Payer Relationships in Texas: An Interview With Matt Zavadsky

Matt Zavadsky speaking at EMS EVOLUTION 2019.

TEMSA recently sat down with Matt Zavadsky, the Chief Transformation Officer at MedStar Mobile Healthcare in Fort Worth, to look at the agency’s latest thoughts on payer relationships.

TEMSA: MedStar has gone in network with five payers (two commercial plan and three managed Medicare/Medicaid plans). What was the impetus behind these payers going in network with you all?

Matt Zavadsky: Typically, it is difficult to demonstrate value for the payer, and the ambulance agency, through an in-network agreement,  For a primarily 911 ambulance provider, the basic network model (accepting a lower fee for service in return for higher volume) is challenging.  Being in-network with a payer does not typically result in more 911 calls, so in essence, you’d be accepting a lower reimbursement with no additional volume.  From the payer’s perspective, ambulance claims are generally < 1% of their healthcare expenditures, meaning they typically are not focused on ambulance providers as an expense reduction strategy. 

However, IF you are able to partner, to the benefit of the insured member/patient, the payer, AND the ambulance provider, magic happens.  A great example is payment for non-traditional ambulance services, such as reimbursement for treatment in place (TIP) for a 911 response.  When the payer realizes that ambulance agencies drive – literally DRIVE – significant downstream expenses to the payer in emergency department (ED) and related fees by convincing lots of patients to go to the ED simply for the possibility of payment.  If ambulance providers could be reimbursed for TIP, and navigate patients to the most appropriate source of care for their medical condition, the patient wins (less inconvenience and high out of pocket co-pays and deductible payments), the payer wins (reduced expenses), and the ambulance agency wins (no loss of revenue and satisfaction of making patient-centric disposition determinations).

Implementing alternate payment models (APMs) with a payer, often requires becoming an in-network provider, and going through the credentialing process as an in-network provider.  We have done this with five payers, and in each agreement, payment for non-traditional services is a major component of that agreement.  In our negotiations with the payers for reimbursement rates, in every case, the payer is paying us the same amount they would have for regular ambulance service that they did when we were out of network.  The additional payments for non-traditional services is additional reimbursement to us that we would have not normally been reimbursed for as an out of network provider.

TEMSA: What additional tools do you expect to add to your “non-traditional EMS delivery system” in 2022?

Matt Zavadsky: The addition of more payers willing to pay for non-traditional services is a high priority for us.  We are hopeful that as more payers begin to see the plan member, payer and even ambulance provider, more will sign on.  We are about to roll out an enhanced membership program to our community.  Many TEMSA members offer ‘traditional’ membership programs that cover the uncovered expenses for traditional ambulance services.  We’re taking that to the next level.  For an additional fee, people can enroll in our membership+PLUS program, which not only gives members the peace of mind for traditional ambulance services, but also gets them access to 24/7 on-demand community paramedicine services, and on-scene patient navigation from a 911 call.

We also plan to introduce the concept of reimbursement for a single resource response and disposition from a 911 call.  MedStar’s 911 center is ACE accredited by the International Academies of Emergency Dispatch.  This external validation of the expertise by our 911 call takes should be used to perhaps dispatch a community paramedic to Medical Director approved low-acuity 911 calls.  The use of the single-resources community paramedic helps preserve ambulances for responses that have a higher likelihood of the need for transport to a receiving facility.  For the payer, perhaps a lower reimbursement could be negotiated for the successful disposition of a 911 caller with a less expensive resource would be a more efficient economic model.

Finally, we will be looking into the potential of providing telehealth services through our 911 center, as opposed to on-scene.  Again, for Medical Director approved EMD determinants, perhaps the 911 call taker could arrange a video telehealth visit with the 911 caller that can safely and effectively get the patient the medical care they need, without having to respond anyone to the scene?  This may provide additional value to the patient, payer, and the agency, as long as the outcomes can be effectively tracked, and the economic model makes sense for all involved.

TEMSA: The 2021 Texas Legislature approved ET3 payments for Medicaid. What kind of impact do you see for your agency in terms of ET3 payments for Medicaid?

Matt Zavadsky: TEMSA scored a major win for HHSC, Medicaid patients and HHSC with the approval and direction from the legislature to HHSC to implement an ‘ET3-like’ payment model for ambulance services in Texas.  There were many supporters of this initiative, due to the economic savings it could mean to Texas.  The combination of fee for service and managed Medicaid represents about 16 percent of our payer mix.  Many Medicaid patients call 911 for medical complaints that may be effectively managed in settings other than an ED.  Many of the managed Medicaid payers also have commercial and managed Medicare plans as part of their portfolio. 

As TEMSA works with HHSC to develop the rules for the implementation of ET3-like payments, we can leverage the model to demonstrate additional value for commercial and managed Medicare plans as well.  For MedStar, patients on Medicaid represent about 16 percent of our overall payer mix.

TEMSA: Can you give us an update on ET3 at the federal level and your agency’s involvement?

Matt Zavadsky: MedStar was blessed to be part of the early discussions with CMS related to the ET3 model; we were one of the early implementers of the model.  Due to some of the complexities of the model, the limited number of alternate destinations available in many communities, due in large part to the ongoing Public Health Emergency (PHE), many of the agencies approved for ET3 participation have struggled to launch.  Recognizing this, CMS recently issued a change to the model that allows agencies to temporarily implement the TIP intervention without needing to have an alternate destination partner.  This may help many agencies implement the model, while they continue to investigate alternate destination partners.

Medicare also recently introduced ‘Affinity Groups,’ which are educational forums designed to provide ‘real’ implementation lessons from agencies that have launched.  The recent series of national webinars and on-line chats have been very well received and attended by approved ET3 model participants.  The hope is that these platforms may help ‘de-mystify’ ET3 model implementation and facilitate networking between agencies that have launched ET3 interventions and those who have not been able to do so yet.

On a side note, it’s worthy of mentioning that likely due to both the ET3 model implementation, AND the expanded roles EMS has taken on during the PHE, the level of communication with CMS has been fantastic!  I’ve been in EMS administration for decades and have never seen the level of communication from CMS that we are seeing today.  They have been exceptionally helpful with many challenges, and exceptionally communicative with the EMS industry.  That will serve both CMS and the industry extremely well as we continue to work together on the myriad of challenges we will face together in the future.

Matt Zavadsky with Adam Boehler, the former leader of the Center for Medicare and Medicaid Innovation (CMMI), at the ET3 announcement on February 14, 2019.