Medicare: Beneficiary Liability for Certain Paramedic Services May Be
Substantial (Briefing Report, 04/15/94, GAO/HEHS-94-122BR).

Volunteer ambulance companies often transport Medicare patients to
hospitals.  In some cases, the patient may require the services of a
paramedic trained in advanced life support services.  GAO found that
Medicare contractors rely on states to certify ambulance companies for
participation in the Medicare program, and states set their own
certification requirements.  Most volunteer ambulance companies do not
charge for their services or have their own paramedics.  Medicare does
not pay separately for paramedics, who are covered only if they are an
integral part of the ambulance service.  Although data are limited, GAO
believes that the potential liability of Medicare beneficiaries for
paramedic services may be substantial.  For example, two providers of
paramedic services in Connecticut charged Medicare patients in excess of
$600,000.  The Health Care Financing Administration (HCFA) has tried to
minimize this liability by allowing ambulance companies to submit a
single bill to Medicare for both the ambulance and paramedic services.
Because volunteer ambulance companies seldom bill for services, however,
this arrangement may not help patients minimize their liability.  HCFA
officials have agreed to reexamine their policy but as of March 1994 had
not yet reached a decision on this matter.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-94-122BR
     TITLE:  Medicare: Beneficiary Liability for Certain Paramedic 
             Services May Be Substantial
      DATE:  04/15/94
   SUBJECT:  Emergency medical services
             Beneficiaries
             Personal liability (legal)
             Paramedical training
             Health care personnel
             Volunteer services
             State-administered programs
             Elderly persons
IDENTIFIER:  Medicare Program
             Connecticut
             
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Cover
================================================================ COVER


Briefing Report to Congressional Requesters

April 1994

MEDICARE - BENEFICIARY LIABILITY
FOR CERTAIN PARAMEDIC SERVICES MAY
BE SUBSTANTIAL

GAO/HEHS-94-122BR

Paramedic Intercept Services


Abbreviations
=============================================================== ABBREV


Letter
=============================================================== LETTER


B-254210

April 15, 1994

The Honorable Daniel Patrick Moynihan
Chairman, Committee on Finance
United States Senate

The Honorable Dan Rostenkowski
Chairman, Committee on Ways and Means
House of Representatives

The Honorable John D.  Dingell
Chairman, Committee on Energy and Commerce
House of Representatives

The Honorable Nancy L.  Johnson
House of Representatives

Volunteer ambulance companies often transport Medicare beneficiaries
to hospitals.  In some cases, the beneficiary may require the
services of a paramedic--an individual trained in advanced life
support services, including the use of specialized equipment and
medications.  If the volunteer ambulance company does not have a
paramedic on staff, it generally requests one from a hospital or
commercial ambulance company.  The paramedic, called a secondary
responder, either meets the volunteer ambulance en route or at the
scene of the call.  If needed, the paramedic boards the volunteer
ambulance and accompanies the beneficiary to the hospital.  The
paramedic provides what is termed paramedic intercept services. 

In your letter to us, you expressed concern that Medicare may not pay
for the services of secondary responders and that beneficiaries may
be liable for them.  Accordingly, you asked that we examine (1)
whether volunteer ambulance companies are certified to participate in
the Medicare program, (2) whether volunteer ambulance companies bill
for their services, and (3) the liability that Medicare beneficiaries
may have for the services of secondary responders. 

As agreed with your offices, we briefed the minority health counsel
for the House Committee on Ways and Means, Subcommittee on Health, on
the results of our work.  Using a series of charts, we described the
objectives, scope, and methodology of our study and presented our
principal findings.  As agreed with the minority health counsel, we
are furnishing you with copies of our briefing charts, and, in some
cases, with additional clarifying comments (see app.  I). 

In summary, we found the following: 

  Medicare contractors rely on states to certify ambulance companies
     for participation in the Medicare program, and states establish
     their own certification requirements. 

  Most volunteer ambulance companies do not charge for their services
     or have their own paramedics. 

  Medicare does not pay separately for paramedics as secondary
     responders.  Paramedic services are only covered if they are an
     integral part of the ambulance service.  While specific data are
     not readily available, the potential liability of Medicare
     beneficiaries for paramedic intercept services may be
     substantial.  For example, two providers of paramedic intercept
     services in Connecticut may have charged Medicare beneficiaries
     in excess of $600,000 (see app.  I). 

The Health Care Financing Administration (HCFA) has tried to minimize
this liability by allowing the ambulance company that transports the
beneficiary to submit a single bill to Medicare for both the
ambulance transportation and paramedic intercept services.  Because
volunteer ambulance companies seldom bill for services, however, this
arrangement may not help beneficiaries minimize their liability. 
Recognizing this dilemma, HCFA officials agreed to reexamine their
policy.  As of
March 15, 1994, HCFA officials had not reached a decision on this
matter. 

We did our work between July 1993 and December 1993 in accordance
with generally accepted government auditing standards. 

We dicussed the results of our work with responsible HCFA program
officials and have incorporated their comments where appropriate. 
These officials generally agreed with our findings and conclusions. 

We are sending copies of this report to the Secretary of Health and
Human Services and other interested congressional committees.  Copies
will also be made available to others upon request.  Major
contributors to this report are listed in appendix II.  If you have
any questions about this report, please call me on (202) 512-7119. 

Sincerely yours,

Leslie G.  Aronovitz
Associate Director
Health Financing Issues


=========================================================== Appendix I



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   edition.)



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   edition.)



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   edition.)



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   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.1

We performed our study in Connecticut because of concerns that
Medicare beneficiaries may be held liable for the uncovered services
of paramedics as secondary responders.  To determine if volunteer
ambulances are Medicare certified, we researched the Medicare laws,
regulations, and guidelines on ambulance services, and Connecticut's
regulations on ambulance services.  In addition, we spoke with
officials from HCFA, both in Boston and at headquarters; the
Connecticut Office of Emergency Medical Services; and the Travelers
Insurance Company--a Medicare contractor in Connecticut.  To
determine if volunteer ambulances bill for their services, we
obtained data from the Connecticut Office of Emergency Medical
Services and interviewed officials of five volunteer ambulance
companies and the American Ambulance Association.  To identify the
potential liability of Medicare beneficiaries for the uncovered
services of secondary responders, we spoke with six providers of
paramedic services. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.2

To accomplish the above, we reviewed various HCFA and Medicare
contractor memorandums and letters.  Also, we spoke with officials
from the American Ambulance Association, the Connecticut Office of
Emergency Medical Services, and six providers of paramedic intercept
services in Connecticut. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.3

Section 1861(s)(7) of the Social Security Act (Medicare statute)
covers payment for ambulance services to the extent provided in
regulations.  HCFA's regulations cover ambulance services as they
pertain to transportation of the sick and injured.  Medicare does not
pay separately for paramedic services. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.4

While Medicare contractors rely on states to certify ambulances for
Medicare participation, states establish their own certification
requirements.  In Connecticut, this certification is done by the
Office of Emergency Medical Services, in the Department of Health
Services. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.5

Each of the five volunteer ambulance companies relied on emergency
medical technicians--individuals who are not as highly trained as
paramedics.  An American Ambulance Association official told us that,
nationally, volunteer ambulance companies generally do not have their
own paramedics and thus seek outside paramedic services.  Also, most
volunteer ambulance companies do not bill for services. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.6

While specific data are not readily available, volunteer ambulance
companies estimated that they served a high proportion of elderly
people.  For example, three estimated that about one-third to
one-half of their calls were for people on Medicare. 



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.7

While specific data are not readily available, the potential
liability of Medicare beneficiaries for paramedic intercept services
may be substantial.  For example, one provider of paramedic intercept
services estimated it billed about 2,500 calls in 1992, and about
one-half were for people on Medicare.  The provider's charge per call
was $320.  Another provider estimated it billed nearly 2,000 calls
for the 1-year period ending April 30, 1993, and about one-third were
for Medicare beneficiaries.  The provider's charge per call was $324. 
For these two providers alone, the charges to Medicare beneficiaries
may have exceeded $600,000. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.8

An ambulance company that transports a patient may obtain paramedic
services from another provider, such as a commercial ambulance
company or a hospital that has its own paramedics.  However, HCFA
considers the transportation and paramedic components to be a single
ambulance service, and the ambulance that transports the beneficiary
must bill Medicare on a single claim form.  Under this arrangement,
Medicare would pay the ambulance company for the entire service, and
the ambulance company would pay the provider of paramedic services
the amount due under its contract. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------- Appendix I:0.9

Although volunteer ambulance companies are not using HCFA's billing
arrangements, their decision does not seem to have been influenced by
Connecticut regulations on ambulance services.  Based on a health
care provider request, the Connecticut Attorney General ruled in
January 1993 that the state does not regulate billing issues. 

To utilize HCFA's billing arrangements, a volunteer ambulance company
would have to submit a claim to Medicare for both the transportation
and paramedic services.  Even if the volunteer ambulance company did
not charge for its transportation services, it could still request
payment for the paramedic services.  Unless the volunteer ambulance
company takes such action, however, no Medicare payment can be made. 
We found that volunteer ambulance companies--not having their own
paramedics--have not billed the Medicare contractor in Connecticut
for paramedic services.  Most volunteer ambulances do not charge for
their services, and several stated that doing so would be an
administrative burden. 



   (See figure in printed
   edition.)


      ADDITIONAL COMMENTS
------------------------------------------------------ Appendix I:0.10

The paramedic intercept issue is not solely a Connecticut issue, but
a national one--particularly for those areas of the country that rely
heavily on volunteer ambulances.  This is based on information from
HCFA and Medicare contractor memorandums/letters on Medicare
operations in New Jersey and Pennsylvania, and comments made by
officials of the American Ambulance Association, Connecticut
providers of paramedic services, and the Connecticut Office of
Emergency Medical Services. 



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)


MAJOR CONTRIBUTORS TO THIS
BRIEFING REPORT
========================================================== Appendix II

John C.  Hansen, Assistant Director, (202) 512-7105
Roland A.  Poirier, Evaluator-in-Charge
Donald B.  Hunter
