VA delays rule change on how it pays veterans’ air ambulance services

Veterans Affairs leaders have agreed to delay rule changes on specialty ambulance reimbursements until 2029, a win for advocates who warned that new policies could severely impact emergency services for veterans living in rural areas.

Before Friday’s announcement, the new rules were set to go into effect next February. Industry officials and department planners have sparred for years over the change, which would in many cases reduce the amount VA pays to air ambulance firms after those companies transport patients.

In a joint statement, Senate Veterans’ Affairs Committee Chairman Sen. Jon Tester, D-Mont., and ranking member Sen. Jerry Moran, R-Kan., praised the VA decision. Both lawmakers have worked to stop the rule change, arguing that any plan that could hurt those ambulance services should be reconsidered.

“Emergency air and ground transportation services in Montana and rural America can be the difference between life and death,” Tester said. “VA’s rushed roll-out of its rate change for these services could have been the final straw for providers serving rural America, and I’m glad to see VA answering our call to fix this issue.”

Last fall, during a speech at the National Press Club, VA Secretary Denis McDonough pushed back on accusations that the rule change was a money-saving move. He insisted that federal regulations require ambulance providers to have a contract with the department or receive reimbursements at a rate set by Medicare, often lower than what they currently charge.

A 2018 report from the VA Inspector General found that of 227,000 specialty medical transportation invoices over a 15-month period, about 20% were not properly authorized. Investigators estimated that the department awards more than $20 million in improper payments annually.

But industry representatives have pushed back on that assertion, pointing to the unique costs and challenges associated with moving critically ill or injured patients in rural areas.

In a statement, Ben Clayton, chief executive officer of Life Flight Network, said the delay will “allow time for us to work together on a permanent solution while ensuring veterans maintain access to these critical, life-saving emergency services.”

Congress had already intervened to delay the reimbursement rule changes last year, including language in a budget bill last year to push back the implementation timeline from early 2024 to 2025. Now lawmakers will have several more years to negotiate a compromise between the emergency response firms and VA administrators.