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PROBLEM: Medicare reimbursements reduced

FORBIDDEN: MONOC can't transport patients

Paramedic cutbacks slow response

Posted by the Asbury Park Press on 02/25/07

BY JAMES A. QUIRK

AND MARGARET F. BONAFIDE

STAFF WRITERS

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You're having a heart attack. You dialed 911 — 35 minutes ago. Where are the paramedics?

This scenario may become increasingly common this year, as the Monmouth-Ocean Hospital Services Corp. (MONOC) has closed its mobile paramedic response unit centers in Marlboro, Lacey, its summertime paramedic center in Seaside Heights, and its Belleville unit in Essex County. MONOC also has petitioned the state to end nighttime service out of Middletown.

These cutbacks will result in longer response times from highly trained paramedic crews, and an increase in emergency response calls that are not answered at all, conceded Vince Robbins, president and chief executive officer of MONOC.

Robbins blamed the closures on the decreased reimbursement rates for the treatment of Medicare patients, and predicted MONOC will be operating in the red by the end of the year. The future of the $57 million hospital cooperative serv-ice is unclear, he said.

"These towns are only the beginning of what has become a frightening state health crisis unless the government makes immediate changes to our current system," Robbins said in a prepared statement.

Scott Kasper, president of the New Jersey Association of Paramedic Services (NJAPP), said the problems experienced by MONOC are also being felt throughout the state. As Medicare decreases its reimbursement rates, it won't be long before many of the state's 21 hospital-based paramedic programs are operating at a loss, Kasper said.

Yet MONOC's decision to scale back the availability of its paramedics has left many first aid squads in Monmouth and Ocean counties crying foul at the increased risk put on patients' lives.

Lacey Police Chief William Nally is concerned with the way MONOC closed its doors in Lacey without warning.

MONOC used to staff a paramedic rig at the Lacey First Aid Squad near Route 9, and could respond to a call within three to five minutes. Now the response could take 10 to 15 minutes — and could mean the difference between life and death, Nally said.

Toms River Police Chief Michael G. Mastronardy said that if MONOC can't meet the needs of the community, something must be done, and if people's lives are at risk because of a lack of paramedic service, the problem has to be fixed.

To do so, "we would have to address the law and legal issues and look at the training issues," Mastronardy said.

When volunteers in Toms River could no longer meet the demand of providing basic life support services around the clock, the township started its own paid service. Led by Patrolman Kevin Geoghegan, the program has become the model for towns such as Brick, which also has started a paid municipal ambulance service, staffed with emergency medical technicians.

"We have to respond to the needs of our residents," Geoghegan said. "They are our priority."

Two-tier system

Even as it shutters some of its paramedic service centers, MONOC remains the largest provider of advanced life-support care in New Jersey, with its roughly 800 employees responding to 25 percent of the state's population. Its operating budget in 2005, the latest data available, was $57 million.

Three factors create a problem for MONOC regarding reimbursement for service to patients with Medicare, which Robbins said typifies the majority of people MONOC treats:

New Jersey is the only state that requires a two-tier emergency response system.

The first tier, called basic life support or BLS, is provided by a mix of volunteer EMS workers and commercial ambulances.

The second tier is the sole domain of trained paramedics — like MONOC's service — who provide advanced life support, or ALS. Only paramedics can perform invasive medical procedures, such as inserting IV lines and placing tubes down a patient's throat.

The state prohibits paramedics like MONOC from transporting patients to hospitals.

Paramedic services are not publicly funded. This means MONOC is a fee-for-service organization that bills every patient.

Under Medicare's regulations, it will reimburse only a bill filed by the service that transported the patient to a hospital, Robbins said. And in New Jersey, in nearly every instance, that means a BLS provider.

Paramedics can't bill

For MONOC, these regulations were not a problem until 1996, when Medicare began to strictly enforce its billing regulations in New Jersey.

Before 1996, Medicare allowed the paramedic programs in New Jersey to submit bills directly to Medicare, even though they weren't the transporters. This changed when a federal auditor realized that a growing number of BLS and ALS agencies were submitting separate bills for the same response, Robbins said.

In the summer of 1996, ALS paramedic services like MONOC across the state received the same letter: Stop billing Medicare for transporting patients.

This prompted paramedic companies to enter into billing arrangements with local BLS providers to insure that everyone could get paid from Medicare reimbursements.

For MONOC, between 1996 until 2005, the math was simple, and the arrangement worked for all parties involved.

According to Robbins, MONOC would receive an average of $1,100 per response, and give a $200 cut to the local BLS provider. The cost for MONOC to provide each response was about $600, so every time someone dialed 911 for a paramedic, MONOC could expect to earn at least $200 in revenue.

But that situation has changed. By 2005, Medicare decreased the amount it would reimburse for patient transport. Medicare now pays $400 for each transport response, and when paramedics are involved, the cut to the BLS provider is $340, Robbins said. The cost for MONOC to provide each response has risen to be $700 to $750.

So with only $60 coming in from each response, Robbins said MONOC is staring down the barrel of operating the service at a loss by the end of the year.

In 2005, MONOC managed to cover its $50 million in operating expenses while earning a $200,000 surplus, Robbins said. The company broke even in 2006.

"It has forced us to try and get people in Trenton and the Legislature motivated to change the structure of the system in New Jersey to get around this conflict," Robbins said. "Either we find other subsidy money — either towns step up and pay, the state steps up and pays, or the county steps up and pays, or you give ALS the right to transport — something has to be done. But the problem is, nothing has been done. We've been in Trenton since 1996."

Service cutbacks

Robbins explained that so far, all of the service centers that have been shut done are "extras" that were added to MONOC's service area in times of less financial strife.

MONOC wants to curtail nighttime operations at Unit 206 in Middletown because "at night, the volume (of calls) is half of what it is during the day," he said. "Two-thirds of our calls come in before 7 p.m."

Robbins emphasized that MONOC has never refused to respond to a call within its coverage area, and will continue to service all of Monmouth and Ocean counties even as it closes the doors of its service centers.

Marilyn Riley, a spokeswoman for the state Department of Health and Senior Services, said that the state granted MONOC permission to close some of its service centers "after assuring us there would be not decrease in the level of service provided. We will continue to monitor the situation closely."

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That was my point on one of the other posts.. N.J. needs to drop the only hospital based ALS provider stuff and allow any FD, Third Service, or qualified dept to run ALS units..... be it Police agenices, Fire Depts, third service, or whatever.

One of the biggest problems with NJ ems is that BY LAW all ALS MUST be hospital based. And when the hospitals lose money, they close and leave large areas without ALS coverage.

I say the FD's and municipal agencies should get a medical director, get a lobbying group together, and change that law.

IMHO

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Contrary to what MONOC would have you believe, not all ALS projects in NJ lose money. MONOC is a unique entity because under Medicare A billing rules, they are considered a "hospital group" and not a "Hospital." Therefore, they are not allowed to bill for Medicare Part A. Which, for a service that serves a large percentage of senior citizens, this could be a problem. However, the rest of the hospitals don't have this problem.

Devin

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