On August 17, 2022, the Centers for Medicare and Medicaid Services (CMS) issued a bulletin (Bulletin) to states addressing potentially inappropriate cost-based proposals and practices related to governmental ambulance providers in the delivery of ground emergency medical transportation to Medicaid beneficiaries (GEMT). CMS states that the Bulletin was issued to remind states of existing federal requirements relevant to payment for GEMT ambulance services in Medicaid. As discussed in the Bulletin, the guidance is based on findings from past GEMT State Plan Amendment (SPA) proposals for additional Medicaid payments through a certified public expenditure or intergovernmental transfer program to pay fire departments and other governmental providers for costs incurred in furnishing GEMT ambulance transports.

Of critical interest is CMS’ focus on what constitutes “allowable direct and indirect cost associated with furnishing Medicaid-covered GEMT services.” As CMS notes, “[c]osts that are claimed improperly may be subject to financial reviews and/or audit findings and place states at financial risk of liability to repay the federal share of any identified overpayments.” Any states found by CMS to have improperly claimed costs would likely seek the return of overpayments from participating GEMT fire departments and other local GEMT government providers. While CMS does not expressly note this in the Bulletin, of greater importance is that any inaccurate characterization of costs...

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