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How does EMS switch from volume-based to value-driven reimbursement?

The disruptive forces of changing reimbursement models, technology and quality initiatives will change how EMS is delivered and funded


Gregg Margolis used a fictional EMS service, Acme EMS, to explore what EMS systems get paid and what payment models might look like in the future at at the Pinnacle EMS Leadership forum.

Image Greg Friese

JACKSONVILLE, Fla. — The linkage between quality prehospital care and payment to EMS was presented to EMS leaders and chiefs at the Pinnacle EMS Leadership forum. The session presented by Gregg Margolis, PhD, director of health system policy for the Office of the Assistant Secretary for Preparedness and Response (ASPR) at the U.S. Department of Health and Human Services, looked at what EMS systems get paid and what payment models might look like in the future.

Margolis used a fictional EMS service, Acme EMS, to explore current reimbursement and explore how that system could change. In EMS currently, the only phase of which EMS gets paid is for the transport of a patient to the hospital. It is only after transport that Acme EMS, like other EMS agencies, is able to bill a payor, but none of those payors – Medicaid, Medicare, insurance companies, or the actual patient – pay the same amount of the actual cost of transport. Acme, like all EMS services, needs to transition from a volume-based system where more transports equals more revenue to a value-based model.

Memorable quote: EMS is truly at a crossroads

“We are two years into the most influential decade in the history of the American health care system. This crossroads brings tremendous opportunity and challenge.”

“EMS is poised to be a big winner in the emerging U.S. healthcare system, but it will take a different mindset to thrive in this dynamic decade.”

Key takeaways

  • The current fee-for-service infrastructure, regardless of quality, rewards patient over-testing, over-treatment, and over-triage. In the future, an increasing amount of healthcare fee-for-service reimbursement will be linked to quality.
  • The shift from volume to value is a difficult and multi-step process. One method might be applying a merit-based incentive payment system which calculates a reimbursement adjustment calculated on metrics related to electronic health records, quality measures, patient experience and clinical procedures.
  • The EMS Compass Initiative is an ongoing effort to develop meaningful performance measures for EMS.
  • Developing a shared savings model, which seeks reimbursement by intentionally not transporting low acuity patients, is only possible with good quality metrics. Successful reimbursement is based on good patient outcomes.
  • Population-based payment, with each payor pre-paying for 911 service based on the percentage of its beneficiaries in a service area, creates stable and predictable funding, enables innovation, and funds the cost of readiness.
  • Affordable Care Organizations, bundled payments, and the patient centered medical home result in clinically integrated network. It’s not clear to Margolis how these models might be applicable to 911 EMS, but they create an incentive for efficient and high-quality care. This incentive creates revenue opportunities for innovative community paramedicine services like hospital readminission reduction, post-discharge in-home visits, high-risk patient home visits and telemedicine.

EMS leaders are at a unique time in the history of health care. The transition from volume to value creates a dynamic environment for innovation and collaboration. At this cross roads, in addition to providing prehospital care and transport to the emergency department, the new EMS value proposition might be helping patients navigate a complex health care system so they receive timely, appropriate and patient-centered care.

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Greg Friese, MS, NRP, is the Lexipol Editorial Director, leading the efforts of the editorial team on Police1, FireRescue1, Corrections1 and EMS1. Greg served as the EMS1 editor-in-chief for five years. He has a bachelor’s degree from the University of Wisconsin-Madison and a master’s degree from the University of Idaho. He is an educator, author, national registry paramedic since 2005, and a long-distance runner. Greg was a 2010 recipient of the EMS 10 Award for innovation. He is also a three-time Jesse H. Neal award winner, the most prestigious award in specialized journalism, and the 2018 and 2020 Eddie Award winner for best Column/Blog. Connect with Greg on LinkedIn.