Administration and Leadership, EMS Insider

Ambulance Cost Data Collection is Coming

Although the most prominent ambulance provision passed in the Bipartisan Budget Act of 2018 (H.R. 1892) was the five-year extension of the Medicare add-ons, the Act also included important language directing the Centers for Medicare and Medicaid Services (CMS) to collect cost and other financial data from ambulance service suppliers and providers. 

The Congress had made the inclusion of a data collection provision a requirement for a long-term extension of the 2% urban, 3% rural and super rural bonus increases. The American Ambulance Association (AAA) successfully advocated for passage of language to create a system which will be the least burdensome on the industry and also the most likely to result in the data necessary for future reform of the Medicare ambulance fee schedule.

Under Section 50203 of H.R. 1892, the Secretary of Health and Human Services “shall develop a data collection system (which may include use of a cost survey) to collect cost, revenue, utilization and other information determined appropriate by the Secretary…” from ambulance service suppliers and providers.

The language passed by Congress doesn’t require “cost reporting” which is a defined process under the Medicare program using an already established cost report created for providers such as hospitals.

Instead, Section 50203 enables CMS to develop a data collection system that takes into consideration the multiple types of ambulance service suppliers and the costs unique to an EMS operation, as well as the fact that our industry is comprised of predominately small suppliers with 54% of the industry doing 250 or less Medicare transports per year. 

Framework of Data Collection

For the past six years, the AAA has been preparing for the requirement that ambulance service suppliers and providers would need to furnish cost data to CMS. In 2012, the AAA enlisted The Moran Company, a well-respected health care analytics firm based in Washington, D.C., to determine the best way to collect cost and other data from ambulance service suppliers and providers. The Moran Company spent close to two years in developing its recommendations which included outreach for data from all types and sizes of ambulance operations.

In its final report issued in April 2014, The Moran Company outlined its recommendations. The Moran Company determined surveying a statistically significant number of ambulance service providers and suppliers every few years would result in the best data, and the process should include two phases. 

The first phase would require all ambulance service suppliers to provide data on the characteristics of their operation such as the type of supplier (e.g. volunteer rescue squad, private company). The second phase would use a survey to collect cost data from a statistically significant number of each group of supplier and provider to obtain cost and other data. This two-phase survey approach would allow CMS to customize surveys for each group of suppliers and providers and ensure that information such as volunteer labor could be taken into consideration when analyzing the results.

The language of Section 50203 sets the foundation for CMS to use a very similar data collection system as the one conceived by The Moran Company. A primary difference is the frequency of the data collection.  The provision directs CMS to collect data every year for the first three years and then no less than every three years. The Moran Company report suggested no less than every three years as costs on average don’t change significantly over shorter periods of time.  

Unlike The Moran Company report, the provision also requires the selection of providers and suppliers to be a representative sample as opposed to a random sample. Section 50203 also implements a penalty of a 10% reduction in Medicare reimbursement for the following year for those suppliers and providers who are selected to provide data and do not return a survey. The Moran Company report was silent on a penalty, but the AAA recognizes that some sort of a penalty is necessary and had proposed a 5% reduction. There’s a hardship clause to mitigate the penalty for good cause.

Source of Information

CMS is in the process of developing the framework of the data collection system and will be reaching out to stakeholders for input. CMS has until December 31, 2019 to specify the framework and identify the providers and suppliers subject to data collection.  The AAA has created a webpage on data collection which includes a copy of The Moran Company report which is accessible to AAA and non-AAA members.  We recommend that your read at least the summary of the report for more details on the proposed data collection system.

To access the webpage on ambulance cost data collection, please click here.

Importance of Good Data

With good data, we can look to better structure the Medicare ambulance fee schedule to reflect the true costs of providing ambulance services. We will also be able to use the data to pursue providing medical care and reimbursement which is not just tied to transporting patients to facilities. 

Mobile Integrated Healthcare (MIH), treat without transport and our ability to continue to provide quality healthcare all stems from having good data. It’s critical that when collection begins in the next couple of years and if operation is selected, you do everything you can to provide accurate data.

AAA is Here to Help

The AAA has spent the last four years thinking about how CMS should collect data from ambulance service suppliers and providers, and how we can assist in helping services prepare and respond to the cost data survey. We’re developing material and resources to help ambulance service suppliers and providers prepare for being selected to provide their cost data. Though many of the finer specifics of the framework and data elements are still to be confirmed by CMS, the AAA has an in-depth and insider understanding of the anticipated process and elements.

For information on the AAA resources, please access the ambulance cost data collection webpage by clicking here. The AAA will announce through AAA member emails about new developments on the collection system as well as new resources. Although the possibility of your organization being selected to provide data is a couple of years away, it’s important that you start preparing now.