HomeMy WebLinkAbout- - ALS Cost Recovery Program Staff Report - 8/3/2010CITY COUNCIL AGENDA REPORT
MEETING DATE: August 3, 2010
SUBJECT: Advanced Life Support (ALS) Cost Recovery Program
DATE: July 20, 2010
FROM: Fire Department
PRESENTATION Mike Morgan, Fire Chief
BY:
FOR FURTHER INFORMATION CONTACT
RECOMMENDATION:
ITEM NUMBER:
Mike Morgan, 714-754-5106
Adopt resolution that implements Advanced Life Support (ALS) Cost Recovery Program
to maintain current level and quality of prehospital Emergency Medical Services (EMS)
provided to Costa Mesa residents, without placing any additional financial burdens on
Costa Mesa residents, under the following terms and conditions:
1. Costa Mesa residents will not be required to pay any costs for EMS that are in
addition to whatever they would be paying under the current EMS billing system
(i.e., Costa Mesa residents will not be subject to any additional costs due to
implementation of this program).
2. Costa Mesa residents will continue to be exempt from paying the $275 first
responder charge (only non-residents are billed for this).
3. Care Ambulance Service, which performs all EMS billing for the City per contract,
will be authorized to begin billing the private insurance companies, Medicare, or
Medi -Cal, of all resident and non-resident patients, a $300 ALS transport charge.
4. Care Ambulance Services will waive all patient co -pay and deductible charges of
Costa Mesa residents that are specific to the ALS Cost Recovery Program.
5. Care Ambulance Service will waive the $300 ALS transport charge for all Costa
Mesa residents who do not have any form of medical insurance or coverage.
6. Residents will not have to do anything to obtain a waiver: All waivers will be
automatically reflected in the billing statement mailed by Care Ambulance
Service, which will be an amount reduced according to the amount waived.
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BACKGROUND:
Care Ambulance Service performs all EMS billing for the City per contract. Because
Care Ambulance Service is currently not authorized to bill Medicare, Medi -Cal, or the
private insurance companies of residents for ALS transport, the City is in effect
subsidizing these entities and losing a substantial amount of potential cost -offsetting
funds in the process, to the detriment of Costa Mesa residents and the EMS system that
they depend on.
Prehospital EMS is a highly specialized field of medicine, and is thus constantly
changing as improved technologies and treatments are developed (e.g., 12 -Lead EKG,
Transcutaneous Pacing, Intra -Osseous Infusion, Capnography, Stroke Triage). There
are necessarily costs associated with these new technologies and treatments, including
continuous education and training, and quality assurance and control mechanisms. It is
therefore imperative that the City provide reasonable cost -offsetting measures to ensure
that Costa Mesa residents continue to receive the standard of care in the treatment of
life-threatening or life -disabling illness and injuries.
A further, more detailed discussion of both the billing process and level of Prehospital
EMS is available on the City Website from the City Council Study Session of July 13,
2010.
ANALYSIS:
The City's goal in implementing the ALS Cost Recovery Program is to maintain the
current level and high quality of prehospital EMS provided to Costa Mesa residents
without placing any additional financial burdens on Costa Mesa residents. This program
achieves that goal because it allows for an increase in revenue to provide needed funds
to offset at least some of the costs of maintaining a modern EMS system, but without
subjecting Costa Mesa residents to any additional costs.
Under the current EMS billing system in which Care does not bill the private insurance
companies, Medicare, or Medi -Cal, of Costa Mesa residents, the City's total estimated
revenue from the ALS transport charge is $51,000 annually ($185 ALS charge x 688
non-resident transports @ 40% collection rate). However, under the proposed plan,
the City would receive $338,000 annually ($300 ALS charge x 2818 resident and non-
resident transports @ 40% collection rate), which represents an estimated net increase
of $287,000 in additional cost -offsetting funds that are needed to ensure that Costa
Mesa residents continue to be protected by a modern, state-of-the-art EMS system.
ALS CHARGE COMPARISON OF OTHER CARE CONTRACT CITIES:
$355.75
Orange County Fire Authority (22 member cities)
$350.00
Anaheim
$350.00
Buena Park
$350.00
Garden Grove
$343.25
Los Angeles County Fire Department (80 member cities)
$343.25
Montebello
$343.25
Santa Fe Springs
E
$325.00
Fountain Valley
$300.00
Costa Mesa - PROPOSED
$185.00
Costa Mesa - CURRENT
ALTERNATIVES CONSIDERED:
Qualified staff from both Costa Mesa Fire Department and Care Ambulance Service have
thoroughly researched and structured this program to achieve the stated goals of
increasing needed EMS cost -offsetting funds without subjecting Costa Mesa residents to
any additional financial burdens. Because these goals are achieved with the proposed
ALS Cost Recovery Program, no other alternatives were considered.
FISCAL REVIEW:
While there are no indirect costs for implementation of this program, it will allow the Fire
Department to retain the position of Emergency Medical Services Coordinator which was
proposed for elimination from the FY 2010-11 Operating Budget. This position is important
not only in terms of the provision of EMS training, materials and supplies but oversight of
the ambulance services contract and billing. Retention of this position will cost $142,725.00
with projected net savings (projected revenue minus position cost) of $195,275.00.
LEGAL REVIEW:
The City Attorney has reviewed the program as proposed and has concluded that the City
may lawfully adopt the cost recovery program. The City Attorney has reviewed the
Resolution and approved it as to form. Care Ambulance Service is the legally recognized
EMS billing entity for the City per contract, and is thus authorized to modify EMS billing at
the direction of the City Council.
CONCLUSION:
There are many costs associated with maintaining a modern EMS system that is capable
of continuous adaptation to new and improved emergency medical technologies and
treatments. The proposed ALS Cost Recovery Program will enable the Fire Department to
continue providing Costa Mesa residents the highest quality EMS according to the
standards of care and to the level that they deserve and expect, by billing medical
insurance providers directly and without any additional costs to residents. Accordingly, the
City Council is requested to adopt the resolution that implements the ALS Cost Recovery
Program as proposed.
MIKE MORGAN
Fire Chief
KIMBERLY HALL BARLOW
City Attorney
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ATTACHMENT: 1 Resolution to Implement the Advanced Life
Support Cost Recovery Program
DISTRIBUTION: City Manager
City Attorney
Deputy City Clerk
Staff
File Name Advanced Life Support Cost Recovery Program Date 7-23-10 Time 11:30 am