Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

Policy & Regulation News

CMS Restricts Ambulance Services for Improper Medicare Billing

By Stephanie Reardon

New Medicare billing regulation could limit the number of allowable ambulance transports and could reduce the revenue intake for ambulance services.

- Ambulance companies in New Jersey are in a bind. Past reports for improper Medicare billing for non-emergency ambulance usage has sparked administrators to tighten regulations on which patient an ambulance is allowed to transport. This new regulation could limit the number of allowable ambulance transports and could reduce the revenue intake.

Last year, the Department of Health and Human Services (HHS) and the Office of Inspector General (OIG) completed an audit on the utilization of Medicare Ambulance Transport, and identified a 69 percent increase of Medicare reimbursement for these services. Medicare covers ambulance transports in cases where the use of other types of transportation would endanger the patient’s health, and the use of an ambulance as a mode of transport would be to or from a Medicare-covered service.

On November 14, 2014, the Centers for Medicare & Medicaid Services (CMS) announced that due to the increase in improper medical transport reimbursement, it would require New Jersey ambulance companies to receive approval from Medicare for non-emergency-related medical transport.

Ambulance transportation is allowed in cases of non-emergency situations only if the beneficiary is bedridden or the beneficiary’s health could be endangered by other modes of transportation.

Pennsylvania and South Carolina will also be subject to this requirement because of their high incidents of inappropriate Medicare billing for ambulance use. The use of ambulance transportation increased for these states to between 126 percent and 145 percent when combined. The provisions of this new CMS regulation are intended to last three years.

“We plan to use this prior authorization process to ensure that all relevant clinical or medical documentation requirements are met before services are rendered to beneficiaries and before claims are submitted for payment,” the CMS announcement states. “This prior authorization process will further ensure that payment complies with Medicare documentation, coverage, payment, and coding rules.”

With CMS’s new regulation, it now has the ability to approve or deny requests from ambulance companies to convey patients with non-emergency medical transport needs. If CMS denies a request, it will reduce the number of possibly inappropriate medical claims and abuse. However, it may also end up hurting the revenue income for ambulance services.

According to OIG’s audit, the amount of ambulance suppliers increased by 26 percent, in correlation with the increase of the number of Medicare fee-for-service beneficiaries who received ambulance rides. If CMS limits these beneficiaries, it stands to reason that newer ambulance suppliers will also decrease, which could leave some ambulance operators in a tight spot.

A report on, says that each ambulance operator has a hefty sum of money at stake if CMS rejects too many requests for approval. For each ambulance trip, Medicare pays approximately $200 and $5.62 per mile for the state of New Jersey.



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