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CMS Cost Data Collection & Reporting

November 07, 2019

The cost data collection and reporting mandate for ground ambulance providers and suppliers is a new initiative from the Centers for Medicare and Medicaid Services (CMS), intended to collect information from across the country on the cost of providing emergency management services.

If you're a Cornerstone client and your agency has been selected, we will work with you to ensure you know what is expected and that you have the tools you need. With this stated, let's dive a little deeper.

The program stems from the Bipartisan Budget Act of 2018, which we tend to remember because it extended the temporary add-on payments (2% urban, 3% rural & 22.6% super-rural with additional mileage for rural and super-rural).

For those who follow the industry, these add-ons were like band aids - useful certainly, but not a fix for something fundamentally broken. If we are to believe CMS, this new cost data collection and reporting initiative is the most significant step yet toward bridging the gap between cost and reimbursement.

As for why CMS has chosen this route, the answer is fairly simple: If the government is going to implement meaningful change to the fee schedule, then it will need to see your books. After all, there are many types of agencies, operating in many different ways, covering many types of service areas and populations, with little information available from the Government Accountability Office. 

As such, it should come as no surprise that the new program comes with rules, requirements, deadlines and penalties for non-compliance.

Who qualifies?

If your agency billed at least one claim to Medicare in 2017, you qualify. This is the most recent year in which CMS has full data. The initial phase will last four years (2020-2024), and during each year, 25% of the nation's ground providers and suppliers will be selected. With around 10,000 qualifying agencies, that's roughly 2,500 per year.

How are agencies selected?

Agencies will be identified by their National Provider Identifier, or NPI. Selection is random and organized through a sampling system which looks at factors such as ownership (for profit, nonprofit), service area population (urban, rural, super-rural), and volume of Medicare transports.

How are agencies notified?

CMS recently mailed letters via US mail and may also send emails.

Notifications are being mailed to the correspondence address listed in the National Plan & Provider Enumeration System (NPPES), and addressed to the attention of the "authorized official" who was listed on the last update to your Medicare records.

A list of the agencies selected for the initial round is posted here. Click on "Ground Ambulance Providers and Suppliers Selected to Submit Data in Year 1."

Cornerstone is actively working with its clients to prepare for the program, and we highly recommend you look to see if your agency is included so that you too can be prepared.

Program Deployment, Timeline to Respond & Consequences of Non-Compliance

The program begins January 1.

A recipient has only 30 days to respond to the notification, and confirm whether it chooses to collect data and report based on calendar year or fiscal year.

Agencies selecting calendar year will be required to collect data from January 1, 2020 through December 31, 2020, and then report that data within five months, or May, 2021.

Agencies that operate on and select a fiscal year will have the same five month span to report on said data from the end of their collection period. In other words, if your agency operates on a fiscal year that runs, say, July 1, 2020 to June 30, 2021, then you would have until the end of November 2021 to report.

A failure to respond and/or report within the specified time period will result in a 10% penalty to Medicare payments no later than three months after the conclusion of the reporting period, applied the next calendar year.

It's worth noting, CMS will extend any agency scheduled to receive a penalty the benefit of a review prior to the penalty being applied. Likewise, CMS intends to provide a hardship exemption due to certain extenuating circumstances, e.g. natural disaster, bankruptcy, etc., and any agency applying for hardship would be subject to an informal review designed to assess the merits of the application.

What exactly will agencies need to collect and report?

In broad terms, CMS is looking for: 

  • Total costs related to ground ambulance services 
  • Total revenue from ground ambulance services 
  • Total ground ambulance service utilization

What's interesting is CMS is not restricting the data to those services that were billable to Medicare. CMS wants the total picture.

Accordingly, CMS recognizes that some agencies share operational costs with fire departments, other public service organizations, air ambulance services, hospitals, and other entities.

Such interwoven costs can make it difficult to accurately discern the costs specifically associated with the provision of ground ambulance services. To address this, CMS has proposed to further refine three separate categories: 

  • Cost and revenue components partially related to ground ambulance services 
  • Cost and revenue component entirely related to ground ambulance services 
  • Cost and revenue components completely unrelated to ground ambulance services (these would not be reported)

Within this, there are several components which CMS will evaluate: 

  • Organizational characteristics: Agency info, service area, ownership, response time, etc. 
  • Utilization statistics: Responses, transports, service levels by HCPCS 
  • Staff and labor costs: Clinical, administrative, facilities, volunteer 
  • Facilities cost: Mortgage, insurance, maintenance, utility 
  • Vehicle costs: Annual depreciation, fuel, maintenance and insurance 
  • Equipment and supply costs: Capital medical and non-medical 
  • Other costs: Anything not reported, e.g. marketing, travel, professional 
  • Total cost: To cross-reference what's reported in the instrument 
  • Revenue: Billing data (by payor), membership fees, grants, etc.

How will agencies need to collect and report data?

To explain the data that must be collected, CMS has chosen a web-based tool (which it calls the "instrument"), though that tool is not yet available in its final version. Until CMS releases the final version of the online tool, it has provided a PDF version of the instrument.

This document reveals the format, scope and criteria of what an agency must collect. It is essential that selected agencies familiarize themselves with the data requirements laid out in the instrument, and ensure they have appropriate mechanisms in place to track this data throughout the collection period.

For a consolidated version of what's in the instrument, check out the CMS quick reference guide.

How to Prepare

Right now, the important thing for selected agencies is to respond to CMS within 30 days, confirming data will be collected within either calendar year 2020, or according to their fiscal year.

Then, agencies will want to ensure they have mechanisms in place to capture the relevant data throughout the collection period. The list of required data is extensive, and may require agencies to put new systems in place if certain data elements have not been tracked up to this point.

CMS anticipates it will take an agency 20 hours - starting now and lasting the course of the collection period - to become educated on the requirements and to collect the data, and then an additional 3 hours to complete the reporting.

Of course, CMS hasn't released all of the information yet as it relates to reporting. However, CMS recommends agencies use the PDF/paper version of the instrument as a guide for completing the required fields.

When the time comes to report, this guide can then make the actual data entry into the final online version a little easier. Also, it's worth mentioning, the instrument can be completed in multiple sittings.

If you're a Cornerstone client, help is available

Cornerstone is here to assist its clients, and can ensure it will provide all the billing-related data CMS needs to see. We are actively speaking with our affected clients to explain the program, its requirements, related timelines, and potential challenges.

For those affected, the next two months may prove very busy as preparations are made to collect the data during the following year. If appropriate accounting methods are not already in place, or if certain categories are not currently being tracked, those agencies must act now to remedy this.

For others, such mechanisms are already in place. In either case, Cornerstone will make sure its clients are informed and understand what's at stake. We're all in this together.

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