EMS Budget Navigation in Uncertain Times

How do you budget when there are unprecedented changes occurring? Many EMS agencies find themselves facing this dilemma as their industry navigates various legislative changes with unclear impacts.

And the shifts aren’t stopping anytime soon; there are certain to be additional changes on the horizon.

Let’s consider this:

• We’re still waiting to see how the impact of the One Big Beautiful Bill Act of 2025 (OBBBA) will impact Medicaid coverage over the next several years, given its 9-year phase-in.  
• As of early 2026, healthcare subsidies for Affordable Care Act (ACA) insurance plans have lapsed.  
• Government shutdowns have put Medicare ambulance add-ons at risk; however, on this there is a reprieve through 2027 based on the delayed budget passed in early February.  
• What, if any, impact the No Surprises Act will have on ground ambulance providers is still pending a decision by Congress.  
• Cost reporting as part of the initial Ground Ambulance Data Collection System mandate by CMS is complete, but how that data will be utilized by MedPAC, and whether there will be any changes to Medicare allowances at some point in the future, is unclear.  

Then there are state level changes. Many states have passed Ambulance Balance Billing legislation or are considering it. Medicaid Ambulance Supplemental Payment Programs exist in a number of states, but there is uncertainty about how those might be impacted by OBBBA.

Now that our heads are sufficiently spinning, it’s time to step back and take a more prudent approach to planning. There is no doubt that the uncertainty level has increased, but the exact impact of everything occurring isn’t known—and the timeline for the changes to occur is playing out over months and years, not days.

What advice can be given to people or businesses facing this sort of financial uncertainty? Here are four tips.

1. Take a more conservative approach to planning for revenue streams.

For example, if your agency’s revenues have been increasing at an average rate of 5% for the past five years, perhaps it is time to project them to be flat for your upcoming budget year. This will likely be questioned by your stakeholders, but sharing what is known to be happening, such as the upcoming cuts to Medicaid coverage and the loss of ACA subsidies, points to a reduction in patients with medical insurance and more that are uninsured.

Do you want to quantify that? You or your billing partner should easily be able to model the impact of a modest reduction of Medicaid and Commercially insured patients, for example, of one percentage point each by shifting those two percentage points into Self Pay.

By modeling a few tweaks, you accomplish a couple of things: First, you signal to your stakeholders that there is some uncertainty on the horizon. You can explain that the exact impacts are unknown, but that it is expected that there will be downward pressure on reimbursement, all else equal. Second, you start to build some buffer into your budget. If the drop ends up being twice as much as you planned for, the gap would be half of what it would have been if you had not planned for a modest change.

2. Assess possible mitigation strategies

If you believe that there will be downward pressure on your core revenues, now is a good time to look at whether there are steps your agency might be able to take to counteract those reductions.

For example, when is the last time you assessed your ambulance fee schedule? How do your fees compare with other providers in the surrounding area? Even though increasing fees only drives additional revenue from patients with Commercial insurance, it does provide an opportunity to offset reductions due to factors outside of your agency’s control. Is your agency billing for treatment and no transport encounters? Again, this might be something to consider to provide some additional revenue for the agency.

Granted, most options come with trade-offs and require navigating community and political considerations, but by laying out some possibly offsetting actions, your agency’s key stakeholders will appreciate that your team is not just talking about lost revenue without providing some off-setting options.

3. Consider contingencies

It is best to avoid being caught off guard by something that was signaled but not fully foreseen. If you planned for a modest reduction in your patients’ Commercial insurance coverage due to ACA subsidy elimination and it ends up having a bigger impact, what will you consider to offset those revenues losses? Perhaps it‘s as simple as communicating early on with your stakeholders so they can plan accordingly. How about setting up a billing/revenue dashboard and committing to monitoring it monthly in order to detect trends early on?

What if you are forced to offset some of your revenue decreases with expenditure reductions? Start thinking about what might be achievable, and over what timeframe those changes can be implemented. For example, can you tweak your response model to only send an ambulance and not a fire apparatus on low acuity calls? Can you utilize nurse triage to address low acuity calls to avoid having to put another ambulance in service? Can you implement a fee for non-transport calls to discourage callers from viewing an ambulance response as a free service?

Very few approaches can be implemented quickly, so some pre-planning is key. Another valuable approach is to reach out to agencies in your area and regional associations to see what priorities they are considering. You might find areas for collaboration and find ways to open revenue options that can be pursued collectively, such as state-level balance billing legislation which supports provider reimbursement.

4. Advocate your value and needs

Approaching your key stakeholders once you are experiencing shortfalls is often too late. Now is the time to share details such as the high costs related to 24/7 readiness and your community’s demand for rapid response during a medical emergency. This advocacy needs to be at the local, state and federal level as well as with other participants in the healthcare eco-system (e.g., hospitals and insurance companies).

Share your cost data with political leaders and explain how Medicaid and Medicare reimbursement rates typically do not cover your costs. Explain to them why a Medicaid Ambulance Supplemental Payment Plan is so vital or why the GADCS collected data really needs to drive reimbursement reform for Medicare payments. This advocacy can be both for the shortfalls on transports and for the fact that there are numerous calls your agency responds to where patients are not transported and no reimbursement is received from most Payers.

This sort of education could also create pathways for reimbursement options for alternative services such as Community Paramedicine and Mobile Integrated Health. In the end, your agency exists to service your community and all you are asking for is the funding to provide the best care possible.

Whether the number of changes that have occurred over the past couple of years is unprecedented or the new normal, our industry needs to be prepared. This is no different than the preparation that is done for the unknown, next 911 call. We need to be prepared for that urgent/lifesaving call at any moment. We do that clinically by having the right personnel, equipment and training so that we are ready. For budgeting, we need to similarly invest time to be prepared to financially navigate the inevitable changes to our revenue streams.

It is time for EMS agencies to plan for the financial unknown.