Air Medical Program in Crisis

Air Medical Service (AMS)

The air medical services (AMS) program in this case was experiencing substantial financial duress and sponsoring hospital leadership was in the process of evaluating several options to mitigate poor financial performance. Among the options was to close the program.

Situation

The AMS program transitioned its billing and reimbursement process to Quick Med Claims (QMC) in 2013. The billing and reimbursement process for the AMS operation was historically handled by the Patient Financial Services (PFS) group at the sponsoring hospital. The reimbursement performance was below the industry benchmarks.

Background

The AMS program completes more than 2,000 patient transports per year, including a mix of scene responses and interfacility transports. The sponsoring hospital engaged several different consulting groups over a five (5) year period to evaluate the financial performance of the program. Less than adequate reimbursement was identified by all of the consultants as a contributing factor.

Assessment

During the implementation process, the QMC team identified several opportunities for improvement within the billing and reimbursement process:

• The reimbursement per transport was below $4,300. This performance is well below the national and regional benchmarks.
• There were a number of hospital driven processes that resulted in a negative impact on the billing and reimbursement performance.
• The documentation quality was solid, but opportunities for improvement were identified.
• The institution entered into a number of contracts with commercial payors with reimbursement levels well below their cost of operation.
• The charge structure was not consistent with industry best practices and the levels were well below the range of charges in the region.

Recommendations

The QMC team worked with the client team to make a series of changes in the billing and reimbursement process:

• QMC assumed primary responsibility for the AMS billing and reimbursement process. The majority of the processes were changed to the QMC operating standard.
• The QMC team continues to work with the leadership at the sponsoring hospital to adjust the processes in order to ensure compliance, maximize reimbursement and deliver quality customer service to patients and families.
• The QMC team provides regular feedback to AMS program leadership regarding the quality of the documentation and has offered educational programming to enhance the performance.
• The payor contracts were analyzed and QMC made recommendations for action to mitigate the low reimbursement levels in each case.
• There was an initial charge structure adjustment at the time of the transition and the sponsoring hospital leadership plans to complete an additional adjustment in 2014 in order to make the structure and levels consistent with the prevailing practices.