Medicaid Reimbursement Under CARES Programs

CARES programs existed before the Health Care Authority's reimbursement standards

Since 2013, statute has allowed fire departments to develop Community Assistance Referral and Education Services (CARES) programs to “provide community outreach and assistance to residents of its jurisdiction to improve health and advance injury and illness prevention.” (RCW 35.21.930)

• This statute's definition of "fire department" includes fire departments, fire protection districts, regional fire protection service authorities, public hospital districts, federally recognized Indian tribes, and other public providers of emergency medical services.
• A CARES program can serve anyone in the community. It is not limited to Medicaid clients.

Per statute, a CARES program:

• Must measure reduction in repeated use of 911, reduction in avoidable emergency department visits, and estimated Medicaid savings.
• Should identify members of the community who use 911 or emergency departments for nonemergency or nonurgent calls and connect them to other providers or services.
• May partner with hospitals to reduce readmissions.
• May provide nonemergency contact information as an alternative to the 911 system.

Fire departments report that they pay for these programs with their own resources, grants or private gifts. Two sources of Medicaid funding also may cover some costs and are the focus of this report.

Fire departments can develop a CARES program to meet local needs

JLARC staff identified 12 CARES programs across the state, and there are likely more. Each fire department designs its own CARES program to meet the needs of its community members. For example, the following fire departments described the services their programs offer:

• Port Angeles Fire Department works with community partner agencies to identify people who need assistance with managing a chronic disease or medications, are known to use the emergency department frequently, have recently been discharged from the hospital, or are otherwise at risk. The department aims to guide these individuals to appropriate services instead of the 911 system and emergency department. The department is participating in HCA's treat and refer reimbursement.
• Prosser Memorial Health paramedics receive referrals from health care providers and meet the person in their home or by phone. During the visit, the paramedic may do a focused physical assessment, check vital signs and medications, assess living conditions, review discharge instructions, and ensure follow-up appointments are made. Other services include disease/condition education and referrals to social services. The department is participating in HCA's treat and refer reimbursement.
• South Snohomish County Fire & Rescue schedules visits with frequent 911 callers. A specially-trained community paramedic meets with the person in their home for about 90 minutes, assesses the needs, and refers the person to other services including home health care. They also conduct a home-safety survey. According to the agency, it works with partners from service organizations, state agencies, and hospitals to identify resources. The model is based on the approach used in Minnesota. The department is not participating in HCA's treat and refer reimbursement.
• Spokane Fire Department works with Eastern Washington University students who are majoring in social work. The students work as interns through the school year and conduct in-home social service needs assessments. The interns advocate for these clients and connect them to community resources. The Spokane Fire Department is currently not participating in HCA’s treat and refer reimbursement. The department reports that its license does not meet HCA’s requirements in WAC.

Community paramedicine is one approach to CARES and part of Medicaid Transformation

Some CARES programs include community paramedicine services. These services typically include nonurgent care, referrals, and education provided in home or community settings at the direction of a primary care provider.

Community paramedicine is mentioned in the project plan for seven of Washington's nine Accountable Communities of Health Regional coalitions working to improve population health.. It is also included as an evidence-supported strategy in the Health Care Authority's Medicaid TransformationAn agreement with the federal government that allows HCA to test new approaches to providing health coverage and care. project toolkit.

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Legislature directed HCA to develop reimbursement standards for non-emergency CARES services

In 2017, the Legislature directed the Health Care Authority (HCA) to develop standards to reimburse fire departments for services provided to Medicaid clients through a Community Assistance Referral and Education Services (CARES) program. The law specified that the standards must allow payment for covered health care services provided to clients whose medical needs did not require a visit to an emergency department (RCW 74.09.335). As described in the previous tab, there are multiple CARES models operated by fire departments in Washington. HCA had to determine which services it would reimburse.

The law anticipated that reimbursement standards might require changes to the certification and training for participating fire department staff. The Department of Health (DOH) was required to review the certification of fire department staff and work with HCA to link the certification to the covered health care services. DOH's report was due to the Legislature in December 2019.

Three other states have CMS approval to reimburse fire departments for non-emergency care they provide

In addition to Washington, the Centers for Medicare and Medicaid Services (CMS) has approved plans from three other states to provide Medicaid reimbursement for treat and refer or community paramedicineNonurgent care, referrals, and education provided in home or community settings. programs.

• Arizona adopted treat and refer standards in 2016. Reimbursement is provided when services are triggered by a 911 call. HCA modeled its standards on Arizona's approach.
• Minnesota and Nevada each have a community paramedicine program that is described in statute. Minnesota began reimbursing for the services in 2012 and Nevada began reimbursements in 2016. Both states reimburse fire departments for a broad range of services and do not require calls to 911.

Existing research about whether the approaches have resulted in savings to the states' Medicaid programs is limited and inconclusive.

Health Care Authority adopted “treat and refer” reimbursement standards based on Arizona model

HCA met with stakeholders and reviewed Arizona's and Minnesota's reimbursement models. Based on Arizona's model, HCA developed standards that it calls "treat and refer." HCA received approval from CMS in May 2019 and began allowing reimbursement on July 1, 2019.

• HCA will reimburse for treat and refer services if a Medicaid client calls 911 (or a similar public dispatch number) to access the services.
• The emergency medical personnel will treat the client and make a referral to a health care or behavioral health provider, or a program for crisis response, chemical dependency, urgent care, or the CARES program team.
• Reimbursement is equal to the basic life supportA level of care that justifies use of ambulance transportation but requires only basic medical treatment skills from the ambulance crew. rate (about $115). It is paid on a fee-for-service basis, even if the client participates in a managed care plan.

Only participating fire departments can be reimbursed. To participate, a fire department must certify to HCA that it is an enrolled Medicaid provider and meets the requirements to develop a CARES program.

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Law requires JLARC to recommend repealing the reimbursement standards if they do not result in cost savings for the state

The 2017 Legislature directed JLARC staff to review the cost-effectiveness of the Health Care Authority's (HCA) reimbursement standards (E2SHB 1358, Ch. 273, Laws of 2017). This is the same legislation that directed HCA to develop the standards.

If the reimbursement standards do not result in savings for the state’s Medicaid program, the Legislature directed JLARC to recommend that the reimbursements be repealed. The statute that permits Community Assistance Referral and Education Services (CARES) programs would not be affected by the repeal of Medicaid reimbursement.

Based on current information described below, the reimbursement standards are unlikely to result in savings to the state’s Medicaid program. Further evaluation of the effect of the reimbursements (e.g., actuarial analysis) is unlikely to conclude otherwise.

Many fire departments are partially compensated for treat and refer services under a separate program that is paid from federal funds

In 2015, the Legislature directed HCA to seek federal approval to implement the Ground Emergency Medical Transportation (GEMT). In 2017, the Centers for Medicare and Medicaid Services (CMS) approved Washington State's GEMT program, which provides fire departments with partial payment for treat and refer services. In 2019, 128 fire departments in Washington participated.

• GEMT pays for at least 50% of a fire department’s unreimbursed costs. This includes direct costs for the services and indirect costs such as department administration, training, and equipment depreciation.
• Unlike the CARES reimbursement, GEMT is paid entirely from federal funds.
• Fire departments can participate in both GEMT and CARES reimbursement.

Although the GEMT calculations are complex, a simplified illustration demonstrates how the two programs reimburse fire departments and affect the state Medicaid program. HCA acknowledges that the CARES reimbursement standards provide little additional funding to the departments compared to the amount they would receive under GEMT. 

Exhibit 3.1: CARES reimbursement is partially funded by the state and provides a relatively small financial benefit compared to using only GEMT

Source: JLARC staff illustration of GEMT and CARES reimbursement.

Achieving cost savings to the state’s Medicaid program would require new or expanded CARES programs

Between 2013 to 2019, fire departments have provided CARES programs at their own cost. If these existing programs led to a decrease in emergency department use, the state's Medicaid program would already reflect any related savings.

In order to achieve savings to the state Medicaid program, CARES programs and services would need to:

1. Result in savings that exceed the total cost to reimburse participating fire departments and can be linked to CARES programs rather than GEMT or other factors.
   • Savings would need to account for both reduced emergency department costs and additional costs for referred services.
   • HCA has estimated that the CARES reimbursement standards will increase combined state and federal Medicaid expenditures by $3.8 million in fiscal year 2019. The portion of these expenditures that will be covered by the state depends on client eligibility and can range from zero to 50 percent. Federal funding for GEMT was not included in the estimated expenditures.
2. Grow beyond the level that existed when the standards took effect in 2019. This could include both new programs and an expansion of existing programs.

Few fire departments are expected to participate in CARES reimbursement

Because of the existence of GEMT, HCA does not expect participation in CARES reimbursement to increase significantly. As of December 16, 2019, six departments had enrolled to receive reimbursement for CARES services but none had filed a claim. However, they stated that they expected to file claims and that the additional funding from CARES reimbursement would be important.

HCA met with fire departments as it developed the reimbursement standards. JLARC staff reached out to some of these departments and learned that they were either unaware that the standards were in place or believed they could not participate in both CARES and GEMT reimbursement programs.

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