What the Affordable Care Act Means for Fire Service EMS

On June 28, 2012, the U.S. Supreme Court handed down a 5-4 decision on what has been unofficially labeled “Obamacare,” upholding what is legally known as The Patient Protection and Affordable Care Act. In my opinion, it will have a major impact on fire service EMS.

First, the law is more than 2,700 pages long, but “EMS” appears only four times within the law. That may make one think there is very little impact on fire service EMS, but that is not necessarily true, since fire service EMS has a major impact on the healthcare system as a whole. Some hospitals provide statistics showing that more than 50% of their admissions come through their emergency room after patients have been delivered by ambulance. When you consider that a recent federally funded study called the “National EMS Assessment” showed that approximately 40% of all agencies that provide EMS transport are fire-based EMS systems, the impact fire service EMS has on the healthcare system as a whole is huge. No other EMS system model comes close to those numbers. (For details about the report, see my February 2012 column, “Study Proves Fire Service Is Top EMS Provider in U.S.”)


What can we expect?

First, expect ambulance reimbursement to be affected. It gets complicated when you start talking about National Fee Schedules, Geographic Practice Cost Index, Ambulance Inflation Factor, designated super rural ZIP codes and Consumer Price Index for All Urban Consumers, so I won’t get into that since I do not profess to be an EMS-billing expert. But I strongly suggest you talk to your billing company because there is additional revenue that can be collected for your service as a result of the Supreme Court’s decision. This includes a 3% bump for rural transports and a 2% increase for ground ambulance transports that originate in urban areas. Both are retroactive from Jan. 1 through Dec. 31, 2010. Through the end of this year, base rates will be modified by a bonus of 22.6% when the point of pickup is in one of the designated super rural ZIP codes. These ZIP codes, which are based on population, represent the lowest 25% of all rural populations.

But perhaps the biggest impact will occur when an estimated 32 million Americans are added to the health insurance rolls and 105 million more will no longer have a lifetime limit on coverage. That means people who have put off healthcare because they had no insurance will be more inclined to seek care. A percentage of those will be people who call for an ambulance. Therefore, ambulance calls will increase and when you factor in baby boomers who will be growing older and need more medical care, the impact could be significant.

Some speculate the biggest effects to come from Obamacare will be the formation of Accountable Care Organizations (ACOs), which are expected to become major players in the healthcare system as a result of the Supreme Court decision. As I write, there are 187 certified ACOs in the U.S.; none existed just a few years ago. An ACO is a healthcare organization characterized by a payment-and-care delivery model that seeks to tie provider reimbursements to quality metrics and reductions in the total cost of care for an assigned population of patients. Basically, ACOs will exist to drive healthcare costs down and will not pay healthcare providers for medical care of their beneficiaries if they do a poor job. As an example, if a patient is discharged from a hospital after being treated for congestive heart failure and is readmitted within 30 days with the same problem, the hospital must eat the cost of the second treatment and may even be penalized monetarily. Hospitals will have a goal of ensuring that patients are not readmitted after being discharged.

Some believe hospitals will partner with EMS systems to treat patients at home. Hospitals will probably partner with EMS systems to also do follow-up care with patients after discharges. If your fire-based EMS system does not partner with local hospitals that are in an ACO in the future, chances are your local private ambulance company will.

Certainly, my speculation about what the Affordable Care Act will mean for fire service EMS is just that – speculation. But I am reasonably certain it will have a dramatic impact on fire departments that transport patients. You must be prepared to adjust to the changes that are coming.


Gary Ludwig will present “Management Case Studies for EMS Managers” and “Does the EMS Manager Know About This?” at EMS World Expo 2012, Oct. 29-Nov. 2 in New Orleans, LA.