(1) Except as provided in (4), the department pays the lowest of the following for ambulance services:

(a) the provider's usual and customary charge for the service; or

(b) the amount listed in the department's Ambulance Fee Schedule.

(2) The department adopts and incorporates by reference the Montana Medicaid Fee Schedule, Ambulance dated October 2008. A copy of the fee schedule is posted at the Montana Medicaid provider web site at http://medicaidprovider.hhs.mt.gov. A copy of the department's fee schedule may be obtained from the Department of Public Health and Human Services, Health Resources Division, 1400 Broadway, P.O. Box 202951, Helena, MT 59620-2951.

(3) For items and services for which no fee has been set in the department's fee schedule referred to in (2), reimbursement will be based on the by-report method and rate specified in ARM 37.85.212.

(a) The department will review billings for items and services, other than those items for which a specific fee has been set, to determine the total number of times each such item has been billed by all providers in the aggregate within the state fiscal year period.

(b) Upon review of the aggregate billings as provided in (3)(a), the department will establish a fee for each item which has been billed in the following manner:

(i) if Medicare sets a fee, the Medicare fees are applicable as the Medicaid fee; or

(ii) if Medicare does not set a fee, the Medicaid fees are set by evaluating the fees of similar services; or

(iii) a fee will be calculated based on the by-report percentage of the average charges billed by all providers in the aggregate for such items or services.

(4) The department may reimburse providers for ambulance services to transport patients to and from out-of-state facilities at negotiated fees where the department or its designee in its discretion determines that the in-state reimbursement rates are inadequate to assure that the recipient will receive medically necessary services.