If you missed the announcement from HHS Secretary Sylvia Burwell (published in the March 5, 2015 issue of the prestigious New England Journal of Medicine) on new Medicare targets for value-based payments, it's past time to wake up and smell the coffee! Bottom line (and the reason EMS services need to be concerned): Medicare (aka HHS or Health and Human Services) plans to substantially accelerate reductions in spending initiated in 2011 by dramatically shifting HOW they pay for services. Two changes are very likely to impact EMS and a May 1st announcement was most assuredly the writing on the wall (more on that in a minute). Firstly, HHS has slowly been shifting reimbursement from service-based to value-based payments. By next year, 85% of Medicare payments will be tied to value rather than service and 30% will be paid through accountable care organizations (ACOs) or in bundled payments to health care organizations (rather than directly to providers). By 2018, 90% of reimbursements will be value-based and 50% will be funneled through ACOs.
EMS is one of a few remaining health care services that are paid entirely for services delivered. That, if you read the writing on the wall, will soon end. To steal the words out of the mouths of HHS, paying for value, not volume is the direction health care is headed. Merely providing transport service will no longer result in payment, according to HHS, unless that transport can be shown to have actually helped the patient. Couple that with the shift in payments from service providers to ACOs in bundled payments, and EMS may find themselves in tough financial times. ACOs are organizations responsible for the entire spectrum of care delivered to patients: from routine medical care in physician offices to ambulance transports to ED visits to hospital admissions, surgery, ICU care, rehab, etc. For this care, ACOs are paid a "bundled" or single amount that they then distribute to the "contractors" they select to deliver the services.
Retired LA County Chief Deputy Mike Metro issued a call to action in his May 1 IAFC On Scene newsletter editorial, Your Ambulance Reimbursement Methodology is Going to Change! Pretty timely, if you ask me. The proof seems to be in the pudding, if you saw the National Association of State EMS Officials May 1 announcement of their EMS Compass initiative, launched this month to accept input on proposed EMS performance based measurements. These will be used as the HHS quality (i.e., value-based) metrics future reimbursement will hinge on. If you're concerned about billing revenue and/or interested in having a voice in your future, you will visit the www.emscompass.org site and submit input into the process.
EMS is about to change, quite likely dragged kicking and screaming into the future of health care reimbursement reform. Opportunities to influence the process are open now.
EMS Editor - Fire Engineering