County Ambulance Contract Becomes a Crash Site!
For many years now, upwards of 70% or more emergency calls to fire departments in Santa Barbara County are non-fire related. That is, the vast majority of the calls have to do with various types of medical emergencies. In some cases, the fire engine crew will beat the county’s ambulance provider, American Medical Response (AMR), to the scene. When the fire department arrives first, they diagnose and stabilize the patient, as they have been trained and certified to do so. When AMR arrives, the fire crew hands off the patient for further treatment and transport to the hospital. AMR pays area fire departments millions of dollars for these “back-up” services.
As a result of all the above, it could make sense to have county fire department add additional EMT’s and Paramedics to their staff, equip them with their own ambulances, and thereby eliminate AMR as the county’s sole ambulance provider, but the devil is always in the details!
Unfortunately, county supervisors skipped over nearly every pertinent detail in a process that was meant to decide whether AMR or county fire would become the county’s sole ambulance provider. Accordingly, AMR and County fire each submitted proposals based upon the request from the county to become the sole contract provider. In the end, however, the supervisors foolishly decided to split the baby and create a non-exclusive contract for ambulance services, which virtually no other jurisdiction in California has done.
How foolish was this decision? Because the two competing proposals by AMR and County Fire were each based on winning an exclusive contract, that means the proposals and all the details therein for both providers are now meaningless because neither proposal envisioned competing for customers and revenues throughout the county in a non-exclusive context.
AMR is a private sector company has been serving Santa Barbara County for the last half-century. Along the way, they have managed to absorb millions in lost revenue by virtue of the fact that they only collect 20-30% of what they bill. This has to do with the fact that most people who need ambulance services are elderly and many of the rest are poor (especially in the north county), and they are covered either by Medicare or Medical, both of which notoriously pay pennies on the dollar for all medical services rendered. Albeit county fire claims that government-run ambulance services can receive higher reimbursement via federal and state subsidies in certain circumstances. Having said that, all of that “extra money” comes from taxes!
This brings up a serious consideration. County fire has indicated that they would be reinvesting the profits that would otherwise accrue to a private sector for-profit company like AMR. However, they never admit that their real advantage over AMR is their ability to rely on local taxes to subsidize their overall operations. For example, county fire EMTs and Paramedics, unlike AMR employees, will be getting a public pension for life. Pension costs and pension losses can’t be billed to insurance providers! Hence, county taxpayers will ultimately foot these bills. Hence, the choice between the providers boils down to profits for AMR or higher taxes for you!
The reason having two ambulance services is sure to fail is that neither AMR or county fire can withstand the costs associated with having personnel and equipment standing around because of oversupply that comes from redundancy. That is, the proposals taken together will effectively double the number of ambulances in the county. This sets up a fiscally untenable non-exclusive, first-to-arrive, first-to-bill scenario. All the while, there will be too many ambulances for the population served.
The supervisors would have us believe that they were splitting the baby ala the wisdom of Solomon. But Solomon actually saved the baby in the biblical narrative by calling a bluff!
Andy Caldwell
