Association for Public Policy Analysis & Management

Medicare is the largest payer for ambulance services in the United States; with over 31% of 911 EMS activations between 2012 to 2016 occurring by Medicare patients. However, strict Medicare reimbursement rules hinder the probability of a profitable ambulance encounter. The potential unprofitability of an ambulance encounter with a Medicare patient could impact how ambulance companies provide service to Medicare patients. In this paper, I examine how Medicare reimbursement rules impact the provision of ambulance service to Medicare patients. I find that Medicare reimbursement rules decrease EMS response times by 28 seconds for Medicare patients relative to non-Medicare patients. The decrease in EMS response times is a result of Medicare reimbursement rules concerning on-scene patient fatalities rather than an increase in quality of care provided to Medicare patients. Additionally, I find that Medicare reimbursement rules increase on-scene fatalities by 0.04% for Medicare patients relative to non-Medicare patients. I find that 75% of the increase in on-scene fatalities is a result of misreporting patient time of death. Medicare reimbursement rules incentivize ambulance companies to (1) provide lower quality service to Medicare patients, which is resulting in increased on scene patient fatalities of roughly 1,493 per year, and (2) misreport patient time of death, resulting in an increase in unnecessary medical expenditures.