Revenue generation through GPS-measured mileage.

Before the 2002 implementation of the Balanced Budget Act of 1997 (BBA), ambulance services (air and ground) were paid on a so-called reasonable-cost basis with 4 billing options: a single, all-inclusive charge; 1 charge for all services and a separate for mileage; 1 charge for all services and mileage and a separate charge for supplies; and separate charges for services, supplies, and mileage. The way an entity billed depended on whether it was a provider (hospital, skilled nursing facility, home health agency) or a supplier (independent entities of any provider) of service. The BBA has changed the way ambulance services can collect for services rendered, with a new schedule based on the level of service provided and the miles a patient is transported. There is no longer a distinction between suppliers and providers; all are now considered ambulance suppliers and covered under the same new fee schedule. The only exceptions to this are critical access hospitals, which will not be reviewed in this article. The purpose of this article is provide a brief review of ambulance billing history, an introduction to the BBA, and an exploration of the benefits of measuring patient-loaded mileage in rotor-wing (RW) and fixed-wing (FW) aircraft by onboard Global Positioning System (GPS) technology to maximize reimbursement. The BBA included a fee schedule created with the goal of decreasing payments made by Medicare by about 2% in its first year of implementation by decreasing inappropriate utilization and unnecessary transports. The fee schedule was introduced with a 4-year progressive execution plan under which suppliers, beginning in 2002, would be allowed to submit a progressively smaller percentage of their former charge and the remaining percentage under the new fee schedule. The new fee schedule will be fully implemented in 2006 (Table 1). Along with the new fee schedule from the BBA, a “moneybox” was dedicated to cover the costs of 9 million ambulance transports annually for over 39 million covered patients. The money put aside by Medicare for ambulance costs over the next 5 years is as follows: $2.7 billion in 2002, $2.8 billion in 2003, $2.9 billion in 2004, $3.0 billion in 2005, and $3.1 billon in 2006. To determine the new fee, a series of calculations must be completed, requiring the definition of new terms. We will first review how to charge for a ground transport. A total of 7 different levels of service were created. Each of these is considered a relative value unit (RVU), with a basic life support (BLS) nonemergency equaling 1.0 RVU. The RVU functions as a constant multiplier; the higher the level of service, the greater the RVU. For example, the RVU for specialty care transport is 3.25 because it is expected to cost 225% more than a nonemergency BLS call. There are only 2 levels of air transport (RW and FW), so they are not part of the RVU system. The RVU is multiplied by the conversion factor, which is $170.54. Then this number is multiplied by the geographic practice cost index (GPCI) for where the patient was picked up. The zip code of patient pick-up is used to get the GCPI for both ground and air transport. For ground transport, the GCPI is multiplied by 70% of the base. Once this is completed, the mileage fee must be calculated. Statute mileage is multiplied by the mileage rate allowed by Medicare, which for ground transports is $5.47 per patient-loaded statute mile. To determine the new fee for air transport, the calculation begins with the base rate for FW or RW transport. The base rate for FW is $2314.51 and $2690.96 for RW. This base amount then is multiplied by 50% of the GPCI, determined by the zip code of patient pick-up location. Mileage is