A friend emailed recently about transport bills her hospital clients received from an ambulance service. The volume of bills seemed excessive. She questioned me about when it was appropriate to bill a hospital for ambulance transport. I answered her question, sent her some regulatory guidance, and started thinking – do hospitals really understand what and when they should pay for ambulance transport? Do hospitals audit this type of billing? Most hospitals don’t want to face an $8.6 million requirement to pay the government for ambulance problems like what happened in Houston last fall. For the ambulance service, do they look at their Part A facility billing to assure they are meeting regulations?

The first challenge is that ambulance is a Part B service. Typically, ambulance transport would be billed to Medicare directly (when coverage criteria are met). But there are some transports that fall under Part A. That’s where the hospital’s responsibility comes into play. Trips to the hospital on the day of admission or trips after discharge get billed to Medicare under Part B. Trips that happen while the patient is an inpatient are hospital responsibility.

Hospitals get their guidance from different manuals that what ambulance companies usually review. Per the Medicare Claims Processing Manual, Chapter 3, Section 10.4, Payment of Nonphysician Services for Inpatients,

“For purposes of this section "hospital inpatient" means a beneficiary who has been formally admitted it does not include a beneficiary who is in the process of being transferred from one hospital to another. Where the patient is transferred from one hospital to another, and is admitted as an inpatient to the second, the ambulance service is payable under only Part B…if an ambulance is used for the transportation of a hospital inpatient to another facility for diagnostic tests or special treatment the ambulance trip is considered part of the DRG, and not separately billable, if the resident hospital is under PPS.”


Ambulance companies need to be careful they do not discount these services inappropriately to avoid anti-kickback issues for themselves or the hospital (as noted in the Houston case). Ambulances also need to assure they do not mistakenly bill Medicare for service that the hospital should cover. There is guidance for ambulance in the Medicare Benefits Policy Manual, Chapter 10, Ambulance Services, Section 10.3.3, Separately Payable Ambulance Transport Under Part B versus Patient Transportation that is Covered Under a Packaged Hospital Service. As outlined in the manual, there are many services that the ambulance company should bill to the hospital. The best way for the ambulance company to stay on top of compliance in this area is to include their facility billing in their internal audit review program.


On the other hand, hospitals should carefully review ambulance billing to make sure they pay for services for which they are responsible. Again, we recommend the hospital includes these bills in their internal review program. Hospitals and ambulance providers can work together to forge good communications about this topic.


Readmissions present a billing and compliance obstacle to both hospitals and ambulance services. Per the Medicare Claims Processing Manual, Chapter 3, Section 10.5, Hospital Inpatient Bundling,


“Hospital bundling rules exclude payment to independent suppliers of ambulance services for beneficiaries in a hospital inpatient stay. The Common Working File (CWF) performs reject edits to incoming claims from independent suppliers of ambulance services. The CWF searches paid claim history and compares the line item service date on an ambulance claim to the admission and discharge dates on a hospital inpatient stay. The CWF rejects the line item when the ambulance line item service date falls within the admission and discharge dates on a hospital inpatient claim.”


Due to timing of claims submission, it’s possible that the ambulance provider billed and was paid by Medicare. Furthermore, it is possible the ambulance company did not know the patient was readmitted. The ambulance company learns later about the readmission when Medicare returns to recoup a payment. Ambulance providers then scramble to bill the hospital for a service that was provided some time ago. Receiving a bill long after service may be disconcerting to the hospital, but if the patient met the standards for inpatient, the service would be hospital responsibility.


This topic is a revenue issue and a compliance issue. For both providers – the hospital and the ambulance service – it’s in your best interest to assure billing and payment is done right. Educate staff about Part A ambulance billing. Include these claims in ongoing internal audit efforts. Finally, have an external review done to catch any problems or to help adjust the billing and payment process for compliance.

Let us know if we can help!

About the author:  Maggie Adams is the president of EMS Financial Services, with 25 years’ experience in the ambulance industry as a business owner and reimbursement and compliance consultant. Known for a practical approach and winning presentation style, Maggie has worked with medical transportation providers and billing companies of all kinds to provide auditing, billing assessments and training, and documentation training efforts. “Like” EMS Financial on Facebook, follow us on LinkedIn or for more info, contact Maggie directly at maggie@ems-financial.com or visit www.ems-financial.com