Tag: Affordable Care Act (ACA)

Federal District Court Judge Strikes Down the ACA

On December 14, 2018, a federal district court judge for the Northern District of Texas issued a ruling striking down the Affordable Care Act (ACA) on the grounds that the Individual Mandate was unconstitutional, and that the rest of the law cannot withstand constitutional scrutiny without the Individual Mandate.

District Court Judge Reed O’Connor’s decision relates to a lawsuit filed earlier this year by 20 states and two individuals. The plaintiffs argued that the Tax Cuts and Jobs Act of 2017 — which amended the Individual Mandate to eliminate the penalty on individuals that failed to purchase qualifying insurance effect January 1, 2019 — rendered the Individual Mandate unconstitutional. The plaintiffs further argued that the Individual Mandate was inseverable from the rest of the ACA, and, therefore, that the entire ACA should be struck down.

The defendants in this case were the United States of America, the U.S. Department of Health and Human Services (HHS), Alex Azar, in his capacity as the Secretary of HHS, and David J. Kautter, in his capacity as the Acting Commissioner of the Internal Revenue Service (IRS). 16 states and the District of Columbia intervened as additional defendants.

In order to properly understand the district court’s ruling, it is necessary to revisit the Supreme Court’s 2012 decision on the constitutionality of the ACA, National Federal of Independent Business v. Sebelius (NFIB). In that case, 26 states, along with several individuals and a business organization challenged the ACA’s Individual Mandate and Medicaid expansion provisions as exceeding Congress’ enumerated powers. In a complicated decision, the majority of Justices ruled that the Individual Mandate was unconstitutional under Congress’ authority to regulate interstate commerce, but that the provision could be salvaged under Congress’ authority to lay and collect taxes. In reaching this conclusion, the majority of Justices focused on the “shared responsibility payment” aspect of the Individual Mandate, which imposed a tax on those individuals that failed to purchase or otherwise obtain qualifying health insurance. The majority of Justices concluded that the shared responsibility payment was a “tax.” It was therefore constitutional under the Congress’ general taxing authority.

In sum, the Supreme Court ruled that Congress lacked the power to compel individuals to buy qualifying health insurance, but that it could constitutionally impose a tax on those that failed to purchase or otherwise obtain qualifying health insurance.

In the current case, the court was asked to reconsider the Individual Mandate in light of the TCJA, which “zeroed” out of the shared responsibility payment, effective January 1, 2019. The plaintiffs argued that the Individual Mandate could no longer be justified as a valid exercise of Congress’ taxing authority. The federal government and its agents did not necessarily contest the plaintiffs’ argument with respect to the Individual Mandate. By contrast, the intervening states and the District of Columbia argued that the Individual Mandate could continue to be construed as a tax because it continues to satisfy the factors set forth by the Supreme Court in NFIB.

Judge O’Connor sided with the plaintiffs, holding that, because the Individual Mandate would no longer trigger a tax beginning in 2019, the Supreme Court’s ruling on this point in NFIB was no longer applicable. He therefore concluded that the Individual Mandate could no longer be upheld under Congress’ taxing authority. Judge O’Connor then fell back on the Supreme Court’s previous holding that the Individual Mandate, as a stand-alone command, remained unconstitutional under the Interstate Commerce Clause. Judge O’Connor then ruled that the Individual Mandate could not be severed from the rest of the ACA. On this point, the judge cited the express provisions of the ACA, as well as the Supreme Court’s decisions in NFIB and King v. Burwell.

What this decision means

On its face, the decision strikes down the Affordable Care Act in its entirety. However, the ruling is likely to be appealed to the Fifth Circuit Court of Appeals. Most legal experts expect that, regardless of the decision at the Circuit Court, the case is likely to make its way up to the Supreme Court.

Pending the resolution of these appeals, the Administration has adopted a “business as usual” approach. The White House has already indicated that it will not attempt to enforce the ruling during the appeals process. CMS Administrator Seema Verma recently tweeted that the decision will have “no impact to current coverage or coverage in a 2019 plan.”

The American Ambulance Association will continue to monitor this case as it makes its way through the appeals process, and we will notify our members of any new developments.

HHS Releases Communication Checklist to Aid First Responders

HHS Releases Checklist to Aid First Responders in Communicating Effectively with Patients

The U.S. Department of Health and Human Services (HHS) Office of Civil Rights (OCR) has released a plain language checklist that is intended to aid First Responders during emergencies that involve individuals with Limited English Proficiency (LEP) and communications related disabilities. The AAA issued numerous articles to its members in 2016 about the newly published requirements for all healthcare providers, including EMS agencies, under the nondiscrimination provisions of the Affordable Care Act (ACA) Section 1557. The requirements are intended to prevent discrimination in the provision of healthcare and ensure that all individuals can meaningfully participate in their healthcare treatment, including those patients with LEP and other communications related disabilities.

The announcement yesterday is intended to provide additional resources for healthcare providers to ensure compliance with the ACA Section 1557. The checklist includes numerous recommendations and action steps that EMS agencies can utilize to ensure that they are serving all members of a community in a meaningful way. These recommendations include conducting research about the communities by accessing U.S. Census Bureau data, engaging Centers for Independent Living and local assistance groups, and by preparing emergency messaging that can be disseminated quickly to individuals with LEP and communications related disabilities.

It is important that EMS agencies recognize their obligations under Section 1557 of the ACA to ensure that they can meaningfully serve their communities and remain compliant with their obligations under the law. HHS OCR has published several resources to assist healthcare providers on their website. EMS agencies that are unsure if ACA Section 1557 rules apply to them or have questions about how they can comply can contact the AAA for assistance.

Access the checklist here►

Final Rules Expand Exemption from ACA’s Contraceptive Mandate

The U.S. Department of Health and Human Services (HHS) issued two final rules earlier this month that will exempt certain entities from having to provide contraceptive coverage in their group health plans on the basis of religious or moral grounds. These rules extend the exemption that is already in place for worship or faith-based nonprofits, religious schools, and some private businesses. Under this rule, over 100,000 women working at several hundred religious hospitals, nursing homes, and faith-based nonprofits will lose coverage.

These new rules are very similar to interim proposed rules that were published late last year. Several states challenged the interim rules in federal court. Those who led the challenge of the interim rules have pledged to continue to fight on behalf of the rights of women. The rules are set to take effect 60 days after they are published in the Federal Register.

Read the Society for Human Resource Management article here►

CMS Announces Revisions to Provider Enrollment Waiver Demonstration (PEWD) Program

CMS Announces Revisions to Provider Enrollment Moratoria Access Waiver Demonstration (PEWD) Program

On August 20, 2018, the Centers for Medicare & Medicaid Services (CMS) published a notice in the Federal Register that it would be revising the terms of its Provider Enrollment Moratoria Access Waiver Demonstration (PEWD) Program. These revisions became effective on August 20, 2018.

Section 6401(a) of the Affordable Care Act granted CMS the authority to impose temporary moratoria on the enrollment of new Medicare providers and suppliers to the extent doing so was necessary to combat fraud or abuse. Based on this authority, CMS has implemented temporary moratoria on the enrollment of new non-emergency ambulance providers in the states of New Jersey and Pennsylvania.

Under the Provider Enrollment Moratoria Access Waiver Demonstration (PEWD) Program, CMS has the authority to grant waivers to statewide enrollment moratorium on a case-by-case basis in response to access to care issues.  However, since the implementation of the PEWD Program in 2016, CMS has identified a handful of technical issues that have complicated the implementation of the PEWD Program.  The revisions in this notice are intended to resolve these technical issues.

The specific revisions CMS is making include:

  1. In December 2016, Congress enacted the 21st Century Cures Act. Section 17004 of that law prohibits payment for items or services furnished within moratoria areas by any newly enrolled provider or supplier that falls within a category of health care provider that is subject to the enrollment moratoria.  This provision became effective on October 1, 2017.  CMS is revising the PEWD Program to waive the requirements of Section 17004 of the Cures Act with respect to providers and suppliers who were granted waivers under the PEWD.
  2. CMS is further revising the PEWD to create a second category of waivers for those providers or suppliers that had submitted an enrollment application prior to the implementation of the moratoria, but who were denied as a result of the implementation of the moratoria. CMS indicated that this new waiver authority was necessary to protect providers and suppliers that spent substantial amounts of time and money preparing for enrollment at the time the enrollment moratoria were county-based, only to be denied once the moratoria were expanded to the entire state.
  3. CMS is revising the PEWD to provide additional discretion regarding the effective date of billing privileges for providers and suppliers granted waivers under the PEWD.

CMS Extends Moratorium on Non-Emergency Ground Services

CMS Extends Temporary Moratorium on Non-Emergency Ground Ambulance Services in New Jersey and Pennsylvania

The Centers for Medicare & Medicaid Services (CMS) has announced that it intends to extend the temporary moratoria on the enrollment of new Medicare Part B non-emergency ground ambulance providers and suppliers in the states of New Jersey and Pennsylvania.  The extended moratoria will run through January 29, 2019.  Notice of the extension of the temporary moratorium will appear in the Federal Register on August 2, 2018.

Section 6401(a) of the Affordable Care Act granted CMS the authority to impose temporary moratoria on the enrollment of new Medicare providers and suppliers to the extent doing so was necessary to combat fraud or abuse.  On July 31, 2013, CMS used this new authority to impose a moratorium on the enrollment of new ambulance providers in Houston, Texas and the surrounding counties.  On February 4, 2014, CMS imposed a second moratorium on newly enrolling ambulance providers in the Philadelphia metropolitan areas.  These moratoriums were subsequently extended on August 1, 2014, February 2, 2015, July 28, 2015, and February 2, 2016.

On August 3, 2016, CMS announced changes to the moratoria on the enrollment of new ground ambulance suppliers.  Specifically, CMS announced that: (1) the enrollment moratoria would be lifted for the enrollment of new emergency ambulance providers and supplier and (2) the enrollment moratoria on non-emergency ambulance services would be expanded to cover the entire states of New Jersey, Pennsylvania, and Texas.  At the same time, CMS announced the creation of a new “waiver” program that would permit the enrollment of new non-emergency ambulance providers in these states under certain circumstances.  The revised moratorium on newly enrolling non-emergency ground ambulance providers was subsequently extended on January 9, 2017 and July 28, 2017.

On September 1, 2017, CMS issued a notice on its website indicating that it had elected to lift the moratorium on the enrollment of new Part B non-emergency ambulance suppliers in Texas, effective September 1, 2017.  CMS indicated that this decision was made to assist in the disaster response to Hurricane Harvey.  CMS published formal notice of the lifting of this moratorium on November 3, 2017.

On January 30, 2018, CMS announced an extension of the moratorium on the enrollment of new Part B non-emergency ambulance suppliers in New Jersey and Pennsylvania.

CMS will need to make a determination on whether to extend or lift the enrollment moratorium on or before January 29, 2019.

ACA Affordability Adjustment

The Internal Revenue Service (IRS) announced on May 21, 2018 that it would be increasing the employee shared responsibility premium percentage under the ACA for 2019. Today, employers are compliant with the ACA if their health plans provide “essential health benefits” that are “affordable” for employees. The “affordability” requirement states that an employer’s health plan premium cost for employees must not exceed 9.56% of household income for the lowest cost, self-only plan. The IRS is adjusting that rate based upon inflation to 9.86% for 2019. With the average cost of health insurance single premium increasing 4% in 2017, this is a bit of relief as employers struggle with maintaining the affordability requirement.

CMS Extends Moratorium on Non-Emergency Ground Services

CMS Extends Temporary Moratorium on Non-Emergency Ground
Ambulance Services in New Jersey and Pennsylvania

On January 30, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a notice in the Federal Register extending the temporary moratoria on the enrollment of new Medicare Part B non-emergency ground ambulance providers and suppliers in the states of New Jersey and Pennsylvania. The extended moratoria will run through July 29, 2018.

Section 6401(a) of the Affordable Care Act granted CMS the authority to impose temporary moratoria on the enrollment of new Medicare providers and suppliers to the extent doing so was necessary to combat fraud or abuse. On July 31, 2013, CMS used this new authority to impose a moratorium on the enrollment of new ambulance providers in Houston, Texas and the surrounding counties. On February 4, 2014, CMS imposed a second moratorium on newly enrolling ambulance providers in the Philadelphia metropolitan areas. These moratoriums were subsequently extended on August 1, 2014, February 2, 2015, July 28, 2015, and February 2, 2016.

On August 3, 2016, CMS announced changes to the moratoria on the enrollment of new ground ambulance suppliers. Specifically, CMS announced that: (1) the enrollment moratoria would be lifted for the enrollment of new emergency ambulance providers and supplier and (2) the enrollment moratoria on non-emergency ambulance services would be expanded to cover the entire states of New Jersey, Pennsylvania, and Texas. At the same time, CMS announced the creation of a new “waiver” program that would permit the enrollment of new non-emergency ambulance providers in these states under certain circumstances. The revised moratorium on newly enrolling non-emergency ground ambulance providers was subsequently extended on January 9, 2017 and July 28, 2017.

On September 1, 2017, CMS issued a notice on its website indicating that it had elected to lift the moratorium on the enrollment of new Part B non-emergency ambulance suppliers in Texas, effective September 1, 2017. CMS indicated that this decision was made to assist in the disaster response to Hurricane Harvey.  CMS published formal notice of the lifting of this moratorium on November 3, 2017.

On or before July 29, 2018, CMS will need to make a determination on whether to extend or lift the enrollment moratorium.


Have any Medicare questions? Contact Brian at bwerfel@aol.com

Should I Hold My Medicare Claims?

The Great Medicare Debate: Should I Hold My Medicare Claims?

By: Brian S. Werfel, Esq. and Rebecca Williamson, Chair, AAA Medicare Regulatory Committee

Ambulance suppliers face an important decision at the start of every calendar year on whether to hold their Medicare claims for the first few weeks of the calendar year.

This decision historically revolved around the patient’s Medicare Part B deductible ($183 in 2018).  The argument in favor of holding claims was that a brief claims hold would allow time for the patient’s deductible to be satisfied by another health care provider, thereby relieving the ambulance supplier of the time and expense involved in billing the patient (or their secondary insurance) for the deductible.  Ambulance suppliers that hold claims believe that this ultimately results in higher collections.  The argument against holding claims is that any increase in overall collections is likely to be minimal, and that the resulting disruption to the company’s cash flow more than offsets any potential benefits from those higher collections.

This year, the debate is complicated by the events surrounding the expiration of the temporary add-ons for urban, rural, and super-rural ground ambulance transports on December 31, 2017.  These temporary add-ons increased the Medicare allowables by 2%, 3%, and 22.6%, respectively.  Congress failed to act upon these temporary add-ons prior to its adjournment.  However, there remains strong bipartisan support for reinstating these add-ons – – and Medicare extenders for other types of Medicare providers – – early in the 2018 Legislative Calendar.  The AAA’s political consultants believe these Medicare extenders will likely be included in the next government funding legislation, which must be passed by January 19, 2018.

Assuming our temporary add-ons are reinstated, they are likely to be made retroactive to January 1, 2018.  This would require CMS to retroactively adjust claims previously paid at the current (lower) rate.  This may also require secondary payers, including State Medicaid Programs, to retroactively adjust their payment amounts to reflect increased cost-sharing amounts.  There is precedent for these sort of retroactive adjustments.  Most recently, the Affordable Care Act, which was enacted on March 23, 2010, provided for a reinstatement of these same temporary add-ons, retroactive to January 1, 2010.

In this inaugural edition of the Great Medicare Debate, AAA Medicare Regulatory Committee Chair Rebecca Williamson and AAA Medicare Consultant Brian S. Werfel, Esq. debate the merits of holding claims pending a resolution of the add-on issue vs. submitting claims.

Ambulance suppliers would likely benefit from holding their claims for some period of time pending clarity on the status of our temporary add-ons.


Rebecca Williamson, Chair of the AAA’s Medicare Regulatory Committee:

According to CMS, 73% of all ambulance service suppliers bill less than 1,000 Medicare covered transports per year. Additionally, 54% of ambulance suppliers bill less than 250 Medicare covered transports per year. Assuming an average claim amount of $400.00 per call (base rate plus mileage), an ambulance supplier with 1,000 Medicare covered transports per year could collect approximately $320,000.00 per year in a best case scenario ($400,000.00 X 80%). This leaves the service with copays of $80,000.00 to be collected from patients. By adding $183.00 as a deductible for each of these 1,000 patients, the collection from Medicare decreases to only $173,600.00. This means the service now must collect an additional $43,400.00 . In other words, if the patient has not met the deductible, the deductible is applied first and a $400.00 allowable becomes a $217.00 allowable. Medicare now pays 80% of $217.00 which is $173.60. Multiplied by 1,000 claims, Medicare pays a total of $173,600.00 and the balance owed to the supplier is the deducible of $183,000.00 and copayments of $43,400.00.

By holding claims for a brief period, usually thirty days, ambulance services increase the likelihood that another provider, often a hospital, will file claims with Medicare first, meaning collecting patients’ deductibles becomes the facilities’ responsibility.

Of course these numbers are only examples and many factors affect the actual billing and collection process. Some Medicare beneficiaries will promptly pay the deductible, many will have secondary payers or insurances, and a certain percentage will be dually eligible for Medicare and Medicaid, all of which results in higher collection ratios for the ambulance service. However, in plain terms, collecting $320,000.00 versus $173,600.00  can make a very real difference in the viability of a small service.  Each service should look carefully at its own payer mix, patient statistics, and demographics to determine individual service projections.

Another good reason to hold claims, this year in particular, is the almost certainty of Congress reinstating the extenders. For those of us who have been in this industry for a long time, the expiration of the add-ons this year is a painful reminder of 2010  when the extenders expired and were not reinstated until March 23, 2010. It wasn’t until July 2010 that CMS even began the process of correcting previously processed claims , and by January 2011 many claims were still outstanding and had not been completely reprocessed. Also by that time, which could have been as long as a year after the date of service, many secondary payers were either unwilling or unable to retroactively correct the reprocessed claims. Some Medicaid states, such as Oklahoma, simply did not have the manpower or ability to even attempt it.

The administrative burden imposed on ambulance suppliers by having claims retroactively reprocessed by CMS, then reprocessed again by secondary payers – potentially incorrectly, if at all – along with the many manual adjustments required in-house, make it even more attractive to advocate and advise holding claims for as long as financially feasible. Of course not every service has the cash reserve to be able to do this, and I would generally not advise holding claims for as long as it may take for Congress to reinstate the extenders and for CMS to implement the correction  for services who cannot afford to, but for those who can, not only will they almost certainly increase the amount of payments collected, they will decrease overhead administrative costs.

I am very optimistic that Congress will include the ambulance extenders in legislation as well as being optimistic that it will be sooner rather than later. I know others disagree, but the higher likelihood of it happening versus not, make this a good bet to take. 

Ambulance suppliers should disregard the status of the temporary add-ons when making their decision on whether to hold claims for some period of time


By: Brian S. Werfel, Esq.:

Rebecca makes a strong argument about the benefits of holding claims.  Moreover, I have long advocated in favor of holding claims for the patient’s deductible.  For these reasons, I would understand if ambulance suppliers elect to hold claims for the patient deductible.  However, I would question the wisdom of holding claims pending further clarity on the status of the temporary add-ons.

My argument against holding claims for that reason boils down to a single word: uncertainty.  In this context, I am referring to four specific types of uncertainty:

  1. Uncertainty over whether the temporary add-ons will be extended.
  2. To the extent legislation is passed extending the temporary add-ons, uncertainty as to whether the higher rates will be made retroactive to January 1, 2018.
  3. To the extent legislation is passed extending the temporary add-ons, uncertainty as to how quickly CMS will implement the revised rates for new claims and adjust claims paid at the original, lower rates.
  4. Uncertainty over how the various secondary payers will handle their adjustments.

With respect to the extension of the add-ons, I agree that they are likely to be included with other Medicare adjusters in the budget resolution that must pass before January 19, 2018.  Likewise, at this point, there is no reason to think that these add-ons will not be made retroactive to January 1, 2018.  However, there are no guarantees.  It is possible that the Republicans and Democrats fail to reach agreement on the larger budgetary issues, including the status of the so-called “Dreamers”, and a government shutdown results.

My larger concern relates to how quickly CMS revises its fee schedule, and implements instructions to its contractors.  As Scott noted above, the last time we faced this issue was in 2010.  The Affordable Care Act was signed into law on March 23, 2010.  However, CMS didn’t issue a transmittal to its contractors until May 21, 2010, and even then, didn’t instruct its contractors to start paying the higher rates until July 6, 2010.

In other words, if you elected to hold claims to avoid having them paid and then reprocessed, you would have needed to hold claims for more than 6 months.

To me, the strongest argument for holding claims is not how Medicare would handle the adjustment.  I recognize the administrative burden created by having to post and then re-post the same claim once it was adjusted.  However, I trust that CMS will eventually get it right (emphasis on eventually).

I have far less confidence in how the secondary payers, including State Medicaid Programs, will handle the adjustments.  When this happened in 2010, we had numerous reports from A.A.A. members of secondary payers incorrectly processing the adjustment.  For example, some State Medicaid Programs didn’t simply issue a supplemental check for the higher copayment.  Instead, the Medicaid Program took back its initial payment, and then reprocessed the claim in its entirety.  Unfortunately, in some instances, the Medicaid rates changed in the interim, and Medicaid then repaid a lower amount.  In other instances, they failed to repay the patient’s deductible.  Similar issues were noted with commercial secondary payers, Medicaid managed care organizations, etc.

In sum, if your company has historically held claims during the first few weeks of the year for the patient’s deductible, I see no reason to discontinue that practice.  If, however, you historically submitted claims without regard to the patient’s deductible, I see little benefit to holding claims pending action by Congress on our add-ons.


Have any Medicare questions? Contact Brian at bwerfel@aol.com

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

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

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

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

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

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

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

Write to Your Members of Congress

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

EMS Employer Year-End Wrap-Up and Preview

2017 was a bit of a wild ride in the employment realm.  The Trump Administration worked to change the trajectory set during the eight years of the Obama Administration.  This past year, we saw the undoing or attempts to undo many of the Obama Administration initiatives, including the Fair Labor Standards Act (FLSA) updates, changes to the Persuader Rule, interpretations of Title VII as it relates to transgender protections.  Not to mention the repeated attempts to chip away at the Affordable Care Act (ACA). In addition, there were several new requirements for employers that went into effect in 2017 and a few upcoming in 2018.  Here is a quick review to ensure that your service is up-to-date and compliant.

The Fair Labor Standards Act Changes

These changes, which would have more than doubled the minimum salary levels for those “White Collar” exemptions, were set to go into effect back in 2016.  A Federal Court in Texas enjoined and put on hold these changes until the question of whether the Department of Labor (DOL) had the authority to unilaterally change the Regulations.  In July, 2016, the DOL published an Request For Information (RFI) with responses due in late September, requesting input from stakeholders about what changes to the FLSA might be appropriate.  We are still awaiting the final action.

The Persuader Rule

In 2016, the DOL Office of Labor-Management Standards (OLMS) released its revised interpretation of the rule that seeks to level the playing field between unions and employers.  The new interpretation of the Persuader Rule, which would have taken effect on April 25, 2016, would have required that employers who hire consultants or labor attorneys to counsel them during union organizing campaigns to report if they will undertake “persuader” activities and the cost of those services.  This rule was an attempt to increase transparency for unions with regard to these services. The U.S. District Court for the Northern District of Texas blocked the persuader rule late last year stating it was overly broad, arbitrary and capricious. The DOL published a notice of public rule making in June, 2017 of its intent to rescind the new rule.

Dismantling of the ACA

In a surprising announcement this past October, the Trump Administration, the DOL, the Department of Health and Human Services (HHS) released an interim rule that rolled back the Obama Administration position regarding the requirement of employer sponsored health plans to pay for “preventative services” which included birth control and abortion procedures under religious or moral objections. This would permit employers who object on these grounds to limit or not offer these coverages under their employer sponsored health plan.  There are several lawsuits pending regarding this move, more to come in 2018.

In another October announcement, the Trump Administration stated that the President had signed an Executive Order that directed the Secretary of Labor to consider expanding access to Association Health Plans (AHP) would give employers the right to form groups in multiple states for the purposes of negotiating health care benefits.  This change would require a amenedment to the current interpretation of Employee Retirement Security Act (ERISA). In addition, the Executive Order directed the Departments of the Treasury, Labor, and Health and Human Services to consider changing several ACA restrictions, including low-cost short term limited duration insurance (STDLI) and Health Reimbursement Accounts (HRAs).  The impact of this Executive Order may be an impact to the ACA insurance markets because it may attract the younger and healthier away from current plan groups causing those coverage costs to increase substantially.

Title VII Transgender Protections

In October, Attorney General Jeff Sessions published memo to Federal prosecutors stating that Title VII’s discrimination protections did not include protections on the basis of gender identity or for transgender individuals.  In the memo, Sessions states that this was a conclusion of law, not of policy and that it would be inappropriate for the DOJ to expand the law beyond what Congress provided.  Sessions said that the law provides protections for men and women but not specifically on the basis of gender identity. This goes against current interpretation and is not shared by the Equal Employment Opportunity Commission (EEOC) who enforces Title VII.  Employers need to ensure that they provide a workplace that is inclusive and respectful to all employees.

EEO-1 Pay Reporting

In February 2016, the EEOC published notice that would add pay information to the EEO-1 reporting form in an effort to further identify disparities in pay between different protected groups.  This new reporting requirement was set to go into effect on September 30, 2017. The deadline was pushed back until March 31, 2018.  Under the new pay reporting requirements, employers with 100 or more employees would report W-2 wage information and total hours worked for all employees by race, ethnicity and sex within the 12 proposed pay bands.  In August, the Office of Management and Budget (OMB) announced plans to stay the effective date of the pay-data collection provisions in order to review the appropriateness of the revisions under the Paperwork Reduction Act (PRA).  In the meantime, employers should still observe the March 1, 2018 deadline and prepare the information on the new EEO-1 Form while we await a decision on if this requirement will go into effect.

OSHA Electronic Injury Reporting

OSHA announced in July that it will be launching the new electronic Injury Tracking Application (ITA) on August 1, 2017.  The new rules are an effort to “nudge” employers to improve safety in the workplace by publishing employee injury data, as reported by employers.  OSHA pushed back the electronic reporting deadline until December 15, 2017.  Many ambulance services already report this information electronically to the Bureau of Labor Statistics (BLS), who collects data on behalf of the Department of Labor but the employer specific information is not released publicly.  Under these new rules, employer injury data will be published.

The electronic reporting requirements are based on the size of employer.  For the purposes of determining employer size, employers must count each individual employed at any time during the calendar year as one employee.  This includes full-time, part-time, seasonal, and temporary workers.  All employers with 250 or more employees in industries covered by the recordkeeping regulation must electronically submit to OSHA injury and illness information from OSHA Forms 300, 300A, and 301.  Employers with 20-249 employees must electronically submit information from OSHA Form 300A only.

If you have not already submitted your data, you need to do so immediately.

New Form I9

Starting this past January 22, 2017, employers were required to begin using the new Form I9.  The old Form I9 expired on August 31, 2017.  The new form can be found on the US Citizenship and Immigration Services (USCIS) website.  To be certain that you are utilizing the correct form, ensure the expiration date of August 31, 2019 is in the top right hand corner of the form. Last year, several ambulance services were audited by the USCIS and fined for technical form violations.  The easiest way to ensure that you are using the correct form and filling it out correctly is to utilize the comprehensive online training resources available on the USCIS website.

Summary of State Law Changes

Ban the Box

Currently 29 states and over 150 local municipalities have enacted criminal background inquiry limitations in an effort to give individuals with criminal histories a fair chance to become employed.  Several of the states that had already enacted these laws have passed additional provisions in 2017 and 2018 that expand the application to smaller employers.

Most of the laws regarding the “ban the box” movement require the removal of criminal history inquiries on the job application.  Others require that no criminal history inquiries can be made until after a conditional job offer is made to the candidate.  If you have not done so already, please remove any criminal history questions from your pre-offer process.  For those ambulance providers that are in states that specifically permit EMS agencies from inquiring prior to a job offer, I strongly recommend that any criminal history inquiries occur after a conditional job offer is made.  State laws permissions do not prevent an employer from being liable for disparate impact discrimination.

Paid Sick Time

Multiple states (AZ, CA, CT, MA, OR, VT, DC) and municipalities already have or have enacted paid sick time laws or ordinances prior to this year.  Joining them in 2017 are Federal Contractors and the states of Arizona, Vermont, and Washington.  Each of these laws share similar provisions.  Employees earn an hour of paid sick leave after having worked a certain number of hours.  Most provide for a 90 day period of employment before an employee can utilize the accrued sick time. For the purposes of calculating working hours, the hours are counted across weeks.  Most of the laws provide for some carry-over of unused time from year to year.

Several other states have enacted or will be expanding existing paid sick time provisions which will take effect in 2018. (CA, RI, WA, VT).  The state of Oregon passed an amendment to the paid sick time law that was enacted in 2016 that permits employers to limit the accrual of sick time to 40 hours per year. In addition, the amendment permit employers to not count certain individuals in the employee count for the purposes of the application of this law.

Parental Leave

California has enacted the New Parent Leave Act which takes effect on January 1, 2018.  The Act requires employers with 20 to 49 workers to offer 12 weeks of job-protected leave to mothers and fathers for the purposes of bonding with newborn or newly adopted children, or foster care placement. The employer also must maintain the employees’ health insurance and reinstate them at the end of their leave period. The law includes a strong anti-retaliation provision for employees who take leave under this law.

Paid Family Medical Leave

Currently three states (CA, NJ, RI) provide for some form of paid Family & Medical Leave.  Starting on January 1, 2018 private employers in New York must provide their employees who regularly work at least 20 hours a week the eligibility to collect paid-family-leave benefits after 26 weeks of employment, and employees who work fewer than 20 hours a week will be eligible after 175 work days. The leave can be used to after the birth, adoption, or placement of a foster child for up to one year.  Additionally, the leave can be used to care for the serious illness of a family member or a qualifying reason an employees’ spouse, domestic partner, child, or parent being on active military duty.

The Act will be phased in over the next few years.  Providing 8 weeks of leave in 2018 paid at 50% os the state’s average weekly was (SAWW).  In 2019, the leave time extends to 10 weeks at 55% of SAWW, 2020 maintains 10 weeks of leave paid at 60% of SAWW, to full implementation in 2021 when an employee can take up to 12 weeks of leave paid at 67% SAWW.

The State of Washington has passed a paid FMLA law that will start collecting premiums from employers in 2019 for enactment in 2020.  Washington DC also enacted paid FMLA that will begin in 2020 as well.

California

Starting in 2018, the State of California will require that employers with 50 or more employees include additional training information fo its employees on gender identity, gender expression and sexual orientation. The training must include practical examples of harassment. The new law also requires employers to post a poster, developed by the California Department of Fair Employment and Housing, on transgender rights.  In addition, the currently mandated two hour supervisor training must also include this new information and provide for annual updates to training programs.

That’s a Wrap

For many employers 2017 proved to be an unusual and challenging year. Aside from the changes details above, it is uncertain what lies on the horizon for EMS employers in 2018. As always, the American Ambulance Association will keep you posted on the important employment and human resources developments that may impact you.

CMS Extends Moratorium on Non-Emergency Ground Ambulance

CMS Extends Temporary Moratorium on Non-Emergency Ground Ambulance Services in New Jersey, Pennsylvania, and Texas

On July 28, 2017, the Centers for Medicare & Medicaid Services (CMS) issued a notice in the Federal Register extending the temporary moratoria on the enrollment of new Medicare Part B non-emergency ground ambulance providers and suppliers in the states of New Jersey, Pennsylvania, and Texas. The extended moratoria will run through January 29, 2018.

Section 6401(a) of the Affordable Care Act granted CMS the authority to impose temporary moratoria on the enrollment of new Medicare providers and suppliers to the extent doing so was necessary to combat fraud or abuse. On July 31, 2013, CMS used this new authority to impose a moratorium on the enrollment of new ambulance providers in Houston, Texas and the surrounding counties. On February 4, 2014, CMS imposed a second moratorium on newly enrolling ambulance providers in the Philadelphia metropolitan areas.

On August 3, 2016, CMS announced changes to the moratoria on the enrollment of new ground ambulance suppliers. Specifically, CMS announced that: (1) the enrollment moratoria would be lifted for the enrollment of new emergency ambulance providers and supplier and (2) the enrollment moratoria on non-emergency ambulance services would be expanded to cover the entire states of New Jersey, Pennsylvania, and Texas. At the same time, CMS announced the creation of a new “waiver” program that would permit the enrollment of new non-emergency ambulance providers in these states under certain circumstances. The moratoria have been extended on these terms every six months thereafter.

On or before January 29, 2018, CMS will need to make a determination on whether to extend or lift the enrollment moratorium.

Senate GOP Releases Revised BCRA

This afternoon Senate Republican leaders released the revised version of the Better Care Reconciliation Act (BCRA). Legislative language and section-by-section summaries are now available.. The material was provided by our team at Akin Gump. The AAA will continue to keep members up to date in regards to the Obamacare repeal and replacement efforts.

Better Care Reconciliation Act (BCRA) Revised Text
BCRA Section by Section Summary

Please contact info@ambulance.org if you have any questions.

House Passes American Health Care Act (AHCA)

The House this afternoon voted 217-213 to pass the American Health Care Act (H.R. 1628), as amended. The bill now heads to the Senate where it will be up for intense debate. The AAA will continue to monitor this legislation as it makes its way through the Senate.

The House also voted 429-0 to pass a bill (H.R. 2192) from Rep. Martha McSally (R-AZ) that would eliminate a congressional exemption from health care changes. The exemption was included in AHCA to comply with budget reconciliation rules.

Two key amendments were added to the healthcare bill in order to ensure Republican support, the Upton Amendment and the MacArthur Amendment. These amendments were two of the more substantial changes to the bill since it was originally introduced. The AAA is currently working on drafting a detailed overview of this legislation and will distribute to members once completed.

 

ACA Repeal and Replace Update

Congress returns to Washington next week, and House Republican Leadership maintains an ambitious agenda to pass the American Health Care Act (AHCA) despite an unclear path navigating its moderate and conservative factions. President Trump, who refuses to let health care reform disappear from the agenda, is especially eager for a victory, and today predicted AHCA would pass within the next few weeks.

During the in-district work period these past two weeks, the White House, House Leadership and Republican committee staff have kept conversations going with the two disagreeing factions within their caucus – the moderate Tuesday Group and the conservative Freedom Caucus. At this stage, there appears to be no agreement within the Republican Caucus, and there are varying reports on how close are discussions. The wild card is whether President Trump and his team can help force a deal. As soon as a deal materializes, the House will move the bill to the floor.

In addition to health care, the discretionary aspects of the Federal government are under a temporary continuing resolution which expires at the end of next week. An effort is underway to pass a measure that will fund the government through the remainder of the 2017 Fiscal Year, which ends September 30. This effort is not without controversy, and includes an attempt by the Trump Administration to appropriate funds to build its border wall. However, Republicans will need at least eight Senate Democrats to vote with them to pass an omnibus spending bill, so compromise will be required. There may be a series of short-term funding patches as Congress considers spending priorities.

One of the more interesting issues Congress and the Trump Administration face is what to do with Affordable Care Act (ACA) subsidies that were meant to help reduce cost sharing (deductibles, co-payments) for especially poor, non-Medicaid eligible individuals buying insurance on the exchange. House Republicans had successfully sued the Obama Administration in district court arguing that Congress must appropriate the money before the ACA’s Cost Sharing Reduction (CSR) subsidies could be paid. With an injunction from the district court in place, Congress must decide whether to appropriate the money in the upcoming spending bill. Some Democrats have stated they will not vote to pass any budget without funds for the CSR program included. If Republicans can pass a budget without funding the CSR subsidies, they aren’t out of the woods yet on the CSR program. Specifically, the President still has to decide whether to appeal the district court decision on May 22. If President Trump chooses to accept the district court decision and there is no appropriation, the President could unilaterally shut down the CSR subsidy program. The President has threatened to use this court decision to bring Democrats to the negotiating table, in the event that the program is not appropriated and AHCA is not passed.

The AAA will continue to keep members up to date on these issues.

CMS Issues Final Market Stabilization Rule

On Thursday, April 13, the Centers for Medicare & Medicaid Services (CMS) released the final “Marketplace Stabilization Rule”. This is the final version of a rule that was first proposed on February 15, 2017. Last month, AAA consultant, Kathy Lester, published a blog post explaining the then proposed rule (“Administration’s Proposed Rule on Marketplace Stabilization”).

The final rule makes several policy changes to improve the market and promote stability, including:

    • 2018 Annual Open Enrollment Period: The final rule adjusts the annual open enrollment period for 2018 to more closely align with Medicare and the private market. The next open enrollment period will start on November 1, 2017, and run through December 15, 2017, encouraging individuals to enroll in coverage prior to the beginning of the year.
    • Reduce Fraud, Waste, and Abuse:  The final rule promotes program integrity by requiring individuals to submit supporting documentation for special enrollment periods and ensures that only those who are eligible are able to enroll. It will encourage individuals to stay enrolled in coverage all year, reducing gaps in coverage and resulting in fewer individual mandate penalties and help to lower premiums.
    • Promote Continuous Coverage: The final rule promotes personal responsibility by allowing issuers to require individuals to pay back past due premiums before enrolling into a plan with the same issuer the following year. This is intended to address gaming and encourage individuals to maintain continuous coverage throughout the year, which will have a positive impact on the risk pool.
    • Ensure More Choices for Consumers:  For the 2018 plan year and beyond, the final rule allows issuers additional actuarial value flexibility to develop more choices with lower premium options for consumers, and to continue offering existing plans.
    • Empower States & Reduce Duplication:  The final rule reduces waste of taxpayer dollars by eliminating duplicative review of network adequacy by the federal government.  The rule returns oversight of network adequacy to states that are best positioned to evaluate network adequacy.

Read the Final Rule

ACHA Update – High-risk Pool Amendment

The House Rules Committee met last week to consider a new amendment to the American Health Care Act (AHCA) to establish a federal risk-sharing fund and appropriate $15 billion for a high-risk pool program from 2018 to 2026.

The amendment, which aims to reduce premiums for those with pre-existing conditions, is sponsored by Reps. Gary Palmer (R-AL) and Dave Schweikert (R-AZ), both members of the House Freedom Caucus.

Washington Post: “GOP House leaders say health bill tweak shows progress, but larger divisions remain

The program is reportedly modeled after a successful initiative in the State of Maine. The federal government would run the program initially, but each state will have the ability to take over the high-risk pool after three years.

The amendment represents one area of limited agreement in the broader AHCA debate. Conservative House Members are likely to support it to the extent it shifts authority and funding to the states to help keep premiums down, and moderates are likely to support it because it would add a layer of protection for individuals with pre-existing conditions. It is unclear whether the level of funding appropriated will be sufficient to meet the need, however.

The development is not evidence of a breakthrough, however, and negotiations are far from over. Rather, it is a strategic move by House Republican leaders to signal progress in the Affordable Care Act (ACA) repeal-and-replace debate before lawmakers head home for a two-week congressional recess at the end of this week. It also is unclear whether the amendment will have any impact on the broader areas of disagreement between the House and Senate regarding the timing, substance and process for ACA repeal.

The decision was reportedly made at a meeting the President convened last week with Speaker Paul Ryan (R-WI) and Majority Leader Kevin McCarthy (R-CA). Speaker Ryan indicated that work will continue “in the days and weeks ahead,” suggesting a longer time-frame for any legislative action beyond last week’s vote in the House Rules Committee.

Status of the American Health Care Act

Today, citing “growing pains” of his Republican majority, Speaker Paul Ryan (R-WI), in consultation with President Donald Trump, determined not to proceed with a planned vote on the American Health Care Act (AHCA), which repealed and replaced important elements of the Affordable Care Act (ACA).  The Speaker indicated that the House Republican Caucus “came up short” in the number of votes needed for the bill.  House Republican Leadership had been moving AHCA through the Chamber at a rapid pace.  The bill was officially released on March 6, and had been changed several times to try to appease various conservative and moderate voting blocs within the Republican Caucus.  The Congressional Budget Office (CBO) originally estimated the bill would reduce federal deficits by $337 billion, and subsequently downgraded the deficit reduction to $150 billion based on additional substantive policy changes to the bill.  The CBO estimates the bill would have increased the country’s number of uninsured by about 24 million people.

In negotiating the provisions of AHCA, the House Republican Leadership had faced a constant seesaw, as efforts to appease one ideological bloc upset the other.  Ultimately, throughout the day in advance of the scheduled vote, an increasing number of moderate Republicans, including Appropriations Committee Chairman Rodney Frelinghuysen (R-NJ), announced they would vote against the bill.  As the moderates disappeared, not enough members of the conservative Freedom Caucus decided to support the bill.

As disarray in the House Republican Caucus occurred, there appeared to be a similar lack of consensus amongst their Republican colleagues on the Senate side.  While Senate Leadership had planned to move the bill directly to the Senate floor as fast as within a week of receipt from the House, there were a number of Senators from a range of political perspectives with serious concerns about the bill.  On one side of the Republican spectrum, Senators Rand Paul (KY), Mike Lee (UT) and Ted Cruz (TX) had planned to push the limits of what can be included in a reconciliation bill to make it more conservative. Senator Paul had advocated for repealing the ACA in full and dealing with the replacement later on. On the other side, more moderate or “purple state” Members like Senators Susan Collins (ME), Lisa Murkowski (AK), Rob Portman (OH), Cory Gardner (CO) and Dean Heller (NV) raised concerns about insurance affordability and the expedited rollback of Medicaid expansion in the House version of the bill. Other Senators who will likely play a prominent role in any further health reform developments include physician Senator Bill Cassidy (LA), and Senator Tom Cotton (AR), who advocated all along to slow the process down. Republicans can only lose two Senators and still pass any health reform bill, with the vote of Vice President Mike Pence breaking the tie.

As a next step, House and Senate Republican Leadership plan to take more time to develop consensus in any future approach to health reform.  How much time is unclear – but it seems unlikely the bill will be the legislative focus in the short term.  Instead, there will likely be a cooling-off period on health reform legislative activity, since the fundamental disagreements within the caucus are not easily fixed.  There will continue to be significant messaging against ACA from conservatives, and there is the potential that the idea of “repeal and delay” may gain more traction.  Nonetheless, in the short term, the Speaker indicated he would move on to other items on his conference’s agenda – including tax reform.  Keep in mind, however, that since health-related tax provisions are a major component of the tax code, it would not be surprising to see some health issues resurface in tax reform.

The Speaker indicated that he expects the ACA marketplace to get worse – specifically citing rising premium costs.  In his own remarks on the failure to pass AHCA, the President suggested the Democrats will own any rising premiums, and provided a rare moment of optimism for the day when he indicated that a bipartisan health care reform bill may be achievable in the future when that happens.   As the Legislative Branch takes time to develop consensus, more focus will be placed on the Executive Branch.

We expect HHS Secretary Tom Price and White House Budget Director Mick Mulvaney to take an increasingly important role in driving the health agenda.  It is unclear at this point whether the Trump Administration will let ACA drift in the wind, take administrative actions to try to improve the marketplace, or even actively work to derail it further.  A likely bellwether as to the Administration’s intent is how it approaches the pending litigation over cost-sharing reduction (CSR) subsidies.  The House had sued the Obama Administration over the program, which funnels federal dollars to insurers to help keep out-of-pocket costs manageable for lower-income individuals, saying the funding had to be appropriated.  But after the inauguration, the House and Trump Administration sought a stay of the case until May 22 to allow time to resolve the issue.  If the Administration agrees to fold, the subsidies would be cut off, leading to further market instability.  If the House folds, the CSR payments would continue into the indefinite future.

From a health care legislative perspective, 2017 will still be far from a quiet year.  The President has proposed significant changes in the funding levels of important discretionary health programs.  Those budget battles will now move more front and center on the legislative agenda.  Furthermore, there continue to be “must pass” pieces of health care legislation, including CHIP reauthorization, FDA User Fee legislation, and certain Medicare extenders legislation.

ACA Repeal & Reform – What It Means for Ambulance Services

By: Tristan North and Kathy Lester, JD, MPH

This is the first of a two part Member Advisory by Tristan North and Kathy Lester on ACA Repeal & Reform. To continue reading, see Part Two: ACA Repeal & Reform – What It Means for Ambulance Services (Pt. 2).

Overview

A top priority of President Trump and congressional Republicans is to repeal and replace the Affordable Care Act (ACA). Since Republicans retook control of Congress in 2012 after passage of the ACA in 2010, they have sought to repeal the ACA. However, they had not developed a consensus on a replacement package, as they knew then-President Obama would veto the repeal bill. Now with President Trump in the White House and Republicans controlling the House and Senate, Republicans in the House have agreed upon a package and moved it through three Committees of jurisdiction: the Ways and Means Committee, the Energy and Commerce Committee, and the Budget Committee. Republicans in the Senate are less aligned and are said to be working on their own package, which is likely to differ in important ways from the House version.
For ambulance services, there are several key components to watch. These are:

  • Coverage for ambulance services. Expressed in terms of providing more flexibility, there is concern that some insurers are pushing and some Republicans agree that the concept of a minimum set of covered services (essential health benefits (EHB)) should be narrowed or even eliminated. Currently, only emergency services are included as an EHB, but through the designation of benchmark plans, non-emergency services have also been covered. If the benchmark plans requirements are modified, coverage for non-emergency services could become an issue.
  • Medicaid expansion. The Administration has sent a clear signal that it plans to roll back the expansion of Medicaid, which provide coverage to many Americans who had signed up under the ACA. For ambulance services in expansion States, the elimination of this program could result in more uncompensated care problems.
  • Coverage more generally. Republicans have clearly indicated a desire to eliminate the individual mandate. This could have two effects that may impact ambulance services. First, if people are not required to have coverage there are many who will not have it. It is not certain whether without coverage these individuals will be able to pay for the services they receive, which could lead to more uncompensated care. Second, individuals who do not purchase health insurance often are younger and healthier. Without such individuals in the risk pool, it is possible that premiums and other cost-sharing requirements will increase making it more likely for sicker individuals who cannot afford care becoming uninsured.
  • Employer costs and obligations. The House Republican legislation includes several provisions that relax the obligations and/or provide tax relief to employers providing health insurance. Such provisions could be beneficial to ambulance services in terms of providing health care coverage for their employees.

In addition, there are a few other provisions that the current bills being considered do not modify, but potential could be part of the discussions at some point or in subsequent Medicare legislation.  Of these, there are three that would directly impact ambulance services.

  • Productivity Adjustment. As part of the ACA, the annual inflation updates for the Medicare ambulance fee schedule rates are now subject to a productivity adjustment, which reduces the amount of the update. CMS subtracts a projection of the non-farm business multi-factor productivity adjustment (MFP) from the Consumer Price Index – Urban to determine the update amount.
  • Inflation Index Below Zero. Prior to the ACA, the Medicare inflation update for ambulance rates could not be a negative percentage. Under ACA policies, the update may be a negative percentage. For example, in 2011, the CPI-U was 1.1 percent and the productivity adjustment was 1.2 percent, which resulted in a cut to the rates of 0.1 percent. In 2016, the CPI-U was 0.1 percent and the productivity adjustment was 0.5 percent, which resulted in a cut of 0.4 percent. 
  • GPCI Increases. The ACA made a temporary change to the practice expense component of the physician geographical price cost index (GPCI), which is the entire GPCI for reimbursement under the Medicare ambulance fee schedule. The change established a minimum 1.0 GPCI for ambulance payments from January 1, 2010, to December 31, 2010. As a result of these changes, rates under the Medicare ambulance fee schedule for localities with a GPCI of less than 1.0 saw an additional temporary increase in reimbursement rates. Localities with a GPCI of 1.0 or higher were not be affected by the provision. The provision was retroactive to January 1, 2010 and the increases escalated for 2011 before expiring on December 31, 2011.

The ACA also established a permanent GPCI floor of 1.0 for “frontier” States which took effect in 2011. The designation of a “frontier” applies to those states in which 50 percent of the counties are frontier which have less than 6 people per square mile. The designation is updated with the original frontier states consisting of Montana, North Dakota, South Dakota, Utah and Wyoming. Utah is no longer deemed frontier and Nevada has been added to the list. While a complete repeal of the ACA would not impact the temporary GPCI increases as the provisions were temporary, it would eliminate frontier status.

Administration’s Proposed Rule on Marketplace Stabilization

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

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

Changes to Open Enrollment/Special Enrollment Periods

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

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

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

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

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

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

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

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

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

Network Adequacy

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

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

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

Interpretation of the Guaranteed Availability Requirement

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

De Minimis Variation in the Actuarial Values

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

Essential Community Providers

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

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

[2]Id.

[3]Id.

[4]Id.

[5]Id.

[6]Id.

[7]Id.

[8]Id.

[9]Id.

[10]Id.

[11]Id.

[12]Id.

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