Missouri hospitals, pharmacies, nursing homes and mental health institutions have for some time enjoyed significant Federal funding by participating as associations in a State/Federal program called a Federal Reimbursement Allocation (FRA). 

The FRA concept is based on a self-taxing plan whereby qualifying health care institutions impose a state tax on themselves which in turn creates a state fund that qualifies to receive additional funding through the Federal Medicaid program. 

 

The funds are then reimbursed back to the association of qualifying institutions, like the Missouri Hospital Association, on an equal share basis. The Federal Medicaid program match's every 39 cents of state money with 61 cents of federal money – a substantial financial supplement for any health care organization. 

A new statewide initiative is now underway to establish Missouri ground ambulance agencies as the newest association to qualify for an FRA.  The move could mean more than $14 million in additional revenues for ambulance agencies that are often hurting financially.

Should ambulance agencies in Missouri be allowed to qualify for an FRA, each agency would be permitted to impose up to 5.5% of emergency gross revenue tax on itself.  The funds would be collected by a newly created coordinating group which would contract with all the ground ambulance services in order to administer the program.  Currently, The Emergency Medical Services Agent Corporation (EMSAC) is being established to act as the coordinating group.

With certain financial and statistical models to comply with, EMSAC will work with the Missouri Department of Social Services who in turn will work with the Center for Medicare and Medicaid Services to gain final approval for the program.

EMSAC will consist of representatives from the Ambulance District Association of Missouri, Missouri Ambulance Association, Missouri Emergency Medical Services Association and the Missouri Fire Service Alliance. This governing organization will contract with each ground ambulance service in Missouri in order to conduct the program.

Members of EMSAC to date have met five times to discuss a proposal for the state, form the organization and begin the process of discussing the program with ground ambulance services in Missouri.  Most importantly for the moment, EMSAC is working to get a new state law passed that would then lead to the creation of an FRA.  The group hired the law firm Husch, Blackwell, Sanders which has developed draft by-laws and the draft legislation for state review.

During the 2008 Missouri legislative session there was considerable interest on behalf of several legislators to pass legislation in order to establish an FRA for ground ambulance services.  EMSAC intends to follow up on that interest in 2009 to create an FRA.

A recent state-wide survey showed more specifically how an FRA would be very beneficial financially to ambulance agencies in the state.

Two hundred and fourteen licensed ground ambulance services in Missouri and a total of 533,284 emergency calls statewide in 2007 represent estimated total gross receipts of $164,895,000 for 2007. 

The aforementioned 5.5% self-imposed tax rate on the estimated state total of emergency gross receipts would represent up to $9,069,225. This means the maximum federal contribution based on 39% state vs. 61% federal would be $14,185,184.

If successful, EMSAC will then contract with each ambulance agency in the state in order to meet the obligations of the law and create the necessary system to distribute the Federal funds equally to all Missouri ambulance agencies.

In order to not only pass the needed legislation but move forward with creating the contracts between the individual services and EMSAC, EMS personnel across the state are requested to keep working to inform their colleagues of this important initiative.