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Rural Hospital Flexibility Program Tracking Project

Chapter 7
EMS Initiatives Under the Medicare 
Rural Hospital Flexibility Program


Julie A. Schoenman, Ph.D.
Penny E. Mohr, M.A.
Curt D. Mueller, Ph.D.
The Project HOPE Walsh Center for Rural Health Analysis

Emergency Medical Services and Rural Hospital Flexibility Program

Emergency medical services (EMS) are a critical element in the rural health care delivery system.  Over half of all car accidents occur in rural areas, with death rates inversely proportional to population density (OTA, 1989; Baker et al., 1987).  Longer distances to emergency care centers also mean that EMS staff spend more time with patients, providing an even more critical interface for ensuring the patient’s survival.  Lack of access to basic primary care services in rural areas may also expand the role rural EMS staff are asked to play in the local health care delivery system.

However, many rural EMS systems are faced with a host of challenges, including:  high reliance on increasingly-hard-to-find volunteer staff; inadequate financial resources; aging or inadequate equipment; difficulty maintaining skills due to the low call volume and lack of training opportunities close to home; long transport and response times; lack of medical direction, particularly from individuals trained in emergency medicine; and gaps in telecommunications.

The legislation that created the Rural Hospital Flexibility Program (RHFP) recognized the importance of strengthening rural EMS systems.  While one paragraph of the legislation creates the grants to states to establish Critical Access Hospitals (CAHs) and improve rural health networks, a second, parallel paragraph permits states to use RHFP funds to improve their rural EMS systems.  The Federal Office of Rural Health Policy (FORHP) has recognized this emphasis by making EMS one of five areas that states are required to address in their annual RHFP grant applications.  As with other facets of the program, states are given very wide latitude in determining the relative emphasis they will give to EMS activities, and the types of initiatives they wish to undertake.  These EMS initiatives need not be tied to hospital conversions and network development, but could be designed to respond to any of the long list of challenges facing rural EMS systems.

Apart from the general need to improve rural EMS systems, there are several reasons why attention to EMS issues is important within the context of a program that creates this new category of limited-service hospitals.  CAHs were intended to become part of a larger rural health network, at a minimum establishing a link with one full-service referral hospital.  Many program organizers at the federal and state levels hope that more extensive networking arrangements will occur over time, and these networks could include local and regional EMS providers.  Even short of establishing hospital-based or hospital-owned EMS systems, which may be neither desirable nor feasible in many communities, many natural opportunities exist for more closely integrating EMS and hospital operations.  Examples include sharing of emergency department (ED) and EMS staff and equipment, joint training, joint purchasing of supplies, and creation of common data systems that track the patient from pre-hospital through acute care. 

Additionally, changes in the day-to-day operations of the hospital after becoming a CAH may affect the need for and/or the organization of area EMS systems and the hospital’s own ED.  For example, the limit on average length of stay, combined with possible changes in the types of services now offered by the CAH, could increase the need to transfer more patients from the CAH to other facilities.  These transfers may stress the local ambulance service, and could also affect the CAH if it needs to provide nurses to accompany critically-ill patients.  Similarly, CAHs are now required to operate their emergency rooms around the clock, but on-site staffing standards have been relaxed.  Likewise, CAH requirements regarding patient transfer agreements and communication systems may affect the delivery of emergency medical care.

In light of the legislative and administrative attention given to EMS issues under the RHFP, and the possibility that CAH conversions will lead to changes in the organization of rural EMS systems, the Tracking Project included a special emphasis on following the development and implementation of EMS initiatives.

Study Methods

Information for this chapter was collected primarily through site visits to five states and to selected CAHs/communities within each of these states (see Table 1).  These sites were selected in cooperation with other members of the Tracking Project team participants.  Prior to selecting states, Walsh Center staff reviewed Year 1 grant applications from approximately 15 states to determine the type of EMS initiatives that were being proposed and the relative importance accorded to EMS activities in these states’ plans for RHFP implementation during the year.  We also made follow-up calls to some states in order to clarify information presented in the proposal and to determine whether the state had scaled back proposed EMS activities in response to federal funding decisions.  Five states were selected to provide some diversity in the range of EMS initiatives being implemented, the relative attention given to EMS activities by the state, the scope and expected timing of the state’s implementation plans, and geographic location. 

We then developed a series of interview protocols to guide the discussions with EMS informants.  The draft protocols were reviewed by several persons active in EMS at the state or national level, staff of FORHP, members of the Tracking Project Advisory Group, and other members of the Tracking Project team from other collaborating centers.  After revisions to reflect comments from these sources, the protocols were integrated into the larger set of protocols used by all site visit teams; thus, some information about EMS systems and RHFP-related changes was to be collected from all 12 states (12 state site visits and 24 CAH site visits within these states).

At the state level, the EMS protocol was directed to the person or people in charge of administering the state’s RHFP grant funds (often based in the state office of rural health).  In the five states visited by Walsh Center staff, we also had a second, more detailed protocol directed to representatives of the state’s EMS office.  Questions directed to these sources asked about the state’s rural EMS system; the working relationship between the EMS office and the state office of rural health; the involvement of EMS representatives in the development of the state’s rural health plan and its RHFP grant application; the EMS initiatives proposed and those actually undertaken; implementation progress, including successes and obstacles; lessons learned; and plans for the future. 

TABLE 1:  EMS Site-Visit Locations

Finally, in several of the EMS site visit states, we investigated special initiatives not specifically related to a CAH conversion.  These investigations often necessitated travel to a different part of the state and development of protocols related to the specific initiative in question for use with a different set of informants.  For example, in both North Carolina and Georgia, we conducted interviews with a county commissioner and a county manager, and in Wisconsin we visited two EMS providers involved in a pilot test of a new emergency medical technician (EMT) training program.

Key Observations 

• States' RHFP grant applications showed considerable variation in the attention paid to rural EMS needs and in the initiatives proposed to address these needs.

Based on our review of a subset of the states’ grant applications, we observed great variation in both the level of attention given to EMS activities and the specific initiatives proposed at either the state or community level.  While some states proposed very specific and tangible projects, others spoke in much more general terms of areas where they envisioned possible EMS improvements.  In fact, we were struck by the fact that several states expressed the need to collect additional EMS data, conduct needs assessments, or otherwise study the current state of EMS systems in their state before proposing concrete activities under the RHFP.  Kansas, for example, proposed creation of a new EMS Integration Committee to identify EMS issues, identify possible legislative barriers to enhancing rural EMS systems, prepare policy recommendations, and recommend EMS activities and priorities for subsequent years.  Similarly, Wisconsin proposed EMS needs assessments in CAH communities that were designed to lead to recommendations for activities to be undertaken in future years of the program, Maine proposed a survey to determine the supply of and need for emergency and non-emergency transportation in rural areas of the state, and Idaho planned to use RHFP funds to identify EMS training needs.

Several states looked to the local community to define EMS (and other CAH-related) needs, rather than including specific, state-driven initiatives in their Year 1 application.  Kansas requested $100,000 to cover grants to communities for local EMS initiatives.  These grants were to be awarded through an RFP process, which presumably would invite the local communities to develop proposals that responded to their own EMS needs.  Oklahoma is another state that is relying heavily on community input in developing its rural health delivery systems, including enhancements to rural EMS systems.  Missouri, too, raised the possibility of awarding EMS planning grants to local communities/CAHs using an RFP process.  While this ‘bottom up’ approach certainly reflects a specific philosophy about, and commitment to, local community development within the RHFP, it may also be indicative of a lack of information at the state level regarding local EMS needs. 

Among the EMS initiatives mentioned by the 12 site visit states in their grant applications were:

• Development and/or funding of EMS training programs.

• Scholarship funds to support EMS training.

• Capital improvements.

• Efforts to “improve recruitment and retention” (often ill defined).

• Creation of a multi-county EMS system.

• Creation of a centralized billing and inventory system for EMS providers.

• Collection and/or analysis of data (e.g., trip reports, supply of EMS providers).

• Education or technical assistance (e.g., to EMS providers, medical directors) regarding CAH conversions.

• Strengthening of medical direction.

• Development of collaborative dispatch effort.

• Telecommunication enhancements.

• Examination of possible expansions to scope of practice for rural EMS providers.

• Establishment of EMS patient assessment and transfer protocols.

• Development of EMS quality assessment tools.

• Conferences and workshops designed to bring together EMS providers, CAH representatives, and RHFP administrators.

• Various other efforts to “promote network development” (again, often not well defined).

The complete list of initiatives proposed by the five EMS site visit states is shown in Table 2.

In several states visited by the Tracking Project site visit teams, nearly the sole focus of Year 1 activities was on identifying hospitals that might wish to convert to CAH status and assisting those facilities in moving through the conversion process.  More complex activities—such as developing rural health networks extending beyond the required CAH/referral hospital linkage, integrating local EMS providers into the network, and initiating other improvements to EMS systems—were sometimes not anticipated until at least the second year of grant funding, if that soon.  As more than one informant noted during our site visits, if struggling rural hospitals cannot be saved in the short-term by the CAH conversion and accompanying cost-based reimbursement, it is not worth worrying about more elaborate changes envisioned as key to longer term survival.

We are optimistic that we will see more attention to EMS issues, and more concrete initiatives in this area, in future years of the program once states collect the data they feel they need to make informed decisions and once the CAH conversion process is working smoothly.

TABLE 2:  Activities Proposed in the EMS Area in the Five EMS Site Visit States

• States used a variety of methods to collect information on EMS needs, with the intent of using this information to define more specific EMS initiatives in later years of the RHFP. 

As stated above, it was not uncommon to find that states felt the need to collect additional information on the status of their rural EMS systems before formulating specific programs to improve these systems.  We found several examples of states using RHFP funds to collect this information, and they approached the task in a variety of ways.

In Wisconsin, for example, the Bureau of Quality Assurance and the Bureau of Emergency Medical Services & Injury Prevention teamed together to use RHFP funds to conduct EMS needs assessments in the market areas served by eight of the state’s current CAH applicants.  Shortly after RHFP grants were awarded, the state issued an RFP and selected a single contractor to complete all assessments—an approach that was thought to be important as a way of promoting consistency in methods across assessments.  Assessments were completed by the spring of 2000.  Each assessment provides detailed information on the applicant’s ED staffing and on available communication resources for emergencies.  A variety of information describing ambulance services used by the CAH applicant is also provided, including numbers of vehicles providing various levels of care, EMT training levels of ambulance staff, and typical transport times for the EMS providers serving the facility.  The assessment for each facility culminates in a series of recommendations about possible improvements to meet the identified needs.  Each recommendation is graded according to the degree of difficulty in adopting it, and an estimate of the benefit to the community should it be adopted.  The state expects these hospitals that continue to receive RHFP funds in the coming year of the program to consider funding the activities recommended in these assessments.

An example from the assessment performed for the community surrounding Wild Rose Community Memorial Hospital (WRCMH), a recently-designated CAH, demonstrates the utility of the assessment process.  The assessment notes that a private ambulance service that provided most inter-facility transfers of patients from WRCMH to its partner facility, Berlin Memorial Hospital, recently ceased operations in the area.  Inter-facility transfers are now provided by Waushara County EMS, but the level of transfers sometimes stresses the county’s capacity and threatens the timely availability of ambulance resources for use in emergencies.  The assessor recommends that a study be used to assess alternative methods of providing inter-facility transports in conformance with guidelines established by the state.  The degree of difficulty is reported to be “medium” due to the need for funding to complete the study, but estimated community benefits are “high” because transfers are essential to a CAH’s success.

Idaho is another state that is using RHFP funds to conduct EMS assessments in its CAH communities.  These assessments are being conducted by site visit teams that consist of a physician, a regional EMS consultant, an administrator from a hospital unrelated to the CAH, and an EMS administrator from a different EMS district (the state is divided into five EMS districts).  A survey form was developed to gather initial information about the EMS systems in these areas.  The state then developed a set of “gold standards” for the assessment teams to use at each site.  These standards dealt with all facets of an EMS system (e.g., education and training, funding, communication, medical direction, quality improvement), and defined the optimal status for each aspect of the system.  For example, in the area of education and training, the standard specifies that EMS personnel should have access to courses including trauma life support, cardiac care, and pediatric care.  By comparing available resources at the site with these uniformly-defined gold standards, the site visit teams should be able to easily identify gaps in the existing EMS system.  The state expects to complete four site visits by the fall of 2000, with another four assessments to follow during Year 2 of the RHFP.  The end product will be development of an action plan designed to assist all rural EMS systems in achieving the gold standard.

As a final example, Florida (not one of the 12 site visit states) recently undertook a systematic survey of rural EMS providers to solicit their input regarding EMS needs and possible initiatives that might be undertaken with RHFP funds.  This survey was conducted in the spring of 2000, in anticipation of the state’s RHFP grant application for Year 2  (and subsequent applications).  In a cover letter that accompanied the mail survey, the Florida Division of Emergency Medical Services and Community Health Resources described the RHFP and explained that program funds could be used to improve rural EMS systems in a number of ways.  The survey itself began by requesting basic information about the EMS provider and its service area (e.g., number of advanced and basic life support runs per month, number of emergency medical technicians and paramedics employed, whether staff are drawn from other counties, distance to the nearest EMS training center, time required for transports out of the service area, communication capabilities).  This section was followed by a listing of the various ways in which RHFP funds might be used including, for example, training, public education, EMS/hospital communications, medical direction, and data collection.  Respondents were asked to indicate for each area whether and how the EMS service could benefit if RHFP funds were made available.  The survey closed by asking for the five greatest challenges faced as a rural EMS provider.

• States are continuing to implement at least a portion of their proposed EMS activities despite reductions in their requested Year 1 budgets.

Given that Year 1 awards were funded with less than requested budgets and the understandable focus on the CAH conversion process during the first year, we were concerned that EMS initiatives would be among the first to be eliminated in response to budget cuts. In fact, we did see some cuts in proposed EMS activities, particularly in states that experienced very large budget cuts. In Maine, for example, which received less than one-quarter of its requested budget, almost none of the proposed EMS initiatives were undertaken. However, we were encouraged to find that the rest of our site visit states preserved some, if not all, of their EMS projects despite budget cuts.¹  For example, North Carolina maintained its commitment to the development and implementation of a centralized EMS billing and inventory system despite fairly severe budget cuts. Texas, too, abided by its proposal to establish a matching scholarship fund for EMT training, although other proposed activities were largely delayed until subsequent years. Georgia continued with its plans to support the development of a regional EMS system in one area of the state, while Wisconsin carried through with its proposed EMS assessments, and initiated activities to collect EMS trip data. Officials in some of these states indicated that it was important to select concrete projects with a high chance of success and to fund them fully, rather than attempt to accomplish a longer list of proposed activities with reduced funding.

• Immediate effects of the RHFP have been to improve communication between EMS personnel and state-level rural health personnel, and between management of newly-designated CAHs and EMS personnel within the CAH and within the community served by the CAH.

In general, the process of developing the state grant applications and guiding the implementation of the program invites cooperation between EMS officials and others responsible for the state's rural health system and the RHFP. In the majority of the EMS states studied, EMS representatives have been active participants in the RHFP development and implementation activities since the earliest days of the program. This process, in and of itself, can lead to beneficial impacts. Several states with existing working relationships between, for example, the state office of rural health and the state EMS office, reported that these relationships were strengthened by working together on the RHFP activities. In other states, such as Idaho, where there had been no real history of the two offices collaborating, the RHFP has provided the impetus for establishing a working relationship. Similarly, the process can bring together various types of providers. Even in Maine, for example, where no EMS initiatives could be undertaken in Year 1 because of deep budget cuts, one EMS informant stated that there was still great value in "having gone through the exercise" because the transport providers are now "talking to one another." 

We also discovered that the CAH conversion process can be a helpful ingredient in improving communication and morale within the potential CAH, with spillovers to the surrounding community. When organizations experience significant changes, it is often the case that a number of environmental changes are occurring at the same time. This was the certainly the case for one hospital, where the physician group serving the hospital was being reorganized, the hospital's relationship with its partner referral hospital was changing, and serious communication problems between the hospital and its primary ambulance service provider were being resolved-all at the same time that the hospital was in the process of converting to CAH status. It appears that all of these forces, including the CAH conversion process, ultimately affected the facility in a positive way. The conversion process, in particular, was one factor that helped to define the new, improved mission of the facility, and staff morale appears to have improved significantly as a result. The emergency department director and the facility's quality assurance officer seemed excited about EMS improvements that might be possible in the future because of recent changes, including CAH conversion. In addition, several informants indicated that the community's perceptions of the hospital's ER seem to have improved as a result of recent changes. 

• EMT training was a popular initiative in many of the states studied. 

More than half of the 12 site visit states included some mention of training of EMS personnel in their Year 1 grant application.  This is, perhaps, not surprising given that adequate training for EMS personnel is a chronic problem faced by many rural EMS systems, particularly those relying largely on volunteer staff.  Details were lacking, however, in a number of these proposals so that it is difficult to judge how serious the state was about implementing the initiative (e.g., the state talked in general terms about the “need to improve EMS education” or “perhaps providing basic EMS training at rural sites”).

Texas was among the states that proposed specific ideas in the area of EMS education.  One reason for the attention given to EMS education by Texas officials was the belief that increasing the supply of adequately trained EMS personnel would lead to long-term improvements in EMS system capacity, lasting beyond the five-year horizon of the RHFP grants.  One of their proposed initiatives called for using $10,000 to fund a locally-based EMS education program.  It was hoped that this program would use distance learning techniques that would permit EMS personnel to receive training without having to leave their local community.  The contract for this program was to be awarded through an RFP process, but the initiative was not implemented due to reductions in the state’s Year 1 budget.

Texas has moved ahead with full implementation of its second proposed initiative in the area of EMS education:  a matching scholarship program.  This program provides scholarships of up to $2,000 per student in order to support EMS training at the EMT, EMT-I, and EMT-P levels for students from rural communities.  These scholarships will be matched (not necessarily dollar for dollar) by funds from the community or from the non-profit ambulance provider serving the community.  After completing training, the student will be required to provide emergency medical services in the contracting community for at least one year.  Funds will be disbursed only after the contracting community provides proof that this commitment has been satisfied.  Final program rules were adopted in early June and the state expects to make the initial awards during the summer, for training that will begin in the fall of 2000.  Twenty-five to thirty scholarship awards are expected with the Year 1 grant funds, and increased funding has been requested in the Year 2 grant application in order to continue and expand the program.

Oklahoma proposed a similar matching scholarship program, and is planning to award approximately 15 scholarships of about $500 each to EMS personnel serving CAH communities.  The state is also planning to develop collaborative relationships with technical colleges, and provide them with RHFP funds to design and conduct EMT training programs. 

• Special initiatives that promote EMS efficiency through system consolidation show great potential. 

System fragmentation is a common problem for rural EMS, leading to higher costs per transport, longer response times, and poorer patient outcomes than would be the case with greater coordination. Two of the states we visited are using RHFP funds to promote EMS system consolidation. Both programs may be replicable in other states and offer promise for reducing response times and producing cost savings - critical benefits in rural areas where long transport times are the norm and there is a limited tax base. Both are being used as demonstration programs with the hope they may diffuse to other counties within the respective states.

In one county in North Carolina, five independent volunteer squads provided emergency transport. The level of service provided and response rates varied widely among the squads. Because the local volunteer base was stretched to capacity, response rates of 40 minutes were not uncommon. Also, the amount a patient was billed for a transport varied widely depending on which squad responded to the call. In 1999, county commissioners passed a 2.5 percent property tax assessment to finance a county-based EMS system that would replace the independent volunteer squads. This new county-based system was to expand capacity and operate with a fully paid EMT-paramedic level staff. However, county funds were expected to cover only 60 percent of the operating costs. Additional revenue was to be obtained through implementing a centralized billing system and improving collections.

RHFP funds are being used to help support a new countywide billing system for EMS transports. The centralized billing system, which was implemented in January 2000, relies on two full-time equivalent administrative assistants and a billing clerk with expertise in Medicare and Medicaid billing. Eight new personal computers supported by a central server complement billing suite software (Sweetsoft Ambulance 2000). The billing software generates a variety of reports, including Automated Call Reports, which can be used to track response times and monitor other indicators of quality. The software also interfaces with an inventory control system. Emergency response personnel can enter data at a remote site, which is downloaded to generate bills at the central office.

RHFP funds pay for approximately 40 percent of the operating costs of this billing system in the first year. The hope is the system will remove billing and service inequities, become self-sustaining, and serve as a model for rural EMS systems throughout North Carolina. System designers are forecasting revenue collections of $1.2 million with a 62 percent collection rate. Formerly, collection rates in the county varied between 20 and 60 percent for those independent volunteer squads that billed.

An important first step to the successful implementation of this billing system was the move away from independent volunteer squads to a county-based system. From the state office of rural health's (ORH's) perspective, it was important to pick an EMS initiative with a high likelihood of success and committed local proponents. Although this new county-based billing system most likely would have been implemented without RHFP funds, federal dollars have served as an important temporary bridge for establishing a good billing system. The billing system should help to ensure the long-term survival of a strong county pre-hospital support system.

A second example of an EMS consolidation effort was found in Georgia. Many Georgia rural counties serve a relatively small population with a limited tax base. In order to reduce system costs and improve response times, the Georgia Office of EMS is using RHFP funds to cover the costs of planning and implementing a regional EMS system, spanning six counties and encompassing two CAHs. These six counties are among the most impoverished in Georgia, and include four of the seven volunteer squads in the state. Ideally, this multi-county scheme would have a regional 911 system headquartered in one county, and a single director with responsibility for centralized billing, procurement, and maintenance. Vehicles would be positioned based on call volume and population.

Implementation of this system is proceeding at a slower pace than anticipated due to some resistance from county commissioners. Because of this resistance, the regional system will first be implemented in two counties that have agreed to participate. One of these does not have its own EMS system. By sharing resources, the county with its own EMS system may realize reduced costs per transport (by expanding volume of services) and the "buyer" county would be getting an enhanced service less expensively than if it had to set up its own system. RHFP funds are being designated to provide first responder training and buy equipment in the county with no EMS system. A collaborative evaluation is planned by both the Georgia Office of EMS and Office of Primary Care to evaluate response times and lives saved. Better response times should be achieved by better positioning of ambulances. It is hoped statistics gathered through this evaluation will convince other counties of the benefits of participation.

• Although the effects of CAH conversion on the EMS system have been modest at this time, larger effects may be observed in the future as later-converting hospitals may need to make more significant structural change than earlier converters. 

In most of the communities we visited, we found that the effect of CAH conversion on the EMS system has been negligible, with the exceptions that some communities experienced a modest increase in inter-facility transfers resulting from new and contractual agreements with an EMS provider in another community. 

Although the increase in inter-facility transports was modest (at most a one percent increase), concern was expressed over the implications of conversion on the ability to provide an adequate level of paramedics for both inter-facility transfers and emergency responses.  In several communities, the hospital’s nurses were sometimes called upon to accompany acutely-ill patients during these transports in order to provide paramedic-level care en route, which in turn would leave the hospital short staffed.  In one community, round trip inter-facility transfer required three hours, time during which the ambulance was not available to respond to an emergency or support the ED staff. 

The potential for conversion to increase the demand for inter-facility transfers was mitigated by the passage of the Balanced Budget Refinement Act, which changed length-of-stay restrictions for CAHs to 96 hours, on average, rather than 96 hours per case.  Notably, in three of the four communities where inter-facility transfers increased, conversion occurred prior to the change in the length of stay restrictions for CAHs.  Hospitals in these instances had already put in place stringent protocols to ensure the per case length of stay limit was not exceeded, and hospital operations were still continuing in the same manner even after the rule change. 

Concern that Medicare might deny payment for inter-facility transfers from a CAH to a referral hospital caused a change in EMS contract arrangements in one community.  Medicare pays for ambulance transports as long as they are deemed “medically necessary.”  For example, if a patient were admitted with angina and required heart surgery that could only be performed at the referral hospital, Medicare would cover the transport to the referral hospital.  However, if a patient were transferred to the referral hospital because he or she required more than a 96-hour stay, the transport would not be a covered expense under Medicare.  The sole ambulance provider in the county refused to contract with the hospital for inter-facility transfers after it converted to a CAH.  The CAH was forced to contract with the referral hospital (which had its own hospital-owned ambulance service) for patient transfers.  Ironically, the referral hospital was considering dropping its ambulance transport service because of its concern over reduced Medicare reimbursement under the new fee schedule (which is discussed below).

One reason why strong EMS effects due to CAH conversion were not observed may be because hospitals we visited had already made the structural changes necessary to become a CAH well prior to conversion.  For example, they had already established a closer affiliation, or even merged, with a referral hospital and downsized their operations.  Consequently, conversion, per se, did not result in a major change on hospital operations or their affiliated EMS systems.  However, the structural changes that preceded CAH conversion did bring about changes in the local EMS systems.  These EMS-related changes that occurred because of structural reform made by the hospital may be harbingers of impacts that will be more apparent for later-converting hospitals.

As an illustration of how formalizing the health care delivery network can affect changes in EMS, in several communities, acquisition, merger, or the development of more formal agreements with a referral hospital led to medical direction being provided by the referral hospital.  As a result, medical direction was now provided on a 24-hour, rather than sporadic, basis, and often by physicians licensed in emergency medicine rather than generalists.  In one community, the same emergency physicians staffed the ER in the CAH and in the referral hospital on a rotating basis after the referral hospital acquired the CAH, which led to greater continuity of patient care for those who were transferred. 

Not only can the quality of patient care improve through better medical direction, but medical directors, themselves, can become important catalysts for more profound changes within the EMS system.  In one community, once medical direction for EMS within the county became the responsibility of a physician at the referral hospital, he became a strong advocate for moving away from a volunteer EMS system to a fully-paid system run by the county.  His goals were realized six years after the regional network was put in place under the Essential Access Community Hospital/Rural Primary Care Hospital (EACH/RPCH) demonstration project, which suggests conversion can be a catalyst for change, but that it may take many years for those changes to reach fruition.

A common theme expressed during many site visits was that closer affiliation between the EMS system and the larger hospital network has many benefits, particularly if the larger hospital owns the EMS system.  In addition to improved medical direction, these potential benefits include:

• Sharing of equipment.

• Capturing economies of scale in training programs, billing systems, and procurement.

• Gaining access to the financial resources of the larger referral hospital.

• Gaining access to experts in a variety of fields, such as to marketing, human resources, and biomedical equipment and repair.

• Standardizing performance improvement and utilization management within a larger system.

• Providing an incentive to develop more defined standards for patient transfer and patient care.

These examples illustrate a natural synergy between the hospital network and the EMS system, which may be strengthened under the RHFP. 

Nevertheless, the potential for conversion to stress both EMS and ED staff is one that should be monitored closely as the RHFP unfolds.  It is possible that later-converting hospitals may need to make even greater changes in their operations to meet the requirements of a CAH.  As a result, the EMS system may be even more affected in these communities.

• Several of the EMS site-visit states had implemented programs or procedures designed to capitalize on existing EMS initiatives in the state, thereby leveraging RHFP dollars and enhancing the likelihood of program success. 

One example of this strategy was the centralized billing system supported by North Carolina (discussed earlier).  In that instance, the state took advantage of the fact that the county in question was moving from a system with several, competing volunteer squads to an organized, paid EMS system—an environment that was ripe for further centralization and coordination in the form of a common billing and inventory system.  A relatively small infusion of RHFP funds can go a long way in this favorable environment.

Another example where a state is capitalizing on the strengths of the existing EMS system to further RHFP goals can be found in Texas.  Texas has a well-developed statewide regional trauma system that includes not only facilities designated as Level I – III trauma facilities, but more than 100 facilities with a Level IV trauma designation.  These Level IV facilities are generally the first line of response in the trauma system unless direct transportation to a higher level of care is more appropriate for the patient.  The ED of a typical CAH would fit the description of a Level IV facility.  The state is blanketed by 22 trauma service areas (TSAs), each of which is served by a regional advisory council (RAC).  The RACs are independent, non-profit organizations with members representing participating hospitals, EMS squads, and consumers in the TSA.  Each RAC is responsible for developing and implementing a trauma system plan for its TSA, the goal of which is to ensure that patients requiring emergency care are safely and efficiently transported to the closest, most appropriate facility.  In general, participation in the RAC is voluntary, but facilities cannot be designated as trauma centers unless they participate. 

Texas has required all of its CAHs to participate in its RAC.  This mandatory participation was seen as having several benefits.  First, it enables other providers in the TSA to understand the type of care a CAH is capable of providing, thereby helping to ensure that the CAH becomes or remains an integral partner in the trauma service plan for the area.  In this way, ambulance services are not likely to bypass the CAH unless a different source of care is more appropriate for the patient.  Building or maintaining patient volume is important for the long-term survival of CAHs.  Second, the mandatory participation forces the CAH to participate in a regional planning entity, hopefully developing contacts that may facilitate subsequent formation of health care networks that go beyond the one required link between the CAH and its referral hospital. 

 A third example of RHFP funds being used to further the potential of existing EMS initiatives was found in Wisconsin, where the state provided RHFP funds to three CAHs to purchase computers for installation of Wisconsin Emergency Medical Service Information System (WEMSIS) software, and is providing technical support in the use of the software.  The WEMSIS software facilitates the entry and collection of comprehensive, pre-hospital data on patients who are transported to hospitals by ambulance.  This software is offered free of charge to EMS service providers so that data describing the pre-hospital care can be entered directly from the ambulance run form.  At present, many EMS providers enter data in their own computers, but primarily for billing purposes, and non-uniform methods are used to prepare data that meet state data reporting standards.  Widespread use of WEMSIS will enable the state to obtain more data items in a standardized format.  In the future, state officials envision linking these pre-hospital data items with inpatient records to form a database that can be used to study relationships between pre-hospital care and patient outcomes.  By using RHFP funds in this way, Wisconsin is helping CAHs to implement changes that will enhance the overall functioning of the state’s rural EMS system.

Although implementation of the WEMSIS is favored by EMS and transportation officials, other states should be aware that start-up costs will likely be incurred by EMS service providers as well as hospitals.  In Wisconsin, some service providers currently use software that was purchased primarily for their own billing and record-keeping functions.  Thus, adoption of WEMSIS means that some providers will have to enter data into their own and the WEMSIS databases.  The need to enter data into two databases might be overcome if providers are willing to purchase special software that translates their files into WEMSIS files for delivery to the state. 

• Implementation of the RHFP is not occurring in a vacuum.  Other forces are also simultaneously affecting the EMS system, and their impact may either enhance or hinder the potential benefits of the RHFP.

Among the future challenges facing CAHs is their ability to adapt to “environmental changes” in the health care delivery system that occur as the RHFP is implemented.  These environmental changes include policy changes that affect the CAH, either directly or indirectly.  For example, CAHs may be directly impacted by the new Medicare ambulance fee schedule if payment changes threaten the financial viability of the CAH’s ambulance provider (see below).  Another example is that training and certification of EMTs is changing in a number of states, and these changes may affect the functioning of rural EMS systems at a time when adequate EMS support of the CAH is critical to its mission. 

We learned of several possible changes in Wisconsin’s EMT training system during our visit to the state EMS office and in discussions with local ambulance services.  An example is the possible upgrade in the training of EMTs at the EMT-Intermediate (EMT‑I) level.  EMT-I training would be replaced with the EMT-Enhanced Intermediate level of training.  This new training level would enhance the scope of skills that would be provided to EMT-Is, especially in dealing with cardiac problems.  At present, a pilot test of the new level, which involves nine primarily rural ambulance services, is winding down.  Whether the new level of training will be adopted statewide depends on results of the analysis of pilot test data, which will soon be completed. 

Future monitoring of the effects of adoption of this change is warranted.  On the one hand, this training enhancement could be especially important in many rural areas where transport times of cardiac patients to CAHs and other hospitals can be relatively lengthy.  On the other hand, enhanced training is costly.  Training requirements can be burdensome because of monetary cost (training costs can often burden ambulance providers, who are often staffed primarily by volunteers) and time costs (e.g., additional training of volunteer EMTs can be burdensome because of time away from paying jobs and family).  Whether training costs can be overcome so that CAHs’ communities will be able to benefit from the enhanced training is unknown.

• CAHs will not be exempt from the new Medicare fee schedule for ambulance transports.  As a result, some CAH-affiliated or owned EMS providers may see a reduction in Medicare payments for ambulance services.

Beginning in 2001, Medicare will reimburse for EMS on the basis of a nationally-determined fee schedule.  Prior to this new fee schedule, hospitals had the option to receive cost-based reimbursement under Medicare Part A for contracted EMS services or for EMS services they provided.  All other providers were paid under Part B.  In the future, all hospitals, including CAHs, will be paid like other EMS providers under the new fee schedule.  While the majority of rural EMS providers are likely to see an improvement in their Medicare fees, some hospital-owned or affiliated providers may see a reduction (Mohr et al., 2000).

Several informants expressed their concerns about the new fee schedule during our site visits.  An informant who directed a hospital-owned service thought their reimbursement would be reduced by about one-third of its current level, though this was an estimate, as the final rule has not yet been published, although it was due out in the spring of 2000.  Another privately-owned independent EMS provider said the referral hospital in the CAH network, which currently had a hospital-owned EMS system, was considering contracting with him for services rather than continuing to operate their own service.  Anticipated reductions in Medicare fees were a reason why they were thinking about divesting their hospital of its ambulance operations.

In the past, the cost-based reimbursement available to hospitals provided an incentive for EMS providers to base their operations at a hospital or to contract their services directly to the hospital.  Informants suggested that rural providers gained through this arrangement by obtaining a billing service knowledgeable in Medicare requirements and potentially improving collections.  Hospitals, also, could benefit by obtaining staff to supplement emergency department staff.  The new fee schedule could discourage such integration.  How the new Medicare fee schedule impacts CAH hospitals and their respective EMS providers warrants close attention.

Conclusions

EMS is a natural partner of CAHs in the rural health care delivery network.  Although some observers may question why the RHFP included funding for EMS, it is our conclusion that EMS belongs here.  Not only can hospitals play an important role in improving basic pre-hospital care, but the program may encourage communities to look beyond their borders and see EMS as part of a broader regional system.  In the face of limited funding to shore up rural EMS, the RHFP provides a real opportunity to fund demonstration projects, which may diffuse to other communities and states.  As one informant indicated, “If you can do good demonstration projects, a small amount of money can go a long way.”

An important outcome of this first year of the grant program was the increase in dialogue among state offices of rural health, EMS offices, rural hospitals and the EMS community about how to strengthen the pre-hospital system in rural areas.  For some, this has been the first occasion to collaborate more closely.  By initiating this dialogue, it is likely that limited RHFP funds can be better leveraged.  We have seen some excellent examples of how RHFP funds were used to take advantage of ongoing EMS initiatives in the state.  We have also seen at least one example where ongoing state EMS initiatives may pose a challenge to CAHs and their communities.  A better dialogue among the key stakeholders can help to further ongoing initiatives and ensure that negative effects are mitigated.

Many states, admitting their lack of prior experience with EMS issues, have sought to better inform themselves about how to proceed by conducting surveys and needs assessments and by hosting joint meetings.  This is an important first step.  In programs that were further along, their experience suggests that gathering solid evidence about system deficiencies is a critical precursor to change.  Some stakeholders are resistant to change, and only by presenting the facts, about the disparity between call volume and locus of providers, for example, can disparate interests find a common ground.  Programs that were further along also demonstrate that EMS system reform may take time.  It is not surprising, then, that we have not seen a major change in rural EMS systems as a result of the RHFP during this first year.  However, we do anticipate that the RHFP will be an important catalyst for future change.  For one thing, more attention may be paid to EMS issues in the future as states gather the information they need to develop EMS initiatives that will address their needs.  Also, as states become more comfortable with the CAH conversion process they should be better prepared to take the next step, implementing more extensive changes to complement the conversions.  Finally, this first year has planted the seeds for change.  It will be important to monitor and disseminate information about future EMS developments as states collect the information they need and learn from the experiences of other states.

References

Baker S, Whitfield RA, and O'Neill B. Geographic Variation in Mortality from Motor Vehicle Crashes. New England Journal of Medicine. 316:1384, 1987.

Mohr P, Cheng CM, and Mueller CD. Establishing a Fair Medicare Reimbursement Rate for Low-Volume Rural EMS Providers. Invited lecture presented at the 23rd Annual Conference of the National Rural Health Association, New Orleans, May 26, 2000.

Office of Technology Assessment, U.S. Congress. Rural Emergency Medical Services-Special Report. OTA-H-445. Washington DC, U.S: Government Printing Office. 1989.

Footnotes

¹ We cannot say whether this experience holds true more generally as we selected the EMS site visit states, in part, because they were undertaking interesting EMS projects.


Chapter 8: Conclusions and Unexpected Findings (WWAMI)

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