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CMS Announces Prior Authorization Demonstration Program for Repetitive Ambulance Transports

May 22, 2014
AAA Member Advisory
TO:          AAA Membership
FROM:      Brian S. Werfel, Esq. and Kathy Lester
RE:           CMS Announces Prior Authorization Demonstration Program for Repetitive Ambulance Transports

On May 22, 2014, CMS announced a limited prior authorization demonstration program for repetitive scheduled non-emergent ambulance transports in New Jersey, Pennsylvania and South Carolina. Through the demonstration, CMS seeks to ensure that these types of ambulance transports are furnished in accordance with Medicare program requirements. The AAA has recommended to the Congress and discussed with CMS that prior authorization is one approach to eliminating fraudulent behavior that is more targeted than an across-the-board reimbursement cut.

CMS selected New Jersey, Pennsylvania and South Carolina because of their high utilization of repetitive scheduled non-emergent ambulance transports and the high rate of improper payments for these services. In its June 2013 report on the ambulance add-ons, the Medicare Payment Advisory Commission (MedPAC) singled out these states as having higher than average utilization of dialysis transports.

CMS did not announce the start date for this demonstration program, but noted that additional details on the program will be provided during the next Open Door Forum. CMS is implementing this demonstration program pursuant to its authority under Section 1115A of the Social Security Act, which gives CMS the authority to test innovative payment and service delivery models. 

Under the demonstration program, ambulance suppliers in these three states will be required to provide certain documentation prior to the fourth round-trip transport of a repetitive scheduled non-emergent patient within a 30-day period. If the request for prior authorization is not made before the fourth round-trip in a 30-day period, claims will be subject to pre-payment review. “Any provider or supplier submitting claims for which no prior authorization request is recorded will be subject to 100 percent medical review.”

CMS contractors will review the requests to ensure compliance with applicable regulations, National Coverage Determinations, Local Coverage Determinations, and other CMS polices. Decisions on an initial request will be postmarked within 10 business days and subsequent requests will be processed within 20 business days. An affirmative decision will authorize a specified number of trips within a specific period of time, up to 40 round trips within a 60-day period. To the extent the patient requires transport beyond the period specified in the original prior authorization, subsequent authorization requests will be required.

Claims submitted with an affirmative prior authorization will be paid provided all other program requirements are met. Claims submitted with a non-affirmative determination will be denied. However, the ambulance supplier will be permitted to resubmit its application for prior authorization an unlimited number of times. 

CMS also indicated that there will be an expedited review process when the standard timeframe for issuing prior authorization determinations could seriously jeopardize the life or health of the beneficiary. In such instances, the review entity would make reasonable efforts to issue expedited decisions within 2 business days. To request an expedited review, the ambulance supplier would need to provide documentation establishing the threat to the beneficiary’s life or health. 

As CMS notes in its announcement: “Prior authorization will not create new clinical documentation requirements. Instead, it will require the same information necessary to support Medicare payment, just earlier in the process. Prior authorization allows providers and suppliers to address issues with claims prior to rending services and to avoid an appeal process.” By providing medical justification upfront, it may provide relief to the long delays appealing denials for such reasons through Administrative Law Judges.

The AAA will continue to monitor the demonstration program and work with CMS to try to ensure appropriate implementation.

The CMS press release can be viewed in its entirety at: http://cms.hhs.gov/Newsroom/MediaReleaseDatabase/Press-releases/2014-Press-releases-items/2014-05-22.html.

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