The second meeting of the HCFA Negotiated Rulemaking Advisory Committee on the Medicare Ambulance Fee Schedule began at 9:40 a.m. April 12 at the above address. The meeting was again facilitated by Commissioners Lynn Sylvester and Elayne Tempel.

Handouts from this meeting are identified by a number assignment reflecting the meeting number as well as the order in which the topic was addressed. Handouts are listed at the end of the minutes, and have been made available to all Members. Copies of handouts will be available to the public from HCFA if a written request is received. Handouts will not be faxed to the public.

Advisory Committee Membership Attendance
American Ambulance Association (AAA) - Darrel Grinstead
American College of Emergency Physicians (ACEP) and National Association of EMS
Physicians (NAEMSP) - Robert R. Bass, MD
American Hospital Association (AHA) - David Long
Association of Air Medical Services (AAMS) - Edward R. Marasco
Health Care Financing Administration (HCFA) - Nancy A. Edwards
International Association of Firefighters (IAFF) - Lori Moore
International Association of Fire Chiefs (IAFC) - Jack J. Krakeel
National Association of Counties - C. Ronald Aycock
National Association of State Emerg. Medical Services Directors (NASEMSD) - W. Dan Manz
National Volunteer Fire Council - Steve Ennis

Member(s) Absent
American Health Care Association (AHCA) - Robert T. Deane, Ph.D.

Agenda: Attachment 2-1

Administrative Matters:

Next meetings:	May 24-25, 1999
	Doyle’s Hotel, address above, (202) 483-6000
	June 28-29, 1999
	B.W.I. Marriott Hotel
	1743 W. Nursery Road
	Baltimore, Maryland
	(410) 859-8300

There was a question regarding the conclusion of this Committee’s work by June 30, 1999. HCFA has a statutory regulation date of January 1, 2000 for implementation. A member pointed out that according to Project HOPE’s time frame, no data could be expected before September. It is unlikely the Committee will meet its goal of completion by June 30th.

Committee Members were reminded that HCFA carries out its duties in response to Congressional mandate. If Members are dissatisfied with HCFA’s mandated requirements which are outside the scope of this committee, they should encourage their constituents to contact Congress to request or suggest change. HCFA will check with their Office of Legislation to determine to whom letters should be sent, as well as whether or not HCFA, as a Member, can sign letters of suggestion.

MONDAY, APRIL 12, 1999
Presentation by Chris Molling, HCFA Actuary - Attachment 2-2
A general presentation was made by one of HCFA’s actuaries, Chris Molling. He noted that the Office of the Actuary (OA) is not involved in policy or legal issues. There are three pieces to the data equation:
      1. HCFA Form 1500. This billing form results in direct, countable data for a year’s experience. HCFA’s most current year is 1997. 1998 is not yet complete.
      2. HCFA Form 1450. This form usually reflects hospital billing for ambulance services. SNFs can bill with this form, but usually don’t.
      3. The $65M adjustment. There was agreement between Mr. Thomas, Ways & Means Committee and HCFA Administrator, Nancy-Ann Min DeParle. This figure is a result of statutory changes and regulation, and is not “dark in motive”.

The OA works with “shares of total spending”. HCFA has a data history; the ambulance share must be determined. Cost reporting data is used along with computer modeling. The OA is using the 1996-96 experience to establish the share. The OA calculated the cost:charge ratio using a sample of hospitals. The actuary assumed the cost:charge ratio can never be >1.

Once again the question was asked whether HCFA will stop paying for services when the estimated budget is reached. Once again, HCFA assured the Committee that Medicare will continue to pay for care for its beneficiaries.

Mr. Molling made the following points:

• 1998 data is 85% complete through April; it will be complete in June, 1999.
• Fourth quarter ambulance statistics closely mimic the other three quarters.
• The final statistics will be used for any calculations.
• He would be willing to work closely with the industry through the committee, but pointed out that his workload is set by his supervisor.
• Ambulance as a share has decreased over time. This may be due to a sentinel effect. HCFA and its partners have become rigorous about fraud & abuse issues.
• Managed care is not included in the figures; they will pay for ambulance transportation out of their portion. HCFA is only discussing fee-for-service in this fee schedule regulation.
• Denied claims do not count as service, so carrier-denied claims would not count towards the statistics.
• Regarding the variation between 1997 and 1998, it was Mr. Molling’s opinion that something else in the equation is growing faster, which is adding significant digits.

• Consensus was reached on the above four items for the minutes.
• Consensus was reached that we will not tape record, video, or otherwise make a permanent record of these meetings other than the minutes.
• Consensus was reached on inclusion of supplemental detail in the minutes at the request of a Member.
• Consensus was reached on the topic of Members leaving the meeting with a copy of the consensus items, if possible.
• Consensus was reached on the request for “bullet items” of consensus decisions being added to February’s minutes.

The following list is a summary of the Committee’s consensus items from February’s meeting, which have also been added to the end of those minutes:

• The agenda for this meeting was approved by the Committee.
• The Committee agreed to adopt the definition of consensus.
• The Committee decided to include the Committee Member’s name & organization only. No address or e-mail addresses will be distributed.
• The Committee agreed not to hold Sunday meetings.
• The following meeting dates were selected by the Committee:
        March 22-23, 1999, April 12-13, 1999, May 24-25, 1999, June 28-29, 1999
• The Committee agrees on “type of service” as an issue.
• The Committee agreed it does not want HCFA to contribute financially to Project HOPE.
• There was a consensus that New York City will not become a member.
• There was consensus that committee membership will remain as it was, and that no new requests for membership will be heard.
• Identification of Issues
  1. How will the schedule be structured?
  2. What adjustments need to be made to the schedule?
  3. Definitions of terms?
  4. Implementation?
  5. Expenditure Control?
• The Committee agreed that the issues identified are before the Committee.
• The Ground Rules were approved.
• The Committee agreed that AAA will incorporate the language changes in a contract modification with Project HOPE, and will create a subsequent agreement to go ahead with Phase 2 as modified in this Committee discussion.
• There will be a 1-week deadline for review and return of the minutes, per the Committee’s suggestion if possible.
• The Committee concurred on the revised language for the “Project Hope National Survey of Ambulance Providers Study Data”.

The Committee accepted February’s minutes as corrected.

American Ambulance Association discussion re: Project Hope Study
The sample survey was distributed to members.

• There was consensus on the revised Project Hope agreement.

Discussion was held concerning the amount of financial participation expected by each organization. AAA agreed to put the agreement in final form for the Tuesday, April 13 session, and will include the dollar amount AAA is requesting from each organization.

• There was consensus that the survey document currently in use is acceptable for the pretest.
• There was consensus that any modifications to the questionnaire after the pretest will be sent to Members for their review.

Final Issues
There is a measure of Member concern on coming to consensus on the issues identified at February’s meeting, specifically, how do these issues fit into the process? There exists a good general list of issues, which will bring out Member interests. A common framework needs to be in place in order to standardize assumptions. The Facilitator recommended getting a handle on the Committee’s universe, which will guide the Committee’s decisions and work. The Committee needs to spend some time deciding what the universe of issues are, and then begin to work on them step by step. There was thumbs-up consensus that the Committee will talk about the process, then double check the issues.

TUESDAY, APRIL 13, 1999
Agenda items:

• Agree on dates of future meetings.
• Project Hope revised agreement.
• Review IBB Process.
• Identify interests under “Issues” categories.
• Review issue statements.

Consensus agreement on the following dates for future meetings, if needed:

August 2 - 3, 1999, tentatively in Washington, DC
October 4 -5, 1999, tentatively in Baltimore, MD

Amendment to Project Hope Agreement - Attachment 2-3
The revised agreement was distributed. Other than the amount required for access to the data by each organization ($25,000), the agreement was the same as previously distributed. There was consensus agreement on the structure of the Project Hope agreement. There were no comments, so AAA circulated a signature copy.

Review of Interest Based Process
The Facilitator referred us to the handout used at the February, 1999 meeting.

• Select and discuss an issue
• Identify, discuss, clarify interests
• Brainstorm options -- that satisfy one or more of the interests
• Discuss and reach consensus on standards/objective criteria
• Evaluate options using standards
• Reach consensus on the options that meet the standards

General discussion was held on the ‘interests’. HCFA pointed out that every point raised is valid, and that Congress needs to hear the Committee’s individual concerns. HCFA suggested that Members encourage their Organization’s members to write to their Congressmen expressing their distress about those issues. HCFA pointed out that those concerns might not be solved by the fee schedule we create here. When the fee schedule is created, we can expect it to be in effect for years.

A Member brought up the recurring theme of frustration with the Carriers. HCFA noted that we have virtually no control over the behavior of the Carriers; they have local discretion in the absence of national policy. The fee schedule should add consistency to reimbursement, however.

The Facilitator guided the Committee to identifying interests under the “Issue” categories. Interest is defined as “why this issue is important”. The Committee gave a thumbs-up consensus on the topics being in the following order for the discussion of the interests:

Structure
Adjustment
Expenditure
Implementation
Definitions

In response to a Member comment, HCFA reiterated that the fee schedule is not intended to cover services which were not previously covered. Additional services will not be covered simply because there is a fee schedule. Also, a fee schedule will not necessarily make it easier to bill, but it may reduce the number of follow-ups.

Wednesday, April 14, 1999
The ‘short list’ of interests identified Tuesday was reviewed. The Committee would like to take this up as a first order of business at the May meeting. The Facilitator recommended refining it now by focusing on the process. The Committee decided that a Medical Issues Working Group should be formed, with the Physician Member as chair. The goal of this work group will be to develop a list of conditions which would meet final regulation requirements and prospectively identify patients who meet the criteria for transport.

HCFA mentioned that this is an excellent idea, and that they would be willing to help identify experts in the medical community who could help with this project. While this will be useful to HCFA, it is not a part of the regulations negotiation.

Procedural questions:

• Are there any travel funds available for workgroup members?
  A: Not from HCFA.
• Is there pressure to have this list of conditions finished by a specific date?
  A: : Standards will be wedded to the Federal Register NPRM.
• Do workgroup announcements need to be published in the Federal Register?
  A: No.
• Do workgroup meetings need to be open to the public?
  A: No.

Consensus: The Committee agreed to form a medical issues workgroup to prospectively establish medical necessity standards for ambulance transport and level of service, to be considered by the Committee.

There was thumbs-up consensus that the workgroup shall make a status report at each meeting with a draft final report at the August, 1999 meeting. Dr. Bass, in consultation with Committee Members, will form the workgroup.

Objective for meeting on Monday, May 24 - the Committee will reach consensus on the interests.
The Committee is in consensus re: restatement of the Issues:

Structure
What will the fee schedule look like?
Expenditure Control
What expenditure controls are necessary to assure that the fee schedule in and of itself does not create expenditure increases?
Adjustments to the Schedule
What adjustments to the fee schedule should be included to assure equity of payment related to cost?
Definitions
What terms must be defined to establish the fee schedule?
Implementation
What factors should be taken into consideration to facilitate the implementation of the fee schedule in an efficient and fair manner?

Proposed Standards:

• Any changes made should preserve or enhance the existing emergency response system.
• More uniformity in carrier administration is requested (e.g., medical necessity, payment levels, data decisions).

The Facilitator mentioned that standards provide an objective way for the Committee to choose options. Standards should be global enough to work for each of the five Issues. Cuts (criteria):

• Is it legal?
• Is this within the scope of the committee?
• Assure that the continuation of quality is supported in the fee schedule.
• The payment system should assure the survival of efficient operators. In other words, operators who are operating efficiently should not go out of business because of the inadequacy of reimbursement.
• Will this option benefit one type of provider to the detriment of another?
• Is it operationally implementable?
• Is it effective as a solution? Is it simple? Is it politically feasible? Is it cost effective?

Public Comment:
Comment: An ambulance system exists “out there” with 911, which we need to preserve. Any negative impact on 911 will negatively impact other systems.

Comment: I’m not clear on the reimbursement generated by HCFA Forms 1500 and 1450. Was Form 1451 rolled in, or is it as yet an undetermined amount of money? HCFA: Yes, it was allocated to the 1500.

Comment: The meetings so far have been positive. The Commentor made three points:
1. EMS systems must be designed. The Committee should consider being non-restrictive, because reimbursement determines EMS design. This Committee’s decisions will have a long term impact on EMS work. The commentor requested that there be a minimal effect of the fee schedule on the public’s safety net.
2. For billing, simplicity is key, but clarity and logic are also key. The Committee must ask whether the fee schedule produces inappropriate incentives.
3. The Commentor believes that the impact of this fee schedule for hospitals is underestimated. The hospital industry is in turmoil, and is making dramatic changes. Hospitals become the point of last resort when other [transport] systems aren’t available. Transportation cost:charge ratios are significantly higher than overall hospital cost:charge ratios. The impact of the fee schedule should be limited on local jurisdictions. Beneficiaries’ interests should guide any individual organizational interests.

May Meeting Agenda:

• Finalize standards.
• Status report from the Medical Issues Workgroup.

Homework:

• Committee to begin working on options for structure.
• Finalize interests.

The following list is a summary of the Committee’s consensus items from this meeting:
1. Record all “Thumbs Up” consensuses in bold, and list these at the end.
2. Record the general topic descriptor of agenda and discussion of consensus items.
3. The exception is that all HCFA statements should be captured in depth.
4. Record only a general description of any other presentation.

• Consensus was reached on the above four items for the minutes.
• Consensus was reached that we will not tape record, video, or otherwise make a permanent record of these meetings other than the minutes.
• Consensus was reached on inclusion of supplemental detail in the minutes at the request of a Member.
• Consensus was reached on the topic of Members leaving the meeting with a copy of the consensus items, if possible.
• Consensus was reached on the request for “bullet items” of consensus decisions being added to February’s minutes.

The Committee accepted February’s minutes as corrected.
There was consensus on the revised Project Hope agreement.

• There was consensus that the survey document currently in use is acceptable for the pretest.
• There was consensus that any modifications to the questionnaire after the pretest will be sent to Members for their review.

There was thumbs-up consensus that the Committee will talk about the process, then double check the issues.

Consensus agreement on the following dates for future meetings, if needed:

August 2 - 3, 1999, tentatively in Washington, DC
October 4 -5, 1999, tentatively in Baltimore, MD

The Committee gave a thumbs-up consensus on the topics being in the following order for the discussion of the interests:

Structure
Adjustment
Expenditure
Implementation
Definitions

Consensus: The Committee agreed to form a medical issues workgroup to prospectively establish medical necessity for ambulance transport and level of service.
There was thumbs-up consensus that the workgroup shall make a status report at each meeting with a draft final report at the August, 1999 meeting. Dr. Bass, in consultation with Committee Members, will form the workgroup.
The Committee is in consensus re: restatement of the Issues:

Structure
What will the fee schedule look like?
Expenditure Control
What expenditure controls are necessary to assure that the fee schedule in and of itself does not create expenditure increases?
Adjustments to the Schedule
What adjustments to the fee schedule should be included to assure equity of payment related to cost?
Definitions
What terms must be defined to establish the fee schedule? Implementation
What factors should be taken into consideration to facilitate the implementation of the fee schedule in an efficient and fair manner?

The meeting was adjourned at approximately 3:30 pm.

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APPENDIX A

Attachment to the Minutes
MEDICARE AMBULANCE FEE SCHEDULE NEGOTIATED RULEMAKING
April 12 - 14, 1999

2 - 1	Agenda
2 - 2	A Preliminary Estimate of HCFA’s Reimbursement for Ambulance Services in Calendar Year 2000
2 - 3	Amendment to Agreement Between Project Hope and the American Ambulance Association

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Last Updated June 6, 1999