HHS Launches Emergency Services Payment Model for FFS Medicare

February 20, 2019 - HHS and the CMS Innovation Center have announced a new payment model for emergency and ambulance services that will enable Medicare fee-for-service beneficiaries to receive quality care with lower out-of-pocket costs.

The new payment model, called the Emergency Triage, Treat, and Transport (ET3) model, is a voluntary, five-year payment model that will make it possible for participating ambulance suppliers and providers to partner with healthcare practitioners and deliver quality treatment.

Currently, Medicare regulations only allow payment for emergency ground services when patients are transported to hospitals, critical access hospitals, or skilled nursing facilities. This can create an incentive to transport all beneficiaries to one of these facilities – most often a hospital ED – even when other destinations may be more appropriate or effective.

The ET3 model will aim to counter this incentive and provide patient-centered, quality care to beneficiaries at the most appropriate time, and in the most appropriate place.

The model allows providers to deliver emergency treatment to Medicare beneficiaries both in place (either on-the-scene or through telehealth) and at alternative destination sites, including primary care offices or urgent care clinics. This will help engage providers across the care continuum to more effectively meet beneficiaries’ needs.

“The ET3 model is yet another way CMS is transforming America’s healthcare system to deliver better value and results for patients through innovation,” said CMS Administrator Seema Verma.

“This model will help make how we pay for care more patient-centric by supporting care in more appropriate settings while saving emergency medical services providers precious time and resources to respond to more serious cases.”

The model will also encourage the development of medical triage lines for low-acuity 911 calls in areas where participating ambulance suppliers and providers operate.

Key participants will include Medicare-enrolled ambulance service suppliers and hospital-owned ambulance providers.

Participating ambulance suppliers and providers can earn up to a five percent positive payment adjustment in later years of the model based on their achievement of key quality measures. The quality measurement strategy will aim to avoid creating more burden to participants.

CMS will use a phased approach for the model, conducting multiple application rounds to encourage participation in regions nationwide. The organization will also encourage partnerships between ET3 model participants and other payers, including state Medicaid agencies.

CMS expects to release a request for applications in summer 2019 to solicit ambulance suppliers and providers who are enrolled in Medicare.

Additionally, in fall 2019, CMS anticipates issuing a notice of funding opportunity for up to 40 two-year cooperative agreements, which will be available to local governments, their designees, or other organizations that operate one or more 911 dispatches in participating areas.

The anticipated start date for ET3 is January 2020.

ET3 will add to existing Medicare payment and service delivery models from CMS’s Innovation Center. CMS previously launched the Bundled Payments for Care Improvement, which is a set of four voluntary models that rewards providers for 48 episodes of care.

The agency also implemented the BPCI Advanced model at the start of 2018, which focuses on a specific subset of BCPI care episodes.

With the announcement of this new payment model, HHS expects to improve emergency care for Medicare beneficiaries and reduce healthcare utilization costs.

“This model will create a new set of incentives for emergency transport and care, ensuring patients get convenient, appropriate treatment in whatever setting makes sense for them,” said HHS Secretary Alex Azar.

“Today’s announcement shows that we can radically rethink the incentives around care delivery even in one of the trickiest parts of our system. A value-based healthcare system will help deliver each patient the right care, at the right price, in the right setting, from the right provider.”