House committee hears bill to create ambulance provider assessment to boost Medicaid reimbursements

Representative Ed Buttry asked the House Health and Human Services committee on Monday to approve House Bill 56, a provider assessment designed to shore up ambulance services across Montana by generating federal Medicaid match dollars.

Buttry, sponsor of the bill, told the committee the proposal would impose a 5.75% assessment on an ambulance provider's net operating revenue (gross revenue less bad debt, charity care and non‑patient service revenue). Money collected would feed a new ambulance Medicaid reimbursement special revenue account; when federal Medicaid match dollars are received, funds would be used to increase Medicaid reimbursements to ambulance providers, pay personnel and cover equipment and administration costs. Buttry said the fiscal note models a net zero impact to the state general fund.

The bill would not take effect unless the federal Center for Medicare & Medicaid Services (CMS) approves the supplemental payment program under applicable waiver authorities. Buttry and department staff also emphasized several assumptions in the fiscal note, including continued Medicaid expansion and the department's estimate that about 18% of ambulance providers would be ineligible for supplemental payments because they are not taxable entities.

Proponents from across the state described strained local systems and workforce shortages. Don Whalen, manager of Missoula Ambulance Service and president of the Montana Ambulance Association, called HB56 "lifeline funding" and said many counties face ambulance deserts. Justin Brester, manager for Polson/Ronan/St. Ignatius services, told the committee his combined operations respond to roughly 4,000 calls a year and are struggling with recruitment and retention because wages are insufficient. Justin Grohs of Great Falls Emergency Services said roughly 15–20% of transports are billed to Medicaid and that current Medicaid reimbursement is about 35–40% below cost.

Department of Public Health and Human Services administrators and fiscal staff described the fiscal analysis to the committee. Gene Hermanson, the department's Medicaid financial manager, and Mary Lemieux, administrator for the Health Resources Division, were present to answer technical and eligibility questions. The Department of Revenue said it would administer collection and designed an electronic filing and payment system; Jason Lay, bureau chief of the DOR's business taxes unit, said the assessment would be a new tax type requiring a separate return and that providers should retain underlying documentation for five years for audit purposes.

Committee members asked how funds would be distributed; Buttry and staff explained supplemental payments would generally be proportional to a provider's share of Medicaid transports, meaning providers that do not do Medicaid transports would not receive supplemental payments even if assessed. Lawmakers also pressed staff on paperwork burdens, the number of vacancies and turnover rates, and how the program would help districts with low Medicaid transport volumes. The sponsor acknowledged data limits: the state requested revenue and transport data from 122 providers and received only 15 responses, lowering confidence in some estimates.

Buttry offered a department‑requested, described‑as‑friendly amendment to change the reporting and payment schedule: reporting/payment due dates in section 5 would move from March 31 to June 30, and the state distribution date in section 14 would move from June 30 to September 30. The amendment was presented to the committee; no formal vote was recorded during the hearing.

The committee held the hearing and did not take formal action on the bill. Buttry closed by noting the measure's intent to avoid increased property‑tax levies by leveraging provider and federal dollars; staff warned that CMS approval is a gating requirement. The committee scheduled an upcoming technical presentation and executive action sessions later in the week.