In a report released last year, the Department of Health and Human Services' Office of Inspector General (OIG) published its findings from a study of Medicare payments for ambulance transports done in 2002.
By way of introduction, the OIG report stated that "Medicare covers and pays for emergency and nonemergency ambulance transports when a beneficiary's medical condition, at the time of transport, is such that other means of transportation, such as taxi, private car, wheelchair van or other type of vehicle, would jeopardize the beneficiary's health." In auditing ambulance claims, the OIG broke down its analysis into three categories: dialysis transports, other nonemergent transports and emergent transports. The study found that 25% of all ambulance transports in 2002 did not meet Medicare program requirements, resulting in an estimated $402 million in improper payments.
The report also stated that "Despite previous OIG inspections indicating that transports for dialysis treatment and other nonemergency transports were particularly vulnerable to abuse, the error rates for these kinds of transports continue to be high." The study found that 27% of dialysis transports (resulting in an estimated $48 million in overpayments) and 20% of other nonemergency transports (resulting in $101 million in overpayments) did not meet Medicare's coverage requirements. As for emergency transports, the report found that only 7% of those claims did not meet Medicare requirements. However, due to the large number of emergency transports that occurred during 2002, the estimated overpayment from this 7% was over $71 million. The OIG noted the clear and significant difference in the error rates for emergency and nonemergency services. It also found an additional 9% error rate for upcoding, or charging for a higher level of service than was actually needed or rendered (e.g., charging ALS rates for a BLS call), and this resulted in an additional $31 million in overpayments.
The report also noted that while almost two-thirds of coverage errors involved transports from dialysis facilities, hospitals and other third-party providers, these providers received little education regarding Medicare's coverage requirements for ambulance transports.
A personal observation that has nothing to do with the OIG's report: The third-party medical provider issue is a problem the ambulance industry has struggled with since the implementation of the Physician Certification Statement (PCS) requirement. Medicare requires that a doctor, nurse or other licensed caregiver sign a statement supporting the necessity of ambulance transport, but the person signing the certificate often does not know the formal requirements for medical necessity as they relate to ambulance services. Could we, as an industry, do better at educating these doctors and nurses on what medical necessity means for us? Maybe (and good luck getting your local ED attending physician to sit down and learn a thing or two from your EMTs), but what does that get you? Medicare has made it clear that ambulance services cannot rely on these statements to get claims paid. So we end up with a certifying statement that ambulance services are "medically necessary" being signed by someone unfamiliar with the requirements for medical necessity, or a certificate we can't use as conclusive proof that a service was actually necessary even if the certifying person understood the requirements.
But that's not the end of the problem created by the PCS requirement. Here's the kicker: What happens when you get a PCS form for a nonemergent trip (as you are required to do) on which a doctor concludes that the patient requires ambulance transportation, but your crew decides the patient doesn't qualify under Medicare guidelines? Then you have two choices: 1) Have the patient transported by other means (automobile or wheelchair van) and pray they don't have a health issue arise during transport (because if they do, you've just gone against a doctor's request, and the civil lawsuit will certainly mention that) or 2) Give the patient a free ride in your ambulance. If anyone can give me a third option, I'd love to hear it.