CAA received the following question/commentary via email:
I requested DHCS policy regarding Paramedic Pass Through Billing in a CPRA one week ago. It is not on their radar, however taxable codes, either ALS1 or ALS2, are used and as I read SB523 must be taxed. These same agencies also charge a medical supply fee and/or dispatch fee. I am wondering if it taxable, (they stated not only the three billing codes but any service charge connected to them is subject to the tax. Mileage, oxygen, night charge, supplies and so on.)
The have requested I resubmit my PRA for review by legal counsel, again. If DHCS does tax, fire agencies likely need a Safe Harbor Letter from CMS in regards to who pays the tax and billing/finances charges to avoid inducement crimes.
According to DHCS the "fee", tax, and the required financial data is clearly on a cash basis, not accrual basis. As spelled out in the demand letter. Is this true? According to DHCS when they say "Gross Receipts" they only mean on the codes subject to "fee" and connected revenue, not your company or agencies gross receipts. They had trouble understanding that in accounting terms for a public agency "gross receipts" typically means all revenue for one program, not for sub financial sections or revenue portions. I told them this is causing panic. They had a flat affect.
They readily admitted they have answered few e-mail questions sent to the general inquiry box. For some reason I made them nervous and wanted to talk.
The tax is not .051%. They will announce in June 2018 what the tax will be.
When I brought up capitation in simple terms they seemed to understand. I said for fraud prevention reviewing none Medicare/Medi-Cal will be tough. Some providers have base rates in $2,000 to $3,000 range. Problem is not only Medicare restricts the fee but CDCR and WC also peg to Medicare rate. In counties like Imperial, Kings, Lassen 2/3 or more of "private pay" may be capitated rates. They understood this, but provided no information as to how breaking out rates would prevent fraud.
As to Medi-Cal they understood that about 90% of Medi-Cal and 50% of Medi/Medis are managed care and that providers are typically blinded to Medi-Cal status. I did not ask, my question is will the supplement cover these patients or only straight Medi-Cal? County run Medi-Cal risk HMOs can't supplement payments. I skipped another managed care question completely, let them figure it out or not.
According to DHCS staff the tax is "Gross Receipts" times .051 divided by estimated emergency runs which results in the tax factor. Same formula for 2019. They state in 2020 the tax goes up but I don't see in SB523 or Federal Registry how that is calculated, allowed by law or by regulatory fiat.
Commercial providers should ask for rate increases now if they need to go through city councils or board of supervisors. Public agencies should increase rates asap. This issue is without a taxing factor, loss revenue, how much of a rate increase.
I asked about bad debt or delayed payment. I told them third party liability or WC cases can take months to years. As to revenue they want that reported on cash basis, when paid. I did not get answer about bad debt collections. I don't want to assume (ass u me) so do you report these transports as they happen in your quarterly statement? or when paid?
I told them I did not think most providers could meet the 15th deadline. You are looking at about eight software vendors. Some can generate reports, some cannot. They said they would make exceptions on case by case basis. I would recommend immediately asking for delay. Local government agencies should send a bill to DHCS for staff time, software, hardware and consulting time under unfunded state mandate. Remember bill early and often.
I see at least 10 ambulance providers DHCS did not contact/are not aware of. DHCS respond to my list request yesterday but it is incomplete, lacks addresses. The first part is non-profit, commercial and Indian providers. It appears to be a copy of CHP's ambulance vehicle count list. The public agency list it appears they called around to LEMSAs or read websites. They missed two fire departments in Los Angeles, UCLA Ronald Reagan Medical Center and UCLA PD....and LA County's own ambulance program. Will review in detail tonight.