California’s Ambulance Providers Struggle With Low Medi-Cal Payments

Ambulance service providers are facing financial strain in California, where Medi-Cal reimbursement rates for ambulance services have not increased since 1999, Capitol Weekly reports. Medi-Cal is California's Medicaid program.

In March 2009, California lowered Medi-Cal rates for ambulance services by 1%. The rates are expected to fall by an additional 10% as part of the budget for the upcoming fiscal year. California's Medi-Cal ambulance rates already rank 41st lowest nationwide.

Reimbursement Details

According to the California Ambulance Association, the average cost of an ambulance trip in California ranged between $586 and $673 last year.

For bringing Medi-Cal patients to a hospital, the state pays ambulance providers about $118 plus $3 per mile, or about one-quarter of the cost of the ambulance trip. In comparison, the federal government pays ambulance providers about $420 plus $6.80 per mile -- or about 75% of the cost of the ambulance trip -- for bringing Medicare beneficiaries to the hospital.

Implications

Ambulance providers say the state and federal government have no incentive to increase reimbursement rates because emergency responders have a legal responsibility to treat all patients.

As a result of the shortfall in Medi-Cal reimbursements, many ambulance providers are shifting costs to private insurers. Although the average cost of an ambulance trip in California was about $630 last year, commercial insurers paid an average of $1,214 per trip. In addition, most private health plans require policyholders to pay a 20% copayment for ambulance services.

State Response

California's Department of Health Care Services says it cannot increase Medi-Cal's ambulance reimbursement rates unless state lawmakers approve additional funding.

Tony Cava, DHCS spokesperson, said, "Legislation to increase these rates has been introduced in the past couple of years, but none [of the bills] were successful." (Lucas, Capitol Weekly, 6/23).