October 9, 2012 Dear AAMS Members -    Last week, the Medicare Payment Advisory Commission (MedPAC) held a public meeting at which it provided an update on its study of the ambulance fee schedule, rural ground add-on payments, and the expiring hold harmless for certain zip codes under the air ambulance fee schedule.   During the meeting, the commission discussed four draft recommendations for Congress.  It is expected the recommendations will be finalized and voted on during the MedPAC Commissioners’ meeting in November.

The first recommendation was to allow all of the Medicare extender provisions to expire.  This includes the 2% urban/3% rural add-on payment for ground transports, the “Super Rural” bonus payments for ground transports and the rural zip code “hold harmless” for air transports.  The only justification given for the elimination of the zip code hold harmless is that it was intended to be used for a transition period, and providers have had ample time to transition.  AAMS disagrees with that characterization and will continue to highlight the need for the hold harmless provision with Congress.    

The second recommendation would use the money from the 2% urban/3% rural add-on to rebalance the ground ambulance RVU’s to lower the RVU for non-emergency BLS and to raise the RVU for all other emergency transports.  That would be done in a budget-neutral manner and the aggregate payment would remain consistent for other types of emergency transports. 

Another recommendation would replace the permanent 50% ground short-mileage rate with a new policy for low-volume and isolated areas: Essentially they’re proposing a four-step process:

• Determine how much costs increase as volume decreases;
• Define areas as a set radius (e.g. 10-15 miles) around a ZIP code;
• Compute the population in the area and the number of transports that population would generate; and
• Decide if there is a low-volume and, if so, increase payments.

MedPAC also discussed the possibility of national guidelines on medical necessity, rather than relying upon local standards, and asking the Secretary of HHS to study abnormal patterns relating to dialysis transports that may indicate the potential of fraudulent transports. 

Once MedPAC approves its recommendations during the November meeting, it is up to Congress to decide whether or not to act on them.  It is doubtful Congress will seek substantive changes to the fee schedule during the 20 legislative days available to them following the elections; however, the discussions could carry over into next year if Congress chooses to do so.  However, Congress must decide by the end of the year whether to extend the ground transport add-on payments and the air ambulance zip code hold harmless provisions or allow them to expire.  For that reason, the add-ons and hold harmless extension will continue to be AAMS’ primary focus for the remainder of the year.    
 
Please contact the AAMS office if you have any questions.