Medical billing can be one of the most tedious and frustrating aspects of the ambulance business – and, as was illustrated in the recent outcome of a high-profile ambulance industry suit, things don’t look to be getting any easier. Here’s what the Pennsylvania Highmark ambulance case could mean for your medical transportation business.
In 2010, the Ambulance Association of Pennsylvania – a group representing more than 200 medical transportation companies – sued seven insurers, including Highmark, Inc., for what they contend is racketeering and a violation of Pennsylvania’s Quality Health Care Accountability and Protection Act.
Ambulance businesses say the insurers’ policy of distributing reimbursements to enrollees instead of to ambulance providers is intended to coerce the service providers into signing a contract at below-market rates. Only by entering the contract can providers collect their payments directly.
As a result of the arrangement, an ambulance business has to recoup money from the people and companies who received their ambulance services. The ambulance association contends this has resulted in its members suffering millions of dollars in losses. But lawyers for the insurers claim that it’s within the rights of their clients to bill as they see fit.
In January 2012, the 3rd U.S. Circuit Court of Appeals rejected the ambulance association’s appeal of a previous district judge’s dismissal of the case.
What It Means Now
While the appeal dismissal was made in the context of Pennsylvania state law, it has implications for medical transportation services in all states. Courts can’t be counted on to protect the ability of ambulance businesses to recover accounts receivable such as Medicaid ambulance coverage.
Running a profitable ambulance business today requires that business owners or their management teams possess a strong understanding of the medical billing process. Submitting claims is already costly and time-consuming; making a mistake only complicates matters.
In order to maintain the most efficient billing procedures, ambulance business owners may want to seek guidance from an industry consultant, implement employee training, or consider hiring an outside firm dedicated to resolving increasingly common billing and collections problems.
What It Means for the Future
With an aging population increasing demand for ambulance transportation by the day, the non emergency transportation business clearly offers opportunity for growth. However, industry expansion often comes at a cost. In this case, the cost may come in the form of increased regulations and red tape. It’s essential to weigh the pros and cons of the ambulance business before making important decisions regarding reinvestment, growth strategies, or exit planning. Whether you opt to tighten the ship and streamline your procedures or cut your losses and prepare to put your ambulance business for sale, a transportation business broker with ambulance industry experience can ensure your decision results in the best possible outcome.