President Obama has signed the long-anticipated healthcare reform bill into law.
The health care reform law will have some direct, positive impact on ambulance services by extending bonus payments made by Medicare for ground ambulance services through the end of calendar year 2010. The bill extends the 2% urban, 3% rural and super rural bonuses for ground service providers and makes those increases retroactive to January 1, 2010. CMS is expected to issue guidance on how the retroactive bonuses will take effect shortly after the bill is signed. Additionally, there are many other key provisions in the bills that could have an effect on reimbursement rates, as well as operational and compliance costs for ambulance services.
Significantly, the new law contains provisions that will thrust a number of previously uninsured individuals into the healthcare insurance market. It is estimated that 32 million Americans who currently have no health insurance will become covered under this sweeping new law. Beginning as early as 2014, most U.S. Citizens will have to obtain health insurance or be forced to pay a fine. Those who cannot afford coverage may be eligible for subsidies to purchase coverage from a qualified plan. State-based health benefit exchanges will eventually be set up for individuals and small employers with up to 100 employees to purchase qualified coverage. Employers with more than 50 employees will be required to either offer coverage to the employees or face penalties. Finally, the new law expands Medicaid coverage to all individuals with incomes up to 133% of the Federal Poverty Guidelines. Though there are many uncertainties about how the new law will actually play out once all of its provisions go into effect, the net result of these changes could mean that more ambulance patients will be insured and fewer accounts will fall into the "self pay" or "uncollectible" categories.
In addition, small employers with 25 employees or less and average annual wages of less than $50,000 that purchase health insurance for their employees will receive a tax credit. During the first phase of this initiative, small employers will be able to avail themselves to a credit of up to 35% of the total contribution toward each employee’s health insurance premium, so long as the provider pays at least 50% of the total premium cost for the employee. Many ambulance providers across the U.S. could be eligible to receive this credit.
The new law could also have an impact on Medicare and Medicaid reimbursement rates over the next ten years. The law will restructure payments to Medicare Advantage plans and hold those plans more accountable for their performance. The law also incorporates “productivity adjustments” for Medicare providers and would adjust annual Medicare reimbursement updates downward under the presumption that providers are getting more “efficient” over time (and therefore require less money). Finally the law will reduce Medicare payments to hospitals when there are preventable hospital readmissions.
The law also establishes a national Medicare pilot program to evaluate paying a “bundled” payment for an “episode of care” beginning three days prior to hospitalization and 30 days following discharge. If the pilot program is being investigated as an effective way to save Medicare dollars, and it's possible that ambulance providers could in the future be requried to look directly to hospitals for reimbursement in the future.
Finally, the healthcare reform package seeks to both fund the reform effort and contain future healthcare costs by reducing waste, fraud, and abuse. For the first time, providers and suppliers may be required to establish compliance programs. Moreover, every provider who receives Medicare and Medicaid dollars is sure to see an increase in oversight. This could mean increased compliance costs for providers.
With all of these changes in the nation's healthcare system, there's only one place you need to turn to keep your ambulance service or EMS organization up to date - www.pwwemslaw.com. Stay tuned to updates from Page, Wolfberg, & Wirth as the situation develops.
Ambulance Billing and Coding Desktop Reference Guide