitoring.  However, the OIG indicated that its recommendation was not to continue monitoring at the current levels, but rather to increase the monitoring of ambulance claims.
  5. Determine the appropriateness of the claims billed by the ambulance suppliers identified in this report and take appropriate action. The OIG indicated that it would be providing CMS with a separate memorandum that lists the claims it identified that did not meet Medicare billing requirements.  The OIG was suggesting that CMS or its contractors should take a closer look at these providers, for example by reviewing medical records or performing unannounced site visits to determine whether additional actions are appropriate.CMS partially concurred with the recommendation, but indicated that it wanted to review the data on the claims identified by the OIG in the report before taking any actions.

Member Advisory: OIG Issues 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 1 of 2 – Read Part Two of the Analysis

On September 29, 2015, the Department of Health and Human Services Office of the Inspector General (OIG) issued a report titled “Inappropriate Payments and Questionable Billing for Medicare Part B Ambulance Transports” (OEI-09-12-00351).  The report, conducted by the Office of Evaluation and Inspections (OEI), looked at claims data for 7.3 million ambulance transports furnished during the first half of 2012.  The OIG reviewed this claims data to determine whether claims were billed appropriately to the Medicare program.

Summary of the OIG’s Findings

The OIG determined that Medicare paid $24.2 million in the first half of 2012 for ambulance transports that did not meet certain program requirements for payment.  The OIG identified an additional $30.2 million paid for transports for which the beneficiary did not receive Medicare services at either the pick-up or drop-location, or anywhere else.  Finally, the OIG determined that 1 in 5 ambulance suppliers met certain criteria that indicated they may have engaged in questionable billing practices.  According to the OIG, more than half of all questionable transports were provided to beneficiaries residing in 4 metropolitan areas.

Detailed OIG Findings

Medicare paid $24.2 million for ambulance transports that did not meet certain Medicare requirements justifying payment.  This included transports to a non-covered destination, as well as transports to a covered destination but where the level of service was inappropriate. 

The OIG determined that Medicare paid $17.4 million for ambulance transports to non-covered destinations.  This amount also include return trips following treatment at the non-covered destination.  These transports represented 0.6% of all Medicare payments during the first half of 2012.

The OIG indicated that transports to a physician’s office were the most common type of non-covered destination.  Payments for transports to and from a physician’s office accounted for $8.7 million in improper payments.  Medicare also paid $5.8 million for transports of beneficiaries to and from community mental health centers or psychiatric facilities (other than duly-licensed psychiatric hospitals).  Other transports to non-covered destinations included independent laboratories, diagnostic or therapeutic sites (i.e., “D” modifiers), non-SNF nursing facilities, long-term care and hospice facilities.

The OIG determined that Medicare paid $7 million for transports with inappropriate combinations of the level of service billed and the type of destination.  This included $4.3 million in payments for specialty care transports (SCT) where either the origin or destination was something other than a hospital, SNF, or intercept site.  The majority of these inappropriate SCT transports involved transports between the patient’s SNF or residence and a free-standing dialysis facility.  The OIG also determined that Medicare paid $2.7 million for emergency transports where the destination was not a hospital.

Medicare paid $30.2 million for ambulance transports for which the beneficiary did not receive Medicare services at any origin or destination. 

The OIG identified $30.2 million in payments for ambulance transports where the beneficiary did not appear to receive any Medicare services at either the origin or destination within 1 day of the date of transport.  To account for the possibility that the ambulance supplier may have submitted a claim with the wrong origin or destination, the OIG only flagged a claim as questionable if its records determined that the beneficiary did not receive Medicare services at any other facility type within 1 day of the transport.  The OIG stated its belief that, since there was no record of the beneficiary receiving Medicare services at or close to the date of transport, the OIG believed that it was likely that Medicare inappropriately paid for the ambulance transports.  The OIG did note the possibility that these transports occurred during an inpatient hospital or SNF stay, and therefore may have been the responsibility of the inpatient facility.  These transports represented 1.1% of all Medicare payments during the first half of 2012.

The OIG determined that 1 in 5 ambulance suppliers had questionable billing

As part of the methodology used for this report, the OIG developed a set of 7 measure that it believed could be evidence of questionable billing practices.  These seven measures were:

  1. No Medicare service provided at either the origin or destination – The OIG believes that a high percentage of an ambulance supplier’s for which the beneficiary did not receive Medicare services at either the origin or destination could be indicative of either: (a) billing for transports to non-covered destinations or (b) billing for transports that were not provided.
  2. Excessive mileage for urban transports – The OIG believes that high average mileage for transports within an urban area could be indicative of either: (a) billing for more miles than the ambulance supplier actually drove or (b) billing for mileage beyond the nearest appropriate facility.
  3. High number of transports per beneficiary – The OIG believes that a high average of per-beneficiary transports could be indicative of billing for transports that were not medically necessary.
  4. Compromised Beneficiary Number – The OIG believes that a high percentage of an ambulance supplier’s transports provided to beneficiary with compromised beneficiary ID numbers could be indicative of billing for transports that were not medically necessary, or which were not provided.
  5. Inappropriate or unlikely transport level – The OIG believes that a high percentage of an ambulance supplier’s transports with inappropriate or unlikely transport levels (given the destination) could be indicative of “upcoding”.
  6. Beneficiary sharing – The OIG believes that when multiple ambulance suppliers all provide dialysis transports to the same beneficiary that it could be evidence of the misuse of a beneficiary’s ID number, or it could be evidence that the beneficiary is shopping his or her ID number for kickbacks.
  7. Transports to or from partial hospitalization programs – The OIG believes that transports to and from a partial hospitalization program (PHP) is unlikely to be medically necessary because beneficiary’s that meet Medicare’s coverage requirements for PHP services generally do not qualify for ambulance transportation.

The OIG indicated that 21% of ambulance suppliers met one of the seven measures it developed for identifying questionable billing practices.  17% of ambulance suppliers met only 1 of the 7 measures, while 4% met 2-4 of these measures.  No ambulance suppliers met more than 4 of these measures.

The OIG identified 2,038 out of the 15,614 ambulance suppliers reviewed (13%) that had questionable billing based on the percentage of their transports where the beneficiary did not receive Medicare services at either the origin or destination.  The OIG flagged an ambulance supplier’s billing as questionable if 3% or more of its transports involved situations where no Medicare service was billed at the destination.  46 ambulance suppliers had 95% or more of their transports involve situations where the beneficiary did not receive Medicare services at either the origin or destination.  By contrast, the median for all ambulance suppliers was zero transports where the beneficiary did not receive services at either the origin or destination.

The OIG identified 642 out of the 15,614 ambulance suppliers reviewed (4%) that had questionable billing based on the average mileage they billed for beneficiaries residing in urban areas.  The OIG indicated that the typical ambulance supplier average 10 miles for an urban transport.  By contrast, the average mileage for the 642 suppliers identified by the OIG was 34 miles.  The OIG identified 48 suppliers with an average urban mileage of more than 100 miles.

The OIG identified 533 out of the 15,614 ambulance suppliers reviewed (3%) that had questionable billing based on the average number of transports per beneficiary.  Beneficiaries transported by the typical ambulance supplier that provided dialysis transports received an average of 4 ambulance transports during the first 6 months of 2012.  Beneficiaries transported by the 533 suppliers identified by the OIG received an average of 21 transports during the first half of 2012.

The OIG identified 358 out of the 15,614 ambulance suppliers reviewed (2%) that had questionable billing based on the percentage of their transports that were associated with compromised beneficiary ID numbers.  In studying this measure, the OIG excluded ambulance suppliers that did not bill for any transports involving the use of compromised beneficiary ID numbers.  Among those suppliers that billed any transports that involved the use of a compromised ID number, only 1% of the typical supplier’s involved the compromised ID numbers.  The 358 suppliers identified by the OIG used a compromised ID number for at least 7% of their claims.  31 suppliers used a compromised ID number for more than 95% of their submitted claims.

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 unlikely or inappropriate transport levels and destinations.  For the typical supplier that billed any claims with an inappropriate combination of transport level and destination, these claims accounted for less than 1% of all claims submitted in the first half of 2012.  For the 268 suppliers identified by the OIG, these claims accounted for more than 3% of all claims submitted in the first half of 2012.  The OIG identified 19 suppliers that used an inappropriate or unlikely combination on at least 25% of the claims they submitted during the first half of 2012.

Finally, the OIG noted that the ambulance suppliers that tested “positive” for any of the questionable billing practices it identified were disproportionately likely to provide BLS non-emergency transports (including dialysis).  The OIG noted that BLS non-emergency transports accounted for only 36% of transports billed by providers that did not meet any of its questionable billing measures, while BLS non-emergency transports accounted for 65% of all claims submitted by those suppliers it identified as having at least one questionable billing practice.

More than half of questionable ambulance transports were provided to beneficiaries residing in 4 metropolitan areas

The OIG determined that questionable billing was concentrated in the metropolitan areas of Houston, Los Angeles, New York, and Philadelphia.  These 4 areas accounted for 18% of all ambulance transports during the first half of 2012, but 52% of all questionable transports.  Collectively, these areas accounted for $104 million of the $207 million in Medicare payments for “questionable” ambulance transports during the first half of 2012.

The OIG also determined that, on average, ambulance suppliers that provided transports to beneficiaries in these 4 metropolitan areas transported more Medicare beneficiaries and received more in Medicare payments than suppliers in other metropolitan areas.  For example, the average ambulance supplier in Los Angeles received a total of $105,696 in Medicare payments, compared with an average of $16,137 in Medicare payments per supplier in other metropolitan areas.  The numbers in NY ($85,606), Philadelphia ($56,667), and Houston ($34,951) were also far in excess of the national average.

OIG’s Recommendations

In this report, the OIG makes a number of recommendations to CMS to reduce the number of inappropriate payments and questionable billing practices.  These recommendations include:

  1. Expanding the temporary moratoria on new enrollments to additional metropolitan area. The OIG is recommending that CMS consider whether the existing moratoria (in place in Houston and Philadelphia) should be expanded to NY and Los Angeles.CMS concurred with this recommendation, and stated that it will continue to monitor these geographic areas, and will impose additional temporary moratoria if warranted.
  2. Require ambulance suppliers to include the National Provider Identifier (NPI) of the certifying physician on non-emergency claims that require a certification. The OIG is recommending that when a physician certification is required (e.g., for dialysis transports), that the physician’s NPI be listed on the claim.  The OIG notes that the NPI of the ordering physician is already required for laboratory and DME claims.  The OIG also recommended that the physician’s NPI be listed on PCS forms.CMS concurred with the recommendation, and indicated that it will explore the best way to implement this recommendation.
  3. Implement new claims processing edits, or improve existing edits, to prevent inappropriate payments for ambulance transports. The OIG is recommending that CMS update its edits to prevent payment: (a) for transports to non-covered destinations and (b) for transports with inappropriate combinations of the destination and the level of service billed (e.g., emergency transports to a patient’s residence).CMS partially concurred with the recommendation, but indicated that it wanted to review the data on the claims identified by the OIG in the report before taking any actions.
  4. Increase CMS’ monitoring of ambulance billing. The OIG is recommending that CMS continue to monitor the billing of ambulance claims using the measures of questionable billing that the OIG developed.CMS appeared to concur with the recommendation, indicating that it would continue its current monitoring.  However, the OIG indicated that its recommendation was not to continue monitoring at the current levels, but rather to increase the monitoring of ambulance claims.
  5. Determine the appropriateness of the claims billed by the ambulance suppliers identified in this report and take appropriate action. The OIG indicated that it would be providing CMS with a separate memorandum that lists the claims it identified that did not meet Medicare billing requirements.  The OIG was suggesting that CMS or its contractors should take a closer look at these providers, for example by reviewing medical records or performing unannounced site visits to determine whether additional actions are appropriate.CMS partially concurred with the recommendation, but indicated that it wanted to review the data on the claims identified by the OIG in the report before taking any actions.

Redeterminations/Reconsiderations: Scope of Review Limited

Written by David Werfel on . Posted in Medicare, Member Advisories, Member-Only.

CMS published MLN Matters article number SE1521, which states:

“For redeterminations and reconsiderations of claims denied following a post-payment review or audit, CMS has instructed MACs and QICs to limit their review to the reason(s) the claim or line item at issue was initially denied.”

What this means is that if you have an audit and a claim is denied for a reason, e.g. not medically necessary, then when you appeal that denial, the MAC cannot deny the claim for a different reason, e.g. signature not legible. The same applies to a denial in the Redetermination decision as the QIC cannot deny for a different reason than what was stated in the original denial. Thus, the Redetermination decision and the Reconsideration decision are limited to the original reason for the denial.

This went into effect for Redetermination and Reconsideration requests received by a MAC or QIC on or after August 1, 2015.

It does not apply to denials that result from failing to submit requested documentation needed to process the claim. It also does not apply to denials from pre-payment reviews.

Novitas Issues Guidance for Ambulance Providers, Facilities and Beneficiaries Regarding Expansion of Prior Authorization Project for Repetitive Patients

Written by Brian Werfel on . Posted in Medicare, Member Advisories, Member-Only, Regional Workshops.

September 17, 2015

Novitas Solutions, Inc. (Novitas) recently issued a series of guidance documents on the expansion of the prior authorization demonstration project for repetitive scheduled non-emergency ambulance transports. This demonstration project is currently operating in the states of New Jersey, Pennsylvania, and South Carolina.

The Medicare Access and CHIP Reauthorization Act of 2015 (Pub. Law 114-10), enacted on April 16, 2015, requires that this program be expanded into the remaining states of MAC Regions L (Delaware, Maryland, and the District of Columbia) and M (North Carolina, Virginia, and West Virginia), effective January 1, 2016. The program will be further expanded to cover all remaining states starting on January 1, 2017.

Novitas is the Medicare Administrative Contractor for MAC Region L, and therefore will be responsible for implementing this program in Delaware, Maryland and the District of Columbia. These guidance documents are intended to educate ambulance services, health care professionals and facilities, and beneficiaries located in these states on the programs requirements.

Guidance Document for Ambulance Services

On August 17, 2015, Novitas issued a “Dear Ambulance Company” letter that provides guidance to ambulance companies on how the program will operate. As noted in the letter, participation is voluntary.

However, ambulance services that elect not to seek prior authorization for repetitive patients (defined as a patient that is transported by non-emergency ambulance for the same service either: (1) three or more times in a 10-day period or (2) once a week for three straight weeks) will find that claims for these patients will be subject to a prepayment review. For this reason, it is anticipated that most ambulance services will elect to seek prior authorization for their repetitive patient population.

The letter further summarizes the documentation requirements needed to request prior authorization for a patient. These include the submission of a prior authorization cover sheet (which can be found on Novitas’ website), a valid Physician Certification Statement (PCS) signed by the beneficiary’s attending physician within sixty (60) days of the requested first transport date, and all other medical records supporting medical necessity.

Novitas will review the submitted documentation and issue either a prior authorization covering all transports within a set date range, or a rejection. To the extent an application is rejected, the provider will be entitled to resubmit the application with additional documentation to support medical necessity.

Guidance Document for Health Care Professionals and Facilities

On August 24, 2015, Novitas issued a “Dear Healthcare Provider/Facility” letter that provides guidance to physicians, healthcare practitioners, and facilities on how the prior authorization project will operate. This letter includes bolded language that indicates that these individuals and facilities must provide certain records to the transporting ambulance service and/or the beneficiary. The letter specifically includes a statement that “[a]ttending physicians must provide a physician certification statement (PCS) and medical records that support medical necessity.” Members may want to download copies of this letter for distribution to physicians and facilities from which they may need to obtain PCS forms and other medical records.

Guidance Document for Beneficiaries

On August 20, 2015, Novitas issued a “Dear Medicare Beneficiary” letter that is intended to educate Medicare beneficiaries on the operation of the prior authorization project. The letter indicates that the pre-approval process is intended to allow the beneficiary to know whether his or her transports will be covered by Medicare prior to the provision of services. The letter indicates that either the beneficiary or the ambulance service can obtain a prior authorization, but notes that the ambulance provider will typically be the one submitting requests. Members may want to download copies of this letter for distribution to beneficiaries and their families.

AAA to hold Prior Authorization Workshop on October 2, 2015

The AAA will be holding a one-day workshop devoted exclusively to the prior authorization program. The workshop will take place on October 2, 2015 at the AAA Headquarters located in McLean, Virginia. This workshop will feature representatives from both Novitas and Palmetto (the MAC for Region M), who will be able to provide additional details on how the project will operate in their areas. Dr. William Rogers from the Centers for Medicare and Medicaid Services will also be in attendance to offer CMS’ perspective on this new program. This is a wonderful opportunity for CEOs and senior ambulance executives in the affected states to hear first-hand how this project will impact their ambulance services.

Submit Comments on Proposed Rule to CY2016 Fee Schedule Changes

Written by Michael Hall on . Posted in Medicare, Member Advisories, Member-Only.

 

On July 8, 2015, the Centers for Medicare and Medicaid Services (CMS) published a copy of its proposed rule for changes to the Medicare ambulance fee schedule for 2016.  The AAA has drafted a comment letter requesting that CMS make several modifications to improve the methodology and data used for determining urban and rural areas under the fee schedule.  We urge all AAA members to use our letter as a template to submit a similar comment letter to CMS.

Here is how to submit a comment letter.

1) Download the draft template of the AAA comment letter.

2) Modify the letter in the highlighted areas to customize it to your organization.

3) Submit the comment letter by going to the Regulations.gov submissions webpage for the proposed rule at http://www.regulations.gov/#!submitComment;D=CMS-2015-0081-0002

If you have any questions about submitting a comment letter, please contact AAA Senior Vice President Tristan North at tnorth@ambulance.org

CMS Issues Proposed Rule for Calendar Year 2016

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

On July 8, 2015, the Centers for Medicare and Medicaid Services (CMS) published a display copy of a proposed rule titled “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2016”.  The proposed rule makes a number of changes to the Medicare Physician Fee Schedule.  It also makes certain changes to the Medicare Ambulance Fee Schedule.  These proposed changes are summarized below.

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