Small Change- Significant Impact

New Year, New Numbers

With the New Year comes new changes, especially from Medicare.

We’ve all become accustomed to each new calendar year ushering in changes to the Medicare fee schedule. The New Year brings new numbers with dollar signs.

This year, for the first time ever those numbers carried a minus sign rather than a plus sign. The Ambulance Inflation Factor (AIF) adjusted negatively by 0.4%. The result is a few dollars here and there, but those dollars can add up.

Small Change- Significant Impact


For many years we were all spoiled. Inflation was running a bit high and the government’s formula for determining the amount of dollars we receive from Medicare basically paralleled that inflationary figure. But a few years ago, the Feds changed the formula and added a productivity adjustment to the equation and that ushered in the possibility that the numbers would adjust negatively rather than positively.

With fuel prices triggering nearly no inflation over the past year the adjustment factor brought the ambulance Medicare fee schedule approvals lower.

A few bucks

Now the actual adjustment in most base rate categories in a matter of a few dollars. Adjustments to the payment approvals for base levels of service adjusted in most cases from a few cents less than a dollar upwards to around $3.00.

The payment rate for loaded miles retreated by three cents in urban areas and rural areas for 0.1 to 17.0 miles traveled and by two cents when the trip exceeds 17 miles.

It doesn’t sound like much, right? Well maybe…let’s explore.

Over the course of a year…

Each of you must consider the tally over the course of a year. Calculate how many miles your ambulances travel over the course of a year and factor in losing a few cents per mile and now the total may seem not as small as you may have thought at first.

Then, factor in a few dollars that you’ll lose for each trip you transport a Medicare patient and now the calculator begins to heat up from all that key punching.

Probably the most frustrating part of this is we are now making fewer dollars for providing the same level of service when our costs have really not retreated. Even if costs remain the same, this means we’re now taking in less money to cover the same workload as last year.

We’re not sure what government bureaucrat sat and conjured up this formula, but I’m sure we’d all agree that there really are no real enormous cost savings except that the price of fuel is better per gallon than it was last year at this time. That’s the only real relief that we see, while everything else we use to do EMS has risen, even if slightly, since 2015.

Not Only Medicare

Plus, remember, these payment adjustments often affect other considerations. Many EMS agencies tie facility contracts to the Medicare fee schedule. In some States, payments for motor vehicle accident and worker’s compensation related incidents ties to the Medicare fee schedule (example, Pennsylvania where our corporate headquarters is based) and then there are the managed care plans that follow the Medicare fee schedule.

Now, I hope you can see how a few bucks less will add up to more than a few bucks less on the bottom line when all is said and done for 2016.

Plan Now

Plan now! Adjust your budgets. Calculate the potential for loss to your organization and make a plan to offset that loss in some way.

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