CMS to Expand Prior Authorizations for Certain Ambulance Transports

CMS is expanding a program integrity payment model that saved Medicare $650 million by targeting inappropriate overuse of ambulance services using prior authorizations.

In an announcement yesterday, the agency said that it will make the Medicare Prior Authorization Model for Repetitive, Scheduled Non-Emergent Ambulance Transport (RSNAT) a nationwide model after receiving the results of a new evaluation report.

The report also released yesterday found that the model reduced RSNAT service use by 63 percent and RSNAT expenditures by 72 percent among beneficiaries with end-stage renal disease and/or severe pressure ulcers during the first four years of the model without impacting quality of care.

“The RSNAT model has proven a resounding success, and beneficiaries across the country deserve to benefit from it,” CMS Administrator Seema Verma said in the announcement.

The RSNAT model tests whether prior authorizations, or advanced approval of a service before it is furnished, reduce healthcare fraud, abuse, and associated costs, while at least maintaining access and quality of care.

The model launched in 2014 in New Jersey, Pennsylvania, and South Carolina – three states that had higher rates of improper payments for the services. A year later, the agency expanded to five more states (Delaware, Maryland, North Carolina, Virginia, and West Virginia) and the District of Columbia under the authority of MACRA.

In the states, prior authorization for RSNAT services has driven down inappropriate use of the services and subsequently Medicare improper payments with little change in quality of care, although the evaluation report did find some small changes in dialysis use among beneficiaries with end-stage renal disease.

The report also found no increases in emergency department use, hospitalizations, or deaths among beneficiaries residing in the states where the model was implemented.

The number of RSNAT suppliers per 100,000 fee-for-service beneficiaries, however, dipped by about half in the four states that started the model.

“Suppliers that were heavily dependent on RSNAT payments were more likely to leave the market,” the report stated.

In light of the model’s successes, the Chief Actuary of CMS recently certified that nationwide expansion of the prior authorization model would reduce net Medicare spending by improving program integrity.

“CMS program integrity functions allow us to hold the entire healthcare system accountable, protect beneficiaries from harm and safeguard taxpayer dollars,” said Administrator Verma. “When deployed appropriately, prior authorization can help ensure Medicare requirements are met before a service is provided and the claim is paid, without creating any new documentation requirements for providers.”

Repetitive, scheduled non-emergency ambulance transportation are covered under Medicare Part B and are typically used to get beneficiaries to dialysis treatments.

CMS, however, has found that ambulance services, and specifically, non-emergency ambulance transports, frequently lead to program integrity risks.

The services are consistently in the top 20 Part B services with improper payments, according to the agency’s Comprehensive Error Rate Testing program, which measures improper payments in Medicare fee-for-service. The estimated improper payment rate for non-emergent ambulance transports was 22.6 and 18.6 percent in 2017 and 2018, respectively, the program found.

CMS hopes to continue improving program integrity and cost-savings by expanding the model using the same design employed in the states participating in Phases 1 and 2.

The agency did not provide a start date for the nationwide expansion of the model. But it did state that the model will “continue without interruption in the current states beyond December 1, 2020,” which was the initial end date of the model.

The agency will also continue to monitor the impact of COVID-19 and promised to “take that into account when determining the timeframe for expansion into additional states,” the announcement stated.