Without changes to Medicare and Medicaid reimbursement policies, ambulance service providers nationwide—including Anderson County Emergency Medical Services (ACEMS) — will likely end up on life support.
Thousands of ambulance services across the country, ACEMS included, are already in critical condition, as pay remains low throughout the industry.
Well, there is more than one problem to be noted, but a key issue affecting ambulance service pay is the way the payer system is structured, particularly the structuring of insurance reimbursements.
Ambulance providers are continuing to be reimbursed by Medicare at prices well below the cost for treating Medicare patients.
“Sixty-five percent of our patients use Medicare or Medicaid,” ACEMS Director Nathan Sweet said, in a public information session on the ambulance services in May.
Established in 1970, ACEMS provides primary pre-hospital care to Anderson County citizens, which includes emergency, non-emergency, and convalescent transports that account for nearly 24,000 calls annually.
The ambulance service operates six stations scattered strategically throughout the county with a fleet of 23 vehicles, 17 of those ambulances.
“When we are down to two ambulances, we post one in Clinton and one in Oak Ridge. When we are down to just one ambulance we post them at the Shell gas station between Oak Ridge and Clinton. These posting locations have been in place for decades, as they are located in the area of highest probability for a call,” stated Sweet in the EMS briefing to the public in May, describing how his department operates on a bare bone staff and shoestring budget already.
ACEMS, like so many ambulance service providers statewide and throughout the nation, has found itself struggling in recent years with a plethora of problems: decreases in Medicare reimbursement, increased deductibles on private insurance, and the rising number of patients without insurance unwilling to pay for services.
Insurance reimbursements from transporting patients constitute the bulk of ACEMS’s revenue stream, but in the past few years, ACEMS has experienced a spike in non-collected revenue volume.
Non-collected revenue is bills ACEMS issues that is unpaid.
ACEMS encountered delays in Medicare reimbursements on the part of its prior billing company which, according to Sweet, was sending patients’ past due bills to a collection agency; patients it was later discovered were already on medical insurance.
By the time the prior billing company discovered the error it was too late to file the bills to recover the payments, he said.
The result of the error was the ambulance department being placed on a prepayment review audit in April 2014 by Cahaba, the company that does Medicare reimbursements in Tennessee.
In light of the continued problems the ambulance department was experiencing with its former billing company, the ambulance service decided to switch to doing business with Digitech, a new billing firm, in the middle of last year with the hopes that they could finally start collecting their money and eliminate their problems with billing.
ACEMS director Nathan Sweet said they have since been working closely with Digitech to address the payment issues.
ACEMS used to do its billing in-house, but it was decided several years ago by county government officials to outsource its billing.
Aware of the financial strain on ACEMS, the Anderson County Commission passed in a 13-2 vote during their regular scheduled commission meeting on July 17, a resolution supporting an increase in Medicare reimbursement rates nationwide which would affect Anderson County if enacted, and substantially improve the ambulance payment system by putting into law a statute that would require insurance companies like Medicare to increase reimbursement rates.
As it currently stands, Medicare reimburses ambulance service providers less — far less — than the cost of providing services.
The resolution Commission passed reads that the county board of commissioners “acknowledge that existing, limited Medicare reimbursement rates and standards have placed a financial strain on ACEMS and systems across the state and nation, especially in rural areas with low population density,” and with the acknowledgement of the current situation, express support for “the reimbursement for providing medical treatment, support those Anderson County citizens served by Medicare, and support an increase in Medicare reimbursement rates to continue the operation of ACEMS.”
Commission also authorized that the submission of the resolution be sent to the following legislators: Congressman Chuck Fleischmann, Senator Lamar Alexander and Senator Bob Corker to review and consider as an action item.
Included in the resolution was U.S. Census data in Anderson County for the county’s 65 plus demographic spanning the past 12 years.
According to U.S. Census data, Anderson County’s 65 plus population has risen significantly, to the point of seeing a 10 percent increase in a five-year time span from 2005 to 2010.
In 2005, the county’s senior population was 16.4 percent, in 2010 that number had risen to 17.4, and on July 1, 2015, the date of the last known Census report, it was reported that the population was then at 19.2 percent.
What is more, the 65 plus demographic is “expected to continue to grow because of the baby boom generation,” the resolution states.
The majority of patients on Medicare and Medicaid are senior citizens.
ACEMS is manned by a staff of 64 full-time and 20 part-time members.