Update on Medicare ambulance fee schedule lawsuit

By DAVID WERFEL
American Ambulance Association Medicare Consultant

WASHINGTON, D.C. — You may recall the American Ambulance Association (AAA) previously advised you of a lawsuit challenging (1) implementation of the fee schedule and (2) payment of mileage in those states that previously were not paid mileage from the point of pick-up. That case, Lifestar Ambulance Service v. United States, resulted in a decision granting (1) the motion by the plaintiffs for implementation of the fee schedule effective January 1, 2000; (2) the motion by the plaintiffs for payment of loaded mileage in those states that did not pay loaded mileage from point of pick-up effective July 1, 2001; and (3) class action status for each of these two issues. 

The Centers for Medicare and Medicaid Services (CMS) has appealed that decision.

In the Federal Register of April 16, CMS placed a notice announcing they are going to comply with the court order in the Lifestar case. 

In sum, they are going to pay for implementation of the fee schedule effective January 1, 2000 to March 31, 2002 and for mileage in North Carolina and Tennessee for July 1, 2001 to March 31, 2002. 

They are going to implement the earlier phase-in by using a 5% phase-in of the fee schedule for 2000; a 10% phase-in for 2001; and a 20% phase-in for January 1, 2--2 to March 31, 2002.

They are also going to pay the loaded mileage in those states that did not pay loaded mileage, effective July 1, 2001.

CMS estimates that two-thirds of the 15,000 suppliers who bill Medicare will receive $81 Million as a result of their implementing the court order. Of this amount, $16 Million is for the mileage in North Carolina and Tennessee.

The actual details of how they will determine who gets what are not listed in this notice.

CMS has also stated that they have appealed this decision and, if they win, they will recoup the payments that will be made as a result of their complying with the court order.

CMS is now preparing a Program Memorandum (I expect it will be issued soon). I believe that what will happen is that this PM will advise Carriers how to calculate payments to suppliers for implementing the Fee Schedule earlier and payment of mileage, where appropriate. 

There are still some details that need to be worked out by CMS, the attorneys handling the case and, possibly the court.  The next step should be publication of the Program Memorandum noted above. 

We wanted to share this latest information with you, but urge you not to submit any questions at this time since this is the latest information and all that we have at this time.  As more becomes available, the AAA will share it with you. 

In anticipation of questions, I have listed below what might be your immediate questions to this notice, as follows:

Q.  How much will be paid, to whom and when?

A.  These are unknown at this point. The Program Memorandum, when issued, will answer these questions.

Q.  Since the court granted class action status, do I have to join the class, sign any documents, etc.

A.  No, everyone is in the class unless they specifically opt out and, there is no reason to do so, even if you gained under the fee schedule since Carriers will only pay those entitled to receive a payment, based on the court decision.

Q.  If I gained under the fee schedule, will they take any money away from me as a result of this lawsuit?

A.  No.  It is our understanding that the payments made are expected to be in addition to all other payments.

Q.  If I am to be paid as a result of this case, who will pay me and do I have to pay legal fees?

A.  You would be paid by your Carrier.  Legal fees will not be paid by you. Either they will come off the top from the $81 Million or be court ordered, in addition to the $81 Million.  This is a very important detail to be worked out, but rest assured that you will not pay legal fees.

Q.  If CMS appeals and wins and I have been paid as a result of this lawsuit, what will happen?

A.  If that happens you will have to return the payment.

You are likely to have other questions on the lawsuit.  I must ask you to hold those questions for now.  When the program memorandum is issued, it will be shared with you through the same format.  I will prepare a summary at that time providing additional details.  At that time I would be willing to entertain additional questions.

I will also make this issue part of the presentation that I will make at the AAA Summer Quarterly Meeting and Health Care Reimbursement Conference in Minneapolis, MN on July 25, 2003.

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