Ems System Performance-Based Funding And Reimbursement Model - Finance Committee Draft Advisory
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34Finance Committee DRAFT Advisory
EMS System Performance-based Funding and Reimbursement Model
The National EMS Advisory Council
Submitted on March 29, 2012
Committee: Finance
Title: EMS System Performance-based Funding and Reimbursement Model
Issue Synopsis
A:
Problem Statement
Emergency Medical Services (EMS) Systems are incredibly diverse across the United States.
EMS varies in clinical sophistication, deployment strategies, performance standards, and
governance. EMS Systems also vary considerably in how they are funded. Emergency Medical
Services is defined as “pre-hospital and out of hospital EMS, including 911 and dispatch,
emergency medical response, field triage and stabilization, and transport by ambulance or
helicopter to a hospital and between facilities (IOM, Crossroads, 2007).” Ambulance services
are a critical component of an EMS System and the health care safety net. Historically,
ambulance services have been primarily funded by user fees. In certain locations, local tax
subsidies have been used to offset costs for all EMS System components.
It is generally recognized that financing EMS has many challenges and the methods are
fragmented, conflicted and often underfunded. Today, the Center for Medicare and Medicaid
Services (CMS) recognizes ambulance service as a transportation benefit only. In general terms,
the ambulance must transport the patient to a hospital emergency department (ED) to receive
compensation from federal payers and most commercial insurance companies. With the growing
sophistication of EMS Systems, pilot programs have shown that EMS crews can often deliver
definitive care at the scene of the emergency thus obviating the need for transport. Proactive
EMS evaluation, treatment by EMS without transport to an ED, treat and refer to other health
care providers by EMS and transportation to alternative destinations by EMS are often viable
options to safely care for the general public. However, insurance will not typically cover these
services and the patient may be liable for one hundred percent of the EMS bill. In most areas,
the patient is transported to the ED, insurance is billed, the service is covered (decreasing the
patient’s out-of-pocket costs), and the EMS agency is compensated for the care it appropriately
provided. Due to the unique nature of the service delivery model, EMS agencies provide an
increasing number of responses where no reimbursement is available. For example, EMS is
called to an emergency scene by law enforcement to assess a patient at a motor vehicle accident
causing an expensive response. If the patient is not transported, no reimbursement is available
by insurance companies. Costs were still incurred to be ready to respond and for the response
itself. Policies vary among EMS agencies regarding whether it is appropriate to bill patients for
a response without transport.
Over the last decade, there have been recommendations to move EMS financing to more of a
readiness-based model rather than principally based on transports. (IOM, Crossroads, 2007). The
cost of readiness must include funding to meet day-to-day capacity as well as the capacity to
March 29,2012
Draft Advisory
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