Non-Contracted Ambulance Services Can Be "Emergency Services" Subject to State Medicaid Rate Cap Payment by Medicaid MCOs

The Centers for Medicare and Medicaid Services ("CMS") has issued an opinion letter clarifying the definition of "provider of emergency services" as it relates to non-contracted ambulance service providers. Section 1932(b)(2)(D) of the Social Security Act, which imposes limits on Medicaid managed care organization ("MCO") payments for emergency services provided by non-contracted providers, requires that non-contracted providers of emergency services "accept as payment in full no more than the amounts . . . that it could collect if the beneficiary received medical assistance under this title." CMS Opinion Letter 9-25-08 to Robert Roth, Crowell & Moring LLP.

According to the CMS opinion letter, while ambulance transportation would not always be an emergency service, it is an emergency service when it is furnished by a qualified provider and is "needed to evaluate or stabilize an emergency medical condition." CMS offered the example of when "a provider responds to an accident, determines that an emergency condition exists, and transports the patient to the emergency department." To the contrary, when a patient is and remains stable, an ambulance transport will not be deemed an "emergency" service.

CMS concluded the term "provider of emergency services" does not address ambulance services categorically, so it elected to read the language in favor of the inclusion of emergency ambulance services. Furthermore, as a policy matter, CMS indicated it has always sought to ensure that Medicaid recipients have appropriate access to medical care. Therefore, CMS found it would be inconsistent with that policy to exclude emergency ambulance services from the definition of "provider of emergency services."

Under the CMS guidance, for emergency ambulance services provided by a non-contracted provider, the ambulance provider is required to accept payment at the rate that would apply under the state Medicaid program, outside the MCO context.