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[Federal Register: September 12, 2000 (Volume 65, Number 177)]
[Proposed Rules]
[Page 55077-55100]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12se00-22]
[[Page 55077]]
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Part II
Department of Health and Human Services
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Health Care Financing Administration
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42 CFR Parts 410 and 414
Medicare Program; Payment of Ambulance Services, Fee Schedule; and
Revision to Physician Certification Requirements for Coverage of
Nonemergency Ambulance Services; Proposed Rule
[[Page 55078]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
42 CFR Parts 410 and 414
[HCFA-1002-P]
RIN 0938-AK07
Medicare Program; Fee Schedule for Payment of Ambulance Services
and Revisions to the Physician Certification Requirements for Coverage
of Nonemergency Ambulance Services
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would establish a fee schedule for the
payment of ambulance services under the Medicare program, implementing
section 1834(l) of the Social Security Act. As required by that
section, this proposed fee schedule for ambulance services was the
product of a negotiated rulemaking process that was carried out
consistent with the Federal Advisory Committee Act. The fee schedule
described in this proposed rule would replace the current retrospective
reasonable cost reimbursement system for providers and the reasonable
charge system for suppliers of ambulance services. In addition, this
proposed rule would require that payment for ambulance services would
be made only on an assignment related basis; establish new codes to be
reported on claims for ambulance services; establish increased payment
for ambulance services furnished in rural areas based on the location
of the beneficiary at the time the patient is placed on board the
ambulance; and revise the physician certification requirements for
coverage of nonemergency ambulance services.
DATES: We will consider comments if we receive them at the appropriate
address, as provided below, no later than 5 p.m. on November 13, 2000.
ADDRESSES: Mail written comments (one original and three copies) to the
following address ONLY: Health Care Financing Administration,
Department of Health and Human Services, Attn: HCFA-1002-P, P.O. Box
8013, Baltimore, MD 21244-8013.
Since comments must be received by the date specified above, please
allow sufficient time for mailed comments to be received timely in the
event of delivery delays. If you prefer, you may deliver your written
comments (one original and three copies) by courier to one of the
following addresses:
Room 443-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW,
Washington, DC 20201, or
C5-15-03, Central Building, 7500 Security Boulevard, Baltimore, MD
21244-1850.
Comments mailed to the two above addresses may be delayed and
received too late to be considered.
Because of staffing and resource limitations, we cannot accept
comments by facsimile (FAX) transmission. In commenting, please refer
to file code HCFA-1002-P.
Comments received timely will be available for public inspection as
they are received, generally beginning approximately 3 weeks after
publication of a document, in Room 443-G of the Department's offices at
200 Independence Avenue, SW, Washington, DC 20201, on Monday through
Friday of each week from 8:30 a.m. to 5 p.m. (phone: (202) 690-7890).
FOR FURTHER INFORMATION CONTACT: Margot Blige, (410) 786-4642, for
coverage issues. Glenn McGuirk, (410) 786-5723, for payment issues.
SUPPLEMENTARY INFORMATION:
I. Background
A. Current Payment System
The Medicare program pays for ambulance services on a reasonable
cost basis when furnished by a provider and on a reasonable charge
basis when furnished by a supplier. (For purposes of this discussion,
the term ``provider'' means all Medicare-participating institutional
providers that submit claims for Medicare ambulance services (hospitals
(including critical access hospitals), skilled nursing facilities
(SNFs), and home health agencies (HHAs)). The term ``supplier'' means
an entity that is independent of any provider.) The reasonable charge
methodology which is the basis of payment for ambulance services
furnished by ambulance suppliers is determined by the lowest of the
customary, prevailing, actual, or inflation indexed charge (IIC).
The following describes the current billing methods for ambulance
services:
Method 1 is a single, all-inclusive charge reflecting all
services, supplies, and mileage.
Method 2 is one charge reflecting all services and
supplies (base rate) with a separate charge for mileage.
Method 3 is one charge for all services and mileage, with
a separate charge for supplies.
Method 4 is separate charges for services, mileage, and
supplies.
Over the past 20 years, the Congress has been moving towards fee
schedules and prospective payment systems for Medicare payment. In the
case of ambulance services, the reasonable charge methodology has
resulted in a wide variation of payment rates for the same service
depending on location. In addition, this payment methodology is
administratively burdensome, requiring substantial recordkeeping for
historical charge data. The Congress, under the Balanced Budget Act of
1997 (BBA), (Pub. L. 105-33), mandated the establishment of a fee
schedule for payment of ambulance services.
B. Recent Legislation
1. Balanced Budget Act of 1997
Section 4531(b)(2) of the BBA added a new section 1834(l) to the
Social Security Act (the Act). Section 1834(l) of the Act requires that
we establish a national fee schedule for payment of ambulance services
furnished under Medicare Part B. This section also requires that in
establishing the ambulance fee schedule, we will--
Establish mechanisms to control increases in expenditures
for ambulance services under Part B of the Medicare program;
Establish definitions for ambulance services that link
payments to the type of services furnished;
Consider appropriate regional and operational differences;
Consider adjustments to payment rates to account for
inflation and other relevant factors;
Phase in the fee schedule in an efficient and fair manner;
and,
Require payment for ambulance services be made only on an
assignment related basis.
In addition, the BBA requires that ambulance services covered under
Medicare be paid based on the lower of the actual billed charge or the
ambulance fee schedule amount. The BBA also requires that total
payments under the ambulance fee schedule may be no more than what
would have been paid if the ambulance fee schedule were not in effect.
As discussed below, we intended to incorporate $65 million in program
savings in the 1998 base year data upon which the ambulance fee
schedule is calculated consistent with the statutory requirement that,
in the aggregate, we pay no more than would have been paid in the
absence of the fee schedule for CY 2001. This amount correlates to
$67.3 million when updated for the effects of inflation.
2. Balanced Budget Refinement Act of 1999
Section 412 of the Medicare, Medicaid, and the State Child Health
[[Page 55079]]
Insurance Program Balanced Budget Refinement Act of 1999 (BBRA)
provided a new definition for the term ``rural'' in the context of the
Medicare coverage provision for paramedic advanced life support (ALS)
intercept services. The BBRA states that, effective for services
furnished on or after January 1, 2000:
An area shall be treated as a rural area if it is designated as
a rural area by any law or regulation of the State or if it is
located in a rural census tract of a metropolitan statistical area
(as determined under the most recent Goldsmith modification,
originally published in the Federal Register on February 27, 1992
(57 Fed. Reg. 6725)).
This definition applies only to the Medicare paramedic ALS
intercept benefit implemented at 42 CFR 410.40(c). This is a very
limited benefit and to date we know of only one State (New York) with
areas that meet the statutory requirements. (See the March 15, 2000
final rule (65 FR 13911).) For all other ambulance services, the
definition of ``rural'' specified in this proposed rule would apply.
C. Components of Ambulance Fee Schedule Payment Amounts
In general, the payment amount for each air ambulance service paid
under the ambulance fee schedule would be the product of two primary
factors: (1) A nationally uniform unadjusted base rate; and (2) a
geographic adjustment factor for an ambulance fee schedule area. A
detailed description of these factors is discussed in this proposed
rule.
In general, the payment amount for each ground ambulance service
paid under the ambulance fee schedule would be the product of three
primary factors: (1) A nationally uniform relative value for the
service; (2) a geographic adjustment factor for an ambulance fee
schedule area; and (3) a nationally uniform conversion factor (CF) for
the service. A detailed description of these factors is discussed in
this proposed rule.
Relative value units (RVUs) measure the value of ambulance services
relative to the value of a base level ambulance service. Thus, if the
value of the resources necessary to furnish service B are twice the
value of the resources needed to furnish service A, service B will have
RVUs that are twice the value of the RVUs for service A. RVUs are
multiplied by a CF expressed as a dollar value to produce a payment
amount. The RVUs represent, on average, the relative resources
associated with the various levels of ambulance services.
Because the fee schedule is based on the relative values of
different levels of ground ambulance services relative to a basic life
support ground ambulance service, a factor is needed in order to
convert the relative value to a dollar amount equal to the national
base payment rate. In order to determine the conversion factor (CF),
the general approach is first to determine the total amount of money
available and divide that total by the total number of relative value
units. As we describe in more detail below, we used 1998 Medicare
ambulance claims data to determine the total RVUs in this calculation.
The total dollars is equal to the total allowed charges for all
ambulance services billed to Medicare in 1998, less the $65 million
adjustment for those basic life support (BLS) services that had been
paid at the advanced life support (ALS) services payment rate, as
described in Section 1834(l)(3) of the Act. This section states that,
in establishing the ambulance fee schedule, the Secretary must ensure
that the aggregate amount of payment made for ambulance services in
calendar year (CY) 2000 does not exceed the aggregate amount of payment
that would have been made absent the fee schedule. In the January 22,
1999 notice concerning the negotiated rule meetings, we stated that,
although we were postponing final agency action on the proposal to
define BLS and ALS services because of the BBA requirement that this
issue be subject to negotiated rulemaking, we believe that the savings
that would have been realized through implementation of that policy
should not be lost to the Medicare program. We determined that $65
million in program savings would have been realized in the base year
1998 data if the final rule had been in effect. The total RVUs are
equal to the sum of the total number of allowed services that were
billed in 1998 for each of the categories (levels) of ambulance
services established by the negotiated rulemaking committee multiplied
by the respective relative value of each of the new levels of service.
Section 4531(b)(3) of the BBA provides that the fee schedule was to
be effective for ambulance services furnished on or after January 1,
2000. However, because of other statutory obligations and the scope of
systems changes required to implement the ambulance fee schedule, we
could not meet this statutory deadline while assuming that our
respective systems were compliant with the Year 2000 requirements.
Therefore, because we were unable to implement the ambulance fee
schedule on January 1, 2000, we delayed implementation of the fee
schedule for ambulance services until January 1, 2001. This action is
in keeping with our objective to have the ambulance fee schedule become
effective as soon as possible after the January 1, 2000 statutory date,
given our Year 2000 activities and our other statutory obligations to
implement various revised payment systems in calendar year 2000.
D. Negotiated Rulemaking Process
Section 1834(l)(1) of the Act provided that the ambulance fee
schedule be established through the negotiated rulemaking process
described in the Negotiated Rulemaking Act of 1990 (Pub. L. 101-648, 5
U.S.C. 561-570). Prior to using negotiated rulemaking under the
Negotiated Rulemaking Act, the head of an agency must generally
consider whether the following conditions exist:
There is a need for a rule.
There are a number of identifiable interests that will be
significantly affected by the rule.
There is a reasonable likelihood that a committee can be
convened with a balanced representation of persons who--
+ Can adequately represent the interests identified; and,
+ Are willing to negotiate in good faith to reach a consensus on
the proposed rule.
There is a reasonable likelihood that a committee will reach a
consensus on the proposed rule within a fixed time frame.
The negotiated rulemaking procedure will not unreasonably
delay the notice of proposed rulemaking and the issuance of a final
rule.
The agency has adequate resources and is willing to commit its
resources, including technical assistance, to the committee.
The agency, to the maximum extent possible consistent with the
legal obligations of the agency, will use the consensus of the
committee as the basis for the rule proposed by the agency for notice
and comment.
Negotiations were conducted by a committee chartered under the
Federal Advisory Committee Act (FACA) (5 U.S.C. App. 2). We used the
services of an impartial convener to help identify interests that would
be significantly affected by the proposed rule (including residents of
rural areas) and the names of persons who were willing and qualified to
represent those interests. The Negotiated Rulemaking Committee on the
Medicare Ambulance Services Fee Schedule (that is, ``the Committee'')
consisted of national representatives of interests that were likely to
be
[[Page 55080]]
significantly affected by the fee schedule. (Additional information
about the negotiations can be found in the January 22, 1999 notice or
may be accessed at our Internet website at http://www.hcfa.gov/
medicare/ambmain.htm.)
To the extent that this proposed rule accurately reflects the
Committee Statement as signed on February 14, 2000, each member to the
Committee has agreed not to comment on those issues on which consensus
was reached.
E. Interaction With the Proposed Rule Published on June 17, 1997
On June 17, 1997, we published a proposed rule (62 FR 32715) in the
Federal Register to revise and update the Medicare ambulance services
regulations at 42 CFR 410.40. Specifically, we proposed: to base
Medicare payment on the level of ambulance service required to treat
the beneficiary's condition; to clarify and revise the policy on
coverage of nonemergency ambulance services; and to set national
vehicle, staff, billing, and reporting requirements. As noted above,
section 1834(l)(2) of the Act provides, in part, that in establishing
the ambulance fee schedule, the Secretary will establish definitions
for ambulance services that link payments to the types of services
furnished. One of the provisions of the June 17, 1997 proposed rule
would have defined ambulance services as either BLS or ALS and linked
Medicare payment to the type of service required by the beneficiary's
condition. We received a large number of comments on this issue, and,
in general, commenters were very concerned about our proposal. In light
of that concern and because defining ambulance services is a required
element of this negotiated rulemaking (under section 1834(l) of the
Act), we decided not to proceed with a final rule on the definition of
BLS and ALS services. Instead, we included this issue as a matter for
the Committee. We did, however, proceed with a final rule on all other
issues of the June 17, 1997 proposed rule. That rule was published on
January 25, 1999 (64 FR 3637).
Section 1834(l)(3) of the Act provides that, in establishing the
ambulance fee schedule, the Secretary must ensure that the aggregate
amount of payment made for ambulance services in calendar year (CY)
2000 does not exceed the aggregate amount of payment that would have
been made absent the fee schedule. In the January 22, 1999 notice
concerning the negotiated rule meetings, we stated that, although we
were postponing final agency action on the proposal to define BLS and
ALS services because of the BBA requirement that this issue be subject
to negotiated rulemaking, we believe that the Medicare program should
not lose the savings that would have been realized through
implementation of that policy. We determined that $65 million in
program savings would have been realized in the base year 1998 data if
the final rule had been in effect. After adjusting for inflation,
program savings for CY 2001 have been estimated at $67.6 million.
Therefore, in the January 22, 1999 notice (64 FR 3474), we stated that
we intended to incorporate these savings in the base amount upon which
the fee schedule is calculated consistent with the statutory
requirement that in the aggregate we pay no more than would have been
paid in the absence of the fee schedule.
II. Provisions of the Proposed Rule
A. Proposed Changes Based on Negotiated Rulemaking
In accordance with the negotiated rulemaking procedures described
above, we propose the following additions to Part 414 based on the
recommendations of the Committee.
1. Definitions and levels of services. In Part 414, we propose to
add Subpart H, Sec. 414.605 that would define several levels of ground
ambulance services ranging from BLS to specialty care transport. (Note
that the term ``ground'' refers to both land and water transportation.
The definitions and RVUs for each of the levels of service are
described in Sec. 414.605, ``Definitions.'') Also, the rate per ground
mile for all ground ambulance services would be the same for each level
of service.
During 1990, the development of a training blueprint and the
evaluation of current levels of prehospital provider training and
certification were identified as priority needs for national emergency
medical services (EMS). As a result, the National EMS Training
Blueprint Project was formed.
In May 1993, representatives of EMS organizations adopted the
National EMS Education and Practice Blueprint (Blueprint) consensus
document. This consensus document is used as the basis for defining the
levels of service. As stated in the National EMS Education and Practice
Blueprint, Executive Summary, printed September 1993, ``The Blueprint
divides the major areas of prehospital instruction and/or core
performance into 16 'core elements'.'' For each core element, the
Blueprint recommends that there be four levels of prehospital EMS
providers ``corresponding to various knowledge and skills in each of
the core elements.'' At the First Responder level, personnel use a
limited amount of equipment to perform initial assessments and
interventions. The EMT--Basic has the knowledge and skill of the First
Responder, but is also qualified to function as the minimum staff for
an ambulance. EMT--Intermediate personnel has the knowledge and skills
identified at the First Responder and EMT--Basic levels, but is also
qualified to perform essential advanced techniques and to administer a
limited number of medications. The EMT--Paramedic, in addition to
having the competencies of an EMT--Intermediate, has enhanced skills
and can administer additional interventions and medications.
Since the release of the Blueprint, a consensus panel of EMS
educators has recommended that the Department of Transportation,
National Highway Traffic and Safety Administration (DOT/NHTSA) revise
the document. DOT/NHTSA has accepted the recommendation of the panel
and expects to release a revised Blueprint or an equivalent document in
the near future.
To request a copy of the National Emergency Medical Services
Education and Practice Blueprint, please fax your request to: NHTSA/EMS
Division, (202) 366-7721. Please include your name and address. Because
of staffing and resource limitations NHTSA will forward the requested
document via regular mail.
There would be two levels of air ambulance services to distinguish
fixed wing from rotary wing (helicopter) aircraft. In addition, to
recognize the operational cost differences of the two types of
aircraft, there would be two distinct payment amounts for air ambulance
mileage. The air ambulance services mileage rate would be calculated
per actual loaded (patient onboard) miles flown, expressed in statute
miles (that is, ground, not nautical, miles.)
We are proposing the following seven levels of ambulance services.
a. Basic Life Support (BLS)--When medically necessary, the
provision of basic life support (BLS) services as defined in the
National Emergency Medicine Services (EMS) Education and Practice
Blueprint for the Emergency Medical Technician-Basic (EMT-Basic)
including the establishment of a peripheral intravenous (IV) line.
b. Advanced Life Support, Level 1 (ALS1)--When medically necessary,
this is the provision of an assessment by an advanced life support
(ALS) ambulance provider or supplier and the
[[Page 55081]]
furnishing of one or more ALS interventions. An ALS assessment is
performed by an ALS crew and results in the determination that the
patient's condition requires an ALS level of care, even if no other ALS
intervention is performed. An ALS provider or supplier is defined as a
provider trained to the level of the EMT-Intermediate or Paramedic as
defined in the National EMS Education and Practice Blueprint. An ALS
intervention is defined as a procedure beyond the scope of an EMT-Basic
as defined in the National EMS Education and Practice Blueprint.
c. Advanced Life Support, Level 2 (ALS2)--When medically necessary,
the administration of at least three different medications or the
provision of one or more of the following ALS procedures:
Manual defibrillation/cardioversion.
Endotracheal intubation.
Central venous line.
Cardiac pacing.
Chest decompression.
Surgical airway.
Intraosseous line.
d. Specialty Care Transport (SCT)--When medically necessary, for a
critically injured or ill beneficiary, a level of interhospital service
furnished beyond the scope of the paramedic as defined in the National
EMS Education and Practice Blueprint. This is necessary when a
beneficiary's condition requires ongoing care that must be furnished by
one or more health professionals in an appropriate specialty area (for
example, nursing, emergency medicine, respiratory care, cardiovascular
care, or a paramedic with additional training).
e. Paramedic ALS Intercept (PI)--These services are defined in
Sec. 410.40(c) ``Paramedic ALS Intercept Services''. These are ALS
services furnished by an entity that does not provide the ambulance
transport. Under limited circumstances, Medicare payment may be made
for these services. (To obtain additional information about paramedic
ALS intercept services, please refer to the March 15, 2000 final rule
(65 FR 13911)).
f. Fixed Wing Air Ambulance (FW)--Fixed wing air ambulance services
are covered when the point from which the beneficiary is transported to
the nearest hospital with appropriate facilities is inaccessible by
land vehicle, or great distances or other obstacles (for example, heavy
traffic) and the beneficiary's medical condition is not appropriate for
transport by either BLS or ALS ground ambulance.
g. Rotary Wing Air Ambulance (RW)--Rotary wing (helicopter) air
ambulance services are covered when the point from which the
beneficiary is transported to the nearest hospital with appropriate
facilities is inaccessible by ground vehicle, or great distances or
other obstacles (for example, heavy traffic) and the beneficiary's
medical condition is not appropriate for transport by either BLS or ALS
ground ambulance.
2. Emergency Response Adjustment Factor
We are proposing to add Sec. 414.610, ``Basis of Payment,''
paragraph (c)(1), to state that for the BLS and ALS1 levels of service,
an ambulance service that qualifies as an emergency response service
would be assigned higher RVUs to recognize the additional costs
incurred in responding immediately to an emergency medical condition.
An immediate response is one in which the ambulance supplier begins as
quickly as possible to take the steps necessary to respond to the call.
No emergency response adjustment factor applies to PI, ALS2, SCT, FW,
or RW.
3. Operational Variations
We are proposing to add Sec. 414.610(a) which would state that the
ambulance fee schedule applies to all entities that furnish ambulance
services, regardless of type. For example, all public or private, for
profit or not-for-profit, volunteer, government-affiliated,
institutionally-affiliated or owned, or wholly independent supplier
ambulance companies, however organized, would be paid according to this
ambulance fee schedule.
4. Regional Variations
a. Cost of living differences:
The payment for ambulance services would be adjusted to reflect the
varying costs of conducting business in different regions of the
country. We would adjust the payment by the geographic adjustment
factor (GAF), equal to the practice expense (PE) portion of the
geographic practice cost index (GPCI) for the Medicare physician fee
schedule. (For purposes of this document, we use the abbreviation
``GPCI'' to mean the PE portion of the GPCI.) The GPCI is an index that
reflects the relative costs of certain components of a physician's
costs of doing business (for example, employee salaries, rent, and
miscellaneous expenses) in one area of the country versus another. The
geographic areas would be the same as those used for the physician fee
schedule. (A detailed discussion of the physician fee schedule areas
can be found in the July 2, 1996 proposed rule (61 FR 34615) and the
November 22, 1996 final rule (61 FR 59494).)
The GPCI would be applied to 70 percent of the base payment rate
for ground ambulance services; this percentage approximates the portion
of ground ambulance service costs that are represented by salaries.
Similarly, the GPCI would be applied to 50 percent of the base payment
rate for air ambulance services. The GPCI would not be applied to the
mileage payment rate. In addition, the applicable GPCI would be based
on the geographic location at which the beneficiary is placed on board
the ambulance.
We would use the most recent GPCI; the physician fee schedule law
requires that the GPCI be updated every 3 years. The next revision will
be effective January 1, 2001. We anticipate using the updated data,
which was proposed in the July 17, 2000 proposed rule on the physician
fee schedule (65 FR 44176).
b. Services furnished in rural areas:
We are proposing to add Sec. 414.610(c)(1)(v) which would state
that an adjustment would be made to increase the base payment rate for
ambulance services furnished in rural areas. This adjustment would be
made because of the additional cost per ambulance trip of isolated,
essential ambulance suppliers (that is, when there is only one
ambulance service in a given geographic area) for which there are not
many trips furnished over the course of a typical month because of a
small rural population. While we recognize the inadequacy of the
methodology to completely compensate for these costs (that is, not
every rural ambulance supplier is isolated, essential, low-volume, and
the definition of rural we are proposing is not as precise as other
alternatives), we propose an additional adjustment to increase the
mileage rate if the location at which the beneficiary is placed on
board the ambulance is located in a rural area. The definition of a
rural area would be an area outside a Metropolitan Statistical Area
(MSA) or a New England County Metropolitan Area, or an area within an
MSA identified as rural, using the Goldsmith modification.
The Goldsmith modification evolved from an outreach grant program
sponsored by the Office of Rural Health Policy of the Health Resources
and Services Administration (HRSA) of the Department of Health and
Human Services. This program was created to establish an operational
definition of rural populations lacking easy geographic access to
health services in large counties with metropolitan cities. Using 1980
census data, Dr. Harold F. Goldsmith and his associates created a
methodology for identifying rural census tracts located within a large
[[Page 55082]]
metropolitan county of at least 1,225 square miles. However, these
census tracts are so isolated by distance or physical features that
they are more rural than urban in character. Additional information
regarding the Goldsmith modification can be found on the Internet at
http://www.nal.usda.gov/orhp/Goldsmith.htm.
We could not easily adopt and implement, within the timeframe
necessary to implement the fee schedule by January 1, 2001, a
methodology for recognizing geographic population density disparities
other than MSA/non-MSA. However, we will consider alternative
methodologies that may more appropriately address payment to isolated,
low-volume rural ambulance suppliers. Thus, the rural adjustment in
this rule is a temporary proxy to recognize the higher costs of certain
low-volume rural supplies.
In the process of evaluating the operation of the regulations
developed through the negotiated rulemaking process, there are several
difficult issues that will need to be resolved. Examples of such issues
include: (1) Appropriately identifying an ambulance supplier as rural;
(2) identifying the supplier's total ambulance volume (since Medicare
only has a record of its Medicare services); and (3) identifying
whether the supplier is isolated, given that some suppliers might not
furnish services for Medicare (that is, Medicare would have no record
of their existence) and one of these suppliers may be located near an
otherwise ``isolated'' supplier. Addressing these issues in some cases
will require the collection of data that is currently unavailable. We
intend to work with the industry to identify and collect all pertinent
data as soon as possible, and we encourage comments regarding the type
and source of data that could be used for this purpose.
The application of the rural adjustment would be determined by the
geographic location at which the beneficiary is placed on board the
ambulance. The rural adjustment would be made using the following
methodology:
Ground--A 50 percent add-on applied to only the mileage
payment rate for the first 17 loaded miles.
Air--A 50 percent add-on applied to the base rate and to
all of the loaded mileage.
5. Mileage
We are proposing to add Sec. 414.610(c)(1) that would state that
mileage would be paid separately from the base rate. The payment for
mileage reflects the costs attributable to the use of the ambulance
vehicle (for example, maintenance and depreciation), which increase as
the vehicle's mileage increases. Based on the Committee's agreement,
the mileage rate for 2001 is as follows: $5 for ground ambulance, $6
for fixed wing ambulance, and $16 for rotary wing ambulance. Payment
for some mileage in rural areas is made at a higher rate and is
discussed in detail later in this proposed rule.
6. Structure of the Fee Schedule for Ambulance Services
We are proposing in Sec. 414.610(a) that the fee schedule payment
for ambulance services would equal a base rate payment plus payments
for mileage and applicable adjustment factors. (See Table 1 for a
description of the structure of the ambulance fee schedule.)
7. Ambulance Inflation Factor
We are proposing to add Sec. 414.615, ``Transition methodology for
implementing the ambulance fee schedule,'' which would state that the
ambulance fee schedule would include the ambulance inflation factor
specified in section 1834(l)(3) of the Act and discussed below.
8. Phase-in Methodology
We are proposing to add Sec. 414.615 that would provide for a 4-
year transition period. (The phase-in schedule is described in section
IV.)
B. Proposed Changes Not Based on Negotiated Rulemaking
We are proposing changes to certain policies that were not within
the scope of the negotiated rulemaking process. These proposed changes
are as follows:
1. Coverage of Ambulance Services
In Sec. 410.40(b), we are proposing to revise the introductory
language to provide a cross reference to Sec. 414.605 for a description
of the specific levels of services. We are proposing to revise
paragraph Sec. 410.40(d)(1) to state that transportation includes fixed
wing and rotary wing ambulances. Also, we are proposing to revise
Sec. 410.40(d)(3) by adding two options to document medical necessity.
2. Physician Certification Requirements
On January 25, 1999, we published a final rule (64 FR 3637) that
updated Medicare coverage policy concerning ambulance services. That
final rule provided the documentation requirements for coverage of
nonemergency ambulance services for Medicare beneficiaries. The rule
requires ambulance suppliers to obtain, from the beneficiary's
attending physician, a written order certifying the medical necessity
of nonemergency scheduled and unscheduled ambulance transports. The
final rule became effective February 24, 1999.
Our present regulations (at Secs. 410.40(d)(2) and 410.40(d)(3))
set forth the requirements for scheduled and unscheduled nonemergency
ambulance transports. The regulations require ambulance suppliers to
obtain, from the beneficiary's attending physician, a written physician
statement certifying the medical necessity of requested ambulance
transports.
Section 410.40(d)(3)(i) specifies that, in cases when a beneficiary
living in a facility and under the direct care of a physician requires
nonemergency, unscheduled transport, the physician's certification can
be obtained up to 48 hours after transport. After publication of this
rule, we were made aware of instances in which ambulance suppliers,
despite having provided ambulance transports, were experiencing
difficulty in obtaining the necessary physician certification
statements within the required 48-hour timeframe.
While we still believe that the 48-hour timeframe is the
appropriate standard, we recognize that there may be instances when,
not through fault of their own, it may not be possible for the
ambulance suppliers to meet the requirement. Therefore, we have
determined that there is a need to revise and clarify this requirement
(as described in Sec. 410.40, ``Coverage of ambulance services,''
paragraph (d)(3)).
Before submitting a claim, the ambulance supplier must obtain: (1)
A signed physician certification statement from the attending
physician; (2) if the ambulance supplier is unable to obtain a signed
physician certification statement from the attending physician, a
signed physician certification must be obtained from either the
physician, physician assistant, nurse practitioner, clinical nurse
specialist, registered nurse, or discharge planner who is employed by
the hospital or facility where the beneficiary is being treated and who
has personal knowledge of the beneficiary's condition at the time the
transport is ordered or the service was furnished (the term physician
certification statement will also be applicable to statements signed by
other authorized individuals); or (3) if the supplier is unable to
obtain the required statement as described in 1 and 2 above within 21
calendar days following the date of service, the ambulance supplier
must document its attempts to obtain the physician certification
statement and may then submit the claim.
[[Page 55083]]
Acceptable documentation must include a signed return receipt from the
U.S. Postal Service or similar delivery service. A signed return
receipt will serve as proof that the ambulance supplier attempted to
obtain the required physician certification statement from the
beneficiary's attending physician.
In all cases, the appropriate documentation must be kept on file
and, upon request, presented to the carrier or intermediary. It is
important to note that neither the presence nor absence of the signed
physician certification statement necessarily proves (or disproves)
whether the transport was medically necessary. The ambulance supplier
must meet all coverage criteria in order for payment to be made.
3. Payment During the First Year
As explained below in more detail, we would use the universe of
claims paid in 1998 (reduced by the $65 million savings that would have
been realized through implementation of the BLS and ALS definitions
proposed in the June 17, 1997 proposed rule (62 FR 32718)) to establish
the CF and would index the 1998 dollars to 2001 dollars using the
compounded inflation factors provided by section 1834(l)(3) of the Act.
(The transition and the inflation factors are described in proposed
Sec. 414.615.)
4. Billing Method
In Sec. 414.610, we would state that after the transition period,
we would bundle into the base rate payment all items and services
furnished within the ambulance service benefit. This would eliminate
billing on an itemized basis for any items and services related to the
ambulance service (for example, oxygen, drugs, extra attendants, and
EKG testing). In addition, only the base rate code and the mileage code
would be used to bill Medicare. (This decision was made, in accordance
with section 1834(l)(7) of the Act, which gives us the authority to
specify a uniform coding system.) During the transition period,
suppliers who currently use billing methods 3 or 4 may continue to bill
for supplies separately.
5. Local or State Ordinances
In Sec. 414.610, we would state that, regardless of any local or
State ordinances that contain provisions on ambulance staffing or
furnishing of all ambulance services by ALS suppliers, we would pay the
appropriate ambulance fee schedule rate for the services that are
actually required by the condition of the beneficiary. This policy
derives from the Medicare statutory requirement (see section 1834
(1)(2)(C) of the Act) to link payments to the types of services
furnished.
6. Mandatory Assignment
In Sec. 414.610, we would state that effective January 1, 2001, all
payments for ambulance services must be made on an assignment-related
basis. Ambulance suppliers must accept the Medicare allowed charge as
payment in full and not bill the beneficiary any amount other than
unmet Part B deductible or coinsurance amounts. There is no
transitional period for mandatory assignment.
7. Miscellaneous Payment Policies
Although not included in the proposed regulations, we are
clarifying the following payment policies.
a. Multiple patients--Occasionally, an ambulance will transport
more than one patient at a time. (For example, this may happen at the
scene of a traffic accident.) In this case, we propose to prorate the
payment as determined by the ambulance fee schedule among all of the
patients in the ambulance. For example, if two patients were
transported at one time, and one was a Medicare beneficiary and the
other was not, we would make payment based on one-half of the ambulance
fee schedule amount for the level of medically appropriate service
furnished to the Medicare patient. The Medicare Part B coinsurance,
deductible, and assignment rules would apply to this prorated payment.
Similarly, if both patients were Medicare beneficiaries, payment
for each beneficiary would be made based on half of the ambulance fee
schedule amount for the level of medically appropriate services
furnished to each patient. The Medicare Part B coinsurance, deductible,
and assignment rules would apply to these prorated amounts.
b. Pronouncement of death--There are three rules that apply to
ambulance services and the pronouncement of death. First, if the
beneficiary was pronounced dead by an individual who is licensed to
pronounce death in that State prior to the time that the ambulance is
called, no payment would be made. Second, if the beneficiary is
pronounced dead after the ambulance is called but before the ambulance
arrives at the scene, payment for an ambulance trip would be made at
the BLS rate, but no mileage would be paid. Third, if the beneficiary
is pronounced dead after being loaded into the ambulance, payment would
be made following the usual rules (that is, the same level of payment
would be made as if the beneficiary had not died).
c. Multiple Arrivals--When multiple units respond to a call for
services, we would pay the entity that provides the transportation for
the beneficiary. The transporting entity would bill for all services
furnished, as stated in current policy. For example, if BLS and ALS
entities respond to a call and the BLS entity furnishes the
transportation after an ALS assessment is furnished, the BLS entity
would bill using the ALS1 rate. We would pay the BLS entity at the ALS1
rate. The BLS entity and the ALS entity would have to negotiate payment
for the ALS assessment.
d. BLS Services in an ALS Vehicle--Effective January 1, 2001,
claims will be paid at the BLS level where an ALS vehicle was used but
no ALS level of service was furnished. Claims must be filed using the
appropriate BLS code. There is no transitional period for claims paid
at the BLS level for non-ALS services rendered in an ALS vehicle.
III. Methodology for Determining the Conversion Factor
Our approach to determining the CF would be to: (1) Use the most
recent complete year of ambulance claims; (2) translate those claims
into the format that would have been used under the fee schedule; and
(3) calculate the CF to be applied to the RVUs of the different levels
of service that would result in the same total program payment for
those claims less $65 million. We would then inflate this CF in
accordance with the inflation factor prescribed in the statute. (See
section 1834(1)(3) of the Act.) We used 1998 as the base year because
this was the most recent complete year for which claims data were
available. For claims processed by carriers (that is, claims from
independent ambulance suppliers), we used allowed charges. For claims
processed by fiscal intermediaries (FIs) from provider-based ambulance
services, we used the submitted charges on the Medicare claims
multiplied by the cost-to-charge ratio applicable to the ambulance
costs for that provider.
We decided that choosing the most common number of miles on
existing claims would be the best estimate as to those claims that did
not report mileage. The research indicated that the mode for urban
claims was 1, and the mode for rural claims was also 1.
We modified the claims data in several ways to calculate the
proposed fee schedule and its impact. First, we separated all claims
into two groups:
Carrier processed claims for ambulance services (8 million
in 1998).
[[Page 55084]]
FI processed claims for ambulance services (900,000 in
1998).
A. Carrier Processed Claims
Not all of the 1998 claims were directly usable for purposes of the
proposed ambulance fee schedule. Some of the claims did not show
mileage and, because mileage would be required for each ambulance
service under the fee schedule, an adjustment had to be made for the
missing miles. In other cases, the billing codes under the old system
did not translate directly into services that would be paid under the
proposed fee schedule. Below is a more detailed explanation of the
adjustments that were made to the 1998 base year data in order to
accommodate missing data.
1. Mileage
Approximately 1.1 million claims for ground ambulance services did
not show any mileage. The proposed fee schedule for ambulance services
would provide a payment for the trip and a payment per statute mile for
the loaded mileage traveled. Therefore, in calculating the proposed CF,
we added mileage to those claims that did not report mileage. We did so
by assigning the mode value (that is, the number of miles billed most
often) per trip in urban areas (1.0 miles) and the mode value or
mileage per trip in rural areas (1.0 miles).
Current billing instructions provide that only one ambulance trip
may be billed per line on a claim. Therefore, we did not count multiple
trips billed on the same line of a claim. This reduced the total trip
count processed by carriers by approximately 1 percent. Billing rules
prohibit more than one trip to be reported on a line; therefore, we
assumed any number greater than one was an error. Because the allowed
charges on these claims represented the amounts paid, there was a
corresponding increase by the same percentage of the average charge per
trip.
2. Billing Codes
We determined that the billing codes that represent items and
services included under the ambulance fee schedule are all billing
codes submitted by ambulance suppliers in the range of HCFA Common
Procedure Coding System (HCPCS) A0030 through A0999 (excluding HCPCS
code A0888, which is not covered by Medicare) and Common Procedural
Terminology-4 (CPT-4) \1\ codes 93005 and 93041. HCPCS billing codes
A0030 through A0999 represent ambulance services, supplies, and
equipment that are covered by the ambulance fee schedule, and CPT codes
93005 and 93041 represent electrocardiogram (EKG) services that may be
billed by ambulance suppliers. In addition, we included all HCPCS
billing codes in the range of A4000 through Z9999; these services may
only be paid by a carrier to an ambulance supplier if they represent
items and services covered under the Medicare ambulance benefit. We
excluded all other CPT billing codes in the range of 00001 through
99999 (except the two EKG codes listed above) because they represent
services not covered by the ambulance fee schedule.
---------------------------------------------------------------------------
\1\ CPT codes and descriptions only are copyright 2000 American
Medical Association. All Rights Reserved. Applicable FARS/DFARS
Apply.
---------------------------------------------------------------------------
Next, we adjusted all billing codes that represented an ALS vehicle
when no ALS service was furnished. We removed the actual allowed
charges on these claims and replaced them with the charges that would
have been allowed by the carrier for the corresponding BLS level of
service (that is, emergency for emergency and nonemergency for
nonemergency). As described in this preamble, this adjustment reduced
the Medicare portion of the total allowed charges for ambulance
services by $65 million.
3. Crosswalking the Old Billing Codes to the New Billing Codes
We converted the old billing codes in the base year data to the new
billing codes as they would be under the proposed fee schedule. The old
BLS codes convert directly to the proposed BLS codes. The old air
ambulance codes (fixed wing and helicopter) convert to the proposed air
ambulance codes. The old water ambulance code converts to the proposed
BLS-Emergency code. The old mileage codes distinguished ALS miles from
BLS miles; both of these old codes would convert to the single proposed
mileage code. Codes used to report air mileage would convert to the
proposed codes for fixed and rotary wing mileage respectively. All air
miles would be reported in statute miles. As mentioned earlier, we
converted the codes for an ALS vehicle when no ALS services were
furnished to the corresponding BLS codes. The conversion of the
remaining old ALS codes (for example, when ALS services were furnished)
to proposed ALS codes is less straightforward because there are more
levels of ALS service under the proposed fee schedule than currently
exist. All nonemergency ALS codes convert to the proposed ALS1
(nonemergency) code. Based on advice from various negotiating committee
members, we propose converting the old emergency ALS codes according to
the following formulas:
For claims on which both the origin and destination was a
hospital: 33 percent would convert to specialty care transport (SCT), 5
percent to advanced life support, level two (ALS2), and the remainder
to ALS1--Emergency.
For all other claims: 8.3 percent would convert to ALS2,
and the remainder to ALS1--Emergency.
B. FI Processed Claims
Since all FI claims contained mileage, we did not make any
adjustment for mileage. We determined the codes that represented items
and services included under the ambulance fee schedule. In the case of
hospital-based claims, the same claim is used to report services
furnished in the emergency room and other outpatient departments of the
hospital as is used to report the ambulance service. Therefore, it is
impossible to know exactly where any of the nonambulance services were
furnished. Because most of these nonambulance services were of the kind
that would likely have been furnished in the hospital's emergency room,
we did not include them in data for the proposed ambulance fee
schedule. Therefore, we determined the billing codes that would be
covered by the ambulance fee schedule were all billing codes
representing ambulance services (for example, in the range of HCPCS
codes A0030 through A0999 (excluding HCPCS code A0888, which is not
covered by Medicare)) submitted by hospitals.
Codes that represented the use of an ALS vehicle, but when no ALS
level of service was furnished, were converted to the corresponding BLS
BILLING CODE. However, in this case, no adjustment was made for payment
because payment for these claims would have been corrected to the
proper amount at cost settlement.
C. Air Ambulance
To establish a consistent system of RVUs that could be applied to
ground and air ambulance services, we would have been required to know
the cost per service in each setting. Unfortunately, these data do not
exist. The air ambulance representative to the Committee presented data
and stated that the data, when combined with an analysis by an
economist, demonstrated that the total costs in 1998 for air ambulance
services were between a minimum of $134.8 million and a maximum of $168
million. This amount exceeded the billed charges for air ambulance
services. The representative also stated that RVUs should be based
[[Page 55085]]
on cost and that there were no verifiable cost data on the ground
ambulance services side against which to compare the cost of air
ambulance services. In addition, other Committee members were unsure of
the accuracy of the air ambulance services cost data, stating that the
air ambulance services costs were not based on an audited statistical
sample and that the data had not been subject to independent scrutiny.
Based on recommendations from the Committee, we would set the amount of
the base year expenditures to be used in determining the payment levels
for air ambulance services between $134.8 million and $158 million.
We considered several approaches in an attempt to accurately
estimate the appropriate amount for air ambulance services within the
range prescribed by the Committee.
We considered using cost data from a ground ambulance services
survey acquired by an independent source that was hired by a member of
the Committee. We tried to compare the results of this survey to cost
data from our estimate. Because the study was only a self-reporting
survey and did not report audited costs and because the results varied
widely and were substantially different from our estimate, we could not
establish a consistent relationship between the survey that resulted in
any estimates within the range prescribed by the Committee.
We converted old billing codes to the proposed billing codes in the
same way as discussed above for the carrier-rocessed claims. Using the
billed charge adjusted by the supplier's cost-to-charge ratio, we are
able to estimate the supplier's Medicare-allowable cost for all
ambulance services. However, we are unable to estimate with any
certainty the split of air ambulance services costs and ground
ambulance services costs from the same supplier. This is because the
Medicare cost-apportioning rules do not furnish data in this detail.
Originally, we assumed that the same cost-to-charge ratio applies to
both air and ground ambulance services charges. However, because this
assumption may not be correct and because it results in an amount below
the range specified by the Committee, we did not pursue this
methodology.
Next, we considered using the billed charges for ambulance
services. Over 80 percent of ground ambulance services are furnished by
independent (not provider-based) ambulance services suppliers. However,
the average adjusted charge (that is, the charge adjusted by the
provider's cost-to-charge ratio) for ALS and basic life support (BLS)
ground ambulance services, excluding mileage, furnished by provider-
based ambulance services is more than 60 percent greater than the
average charge for independent ambulance services suppliers ($342 vs.
$206 per trip). Assuming the appropriate payment for ground ambulance
services is the average allowed charge for the independent suppliers,
the amount of money misallocated to provider-based ground ambulance
services substantially exceeds the amount that would result in a total
payment for air ambulance services at the maximum authorized by the
Committee ($158 million). Considering this large discrepancy between
the payment rates for provider-based and independent supplier ground
ambulance services and the fact that suppliers are able to furnish
services at the lower rate, we believe that the appropriate payment for
ground ambulance services is closer to the independent supplier charge.
Consequently, we have chosen the maximum air ambulance total amount
designated by the Committee, that is, $158 million.
D. Calculation of the CF
Following this process, we determined the total number of ambulance
trips and loaded miles and the total amount of charges allowed by
Medicare for ambulance services in the base year of 1998 (less the
adjustment for those cases where an ALS vehicle was used, but no ALS
services were furnished, described above). To calculate the CF for
ground ambulance services, we followed these steps--
Multiplied the volume of services for each level of ground
ambulance service by the respective RVUs recommended by the Committee
(including application of the practice expense of the GPCI and rural
payment rate as described above);
Summed those products to arrive at the total number of
RVUs;
Subtracted the total allowed amount for air ambulance
services ($158 million as discussed above) from the total charges
allowed by Medicare for ambulance services, which results in the total
amount of charges allowed by Medicare for ground ambulance services;
Subtracted the total amount of RVUs for ground mileage
from this total charge amount;
Divided the remaining charge amount by the total number of
RVUs for ground services and applied the ambulance inflation factor for
2001, which results in a CF for ground ambulance trips of $157.52.
We would follow a similar procedure to determine the fee schedule
amount for air ambulance services. Because there are only two kinds of
air ambulance--fixed wing and rotary--we would not calculate RVUs and a
CF, but would calculate the actual fee schedule amounts directly.
Namely, we divided the total number of billed air ambulance services
into the total amount of payment available for these services ($158
million). The amounts in the base year (1998) are $2,115.00 and
$2,459.00 for fixed wing and rotary trips, respectively. Then these
numbers would also be inflated by the inflation factor provided in
section 1834(l) of the Act. (Additional information regarding the
inflation factor is discussed below.)
We would monitor payment data and evaluate whether projections used
to establish the original CF (for example, the ratio of the volume of
BLS services to ALS services) is accurate. If the actual proportions
among the different levels of service are different from the projected
amounts, we would adjust the conversion factor accordingly and apply
this adjusted conversion factor prospectively.
IV. Implementation Methodology
Currently, payment of ambulance services follows one of two
methodologies, depending on the type of ambulance biller. Claims from
ambulance service suppliers are paid based on a reasonable charge
methodology, whereas claims from providers are paid based on the
provider's interim rate (which is a percentage based on the provider's
historical cost-to-charge ratio multiplied by the submitted charge) and
then cost-settled at the end of the provider's fiscal year.
The proposed ambulance fee schedule would be phased in over a 4-
year period. The transition would begin on January 1, 2001 and the fee
schedule would be phased in on a CY basis. Therefore, for dates of
service (DOS) beginning January 1, 2001, suppliers/providers would be
paid based on 80 percent of the respective current payment allowance
(as described in Program Memorandum AB-99-73) applicable to 2001 plus
20 percent of the ambulance fee schedule amount. (See Sec. 414.615 for
additional information.)
Based on the Committee's consensus recommendation, we would
implement the ambulance fee schedule as follows:
[[Page 55086]]
------------------------------------------------------------------------
Former Fee
payment schedule
percentage percentage
------------------------------------------------------------------------
Year One (CY 2001).............................. 80 20
Year Two (CY 2002).............................. 50 50
Year Three (CY 2003)............................ 20 80
Year Four (CY 2004)............................. 0 100
------------------------------------------------------------------------
A. Revisions and Additions to HCPCS Codes
Claims would be processed using the proposed billing codes created
for the ambulance fee schedule. From these proposed codes, the amount
for the portion of the payment based on the current system (80 percent
in 2001) would be derived using the HCPCS crosswalks as shown below.
We would change current ambulance HCPCS codes in order to implement
the ambulance fee schedule. The proposed HCPCS codes would have to be
effective January 1, 2001. The existing HCPCS codes are not billable
effective January 1, 2001, except for those HCPCS codes related to
items and services for which a Method 3 or Method 4 biller may bill for
supplies separately during the transition period.
National HCPCS codes and descriptions of services created for
ambulance services were presented to the HCFA Alpha-Numeric group. The
following chart shows how the existing codes would crosswalk to the
proposed new codes under the ambulance fee schedule. We would establish
the codes before implementation of the ambulance fee schedule on
January 1, 2001. Additionally, the chart shows current HCPCS codes that
would not have a corresponding code under the proposed ambulance fee
schedule. The items and services represented by these codes would be
bundled into the base rate services.
Codes Not Valid Under the New Fee Schedule (Codes Terminate Effective
01/01/04):
A0382, A0384, A0392, A0396, A0398, A0420, A0422, A0424, A0999
HCPCS Code Changes
----------------------------------------------------------------------------------------------------------------
Current HCPCS Code(s) New HCPCS Code Descriptions of proposed new codes
----------------------------------------------------------------------------------------------------------------
A0380, A0390...................... A0425 Ground mileage (per statute mile).
A0306, A0326, A0346, A0366........ A0426 Ambulance service, advanced life
support, non-emergency transport, level
1 (ALS1).
A0310, A0330, A0350, A0370........ A0427 Ambulance service, advanced life
support, emergency transport, level 1
(ALS1-Emergency).
A0300, A0304, A0320, A0324, A0340, A0428 Ambulance service, basic life support,
A0344, A0360, A0364. non-emergency transport (BLS).
A0050, A0302, A0308, A0322, A0328, A0429 Ambulance service, basic life support,
A0342, A0348, A0362, A0368. emergency transport (BLS-Emergency).
A0030............................. A0430 Ambulance service, conventional air
services, transport, one way (fixed
wing).
A0040............................. A0431 Ambulance service, conventional air
services, transport, one way (rotary
nwing).
Q0186............................. A0432 Paramedic ALS intercept (PI), rural
area, transport furnished by a
volunteer ambulance company which is
prohibited by state law from billing
third party payers.
A0433 Advanced life support, Level 2 (ALS2).
The administration of at least three
different medications and/or the
provision of one or more of the
following ALS procedures: Manual
defibrillation/cardioversion,
endotracheal intubation, central venous
line, cardiac pacing, chest
decompression, surgical airway,
intraosseous line.
A0435 Air mileage; fixed wing (per statute
mile).
A0436 Air mileage; rotary wing (per statute
mile).
A0434 Specialty Care Transport (SCT). In a
critically injured or ill patient, a
level of inter-facility service
provided beyond the scope of the
Paramedic. This service is necessary
when a patient's condition requires
ongoing care that must be provided by
one or more health professionals in an
appropriate specialty area (for
example, nursing, emergency medicine,
respiratory care, cardiovascular care,
or a paramedic with additional
training).
----------------------------------------------------------------------------------------------------------------
New suppliers that have not billed Medicare in the past would be
subject to the transition period rules. They would be assigned an
allowed charge under the current reasonable charge rules (50th
percentile charges) and would follow the same blended transition
payments as other ambulance suppliers. In all cases, the resulting
transitional payment would be subject to the Part B coinsurance and
deductible requirements.
Currently, provider claims are paid based on the provider's interim
rate (the provider's submitted charge multiplied by the provider's past
year's cost to charge ratio) which is cost settled at the end of the
provider's fiscal year and limited by the statutory inflation factor
applied to the provider's cost per ambulance trip. The fee schedule
transition would begin on January 1, 2001 and would phase in the fee
schedule on a CY basis. Therefore, for providers that file cost reports
on other than a CY basis, for cost reporting periods beginning after
January 1, 2001, two different blended rates would apply. Effective for
services furnished during CY 2001, the proposed blended amount for
provider claims would equal the sum of 80 percent of the current
payment system amount and 20 percent of the ambulance fee schedule
amount. The intent of our implementing payment under the fee schedule
at only 20 percent in the first year is to give ambulance providers a
period of time to adjust to the new payment amounts, because some
providers may receive substantially lower payments that at present. For
DOS in CY 2002, the blended amount would equal the sum of 50 percent of
the current payment system amount and 50 percent of the ambulance fee
schedule amount. For DOS in CY 2003, the blended amount would equal the
sum of 20 percent of the current payment system amount and 80 percent
of the ambulance fee schedule amount. For DOS in CY 2004 and beyond,
the payment amount would equal the ambulance fee schedule amount. The
program's payment in all cases would be subject to the Part B
coinsurance and deductible requirements.
[[Page 55087]]
To assure that the providers receive the correct payment amount
during the transition period, all submitted charges attributable to
ambulance services furnished during a cost-reporting period would be
aggregated and treated separately from the submitted charges
attributable to all other services furnished in the hospital. Also, the
necessary statistics would be maintained for the provider's Provider
Statistics and Reimbursement report; this would ensure that the
ambulance fee schedule portion of the blended transition payment would
not be cost settled at cost settlement time.
New providers would not have a cost per trip from the prior year.
Therefore, there would be no cost per trip inflation limit applied to
new providers in their first year of furnishing ambulance services.
New suppliers would use the customary charge established for new
suppliers in accordance with standard program procedures from the year
2000, adjusted for each year of the transition period by the ambulance
inflation factor that we published.
Section 1834(1) of the Act also requires that all payments made for
ambulance services under the proposed fee schedule be made on an
assignment-related basis. As stated in section 1842(b)(18) of the Act,
referenced in section 1834(l)(6), ambulance suppliers would have to
accept the Medicare allowed charge as payment in full and not bill or
collect from the beneficiary any amount other than the unmet Part B
deductible and Part B coinsurance amounts. Violations of this
requirement may subject the supplier to sanctions. The law provides
that mandatory assignment provisions apply as soon as payment is made
under the fee schedule; therefore, there would be no transitional
period for mandatory assignment of claims. Also, the rule that claims
would be paid at the BLS level if an ALS vehicle was used but no ALS
level of service was furnished would be effective on January 1, 2001
and would not be subject to transition. These claims would have to be
filed using the appropriate BLS code.
V. Mechanisms To Control Expenditures for Ambulance Services
A. Number of Services
We do not anticipate that the number of ambulance services
furnished will increase to offset the effects of lower payments per
service. Therefore, the Committee has not suggested mechanisms to
control expenditures. However, we will monitor payment data and
evaluate whether projections used to set the original CF (for example,
the ratio of the volume of BLS services to ALS services) are accurate.
If the actual proportions of the various levels of service are
different (too high or too low) from the projected ones, we will adjust
the CF accordingly.
B. Low Billers
A concern was raised about low billers of ambulance services. Low
billers are suppliers who currently bill less than the maximum charge
allowed by Medicare. There are several reasons low billers exist. For
example, low billers may be municipal or volunteer suppliers of
services, regulated by local ordinances, limited by an inflation-
indexed charge that is part of the Medicare program's current
reasonable charge policy, or restricted for other reasons.
Because the total ambulance service payment amount is based on the
actual allowed charges from the base year (1998), the CF will reflect
the lower than maximum charges. At the same time, if low billers of
ambulance services continue to charge less than the ambulance fee
schedule amount, we will pay less than if all suppliers charged the
ambulance fee schedule amount. Therefore, some members of the ambulance
industry have urged us to increase the fee schedule CF anticipating
that otherwise savings would result from billers who continue to charge
less than the fee schedule amount. We have estimated that in the base
year 1998 the difference between actual charges and the maximum charges
allowed by Medicare is approximately $150 million. Approximately half
of this amount is attributable to charges that are 70 percent of the
maximum allowed charges or greater. Assuming that a low biller is
someone whose charge is less than 70 percent of the maximum allowed
charge, approximately $75 million can be attributed to low billing.
We have neither a means to estimate the extent to which low billing
will continue after the fee schedule is implemented and the inflation-
indexed charge limit no longer applies, nor a means to estimate the
extent to which volunteer and municipal ambulances will choose not to
file Medicare claims at the fee schedule amounts to which they could be
entitled. The Congress has provided that ``the amounts paid shall be 80
percent of the lesser of the actual charge for the services or the
amount determined by a fee schedule * * *'' (section 1833(a)(1)(R) of
the Act). Moreover, the Congress did not require that payment under the
ambulance fee schedule be budget neutral to the current reasonable
charge system, but rather specified only that the aggregate amount of
payments for ambulance services not exceed the amount that would have
been paid absent the fee schedule.
Given the law and the uncertainty of suppliers' future behavior, we
propose not to attempt to adjust the CF on the assumption that low
billing will or will not continue. However, as mentioned above, we will
monitor payment and billing data and recalculate the CF as appropriate.
VI. Adjustments to Account for Inflation and Other Factors
In setting the CF for 2001, we would adjust the base year data from
1998 for inflation. Section 4531 of the Balanced Budget Act of 1997
prescribes the inflation factor to be used in determining the payment
allowances for ambulance services paid under Medicare under the current
payment system. The inflation factor is equal to the projected consumer
price index for all urban consumers (U.S. city average) (CPI-U) minus 1
percentage point from March-to-March for claims paid under cost
reimbursement (providers) and from June-to-June for claims paid under
reasonable charges (carrier processed claims). The base year for our
data is 1998. The inflation factors in percent are:
------------------------------------------------------------------------
March-to- June-to-
March June
(provider (carrier
claims) claims)
------------------------------------------------------------------------
1999/1998....................................... 0.9 1.1
2000/1999....................................... 2.4 2.0
2001/2000....................................... 1.3 1.4
Compounded inflation factor (in percent)........ 4.665 4.566
------------------------------------------------------------------------
We would use the most recently available estimate of inflation from
2000 to 2001 at the time of the writing of the final rule.
In addition, the Committee acknowledged that the statutory
provisions in section 1834(l)(3)(B) of the Act, regarding annual
updates to the fee schedule, would be used to make adjustments to
account for inflation. That section of the Act provides for an annual
update to the ambulance fee schedule based on the percentage increase
in the CPI-U for the 12-month period ending with June of the previous
year. For 2001 and 2002, the increase in the CPI-U is reduced by 1.0
percentage point for each year.
We would monitor payment data and evaluate whether projections used
to establish the original CF (for example,
[[Page 55088]]
the ratio of the volume of BLS services to ALS services) is accurate.
If the actual proportions among the different levels of service are
different from the projected amounts, we would adjust the CF
accordingly.
VII. Medical Conditions Lists
When the Congress mandated that the ambulance fee schedule be
developed through the negotiated rulemaking process, we deferred final
action on our proposal to base Medicare payment on the level of
ambulance service required to treat the beneficiary's condition. That
proposal would have used International Classification of Diseases, 9th
revision, Clinical Modification (ICD-9-CM) diagnostic codes that would
have described the nature of the beneficiary's medical condition. Use
of the ICD-9-CM codes would also have assisted ambulance suppliers to
bill the medically necessary level of ambulance service.
While we are not establishing a formal proposal in this proposed
rule, as a first step, we reopened the discussion of developing a
medical condition listing during the negotiated rulemaking process. The
goal of the discussion was to develop a list of medical conditions, not
diagnoses, that generally require ambulance services and the
appropriate level of care. The identified condition(s) would describe
the beneficiary's medical condition that would necessitate the
ambulance services.
The medical conditions listed in Addendum A of this proposed rule
would enable the ambulance supplier to identify the level of service at
which a claim may be paid. The list identifies nonemergency conditions;
emergency medical conditions--traumatic and nontraumatic; and emergency
and nonemergency conditions that warrant interfacility transport
services. This listing would also aid Medicare contractors in their
efforts to assure that claims for ambulance services are paid
appropriately and that providers and suppliers of ambulance services
are educated as to the documentation that would best support a claim.
Use of an identified condition, however, would not make the claim
payable if the beneficiary could have been served by other means. We
recognize that unusual circumstances exist that warrant the use of
ambulance services. In these circumstances, the publication of the list
would not preclude the contractor from accepting other relevant medical
information (for example, ICD-10-CM codes or other relevant on-the-
scene information) to describe a medical condition that is not included
on the list. Therefore, the medical condition list is not all-
inclusive.
Since the negotiated rulemaking committee concluded its work, we
have received positive feedback on the medical conditions list in
Addendum A. While we maintain the final decision-making authority
regarding required use of the above referenced medical condition list
or a similar type of list, we are soliciting information from
interested parties on the need for such a listing and the development
of codes used in association with such a list that would best support
the processing of claims.
VIII. Collection of Information Requirements
Under the Paperwork Reduction Act of 1995 (PRA), we are required to
provide 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
the Office of Management and Budget (OMB) for review and approval. In
order to fairly evaluate whether an information collection should be
approved by OMB, section 3506(c)(2)(A) of the PRA requires that we
solicit comment on the following issues:
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
We are soliciting public comment on each of these issues for the
following sections of this document that contain information collection
requirements:
Section 410.40 Coverage of Ambulance Services.
(d)(3)(iii) If the ambulance supplier is unable to obtain the
signed physician certification statement from the beneficiary's
attending physician, a signed physician certification statement must be
obtained from either the physician, physician assistant (PA), nurse
practitioner (NP), clinical nurse specialist (CNS), registered nurse
(RN), or discharge planner, who is employed by the hospital or facility
where the beneficiary is being treated, and who has personal knowledge
of the beneficiary's condition at the time the ambulance transport is
ordered or the ambulance service was furnished.
The burden associated with this requirement is the time and effort
necessary for the required hospital employee to provide the
certification. We estimate that, there will be 5,000 certifications on
an annual basis at an estimated 5 minutes per certification. Therefore,
the annual national burden associated with this requirement is 417
hours.
(d)(3)(iv) If the ambulance supplier is unable to obtain the
required physician certification statement within 21 calendar days
following the date of the service, the ambulance supplier must document
its attempts to obtain the requested physician certification statement
and may then submit the claim. Acceptable documentation must include a
signed return receipt from a U.S. Postal Service or other similar
service. This documentation will serve as proof that the ambulance
supplier attempted to obtain the required signature from the attending
physician.
The burden associated with this requirement is the time and effort
necessary for the ambulance supplier to document its attempts to obtain
the requested physician certification statement. We estimate that 5,000
providers will be required to submit a receipt instead of certification
for an average of 12 instances on an annual basis, at an estimated 5
minutes per instance. Therefore, the annual national burden associated
with this requirement is 5,000 hours.
Section 414.610 Basis of Payment.
(d) The zip code of the point of pick-up must be reported on each
claim for ambulance services, so that the correct GAF and RAF may be
applied, as appropriate.
The burden associated with this requirement is the time and effort
necessary for the ambulance supplier to note the required zip code for
each claim of service. We estimate that of the 9,000 (potential)
providers, 5000 providers will be required to provide the
documentation, for an estimated 550,000 (5% of total claims volume of
11M) instances on an annual basis. Per provider (5,000), we estimate 1
minute per instance to meet this requirement, for a burden of 2 hours
per provider on an annual basis. Therefore, the annual national burden
associated with this requirement is 10,000 hours.
If you comment on these information collection and recordkeeping
requirements, please mail copies directly to the following:
Health Care Financing Administration, Office of Information Services,
Information Technology Investment Management Group, Attn: John Burke,
Room N2-14-26,7500 Security Boulevard, Baltimore, MD 21244-1850.
[[Page 55089]]
Office of Information and Regulatory Affairs, Office of Management and
Budget, Room 10235, New Executive Office Building, Washington, DC
20503, Attn: Allison Herron Eydt, HCFA Desk Officer.
IX. Regulatory Impact Analysis
A. Overall Impact
We have examined the impacts of this rule as required by Executive
Order 12866 and the Regulatory Flexibility Act (RFA) (Public Law 96-
354). Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
significant effects ($100 million or more annually). We have determined
that this is not a major rule. It would result in spending for the
first year at approximately $67.6 million less than would have been
paid if the fee schedule were not implemented. The total impact would
be $84.5 million in reduced revenue for ambulance providers and
suppliers ($67.6 million plus $16.9 million in reduced Part B
coinsurance). In addition, approximately $19 million in total revenue
(due to Medicare Part B coinsurance and deductible requirements of
approximately 80 percent that would be program expenditures) would be
redistributed among entities that furnish ambulance services according
to the data presented in this section.
The RFA requires agencies to analyze options for regulatory relief
of small businesses. For purposes of the RFA, small entities include
small businesses, nonprofit organizations, and government agencies.
Most hospitals and most other providers and suppliers are small
entities, either by nonprofit status or by having revenues of $5
million or less annually. For purposes of the RFA, most ambulance
providers and most ambulance suppliers are considered to be small
entities. Individuals and States are not included in the definition of
a small entity.
In addition, section 1102(b) of the Act requires us to prepare an
RIA if a rule may have a significant impact on the operations of a
substantial number of small rural hospitals. This analysis must conform
to the provisions of section 603 of the RFA. For purposes of section
1102(b) of the Act, we define a small rural hospital as a hospital that
is located outside of a Metropolitan Statistical Area and has fewer
than 50 beds. In the aggregate, in 2001, $17 million in total revenue
would be redistributed from urban to rural entities. It is also true
that some rural entities would be paid less than their current rate.
While we do not have specific data on the number of small rural
hospitals that furnish ambulance services, we recognize that the rural
adjustment factor incorporated in this proposal may not completely
offset the higher costs of low-volume suppliers. As stated earlier, we
recognize that this rural adjustment is a temporary proxy to
acknowledge the higher costs of certain low-volume isolated and
essential suppliers. We will consider alternative methodologies that
would more appropriately address payment to isolated, low-volume rural
ambulance suppliers. Therefore, we solicit public comment on the
number, location, and characteristics of the rural entities that are
affected by this proposal.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule that may result in an expenditure in any one year by
State, local, or tribal governments, in the aggregate, or by the
private sector, of $100 million. The proposed rule would not have any
unfunded mandates.
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct compliance costs on State
and local governments, preempts State law, or otherwise has Federalism
implications. The proposed rule would not impose compliance costs on
the governments mentioned.
Although we view the anticipated results of this proposed
regulation as beneficial to the Medicare program and to Medicare
beneficiaries, we recognize that not all of the potential effects of
this proposed rule can be anticipated.
The foregoing analysis concludes that this regulation may have a
financial impact on a number of small entities. This analysis, in
combination with the rest of the preamble, is consistent with the
standards for analysis set forth by the RFA.
B. Anticipated Effects
1. Effect on Ambulance Providers and Suppliers
Section 1834(l)(3)(A) of the Act requires that the aggregate amount
paid under the ambulance fee schedule not exceed the aggregate amount
that would have been paid absent the fee schedule. One of the
characteristics of the present payment system is that widely varying
amounts are paid for the same type of service depending upon the
location of the service. In effect, the proposed ambulance fee schedule
would lower payments in areas of high current levels of payment and
raise payments in areas of low current levels of payment. When
examining the impact of the proposed ambulance fee schedule, a given
area could have a large reduction in payment only because such an area
had historically been paid at a rate higher than average for the type
of service. Also, as previously described, we are taking into account a
$67.6 million program savings that would have resulted from a coverage
change that was proposed in 1997. Implementation of that proposed rule
was delayed until the ambulance fee schedule was established.
Implementation of the proposed ambulance fee schedule would have
several general effects. One effect would be that in 2001, $19 million
in total revenue would be redistributed from providers to ambulance
suppliers because providers have been paid, on average, more for the
same service furnished by a supplier.
2. Effects on Urban, Rural, and Air Ambulance Services
Payment could be redistributed from urban ambulance services to
rural ambulance services for two reasons: (1) urban ambulance services
have been paid, on average, more than for the same services furnished
in rural areas; and (2) the proposed ambulance fee schedule would pay
more for the same services furnished in a rural area because of the
rural adjustment factor (RAF). Payment would also be redistributed from
urban air ambulance services to rural air ambulance services because of
the RAF for air services. Finally, there would be a redistribution of
payment from ground ambulance services to air ambulance services. This
effect is explained in greater detail in the discussion of the CF.
Currently, providers are paid on average 66 percent more than
independent suppliers for the same type of ambulance service. This is
because providers are currently paid based on reasonable cost and
suppliers are paid based on reasonable charges capped by the inflation
indexed charge (IIC). The IIC has limited the growth of suppliers'
payments over the years, whereas, until enactment of the BBA in 1997,
there had not been a limit on the growth of providers' reimbursable
cost for ambulance services.
[[Page 55090]]
There are offsetting factors that affect payment in urban versus
rural areas. While payment rates in rural areas would generally be
lowered by the proposed GPCI (since the GPCI is generally lower in
rural areas than it is in urban areas), rural payment rates would
increase because of the rural mileage add-on. As a result, in 2001, $17
million in total revenue would be redistributed from providers and
suppliers in urban areas to providers and suppliers in rural areas.
Furthermore, in 2001, $7 million in total revenue would be
redistributed from providers and suppliers of ground ambulance services
to providers and suppliers of air ambulance services.
The following chart summarizes these findings for 2001:
------------------------------------------------------------------------
From To Revenue
------------------------------------------------------------------------
Providers...................... Suppliers......... $19 million.
Urban.......................... Rural............. $17 million.
Ground......................... Air............... $7 million.
------------------------------------------------------------------------
These amounts represent total revenue, that is, the 80 percent Medicare
portion plus the 20 percent beneficiary coinsurance liability.
3. Effect on the Medicare Program
We estimate that the proposed rule would produce a calendar year
net savings to the Medicare program of $67.6 million because of the
delayed implementation of the coverage policy proposed in the June 17,
1997 rule. The following chart shows the estimated fiscal year annual
savings that the Medicare program would realize over the next 5 years
as a result of our proposal to implement the policy proposed in 1997 of
paying for an ALS ambulance vehicle at the BLS payment rate when no ALS
service is furnished to the beneficiary. This change would be
implemented as part of the ambulance fee schedule.
------------------------------------------------------------------------
Savings ($
Fiscal year Million)
------------------------------------------------------------------------
2001.................................................... 40
2002.................................................... 70
2003.................................................... 70
2004.................................................... 70
2005.................................................... 80
------------------------------------------------------------------------
Under this proposed rule, we anticipate savings for beneficiaries
in terms of reduced coinsurance and savings due to mandatory assignment
of benefits.
The table below represents the proposed fee schedule amounts for CY
2001 under this rule:
Table 1.--2001 Fee Schedule for Payment of Ambulance Services
--------------------------------------------------------------------------------------------------------------------------------------------------------
Amount
Unadjusted adjusted by Amount not Loaded Rural ground
Service level RVUs CF base rate GPCI (70% of adjusted (30% mileage mileage*
(UBR) UBR) of URB)
--------------------------------------------------------------------------------------------------------------------------------------------------------
BLS..................................... 1.00 157.52 $157.52 $110.26 $47.26 $5.00 $7.50
BLS--Emergency.......................... 1.60 157.52 252.03 176.42 75.61 5.00 7.50
ALS1.................................... 1.20 157.52 189.02 132.31 56.71 5.00 7.50
ALS1--Emergency......................... 1.90 157.52 299.29 209.50 89.79 5.00 7.50
ALS2.................................... 2.75 157.52 433.18 303.23 129.95 5.00 7.50
SCT..................................... 3.25 157.52 511.94 358.36 153.58 5.00 7.50
PI...................................... 1.75 157.52 275.66 192.96 82.70 (1) No Mileage Rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------------------------------
Amount
Unadjusted adjusted by Amount not Loaded Rural Air Rural air
Service Level base rate GPCI (50% of adjusted (50% mileage mileage ** base rate ***
(UBR) UBR) of UBR)
--------------------------------------------------------------------------------------------------------------------------------------------------------
FW...................................................... $2,213.00 $1,106.50 $1,106.50 $6.00 $9.00 $3,319.50
RW...................................................... 2,573.00 1,286.50 1,286.50 16.00 24.00 3,859.50
--------------------------------------------------------------------------------------------------------------------------------------------------------
* A 50 percent add-on to the mileage rate (that is, a rate of $7.50 per mile) for each of the first 17 miles identified as rural. The regular mileage
allowance applies for every mile over 17 miles.
** A 50 percent add-on to the air mileage rate is applied to every mile identified as rural.
*** A 50 percent add-on to the air base rate is applied to air trips identified as rural.
The payment rate for rural air ambulance (rural air mileage rate and rural air base rate) is 50 percent more than the corresponding payment rate for
urban services (that is, the sum of the base rate adjusted by the geographic adjustment factor and the mileage).
This column illustrates the payment rates without adjustment by the GPCI. The conversion factor (CF) has been inflated for 2001.
Legend for Table 1
ALS1--Advanced Life Support, Level 1
ALS2--Advanced Life Support, Level 2
BLS--Basic Life Support
CF--Conversion Factor
FW--Fixed Wing
GPCI--Practice Expense Portion of the Geographic Practice Cost x
from the Physician Fee Schedule
PI--Paramedic ALS intercept
RVUs--Relative Value Units
RW--Rotary Wing
SCT--Specialty Care Transport
UBR--Unadjusted Base Rate
Formulas--The amounts in the above chart are used in the
following formulas to determine the fee schedule payments--
Ground:
Ground--Urban:
Payment Rate=[(RVU* (0.3+(0.7*GPCI)))*CF]+[MGR*#MILES]
Ground--Rural:
Payment Rate=[(RVU* (0.3+(0.7*GPCI)))*CF]+
[(((1+RG)*MGR)*#MILES17)+ (MGR*#MILES17)]
Air:
Air--Urban:
Payment Rate = [(((RVU* 0.5)+((RVU*0.5)*GPCI))*CF)]+
[MAR*#MILES]
Air-Rural:
Payment Rate = [(1+RA)*(((RVU*0.5)+((RVU* 0.5)*GPCI))*CF)]+
[(1+RA)*(MAR*#MILES)]
Legend for Formulas
Symbol and Meaning
less than or equal to.
> greater than.
* multiply.
CF conversion factor (ground = $157.52; air = 1.0).
[[Page 55091]]
GPCI practice expense portion of the geographic practice cost index
from the physician fee schedule.
#MILES number of miles the beneficiary was transported.
MGR mileage ground rate (5.0).
MAR mileage air rate (fixed wing rate = 6.0, helicopter rate =
16.0).
RA rural air adjustment factor (0.50 on entire claim).
Rate maximum allowed rate from ambulance fee schedule.
RG rural ground adjustment factor amount (0.50 on first 17 miles).
RVUs relative value units (from chart).
Notes: The GPCI is determined by the address of the point of
pickup.
Table 2
EXAMPLES: The following examples demonstrate the use of the
proposed ambulance fee schedule amounts and how they would be used
during the first year (2001). Examples 1 through 4 relate to
independent supplier claims, and Example 5 relates to hospital based
supplier claims.
Example 1: Ground Ambulance, Urban (Independent Supplier)
A Medicare beneficiary residing in Baltimore, Maryland, was
transported via ground ambulance from his or her home to the nearest
appropriate hospital 2 miles away. An emergency response was
required, and an ALS assessment was performed. The level of service
furnished would be ALS1-Emergency.
Assuming that the beneficiary was placed on board the ambulance
in Baltimore, it would be an urban trip. Therefore, no rural payment
rate would apply. In Baltimore, the GPCI = 1.039. The fee schedule
amount would be calculated as follows--
Payment Rate = [(RVU* (0.3+ (0.7*GPCI)))*CF]+ [MGR*#MILES]
Payment Rate = [(1.9*(0.3+(0.7*1.039)))*157.52]+[5*2]
Payment Rate = [(1.9*(0.3+(.7273)))*157.52]+[10]
Payment Rate = [(1.9*(1.0273))*157.52]+[10]
Payment Rate = [(1.95187)*157.52]+[10]
Payment Rate = [307.4585624]+[10]
Payment Rate = 317.4585624
Payment Rate = $317.46 (subject to Part B deductible and coinsurance
requirements)
Because 2001 would be the first year of a 4-year transition
period, the ambulance fee schedule payment rate would be multiplied
by 20 percent and added to 80 percent of the payment calculated by
the current payment system. The payment rate for Year 2 (2002) would
be calculated by multiplying the ambulance fee schedule payment rate
by 50 percent and adding the result to 50 percent of the current
payment system amount. The payment rate for Year 3 (2003) would be
calculated by multiplying the ambulance fee schedule payment rate by
80 percent and adding the result to 20 percent of the current
payment system amount. The payment rate for Year 4 (2004) would be
based solely on the ambulance fee schedule.
Assuming the inflation indexed charge (IIC) in 2001, the
reasonable charge rate for this service in Maryland would be $315.62
($303.00 for HCPCS A0310, $6.31 x 2 miles for A0390). Therefore,
the total allowed charge for this service during 2001 would be:
Old HCPCS Code(s) = A0310 and A0390
New HCPCS Code(s) = A0427 and A0425
----------------------------------------------------------------------------------------------------------------
Reasonable new Fee schedule x Total allowed
Reasonable charge IIC charge x 80% Fee schedule 20% charge
----------------------------------------------------------------------------------------------------------------
$315.62..................................... $252.50 $317.46 $63.49 $315.99
----------------------------------------------------------------------------------------------------------------
Assuming that the Part B deductible has been met, the program
would pay 80 percent, and beneficiary's liability would be 20
percent, representing the Part B coinsurance amount:
------------------------------------------------------------------------
Beneficiary
Medicare Payment (80%) Liability
(20%)
------------------------------------------------------------------------
$252.79................................................ $63.20
------------------------------------------------------------------------
Example 2: Ground Ambulance, Rural (Independent Supplier)
A Medicare beneficiary residing in Cottle County, Texas, was
transported via ground ambulance from his or her home to the nearest
appropriate facility located in Quanah, Texas. Cottle County, where
the beneficiary was placed on board the ambulance, is a non-MSA and,
therefore, is rural. A rural payment rate would apply. The total
distance from the beneficiary's home to the facility was 36 miles. A
BLS nonemergency assessment was performed. Under our proposal, the
level of service would be BLS (nonemergency).
For this part of Texas, the GPCI = 0.888. The proposed ambulance
fee schedule amount would be calculated as follows--
36 mile trip = 17 miles at the rural payment rate plus 19 miles at
the regular rate.
Payment Rate = [(RVU* (0.3+ (0.7*GPCI)))*CF]+
[(((1+RG)*MGR)*#MILES17)+ (MGR*#MILES>17)]
Payment Rate = [(1.00*(0.3+ (0.7*0.888)))*157.52]+
[(((1+0.5)*5)*17)+ (5*19)]
Payment Rate = [(1.00* (0.3+0.6216))* 157.52]+ [((1.5*5)*17)+95]
Payment Rate = [(1.00*0.9216)*157.52]+[(7.5*17)+95]
Payment Rate = [0.9216*157.52]+[127.50+95]
Payment Rate = [145.170432]+[222.50]
Payment Rate = 367.670432
Payment Rate = $367.67 (subject to Part B deductible and coinsurance
requirements)
Under the proposal, since 2001 would be the first year of a 4-
year transition period, the ambulance fee schedule payment rate
would be multiplied by 20 percent and added to 80 percent of the
payment calculated by the current payment system. The payment rate
for Year 2 (2002) would be calculated by multiplying the ambulance
fee schedule payment rate by 50 percent and adding the result to 50
percent of the current payment system amount. The payment rate for
Year 3 (2003) would be calculated by multiplying the ambulance fee
schedule by 80 percent and adding the result to 20 percent of the
current payment system amount. The payment rate for Year 4 (2004)
would be based solely on the ambulance fee schedule.
Assuming the inflation indexed charge (IIC) in 2001, the
reasonable charge rate for this service in Texas would be $292.44
($152.76 for HCPCS A0300, $3.88 x 36 miles for A0380). Therefore,
the total allowed charge for this service during 2001 under our
proposal would be:
Old HCPCS Code(s) = A0300 and A0380
New HCPCS Code(s) = A0428 and A0425
----------------------------------------------------------------------------------------------------------------
Reasonable new Fee schedule x Total allowed
Reasonable charge IIC charge x 80% Fee schedule 20% charge
----------------------------------------------------------------------------------------------------------------
$292.44..................................... $233.95 $367.67 $73.53 $307.48
----------------------------------------------------------------------------------------------------------------
Assuming that the Part B deductible was met, the program would
pay 80 percent, and the beneficiary's liability would be 20 percent,
representing the Part B coinsurance amount:
------------------------------------------------------------------------
Beneficiary
Medicare Payment (80%) Liability (20%)
------------------------------------------------------------------------
$245.98................................................ $61.50
------------------------------------------------------------------------
Example 3: Air Ambulance, Urban (Independent Supplier)
A Medicare beneficiary was involved in an automobile accident
along a busy interstate near Detroit, Michigan. A helicopter
[[Page 55092]]
transported the beneficiary to the nearest appropriate facility
located within the city limits of Detroit. The total distance from
the accident to the facility was 14 miles. The level of service was
rotary wing.
Assuming that the patient was placed on board the air ambulance
within the Detroit MSA, and because this is not a Goldsmith county,
the trip would be urban. Therefore, no rural payment rate would
apply. In the Detroit metropolitan area, the GPCI = 1.022. The
ambulance fee schedule amount would be calculated as follows--
Payment Rate = [((UBR*0.5)+ ((UBR*0.5)* GPCI))]+ [MAR*#MILES]
Payment Rate = [((2573.00*0.5)+ ((2573.00*0.5)*1.022))]+ [16.00*14]
Payment Rate = [(1286.50+ ((1286.50)*1.022))]+ [224]
Payment Rate = [(1286.50+1314.803)]+[224]
Payment Rate = [2601.303]+[224]
Payment Rate = [2825.303]
Payment Rate = $2,825.30 (subject to Part B deductible and
coinsurance requirements)
Because 2001 would be the first year of a 4-year transition
period, the payment rate from the ambulance fee schedule would be
multiplied by 20 percent and added to 80 percent of the payment
calculated by the current payment system. The payment rate for Year
2 (2002) would be calculated by multiplying the ambulance fee
schedule by 50 percent and adding the result to 50 percent of the
current payment system amount. The payment for Year 3 (2003) would
be calculated by multiplying the ambulance fee schedule by 80
percent and adding the result to 20 percent of the current payment
system amount. The payment for Year 4 (2004) would be based solely
on the ambulance fee schedule.
Assuming the inflation indexed charge (IIC) in 2001, the
reasonable charge rate for this service in Michigan is $1,982.26.
Therefore, the total allowed charge for this service during 2001
would be:
Old HCPCS Code = A0040
New HCPCS Code = A0431 and A0436
----------------------------------------------------------------------------------------------------------------
Reasonable new Fee schedule x Total allowed
Reasonable charge IIC charge x 80% Fee schedule 20% charge
----------------------------------------------------------------------------------------------------------------
$1,982.26................................... $1,585.81 $2,825.30 $565.06 $2,150.87
----------------------------------------------------------------------------------------------------------------
Assuming that the Part B deductible has been met, the program
would pay 80 percent and the beneficiary's liability would be 20
percent, representing the Part B coinsurance amount:
------------------------------------------------------------------------
Beneficiary
Medicare Payment (80%) Liability (20%)
------------------------------------------------------------------------
$1,720.70.............................................. $430.17
------------------------------------------------------------------------
Example 4: Air Ambulance, Rural (Independent Supplier)
A Medicare beneficiary was transported via helicopter from a
rural county in Arizona to the nearest appropriate facility. The
total distance from point of pick-up to the facility was 86 miles.
The level of service was rotary wing.
Because the point of pick-up was in a rural, non-MSA area, this
transport would be a rural trip under the proposed rule. Therefore,
a rural payment rate would apply. In Arizona, the GPCI = 0.971. The
ambulance fee schedule amount would be calculated as follows--
Payment Rate = [(1+RA)*((UBR*0.5)+ ((UBR*0.5)*GPCI))]
+[(1+RA)*(MAR*#MILES)]
Payment Rate = [(1+0.5)*(((2573.00*0.5)+ ((2573.00*0.5)*0.971))]+
[(1+0.5)*(16*86)]
Payment Rate = [(1.5)*((1286.50)+ (1286.50*0.971))]+ [(1.5)*(1376)]
Payment Rate = [(1.5)*(1286.50+1249.192)]+[2064]
Payment Rate = [(1.5)*2535.692]+[2064]
Payment Rate = 4599.692
Payment Rate = $4,599.69 (subject to Part B deductible and
coinsurance requirements)
Because 2001 is the first year of a 4 year transition period,
this payment rate from the proposed fee schedule would then be
multiplied by 20 percent and added to 80 percent of the payment
calculated by the current payment system. Year 2 would be calculated
by multiplying the fee schedule by 50 percent and adding the result
to 50 percent of the current payment system amount. Year 3 would be
calculated by multiplying the fee schedule by 80 percent and adding
20 percent of the current payment system amount. Year 4 (2004) is
based solely on the fee schedule amount.
Assuming the inflation indexed charge (IIC) for the example in
question, in 2001 the reasonable charge rate for this service in
Arizona would be $1,564.80. Therefore, the total allowed charge for
this service during 2001 would be:
Old HCPCS Code = A0040
New HCPCS Code = A0431 and A0436
----------------------------------------------------------------------------------------------------------------
Reasonable new Fee schedule x Total allowed
Reasonable charge IIC charge x 80% Fee schedule 20% charge
----------------------------------------------------------------------------------------------------------------
$1,564.80................................... $1,251.84 $4,599.69 $919.94 $2,171.78
----------------------------------------------------------------------------------------------------------------
Assuming that the Part B deductible has been met, the program
would pay 80 percent and 20 percent would be the beneficiary's
liability:
------------------------------------------------------------------------
Beneficiary
Medicare payment (80%) liability (20%)
------------------------------------------------------------------------
$1,737.42.............................................. $434.36
------------------------------------------------------------------------
Example 5: Ground Ambulance, Rural (Hospital Based Supplier) A
Medicare beneficiary residing in a rural area in the state of Iowa
was transported via ground ambulance from her home located in a
rural area (non-MSA) to the nearest appropriate facility (Hospital
A). Because the point of pick-up is in a rural area, under our
proposal, a rural payment rate would apply. The total distance from
the beneficiary's home to Hospital A is 14 miles. A BLS nonemergency
transport was furnished. The level of service would be BLS
(nonemergency).
For Iowa, the GPCI = 0.882. The ambulance fee schedule amount
would be calculated as follows--
14 mile trip = 14 miles at the rural payment rate plus 0 miles at
the regular rate.
The HCPCS codes to be used under the fee schedule are A0428 and
A0425.
Payment Rate = [(RVU*(0.3+(0.7*GPCI)))*CF]+
[(((1+RG)*MGR)*#MILES17)+ (MGR*#MILES>#7)]
Payment Rate = [(1.00*(0.3+(0.7*0.882) ))*157.52]+
[(((1+0.5)*5)*14)+(5*0)]
Payment Rate = [(1.00*(0.3+0.6174))*157.52]+ [((1.5*5)*14)+0]
Payment Rate = [(1.00*0.9174)*157.52]+ [(7.5*14)+0]
Payment Rate = [0.9174*157.52]+[105+0]
Payment Rate = [144.508848]+[105]
Payment Rate = 249.508848
Payment Rate = $249.51 (subject to Part B deductible and coinsurance
requirements)
Since 2001 would be the first year of a proposed 4-year
transition period, the ambulance fee schedule payment rate would be
multiplied by 20 percent. The total payment under the proposed fee
schedule for 2001 is:
Payment Rate = Fee Schedule * Transition Percentage
Payment Rate = 249.51*0.2
Payment Rate = 49.902
Payment Rate = $49.90
[[Page 55093]]
The remaining 80 percent of the payment rate is determined by
the current payment system. For FIs, the current payment calculation
is as follows.
Assume that Hospital A's charge (HCB) for a BLS-nonemergency
service is $220.00, its charge for mileage (HCM) is $4.00 per mile,
and its past year's cost-to-charge ratio (CCR) is 0.9.
Assuming that the beneficiary's Medicare Part B deductible has
been met, the beneficiary's coinsurance liability for 2001 would be:
Total Charge = HCB+(HCM*#MILES)
Total Charge = 220+(4*14)
Total Charge = 220+56
Total Charge = $276.00 (Current system)
For 2001, the coinsurance is equal to 20 percent of:
Total rate = (0.80*Current System)+(0.20*FS)
Total rate = (0.80*276)+(49.90)
Total rate = (220.80)+(49.90)
Total rate = $270.70
Coinsurance = 0.20*270.70 = $54.14
For 2001, the transition payment rate is equal to:
Transition payment rate = [0.80*current rate]+[0.20*FS]
Transition Payment Rate = [0.80*((HCB)+ (HCM*#MILES))*CCR]+
[0.20*FS]
Transition Payment Rate = [0.80*((220)+ (4*14))*0.9]+[49.90]
Transition Payment Rate = [0.80*((220)+ (56))*0.9]+[49.90]
Transition Payment Rate = [0.80*(276)*0.9]+[49.90]
Transition Payment Rate = [198.72]+[49.90]
Transition Payment Rate = $248.62
Assuming the part B deductible is met:
Medicare program payment = (transition payment rate)-(coinsurance)
Medicare program payment = 248.62-54.14
Medicare program payment = $194.48
Under our proposal, the payment rate for Year 2 (2002) would be
calculated by multiplying the ambulance fee schedule payment rate by
50 percent and adding the result to 50 percent of the current
payment system amount. The payment rate for Year 3 (2003) would be
calculated by multiplying the ambulance fee schedule by 80 percent
and adding the result to 20 percent of the current payment system
amount. The payment rate for Year 4 (2004) would be based solely on
the ambulance fee schedule.
C. Alternatives Considered
While there were many alternatives considered during the course of
the negotiated rulemaking process, the statute requires that total
program expenditures not exceed what the payments would have been
without the fee schedule. All of the alternatives considered did not
change total program expenditures. The alternatives varied in the
manner in which the total amount of program expenditures might be
distributed among the entities that furnish ambulance services to
Medicare beneficiaries. For example, the Committee considered other
geographical adjustment factors, other relative values for the levels
of ambulance service, other definitions for the levels of ambulance
service and other definitions for ``rural entities'', but it did not
adopt them for various reasons. (A full description of these
alternatives may be found at the website: www.hcfa.gov/medicare/
ambmain.htm.)
D. Conclusion
We anticipate that the proposed ambulance fee schedule amounts for
entities that have received lower than average payment rates
historically would be relatively higher and the fee schedule amounts
for entities that have received higher than average payment rates
historically would be relatively lower. Generally, this would mean
higher rates in the future for rural transports, lower rates in the
future for urban transports, and higher rates in the future for air
ambulance services. The ambulance fee schedule will have a leveling
effect on coinsurance liability. While beneficiaries in those areas of
historically higher than average payment rates would benefit from lower
coinsurance liability, beneficiaries in areas of historically lower
than average payment rates would experience an upward adjustment of
coinsurance liability. Beneficiaries would also benefit in those cases
in which suppliers previously did not accept assignment and billed the
beneficiary the difference between the Medicare program allowed amount
and their actual charge, because under the fee schedule all suppliers
must accept assignment. We anticipate that the integrity of the
Medicare Part B Trust Fund will be protected by the continuance of the
inflation factors prescribed in the statute.
In accordance with the provisions of Executive Order 12866, this
regulation was reviewed by the Office of Management and Budget.
List of Subjects Affected
42 CFR Part 410
Health facilities, Health professions, Kidney diseases,
Laboratories, Medicare, Rural areas, X-rays.
42 CFR Part 414
Administrative practice and procedure, Health facilities, Health
professions, Kidney diseases, Medicare, Reporting and recordkeeping
requirements, Rural areas, X-rays.
For the reasons set forth in the preamble, 42 CFR chapter IV is
proposed to be amended:
PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS
I. Part 410 is amended as set forth below:
1. The authority citation for part 410 continues to read as
follows:
Authority: Secs. 1102 and 1871 of the Social Security Act (42
U.S.C. 1302 and 1395hh).
Subpart B--Medical and Other Health Services
2. Section 410.40 is amended by:
A. Revising paragraph (b).
B. Revising paragraph (d)(1).
C. Republishing the introductory paragraph (d)(3).
D. Adding new paragraphs (d)(3)(iii), (d)(3)(iv), and (d)(3)(v).
The revisions and additions read as follows:
Sec. 410.40 Coverage of ambulance services.
* * * * *
(b) Levels of service. Medicare covers the following levels of
ambulance service: basic life support ((BLS) emergency and
nonemergency), advanced life support, level 1 ((ALS1) emergency and
nonemergency), advanced life support, level 2 (ALS2), paramedic
intercept (PI), specialty care transport (SCT), fixed wing transport
(FW), and rotary wing transport (RW). See Sec. 414.605 for a definition
of each level of services.
* * * * *
(d) Medical necessity requirements--(1) General rule. Medicare
covers ambulance services, including fixed wing and rotary wing
ambulance services, only if they are furnished to a beneficiary whose
medical condition is such that other means of transportation would be
contraindicated. While physician certification allows the ambulance
supplier to assert that the transportation was reasonable and
necessary, the beneficiary's medical record must support the coverage
of the transportation. For nonemergency ambulance transportation, the
following criteria must be met to ensure that ambulance transportation
is medically necessary:
(i) The beneficiary is unable to get up from bed without
assistance.
(ii) The beneficiary is unable to ambulate.
(iii)The beneficiary is unable to sit in a chair or wheelchair.
These criteria, as defined, are not meant to be the sole criterion
in determining medical necessity. They are one factor to be considered
when
[[Page 55094]]
making medical necessity determinations.
* * * * *
(3) Special rule for nonemergency, unscheduled ambulance services.
Medicare covers nonemergency, unscheduled ambulance services, provided
medical necessity is established under one of the following
circumstances:
* * * * *
(iii) If the ambulance provider or supplier is unable to obtain a
signed physician certification statement from the beneficiary's
attending physician, a signed physician certification statement must be
obtained from either the physician, physician assistant (PA), nurse
practitioner (NP), clinical nurse specialist (CNS), registered nurse
(RN), or discharge planner, who is employed by the hospital or facility
where the beneficiary is being treated, and who has personal knowledge
of the beneficiary's condition at the time the ambulance transport is
ordered or the ambulance service was furnished; and,
(iv) If the ambulance provider or supplier is unable to obtain the
required physician certification statement within 21 calendar days
following the date of the service, the ambulance supplier must document
its attempts to obtain the requested physician certification statement
and may then submit the claim. Acceptable documentation must include a
signed return receipt from a U.S. Postal Service or other similar
service. This documentation will serve as proof that the ambulance
supplier attempted to obtain the required signature from the attending
physician.
(v) In all cases, the provider or supplier must keep appropriate
documentation on file and, upon request, present it to the contractor.
The presence or absence of the signed physician certification statement
or signed return receipt does not definitively demonstrate that the
ambulance transport was medically necessary. The ambulance provider or
supplier must meet all other coverage criteria for payment to be made.
* * * * *
PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES
II. Part 414 is amended as set forth below:
1. The authority citation for part 414 continues to read as
follows:
Authority: Secs. 1102, 1871, and 1881(b)(1) of the Social
Security Act (42 U.S.C. 1302, 1395hh, 1395rr(b)(1)).
2. Section 414.1 is revised to read as follows:
Sec. 414.1 Basis and scope.
This part implements the indicated provisions of the following
sections of the Act:
1802--Rules for private contracts by Medicare beneficiaries.
1820--Rules for Medicare reimbursement for telehealth services.
1833--Rules for payment for most Part B services.
1834(a) and (h)--Amounts and frequency of payments for durable
medical equipment and for prosthetic devices and orthotics and
prosthetics.
1834(l)--Establishment of a Fee Schedule for Ambulance Services.
1848--Fee schedule for physician services.
1881(b)--Rules for payment for services to ESRD beneficiaries.
1887--Payment of charges for physician services to patients in
providers.
3. A new subpart H, consisting of Secs. 414.601 through 414.625, is
added to read as follows:
Subpart H--Fee Schedule for Ambulance Services
Sec.
414.601 Purpose.
414.605 Definitions.
414.610 Basis of payment.
414.611 Coding system.
414.615 Transition for implementation of the ambulance fee
schedule.
414.620 Publication of the ambulance services fee schedule.
414.625 Limitation on review.
Subpart H--Fee Schedule for Ambulance Services
Sec. 414.601 Purpose.
This subpart implements section 1834(l) of the Act, by establishing
a fee schedule for the payment of ambulance services. Section 1834(l)
of the Act requires that payment for all ambulance services otherwise
payable on a reasonable charge system or retrospective reasonable cost
reimbursement system be made under the ambulance fee schedule effective
for services furnished after January 1, 2000.
Sec. 414.605 Definitions.
As used in this subpart, the following definitions apply to both
land and water (hereafter referred to as ``ground'') and to air
services:
Advanced Life Support (ALS) assessment is an assessment performed
by an ALS crew that results in the determination that the patient's
condition requires an ALS level of care, even if no other ALS
intervention is performed.
Advanced Life Support, Level 1 (ALS1) means transportation by
ambulance vehicle and medically necessary supplies and ancillary
services, plus an ALS assessment by an ALS provider or the provision of
at least one ALS intervention.
Advanced Life Support, Level 2 (ALS2) means transportation by
ambulance vehicle and medically necessary supplies and ancillary
services, plus the administration of at least three different
medications and the provision of at least one of the following ALS
procedures:
(1) Manual defibrillation/cardioversion.
(2) Endotracheal intubation.
(3) Central venous line.
(4) Cardiac pacing.
(5) Chest decompression.
(6) Surgical airway.
(7) Intraosseous line.
Advanced Life Support (ALS) intervention means a procedure beyond
the scope of an emergency medical technician-basic (EMT-Basic).
Advanced Life Support (ALS) provider means an individual trained to
the level of the EMT-Intermediate or paramedic. The EMT-Intermediate is
defined as having the knowledge and skills identified for the EMT-
Basic, but also as qualified to perform essential advanced techniques
and to administer a limited number of medications. The EMT-Paramedic is
defined as possessing the competencies of the EMT-Intermediate, but
also has enhanced skills that include being able to administer
additional interventions and medications.
Basic Life Support (BLS) means transportation by ambulance vehicle
and medically necessary supplies and ancillary services, plus the
provision of BLS ambulance services. The EMT-Basic, in addition to
being able to operate limited equipment on board the vehicle and being
able to assist in performing assessments and interventions, is
qualified to function as minimum staff for an ambulance and, to
establish a peripheral intravenous (IV) line.
Conversion Factor (CF) is a nationally uniform dollar value,
multiplied by relative value units for a service to produce a payment
amount.
Emergency Response means responding immediately to an emergency
medical condition. An immediate response is one in which the ambulance
supplier begins as quickly as possible to take the steps necessary to
respond to the call.
Fixed Wing Air Ambulance (FW) means transportation by a fixed wing
aircraft that is certified as a fixed wing air ambulance and such
ancillary services as may be medically necessary.
Geographic Adjustment Factor (GAF) means the practice expense (PE)
portion of the geographic practice cost index
[[Page 55095]]
(GPCI) from the physician fee schedule as applied to a percentage of
the base rate. For ground ambulance services, the PE portion of the
GPCI is applied to 70 percent of the base rate. For air ambulance
services, the practice expense (PE) portion of the GPCI is applied to
50 percent of the base rate.
Goldsmith Modification means the methodology for the identification
of rural census tracts that are located within large metropolitan
counties of at least 1,225 square miles, but are so isolated from the
metropolitan core of that county by distance or physical features so as
to be more rural than urban in character.
Loaded Mileage means the number of miles for which the Medicare
beneficiary is transported in the ambulance vehicle.
Paramedic ALS Intercept (PI) means EMT-Paramedic services furnished
by an entity that does not furnish the ambulance transport. See
Sec. 410.40(c) of this chapter for criteria governing direct payment.
Point of Pick-up means the location of the beneficiary at the time
he or she is placed on board the ambulance.
Relative value units (RVUs) measure the value of ambulance services
relative to the value of a base level ambulance service.
Rotary Wing Air Ambulance (RW) means transportation by a helicopter
that is certified as an ambulance and such ancillary services as may be
medically necessary.
Rural adjustment factor (RAF) means an adjustment applied to
services at the point of pick-up in a rural area and added to the base
payment rate.
Services in a Rural area means services that are furnished in an
area outside a Metropolitan Statistical Area (MSA) or a New England
County Metropolitan Area (NECMA) or an area within an MSA identified as
rural, using the Goldsmith modification.
Specialty Care Transport (SCT) means interfacility transportation
by an ambulance vehicle, including medically necessary supplies and
ancillary services, of a critically injured or ill patient at a level
of service beyond the scope of the EMT-Paramedic. SCT is necessary when
a patient's condition requires ongoing care that must be furnished by
one or more health professionals in an appropriate specialty area (for
example, nursing, emergency medicine, respiratory care, cardiovascular
care, or a paramedic with additional training).
Sec. 414.610 Basis of payment.
(a) Method of payment. Medicare payment for ambulance services is
based on the lesser of the actual charge or the applicable fee schedule
amount. The fee schedule payment for ambulance services equals a base
rate for the level of service plus payment for mileage and applicable
adjustment factors. All ambulance services (regardless of the vehicle
(for example, ALS or BLS) furnishing the service or of any local or
State ordinances) are paid under the fee schedule specified in this
subpart.
(b) Mandatory assignment. Effective with implementation of the
ambulance fee schedule described in Sec. 414.601, for services
furnished on or after January 1, 2001, all payments made for ambulance
services are made on an assignment-related basis. Ambulance suppliers
must accept the Medicare allowed charge as payment in full and may not
bill or collect from the beneficiary any amount other than the unmet
Part B deductible and Part B coinsurance amounts. Violations of this
requirement may subject the provider or supplier to sanctions, as
provided by law. There is no transitional period for mandatory
assignment of claims.
(c) Formula for computation of payment amounts. The fee schedule
payment amount for ambulance services is computed according to the
following:
(1) Relative value units. The relative value unit (RVU) scale for
the ambulance fee schedule is as follows:
------------------------------------------------------------------------
Relative value
Service level units (RVUs)
------------------------------------------------------------------------
BLS..................................................... 1.00
BLS--Emergency.......................................... 1.60
ALS1.................................................... 1.20
ALS1--Emergency......................................... 1.90
ALS2.................................................... 2.75
SCT..................................................... 3.25
PI...................................................... 1.75
------------------------------------------------------------------------
(i) Ground ambulance service levels. RVUs for ground ambulance
services are multiplied by a CF and adjusted by the GAF and rural
adjustment factor (RAF), as appropriate, in order to determine the
respective payment rates.
(ii) Air ambulance service levels. The base payment rate for air is
adjusted by the GAF and RAF, as appropriate, in order to determine the
amount of payment. There are no RVUs for air ambulance services because
there are only two types of air ambulance services: fixed wing (FW) and
rotary wing (RW).
(iii) Loaded mileage. Payment is made for each loaded mile. Air
mileage is based on loaded miles flown, as expressed in statute miles.
There are three mileage payment rates for ground and water, FW, and RW.
(iv) Geographic adjustment factor (GAF). For ground ambulance
services, the PE portion of the GPCI from the physician fee schedule is
applied to 70 percent of the base rate. For air ambulance services, the
PE portion of the physician fee schedule GPCI is applied to 50 percent
of the base rate.
(v) Rural adjustment factor (RAF). For ground ambulance services, a
50 percent increase is applied to the mileage rate for each of the
first 17 miles; the regular mileage allowance applies to every mile
over 17 miles. For air ambulance services, a 50 percent increase is
applied to the total payment for air services; that is, the adjustment
applies to the sum of the base rate and the mileage.
(2) Payment Rates. Payment, in accordance with this section,
represents payment in full (subject to applicable Medicare Part B
deductible and coinsurance requirements as described in subpart G of
part 409 of this chapter) for all costs (routine, ancillary, and
capital-related) associated with furnishing inpatient SNF services to
Medicare beneficiaries other than costs associated with operating
approved educational activities as described in Sec. 413.85 of this
chapter.
(d) Point of pick-up. The zip code of the point of pick-up must be
reported on each claim for ambulance services, so that the correct GAF
and RAF may be applied, as appropriate.
(e) Updates. The CF is updated annually for inflation by a factor
equal to the payment amounts provided under the fee schedule for
services furnished in CY 2001 and each subsequent year at amounts under
the fee schedule for services furnished during the previous year. The
CF is increased by the percentage increase in the consumer price index
for all urban consumers (U.S. city average) for the 12-month period
ending with June of the previous year reduced in 2001 and 2002 by 1
percentage point.
(f) Adjustments. The CF may be adjusted to take into account
factors that, as determined by the Secretary, show data that results in
a significantly different aggregate payment of items and services paid
under the ambulance fee schedule.
Sec. 414.611 Coding system.
All claims for services for which the amount of payment is
determined under Sec. 414.610 must include a code (or codes) from the
uniform coding system specified by the Secretary that identifies the
services furnished.
[[Page 55096]]
Sec. 414.615 Transition for implementation of the ambulance fee
schedule.
The fee schedule for ambulance services will be phased in over 4
years beginning January 1, 2001. Payment for services furnished during
the transition period are made based on a combination of the fee
schedule payment for ambulance services and the amount the carrier
would have paid absent the fee schedule for ambulance services, as
follows:
(a) For services furnished in CY 2001, the payment is based 80
percent on the reasonable charge-based payments for independent
suppliers and 80 percent on reasonable cost for providers, plus 20
percent of the ambulance fee schedule amount. The reasonable charge or
reasonable cost portion of payment in CY 2001 is equal to the
reasonable charge or reasonable cost for CY 2000, multiplied by the
statutory inflation factors for ambulance services.
(b) For services furnished in CY 2002, the payment is based 50
percent on the reasonable charge or reasonable cost, as applicable,
plus 50 percent of the ambulance fee schedule amount. The reasonable
charge and reasonable cost portion in CY 2002 is equal to the supplier
or provider's reasonable charge or reasonable cost for CY 2001,
multiplied by the statutory inflation factors for ambulance services.
(c) For services furnished in CY 2003, the payment is based 20
percent on the reasonable charge or reasonable cost, plus 80 percent of
the ambulance fee schedule amount. The reasonable charge and reasonable
cost in CY 2003 for each supplier or provider respectively is equal to
the supplier or provider's reasonable charge or reasonable cost for CY
2002, multiplied by the statutory inflation factors for ambulance
services.
(d) For services furnished in CY 2004 and thereafter, the payment
is based solely on the ambulance fee schedule amount.
(e) Updates. The portion of the transition payment that is based on
the existing payment methodology (that is, the non fee schedule
portion) is updated annually for inflation by a factor equal to the
projected consumer price index for all urban consumers (U.S. city
average), from March to March for claims paid under cost reimbursement
and from June to June for claims paid under reasonable charges, minus 1
percentage point. The portion of the transition payment that is based
on the ambulance fee schedule is updated annually for inflation as
described in Sec. 414.610(e).
Sec. 414.620 Publication of the ambulance services fee schedule.
Each year, HCFA will publish updates to the fee schedule for
ambulance services.
Sec. 414.625 Limitation on review.
There shall be no administrative or judicial review under sections
1869 of the Act or otherwise of the amounts established under the fee
schedule for ambulance services, including but not limited to matters
described in section 1834(l)(2) of the Act.
(Catalog of Federal Domestic Assistance Program No. 93.774,
Medicare--Supplementary Medical Insurance Program)
Dated: August 15, 2000.
Nancy-Ann Min DeParle,
Administrator, Health Care Financing Administration.
Dated: August 31, 2000.
Donna E. Shalala,
Secretary.
Note: The following addendum will not appear in the Code of
Federal Regulations.
Addendum A
[** When using this chart, use all codes that apply **]
----------------------------------------------------------------------------------------------------------------
On-scene condition On-scene condition Comments and examples
# (general) (specific) Svc. Lev. [not all-inclusive]
----------------------------------------------------------------------------------------------------------------
Emergency Conditions (non-traumatic)
----------------------------------------------------------------------------------------------------------------
1................. Abdominal pain......... With other signs or ALS Nausea, vomiting,
symptoms. fainting, pulsatile
mass, distention,
rigid, tenderness on
exam, guarding.
2................. Abdominal pain......... Without other signs or BLS ......................
symptoms.
3................. Abnormal cardiac rhythm/ Potentially life- ALS Bradycardia,
Cardiac dysrythmia. threatening. junctional and
ventricular
blocks,non-sinus
tachycardias, PVC's
>6, bi and trigeminy,
vtach,vfib, atrial
flutter, PEA,
asystole.
4................. Abnormal skin signs.... ....................... ALS Diaphorhesis,
cyanosis, delayed cap
refill, poor turgor,
mottled.
5................. Abnormal vital signs With symptoms.......... ALS Other emergency
(includes abnormal conditions.
pulse oximetry).
6................. Abnormal vital signs Without symptoms....... BLS ......................
(includes abnormal
pulse oximetry).
7................. Allergic reaction...... Potentially life- DALS Other emergency
threatening. conditions, rapid
progression of
symptoms, prior hx.
of anaphylaxis,
wheezing, difficulty
swallowing.
8................. Allergic reaction...... Other.................. BLS Hives, itching, rash,
slow onset, local
swelling, redness,
erythema.
9................. Animal bites/sting/ Potentially life or ALS Symptoms of specific
envenomation. limb-threatening. envenomation,
significant face,
neck, trunk, and
extremity
involvement; other
emergency conditions.
10................ Animal bites/sting/ Other.................. BLS Local pain and
envenomation. swelling, special
handling
considerations and
patient monitoring
required.
11................ Sexual assault......... With injuries.......... ALS ......................
12................ Sexual assault......... With no injuries....... BLS ......................
13................ Blood glucose.......... Abnormal- 80 or >250, ALS Altered mental status,
with symptoms. vomiting, signs of
dehydration, etc.
[[Page 55097]]
14................ Respiratory arrest..... ....................... ALS Apnea, hypoventilation
requiring ventilatory
assistance and airway
management.
15................ Difficulty breathing... ....................... ALS ......................
16................ Cardiac arrest-- ....................... ALS ......................
Resuscitation in
progress.
17................ Chest pain (non- ....................... ALS Dull, severe,
traumatic). crushing, substernal,
epigastric, left
sided chest pain
associated with pain
of the jaw, left arm,
neck, back, and
nausea, vomiting,
palpitations, pallor,
diaphoresis,
decreased LOC.
18................ Choking episode........ ....................... ALS ......................
19................ Cold exposure.......... Potentially life or ALS Temperature 95F, deep
limb threatening. frost bite, other
emergency conditions.
20................ Cold exposure.......... With symptoms.......... BLS Shivering, superficial
frost bite, and other
emergency conditions.
21................ Altered level of ....................... ALS Acute condition with
consciousness (non- Glascow Coma Scale15.
traumatic).
22................ Convulsions/Seizures... Seizing, immediate post- ALS ......................
seizure, post-ictal,
or at risk of seizure
& requires medical
monitoring/observation.
23................ Eye symptoms, non- Acute vision loss and/ BLS ......................
traumatic. or severe pain.
24................ Non traumatic headache. With neurologic ALS ......................
distress conditions.
25................ Non traumatic headache. Without neurologic BLS ......................
symptoms.
26................ Cardiac Symptoms other Palpitations, skipped ALS ......................
than chest pain. beats.
27................ Cardiac symptoms other Atypical pain or other ALS Persistent nausea and
than chest pain. symptoms. vomiting, weakness,
hiccups, pleuritic
pain, feeling of
impending doom, and
other emergency
conditions.
28................ Heat Exposure.......... Potentially life- ALS Hot and dry skin,
threatening. Temp>105, neurologic
distress, signs of
heat stroke or heat
exhaustion,
orthostatic vitals,
other emergency
conditions.
29................ Heat exposure.......... With symptoms.......... BLS Muscle cramps, profuse
sweating, fatigue.
30................ Hemorrhage............. Severe (quantity)...... ALS Uncontrolled or
significant signs of
shock, other
emergency conditions.
31................ Hemorrhage............. Potentially life- ALS Active vaginal, rectal
threatening. bleeding,
hematemesis,
hemoptysis,
epistaxis, active
post-surgical
bleeding.
32................ Infectious diseases ....................... BLS ......................
requiring isolation
procedures / public
health risk.
33................ Hazmat Exposure........ ....................... ALS Toxic fume or liquid
exposure via
inhalation,
absorption, oral,
radiation, smoke
inhalation.
34................ Medical Device Failure. Life or limb ALS Malfunction of
threatening ventilator, internal
malfunction, failure, pacemaker, internal
or complication. defibrillator,
implanted drug
delivery device.
35................ Medical Device Failure. Health maintenance BLS O2 supply malfunction,
device failures. orthopedic device
failure.
36................ Neurologic Distress.... Facial drooping; loss ALS ......................
of vision; aphasia;
difficulty swallowing;
numbness, tingling
extremity; stupor,
delirium, confusion,
hallucinations;
paralysis, paresis
(focal weakness);
abnormal movements;
vertigo; unsteady gait/
balance; slurred
speech, unable to
speak.
37................ Pain, acute and severe Patient needs BLS ......................
not otherwise specialized handling
specified in this list. to be moved: pain
exacerbated by
movement.
38................ Pain, severe not Acute onset, unable to BLS Pain is the reason for
otherwise specified in ambulate or sit. the transport.
this list.
39................ ....................... Pain, severe not ALS Use severity scale (7-
otherwise specified in 10 for severe pain),
this list. pt. receiving pre-
hospital
pharmacologic
intervention.
[[Page 55098]]
40................ Back pain--non- Suspect cardiac or ALS Other emergency
traumatic (T and/or vascular etiology. conditions, absence
LS). of or decreased leg
pulses, pulsatile
abdominal mass,
severe tearing
abdominal pain.
41................ Back pain--non- New neurologic symptoms ALS Neurologic distress
traumatic (T and/or list.
LS).
42................ Poisons, ingested, Adverse drug reaction, ALS ......................
injected, inhaled, poison exposure by
absorbed. inhalation, injection
or absorption.
43................ Alcohol intoxication, Unable to care for BLS.
drug overdose self; unable to
(suspected). ambulate; no risk to
airway; no other
symptoms.
44................ Alcohol intoxication, All others, including ALS.
drug overdose airway at risk,
(suspected). pharmacological
intervention, cardiac
monitoring.
45................ Post--operative Major wound dehiscence, BLS Orthopedic appliance;
procedure evisceration, or prolapse.
complications. requires special
handling for transport.
46................ Pregnancy complication/ ....................... ALS ......................
Childbirth/Labor.
47................ Psychiatric/Behavioral. Abnormal mental status; ALS Suicidal, homicidal,
drug withdrawal. hallucinations,
violent, Disoriented,
DT's, withdrawal
symptoms, transport
required by state law/
court order.
48................ Psychiatric/Behavioral. Threat to self or BLS ......................
others, severe
anxiety, acute episode
or exacerbation of
paranoia, or
disruptive behavior.
49................ Sick Person............ Fever with associated ALS ......................
symptoms (headache,
stiff neck, etc.).
50................ Sick Person............ Fever without BLS >102 in adults; >104
associated symptoms. in children.
51................ Sick Person............ No other symptoms...... BLS With other emergency
conditions
52................ Sick Person............ Nausea and vomiting, ALS ......................
diarrhea, severe and
incapacitating.
53................ Unconscious, Fainting, Transient unconscious ALS ......................
Syncope. episode or found
unconscious.
54................ Near syncope, weakness Acute episode or ALS ......................
or dizziness. exacerbation.
55................ Medical/Legal.......... State or local BLS Minor with no
ordinance requires guardian; DWI arrest
ambulance transport at MVA for
under certain evaluation; arrests
conditions. and medical
conditions (psych,
drug OD).
----------------------------------------------------------------------------------------------------------------
Emergency Conditions--Trauma
----------------------------------------------------------------------------------------------------------------
56................ Major trauma........... As defined by ACS Field ALS Trauma with one of the
Triage Decision Scheme. following: Glascow
14; systolic BP90;
RR10 or >29; all
penetrating injuries
to head, neck, torso,
extremities proximal
to elbow or knee;
flail chest;
combination of trauma
and burns; pelvic
fracture; 2 or more
long bone fractures;
open or depressed
skull fracture;
paralysis; severe
mechanism of injury
including: ejection,
death of another
passenger in same
patient compartment,
falls >20'', 20''
deformity in vehicle
or 12'' deformity of
patient compartment,
auto pedestrian/bike,
pedestrian thrown/run
over, motorcycle
accident at speeds
>20 mph and rider
separated from
vehicle.
57................ Other trauma........... Need to monitor or ALS Decreased LOC,
maintain airway. bleeding into airway,
trauma to head, face
or neck.
58................ Other trauma........... Major bleeding......... ALS Uncontrolled or
significant bleeding.
59................ Other trauma........... Suspected fracture/ BLS Spinal, long bones,
dislocation requiring and joints including
splinting/ shoulder elbow,
immobilization for wrist, hip, knee, and
transport. ankle, deformity of
bone or joint.
60................ Other trauma........... Penetrating extremity BLS Isolated with bleeding
injuries. stopped and good CSM.
61................ Other trauma........... Amputation--digits..... BLS ......................
[[Page 55099]]
62................ Other trauma........... Amputation--all other.. ALS ......................
63................ Other trauma........... Suspected internal, ALS Signs of closed head
head, chest, or injury, open head
abdominal injuries. injury, pneumothorax,
hemothorax, abdominal
bruising, positive
abdominal signs on
exam, internal
bleeding criteria,
evisceration.
64................ Other trauma........... Severe pain requiring ALS See severity scale.
pharmacologic pain
control.
65................ Other trauma........... Trauma NOS: it is up to BLS Ambulance required
the provider to because injury is
furnish sufficient associated with other
documentation to emergency conditions
support this claim. or other reasons for
transport exist such
as special patient
handling or patient
safety issues.
66................ Burns.................. Major--per ABA......... ALS Partial thickness
burns > 10% TBSA;
involvement of face,
hands, feet,
genitalia, perineum,
or major joints;
third degree burns;
electrical; chemical;
inhalation; burns
with preexisting
medical disorders;
burns and trauma;
67................ Burns.................. Minor--per ABA......... BLS Other burns than
listed above.
68................ Lightning.............. ....................... ALS ......................
69................ Electrocution.......... ....................... ALS ......................
70................ Near Drowning.......... ....................... ALS ......................
71................ Eye injuries........... Acute vision loss or BLS
blurring, severe pain
or chemical exposure,
penetrating, severe
lid lacerations.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Reason for transport Reason for transport
# (general) (specific) Svc. Lev. Comments
----------------------------------------------------------------------------------------------------------------
Non-Emergency
----------------------------------------------------------------------------------------------------------------
72............. Bed confined (at the time *Unable to get up without BLS Patient is going to a
of transport). assistance; and. medical procedure,
*Unable to ambulate; and. treatment, testing, or
*Unable to sit in a chair evaluation that is
or wheelchair. medically necessary.
73............. ALS monitoring, required. Cardiac/hemodynamic ALS Expectation monitoring
monitoring required en is needed before and
route. after transport.
74............. ALS monitoring, required. Advanced airway ALS Ventilator dependent,
management. apnea monitor, possible
intubation needed, deep
suctioning.
75............. ALS monitoring, required. IV meds required en route ALS Does not apply to self-
administered IV
medications.
76............. ALS monitoring, required. Chemical restraint....... ALS ........................
77............. BLS monitoring required.. Suctioning required en BLS Per transfer
route. instructions.
78............. BLS monitoring required.. Airway control/ BLS Per transfer
positioning required en instructions.
route.
79............. BLS monitoring required.. Third party assistance/ BLS Does not apply to
attendant required to patient capable of self-
apply, administer, or administration of
regulate or adjust portable or home O2.
oxygen en route. Patient must require
oxygen therapy and be
so frail as to require
assistance.
80............. Specialty care monitoring A level of service SCT ........................
provided to a critically
injured or ill patient
beyond the scope of the
national paramedic
curriculum.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
81....... Medical Patient Safety: Danger to In restraints............. BLS Refer to
conditions that self or others. definition in
contraindicate the CFR--sec.
transport by 482.13(e).
other means.
82....... Medical Patient safety: Danger to Monitoring................ BLS Behavioral or
conditions that self or others. cognitive risk
contraindicate such that
transport by patient
other means. requires
monitoring for
safety.
[[Page 55100]]
83....... Medical Patient safety: Danger to Seclusion (Flight risk)... BLS Behavioral or
conditions that self or others. cognitive risk
contraindicate such that
transport by patient
other means. requires
attendant to
assure patient
does not try to
exit the
ambulance
prematurely.
CFR sec.
482.13(f)(2)
for definition.
84....... Medical Patient safety Risk of falling off wheel BLS Patient's
conditions that chair or stretcher while physical
contraindicate in motion. condition is
transport by such that
other means. patient risks
injury during
vehicle
movement
despite
restraints.
Indirect
indicators
include MDS
criteria.
85....... Medical Special handling en route. Isolation................. BLS Includes
conditions that patients with
contraindicate communicable
transport by diseases or
other means. hazardous
material
exposure who
must be
isolated from
public or whose
medical
condition must
be protected
from public
exposure;
surgical
drainage
complications.
86....... Medical Special handling en route. Patient Size.............. BLS Morbid obesity
conditions that which requires
contraindicate additional
transport by personnel or
other means. equipment to
transfer.
87....... Medical Special handling en route. Orthopedic device......... BLS Backboard,
conditions that halotraction,
contraindicate use of pins and
transport by traction, etc.
other means.
88....... Medical Special handling en route. 1 person for physical BLS ................
conditions that assistance in transfers.
contraindicate
transport by
other means.
89....... Medical Special handling en route. Severe pain............... BLS Pain must be
conditions that aggravated by
contraindicate transfers or
transport by moving vehicle
other means. such that
trained
expertise of
EMT required
(pain scale).
Pain is
present, but is
not sole reason
for transport.
90....... Medical Special handling en route. Positioning requires BLS Requires special
conditions that specialized handling. handling to
contraindicate avoid further
transport by injury (such as
other means. with >grade 2
decubiti on
buttocks).
Generally does
not apply to
shorter
transfers of 1
hour.
Positioning in
wheelchair or
standard car
seat
inappropriate
due to
contractures or
recent
extremity
fractures--post-
op hip as an
example.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Reason for
# Reason for transfer Ser. Lev. Comments
transfer (general) (specific)
----------------------------------------------------------------------------------------------------------------
Inter-facility
----------------------------------------------------------------------------------------------------------------
91............ EMTALA-certified Physician has made BLS, ALS, SCT, FW, RW............... Excludes patient-
inter-facility the determination requested EMTALA
transfer to a that this transfer.
higher level of transfer is
care. needed--Carrier
only needs to
know the level of
care and mode of
transport.
92............ Service not .................. BLS, ALS, SCT, FW, RW............... Specify what
available at service is not
originating available.
facility, and
must meet one or
more emergency or
non-emergency
conditions.
93............ Service not Indicates to
covered. Carrier that
claim should be
automatically
denied.
----------------------------------------------------------------------------------------------------------------
[FR Doc. 00-23195 Filed 9-11-00; 8:45 am]
BILLING CODE 4120-01-P
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