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Cornerstone Adminisystems

Cornerstone Adminisystems

2022 Ambulance Inflation Factor

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The Centers for Medicare and Medicaid Services (CMS) recently announced the Ambulance Inflation Factor (AIF) for 2022 is 5.1%.

The AIF is updated each year and is calculated by measuring the increase in the consumer price index for urban consumers (CPI-U) for the 12-month period ending with June of the previous year.

This figure is then reduced by a productivity adjustment, which is itself based on the change in the 10-year moving average of the multi-factor productivity index (MFP).  Depending on the year, the MFP reduction may result in a negative AIF.

For the 12-month period ending June 2021, the CPI-U increased by 5.4%.  Meanwhile, the calendar year MFP will be 0.3%.  When we subtract the MFP from the CPI-U, we arrive at the AIF.  This value is then added to the conversion factor used to calculate Medicare payments under the Ambulance Fee Schedule.

Of course, it is important to remember that the current suspension of sequestration (a 2% reduction applied to the 80% allowed charge) is due to expire at the end of the year.  Sequestration came into effect in 2013, but the current suspension was prompted by the financial hardship created by the pandemic.

Unless Congress extends the suspension, sequestration will return, thus eating into the 5.1% gain promised by the AIF.

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