CMS Releases First GADCS Reports- Part I, Entry and Exit Trends
By Chuck Humphrey, B.A., EMT-B, CADS*
Ground Ambulance Industry Trends
Two reports were released by the Centers for Medicare and Medicaid Services (CMS) using the newly acquired data from the Ground Ambulance Data Collection System (GADCS) project.
One report is subtitled An Analysis of Ground Ambulance Organization Entrance and Exit trends. A companion report bears the subtitle An Analysis of Medicare Fee-for-Service Claims. The reports detail trends for the comparison period of 2017 through 2022.
In consideration of time and space, this blog post will focus on the entrance and exit trend report. A second blog will follow to look at the claim analysis.
Traditional Medicare
It is important to note that the analysis strictly focuses on Traditional Medicare. There is weighting mentioned to account for the shift from traditional to Medicare managed care which is useful to account for the transition in most states and many areas of patients to the managed care option.
Also, of note, is the effect that the COVID-19 public health emergency (PHE) had in skewing some of the analysis, especially accounting for a noticeable dip in the number of transports billed to Traditional Medicare when comparing the pre-PHE years of 2017 through 2019 to the anomaly of 2020. And, thus, a contrast to a rebound in 2021 and thereafter.
Benefit of GADCS
Of importance is the noticeable potential impact the GADCS project will have at the highest levels of both the legislative bodies who will review the report and in the highest levels of the CMS bureaucracy. Until now, an analysis of this type was never made available to the feds.
Now, as a result of the project, there is telling data to support or refute the assumptions made about our industry. In the humble opinion of this author, the ambulance industry as a whole can only benefit by providing important data regarding the trends in the industry as it relates to how the government spends money to reimburse us in our EMS mission. While many of you have found this project “painful,” it’s time the EMS industry becomes transparent about the underlying currents that affect how we fund the lifesaving efforts on behalf of all American citizens.
Comings and Goings
There are a lot of numbers to digest in these reports. I only have the space to highlight the data points and conclusions that jumped off the page upon reading over the reports.
The data points to for-profit ambulance organizations as most likely to enter and exit in the review period when compared with non-profits and government organizations. No surprise there. Also, of note, super rural organizations were less likely to enter and exit the system compared with urban organizations.
Of course, there has always been more stability in the non-profit/government and rural sections of EMS. If one is going to think about making a profit in EMS, the cities are definitely where the action is and the volume. Plus, a non-profit or government grass roots organization has tradition and public support to draw from, including donation and tax dollars whereas a for-profit either is successful or not successful and can come and go based on profitability.
Based on NPIs
I feel it important to point out that the entrance and exit analyses are based on examining movement tied to the National Provider Identifier (NPI). I understand why CMS determined this was the best means of tracking movement as it relates to the individual organization. But it should be noted that it also presents a problem, in my opinion, given that NPI analysis may not paint the entire picture of the state of our industry. Smaller organizations that are acquired by larger organizations (i.e. a for-profit purchasing the assets of a non-profit or a larger non-profit merging with a smaller non-profit) have the ability to maintain the same NPI and report to the IRS or state authorities as a “doing business as” (dba).
Those of us who monitor the industry closely know that small ambulance services in rural areas are struggling. There has been a noticeable change in the complexion of the industry with volunteerism waning and the number of EMS practitioners plummeting, nationwide, thus sinking many community-oriented ambulance service organizations. I’m not sure that these numbers adequately are reflected in the analysis which is concerning.
As such, the report finds that roughly 4 percent of the NPIs that billed Traditional Medicare and were selected for the first tranche of the process, for transports in a given year did not bill Traditional Medicare for transports in the subsequent year. And yet, when comparing 2017 to 2022, the number of NPIs with paid Medicare FFS ground ambulance claims only dipped by a few hundred organizations (10,640 in 2017 compared to 10,451 in 2022) or a 1.8-percent cumulative decline in the number of NPIs in that span of time.
Again, my assumptions going into this project at the outset would be that the number of organizations would have declined must be sharper. But, then again, I cite what I believe to be an inherent skew in that the report is tied to NPIs coupled with the fact that the analysis centers only on billing to Traditional Medicare.
Demographic Distribution
Of interest, is how the report notes the percentage of the breakdown of ambulance organizations based on which organizations entered the system to bill Traditional Medicare. For-profits comprised 49.5% of the new organizations’ billing. There were 32.5% new government entities while only 17.9% of new entries were non-profits.
The new entries were 55.9% in urban areas contrasted to 23.4% in rural districts and 20.7% in super rural areas. New entities also showed very low volume upon start-up with 79.6% of them billing fewer than 200 claims annually to Traditional Medicare. Of course, this also can be tell-tale why many of these newly-entered organizations subsequently fail and exit the system. New start-ups take time to generate transport volume and thus revenue, even when based in predominantly urban population centers.
It’s not easy to turn a quick profit in EMS, immediately. Period.
*Chuck Humphrey is an independent contractor who spent 25 years in the EMS revenue cycle management industry, prior to his retirement from Quick Med Claims. In addition to holding active EMT credentials in Pennsylvania, he is also a Certified Ambulance Coder, Certified Ambulance Compliance Officer and Certified Ambulance Documentation Specialist via the National Academy of Ambulance Compliance. Humphrey is a periodic guest contributor to the QMC blog and podcast space.
