Transports of S.C. dialysis patients crippled by Medicare

Since Medicare began requiring pre-approval of non-emergency transports in December, four ambulance companies have closed and three dialysis patients died after the requests were rejected

By Kirk Brown
Anderson Independent Mail

ANDERSON, S.C.  — Ambulance companies in South Carolina have received a windfall of Medicare money in recent years for taking a growing number of patients with kidney disease to dialysis clinics.

The number of people covered by Medicare who rode in ambulances to dialysis clinics throughout the state increased almost 7,000 percent over a decade-long period that began in 2002, according to a federal report. By 2011, 48 percent of all ambulance transports in South Carolina were dialysis-related. That same year, Medicare spent an average of $9,400 per dialysis patient on ambulance bills, a figure nearly three times higher than the national average.

In Anderson County, Pelzer Rescue Squad received a total of $4.78 million in Medicare reimbursements in 2012 and 2013, according to federal records.

The squad has built a reputation over the past 20 years for serving people who need dialysis, its board chairman, Dan Durham, said Saturday.

“It is the primary transportation service we provide outside of emergency calls,” Durham said. “If you need dialysis, we’re going to get you there.”

In an effort to bring down costs, Medicare imposed a new rule in December. Ambulance companies in South Carolina and two other states now must get prior approval for patients seeking repetitive nonemergency transportation to dialysis clinics and other medical offices.

Critics say the new process has been riddled with flaws that have led to problems for ambulance companies and patients.

A spokesman at the Centers for Medicare and Medicaid Services did not provide answers to written questions submitted by the Independent Mail.

Four ambulance companies in South Carolina have closed since the new rule took effect. Officials with a pair of Upstate ambulance companies say three dialysis patients died after their pre-authorization requests were rejected.

“Ambulance providers are having real problems getting pre-authorizations approved,” said Ryan Thorne, owner of Greenville-based Thorne Ambulance Service.

Thorne said Medicare has preapproved only nine of the 25 patients who depend on his company’s ambulances for transportation to dialysis centers. Another Medicare computer glitch has caused his company to go several weeks without receiving any reimbursements, forcing him to lay off several employees, he said.

“We haven’t seen a dime,” Thorne said. “It is definitely hurting us.”

Williamston EMS chief Joseph Barr said his unit is experiencing similar difficulties.

“It has been pretty tough,” he said. “We are having to tighten our belt and run leaner.”

Medshore Ambulance Service chief executive officer Greg Shore said his company was able to get pre-authorization paperwork approved for all 11 of its dialysis patients. With 85 ambulances, Anderson-based Medshore is South Carolina’s biggest ambulance company.

Shore said the new rule is a good idea that is overdue. He said most patients with kidney disease who are not bedridden can get to dialysis clinics without riding in ambulances.

“I think it is going save Medicare a lot of money,” Shore said.

Rampant fraud

Nationally, Medicare officials started seeing a big increase in ambulance-related expenses several years ago. Between 2002 and 2011, Medicare payments for ambulance transports jumped 130 percent to $4.5 billion annually from $2 billion, federal reports show. Trips to and from dialysis clinics were major factors in these higher costs, especially in New Jersey, Pennsylvania and South Carolina — the three states covered by the new pre-authorization rule.

“People realized, ‘Hey you can go out and buy a couple of ambulances and start taking people to dialysis,” said Scot Parsick, owner of Shoreline Medical Transport, which provides services in the Lowcountry. He is also vice president of a state association of private ambulance companies.

In the last 10 years, the number of private ambulance companies in South Carolina went to 104 from 71, a 46 percent increase, according to the state Department of Health and Environmental Control.

“Fraud became rampant,” Parsick said.

In 2013, a South Carolina ambulance company agreed to pay federal officials $800,000 to resolve allegations that it filed false Medicare claims. The case against Williston Rescue Squad was based on information from a whistleblower at a dialysis clinic.

“It put a black eye on our industry,” said Shore, whose company replaced the Williston unit as the provider of emergency medical services in Barnwell County after the false-claims case was settled.

Parsick said the pre-authorization rule that Medicare officials put in place in December was well-intentioned but poorly executed.

“A prior authorization process is a great idea, but they rolled it out without any education,” he said.

Medicare officials in South Carolina conducted a lengthy meeting in Columbia last month with representatives of ambulance companies in an effort to clear up the confusion, Parsick said. He predicted that kinks in the system will be worked out fairly soon.

Anderson County ambulances

Anderson County pays Medshore and nonprofit rescue squads in Belton, Honea Path, Iva, Pelzer, Pendleton, Townville and Williamston a total of $4 million annually to handle emergency calls throughout the county.

Those eight ambulance providers also collected a combined $10 million in Medicare money in 2012, the most recent year for which are figures are available. That total is from a database prepared last year by ProPublica, a independent, nonprofit journalism organization.

Medshore, which also operates in at least six other South Carolina counties, received Medicare reimbursements of nearly $4.8 million in 2012, according to the ProPublica database. The company was paid an average of $658 for each of its 7,287 patients. Medshore has 19 of its vehicles based in Anderson County, Shore said.

Pelzer Rescue Squad was paid $2.11 million by Medicare in 2012. That equates to $3,447 per patient — $96 above the statewide average. According to a state database, Pelzer also has 19 vehicles, three of which are designated for handling emergency calls.

No other rescue squad in Anderson County got more than $1 million in Medicare money or exceeded the state’s average per-patient cost in 2012. None of those rescue squads has more than 10 vehicles.

The rescue squad in Pelzer has more than 50 employees. They work out of three stations in an area where about 20 percent of the county’s population lives.

More than half of Pelzer’s Medicare reimbursements in 2012 involved 77 patients who received 8,451 nonemergency ambulance transports, according to the data compiled by ProPublica.

By comparison, Pelzer Rescue Squad handled 3,516 emergency calls last year, according to Anderson County Emergency Medical Services.

In a phone interview Saturday, Durham, the squad’s board chairman, said the fees from taking dialysis patients to their clinics three times a week offsets the expense of emergency calls.

“That is basically what pays our bills,” he said.


©2015 the Anderson Independent Mail (Anderson, S.C.)

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