« Back to

CMS Bans New Suppliers in Greater Philadelphia Region

February 4, 2014

FROM: Page, Wolfberg & Wirth, LLC
RE:  CMS Bans New Suppliers in Greater Philadelphia Region

The Centers for Medicare and Medicaid Services (CMS) announced today that it is barring new ambulance suppliers in the Greater Philadelphia region from enrolling in Medicare for 6 months. CMS is also extending an existing enrollment moratorium on new ambulance suppliers in the Greater Houston region for another 6 months. This is the second time CMS has exercised its new "moratorium powers" under the Affordable Care Act. This is also the second time CMS included ambulance suppliers in its moratoria.

The Philadelphia-based moratorium bans ambulance suppliers in the Pennsylvania Counties of Philadelphia, Bucks, Delaware, and Montgomery, and the New Jersey Counties of Burlington, Camden, and Gloucester from enrolling in Medicare, Medicaid and CHIP. The moratorium does not apply to provider-based ambulances that are owned and/or operated by a Medicare provider such as a hospital, and it doesn't apply to air ambulance services. And it does not affect currently enrolled ambulance suppliers, who may make changes regarding practice locations, address and ownership.    

To impose an enrollment moratorium, CMS must find there is a "significant potential for fraud, waste, or abuse" regarding a provider type, a particular geographic location, or both. CMS said they examined both qualitative and quantitative factors that suggested a high risk of fraud with respect to ambulance suppliers in the Greater Philadelphia region. In looking at Philadelphia County, CMS found that:

  1. The ratio of ambulance suppliers to Medicare beneficiaries was 243% greater than in the comparison counties
  2. The average annual growth rate of ambulance suppliers was 15 times higher than in comparison counties
  3. In 2012, Medicare payments to ambulance suppliers were 64% higher than the average for comparison counties
  4. Pennsylvania Medicaid paid ambulances an average amount that was 130% more than the average amount Medicaid paid ambulances in the rest of the State

CMS cited similar data as justification for extending its enrollment moratorium in the Greater Houston area. In fact, in the first 60 days after the Houston area moratorium went into effect on July 31, 2013, CMS revoked the billing privileges of 15 ambulance suppliers. Again, both moratoria announced today are in effect for 6 months and, if deemed necessary by CMS, may be extended in 6-month increments in the future.

Guaranteed cash flow during transition.