Today’s ambulance organizations stand at a critical crossroad and unless we figure out how to find an economically and clinically appropriate pathway forward, many of our organizations are simply not going to survive to participate in future innovative payment models. Before the industry as a whole can embrace mobile integrated health, community paramedicine, and value-based purchasing, the industry must contend with standardizing cost data and submitting it to the federal government. We must also fight to ensure that payment is linked to the health care services provided and less to the act of transporting patients.
Whether we like it or not, federal policy-makers have decided it is time for ambulance organizations to report their costs, just like other Medicare providers. The American Ambulance Association anticipated this development and several years ago began working with Medicare cost report experts to craft recommendations that would work in this highly diverse and unique health care community. In short, the framework we developed would allow all types of ambulance organizations to report their costs in a standardized manner that also recognizes their unique characteristics. For example, how to report labor costs would differ based on an ambulance organization’s status as for-profit, not-for-profit, volunteer, governmental entity, etc. The experts also identified ways to reduce the burden of providing such cost data through statistically appropriate grouping of organizations and staggering the collection period over an appropriate time period.
The Congress is currently considering legislation that would require the Centers for Medicare and Medicaid Services (CMS) to collect cost data from ambulance organizations. The AAA is working closely with Members of the House and the Senate to find ways to make sure the final policy is not overly burdensome and will result in accurate and meaningful data.
Although it may seem difficult to report cost data, having such data will benefit the industry. First, cost data will allow us to understand the relationship between the Medicare rates and the cost of providing services, which we believe will support not only making the add-ons permanent, but also other payment adjustments. Second, cost data will help policy-makers and the industry to understand the cost of providing health care services at the scene when transportation is not required. With this information, it will be possible to begin discussing how such services should be paid for. Third, cost data is absolutely essential to setting rates for the coverage of future potential benefits, such as mobile integrated health and community paramedicine. Without cost data, it is likely that any policy changes would result in reimbursement rates that would not be sufficient to support continuation of such services.
Perhaps most importantly, providing cost data is just one more way in which ambulance organizations will be acting like Medicare providers rather than suppliers. Ambulance organizations already must meet the vast majority of requirements that Medicare mandates for providers, but not for suppliers. Having provider status is important not only to support future reform in which payment would be based on the services provided rather than transportation, but also to allow ambulance organizations to participate in the myriad of Medicare innovation programs to which they are currently prohibited from participating in. It would also allow us to be recognized for provider care management and care transition services.
As we watch the rest of the health care industry evolve, it is important that ambulance organizations and our payment system evolve with it. That is why the AAA has been working diligently with Members of the Congress and the Administration to obtain provide status for all ambulance organizations and to make sure that cost collection requirements are designed to support and not punish the industry.
Asbel Montes is Chairman of the AAA Payment Reform Committee
Jimmy Johnson is Vice Chair of the AAA Payment Reform Committee