A recent government push to crack down on fraudulent ambulance services in Pennsylvania has triggered a dramatic decline in Medicare billings, Federal and state health care data shows. In 2014, tougher measures were passed that took aim at illegitimate ambulance services. That means more taxpayer money can be spent on medically necessary services instead of bankrolling sham ambulance companies.
Before that time, ambulance companies that were closed amid allegations of Medicare fraud simply re-appeared under a different name just as the former incarnation was shut down. These companies billed Medicare for millions of dollars in unnecessary, non-emergency transportation as well as ambulance trips that never occurred.
The Philadelphia Inquirer noted that most of the Medicare fraud took aim at Medicare beneficiaries who needed kidney dialysis treatments three times a week. The Inquirer reported:
When the fraud was rampant, companies bid against each other for patients, with some paying patients as much as $500 a month for the right to bill Medicare, which pays $360 to $380 per round trip, including mileage, for each of those three weekly trips. Some patients were driven in cars. Others drove themselves.
In fact, one dialysis patient was worth about $67,000 per year to ambulance companies that did nothing but taxi dialysis patients on the taxpayers’ dime when the patients could have driven themselves, found a ride, or taken public transportation.
Federal authorities hit on an effective strategy to combat this fraud in 2014 when they barred new ambulance companies in the Philadelphia area from being paid for these services by Medicare. Additionally, all repetitive, non-emergency ambulance trips, such as rides to dialysis, needed prior authorization before they could be billed.
As a result of these new rules, Medicare’s annual expenditures for ambulance services dropped from $55.4 million in 2010 to just $12.7 million in 2015. The new measures also led to more than a quarter of the ambulance companies in Southeastern Pennsylvania closing (83 companies total), as well as 30 criminal convictions, $22 million in restitution, and 82 years in aggregate prison sentences.
The Inquirer also noted that New Jersey and South Carolina – two other states where prior authorization has been required since December 2014 – have also seen drastic drops in Medicare expenditures on ambulance services to an average of $5.4 million last year from $19 million in 2014.
Sources: The Philadelphia Inquirer and Righting Injustice
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