CMS Pub. 100-04, ch. 15, § 10.4

Since April 1, 2002 (the beginning of the transition to the full implementation of the ambulance

fee schedule), payment for a medically necessary ambulance service is based on the level of

service provided, not on the vehicle used.

Ambulance services are separately reimbursable only under Part B. Once a beneficiary is

admitted to a hospital, CAH, or SNF, it may be necessary to transport the beneficiary to another

hospital or other site temporarily for specialized care while the beneficiary maintains inpatient

status with the original provider. This movement of the patient is considered "patient

transportation" and is covered as an inpatient hospital or CAH service and as a SNF service

when the SNF is furnishing it as a covered SNF service and payment is made under Part A for

that service. (If the beneficiary is a resident of a SNF and must be transported by ambulance to

receive dialysis or certain other high-end outpatient hospital services, the ambulance transport

may be separately payable under Part B. Also, if the beneficiary is a SNF resident and not in a

Part A covered stay and must be transported by ambulance to the nearest supplier of medically

necessary services not available at the SNF, the ambulance transport, including the return trip,

may be covered under Part B.) Because the service is covered and payable as a beneficiary

transportation service under Part A, the service cannot be classified and paid for as an ambulance

service under Part B. This includes intra-campus transfers between different departments of the

same hospital, even where the departments are located in separate buildings. Such intra-campus

transfers are not separately payable under the Part B ambulance benefit. Such costs are

accounted for in the same manner as the costs of such a transfer within a single building.

See IOM Pub. 100-02, Medicare Benefit Policy Manual, chapter 10 - Ambulance Services,

section 10.3.3 - Separately Payable Ambulance Transport Under Part B Versus Patient

Transportation that is Covered Under a Packaged Institutional Service for further details. Refer

to IOM Pub. 100-04, Medicare Claims Processing Manual, chapter 3 - Inpatient Hospital Billing,

section 10.5 - Hospital Inpatient Bundling for additional information on hospital inpatient

bundling of ambulance services. Refer to IOM Pub. 100-04, Medicare Claims Processing

Manual, chapter 3 - Inpatient Hospital Billing for the definitions of an inpatient for the various

inpatient facility types. All Prospective Payment Systems (PPS) have a different criteria for

determining when ambulance services are payable (i.e., during an interrupted stay, on date of

admission and date of discharge).

NOTE: The cost of oxygen and its administration in connection with and as part of the

ambulance service is covered. Under the ambulance FS, oxygen and other items and services

provided as part of the transport are included in the FS base payment rate and are NOT

separately payable.

The A/B MAC (A) is responsible for the processing of claims for ambulance services furnished

by a hospital based ambulance or for ambulance services provided by a supplier if provided

under arrangements for an inpatient. The A/B MAC (B) is responsible for processing claims

from suppliers; i.e., those entities that are not owned and operated by a provider. See section

10.2 below for further clarification of the definition of Providers and Suppliers of ambulance

services.

Effective December 21, 2000, ambulance services furnished by a CAH or an entity that is owned

and operated by a CAH are paid on a reasonable cost basis, but only if the CAH or entity is the

only provider or supplier of ambulance services located within a 35-mile drive of such CAH or

entity. Beginning February 24, 1999, ambulance transports to or from a non-hospital-based

dialysis facility, origin and destination modifier “J,” satisfy the program’s origin and destination

requirements for coverage.

Ambulance supplier services furnished under arrangements with a provider, e.g., hospital or SNF

are typically not billed by the supplier to its A/B MAC (B), but are billed by the provider to its

A/B MAC (A). The A/B MAC (A) is responsible for determining whether the conditions

described below are met. In cases where all or part of the ambulance services are billed to the

A/B MAC (B), the A/B MAC (B) has this responsibility, and the A/B MAC (A) shall contact the

A/B MAC (B) to ascertain whether it has already determined if the crew and ambulance

requirements are met. In such a situation, the A/B MAC (A) should accept the A/B MAC (B)’s

determination without pursuing its own investigation.

Where a provider furnishes ambulance services under arrangements with a supplier of ambulance

services, such services can be covered only if the supplier’s vehicles and crew meet the

certification requirements applicable for independent ambulance suppliers.

Effective January 1, 2006, items and services which include but are not limited to oxygen, drugs,

extra attendants, supplies, EKG, and night differential are no longer paid separately for

ambulance services. This occurred when CMS fully implemented the Ambulance Fee Schedule,

and therefore, payment is based solely on the ambulance fee schedule.

Effective for claims on or after October 1, 2007, if ambulance claims submitted with a code(s)

that is/are not separately billable the payment for the code(s) is included in the base rate.

Contractors shall use the following remittance advice messages and associated codes when

rejecting/denying claims under this policy. This CARC/RARC combination is compliant with

CAQH CORE Business Scenario Four.

Group Code: CO

CARC: 97

RARC: N390

MSN: 1.6

This is true whether the primary transportation service is allowed or denied. When the service is

denied, the services are not separately billable to the beneficiaries as they are already part of the

base rate.

Payment for ambulance services may be made only on an assignment related basis.

Prospective payment systems, including the Ambulance Fee Schedule, are exempt from Inherent

Reasonableness provisions.