Fractional Mileage Billing is on it’s way!

You may have heard…

As some of you may already be aware, the Centers for Medicare and Medicaid Services (CMS) announced recently that they intend to publish new rules regarding billing for ambulance mileage. If the final rule on the matter is published at the end of November, as anticipated, it will mean that beginning on January 1, 2011 Medicare claims must be billed with the “tenths” of mile documented.

This is a fairly significant change from how things are now done right now.

Enhanced always recommended recording tenths and “rounding up”…

Our company, Enhanced Management Services, has always encouraged our clients to record the “tenths” of miles when documenting the loaded mileage for transports, especially when supporting billing to Medicare. We have encouraged this practice due to the current ability to round up when billing.

For example, if your crews record via documented odometer readings that a patient was transported from his/her residence to a hospital at a distance of 3.2 miles, then the resulting claim to Medicare can be submitted billing a full 4 miles! Any fractional tenth of a mile can now be rounded to the next highest whole number for billing purposes.

However, with this proposed change looming on the horizon, that same example in 2011 will require the claim to be billed to Medicare using the 3.2 mile factor and the reimbursement rate will be paid at a rate of 3.2 times the mileage approval as published in the Medicare Ambulance Fee Schedule. Now instead of of receiving 4 times the reimbursement, your company will be paid at 8/10 less of the reimbursement approval that you are right now. Add those numbers up across all of your existing call volume numbers and the decrease may be fairly significant depending on your company’s total annual Medicare billable run volume.

Aside from the potential loss in revenue, the new rule presents a bit of a problem for those companies that haven’t been collecting these readings. Now, it will be imperative that all companies comply with the fractional reporting. So now, more than ever, it will be important for ambulance companies to come up with a plan to train crew members to collect this data.

“But…the odometer doesn’t have a ‘tenths’ reading; what do we do?”

One of the common arguments I have heard through the years is the lack of a “tenths” reading on some digital odometers. This creates a bit of a hassle for the crew, as now they will need to set a trip odometer in order to capture the “tenths” reading to properly fulfill the documentation requirements for backing up the billing of loaded mileage on the claim.

For example, upon arriving on scene the crew member would note the actual total mileage at the time. Let’s say that the total mileage is noted to be 10,300 miles. At that point, the driver would reset the trip odometer to zero. Once the ambulance arrives at the hospital to deliver the patient, the crew would note the amount of miles, including tenths, traveled via the trip odometer and record the new actual mileage. So given the starting mileage of 10,300 miles, if the trip odometer reads 5.3 upon arriving at the hospital, then the mileage reading documented would be 10,305.3. Of course, this would be the scenario for those ambulance vehicles that do not contain “tenths” reading as part of the main odometer display. For those ambulance vehicles that have a tenth readout on the primary odometer then it’s as “simple” as recording the numbers on scene and at the hospital/facility/destination.

CMS’s ultimate goal here is for Medicare to “save” a potential $80 million! That just enough savings to push this forward, it appears, at least for now.

Do it voluntarily and you’ll be ready when it’s required!

Our suggestion to all of your is to implement recording the tenths reading immediately, if you not already doing so. We highly recommend that you do not wait until January to consider requiring this documentation in your run reports, as it will only make the transition more difficult for your staff.

One final suggestion…

We anticipate that there will be some major systems changes that will need to be made by Medicare and even the various secondary payer insurances. Anytime a massive system change takes place on a grand scale, there is always the possibility that payments may be delayed, suspended or even incorrect payments issued by Medicare when then later must be accounted for and corrected, creating even more hassle for your billing folks. This could all happen right away in 2011. So, we suggest that you consider submitting claims to Medicare for as many 2010 dates of service as quickly as possible between now and the end of the year to beat those potential system hiccups, should they occur. Billing 2010 trips before the end of the year will certainly help you beat any processing problems that may be encountered because of this expected change in mileage billing.

Please remember- the final rule has not yet been published as of this post! We don’t see a change taking place at this point, however when it comes to the Federal Government anything is possible. Stay tuned to this Blog site for more information. We’ll keep you in the know as the New Year draws closer regarding this and any other changes on the horizon.

We are here to lend a helping hand. If you don’t think your billing office or outsourcing company is ready to meet the challenges of the proposed changes, give us a call or contact us by e-mail. We are ready to help you.

What are your thoughts on this or any other ambulance billing subject? Take a minute to tell us.

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