Ohio’s private EMS industry is in trouble, executive warns

A change in the way Ohio emergency medical services providers are reimbursed by Medicaid has left the industry “teetering,” an executive of an EMS company warned.

“There is some real concern that the private EMS system as a whole is teetering,” said Fred Isch, COO of Toledo-based MedCorp Inc. “If the privates fail on a large scale, it will cascade and cause a huge public safety issue.” Isch was quoted by the Dayton Daily News.

Of course Isch has plenty of reason to blame others for his company’s problems — MedCorp was placed in receivership last week after defaulting on a $10 million loan. But that doesn’t mean Isch’s statements should be disregarded because plenty of others are making similar claims.

The change to Medicaid reimbursement, which was pushed through last year in a last-minute state budget deal, has vexed several of the state’s industries, such as specialty nursing homes, custom wheelchair makers and occupational therapists.

The new system, known as “bundling,” means that nursing homes get paid a per-day, per-patient fee of about $4 for the services they provide to Medicaid residents, including emergency services. Nursing homes then funnel that money to the companies, such as ambulance firms, that provide those services to them.

That’s a big change from the past, when those service providers would simply bill Medicaid themselves. The new system was put in place to cut costs, but companies like MedCorp are complaining that the cuts are too drastic and threaten their ability to survive.

The bundling bug has also bitten Cleveland’s Westpark Neurology and Rehabilitation Care Center, making it difficult for the center to afford to replace residents’ damaged wheelchairs, The Plain Dealer reported last year. The center’s administrator estimated that bundling will pay her about $107,000, but she has calculated that the services will cost nearly $330,000, leaving a deficit of $223,000.

The reason bundling was instituted in the first place was to draw more matching federal dollars to the state’s Medicaid program. Bundling accomplishes that by increasing the base amount paid to nursing homes, which brings greater reimbursement from the federal government.

With the widespread unpopularity of bundling, the state is under pressure to change the system. A Plain Dealer editorial in May urged Ohio lawmakers to “consider the consequences of what they have done and find a way to repair the damage.”

In April, a Democratic member of Ohio’s House of Representatives introduced a bill that would do just that.

Photo from flickr user dave_7

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