Texas City Grapples With Rising Ambulance Costs

Texas City Grapples With Rising Ambulance Costs

News Nov 26, 2012

Nov. 26--ARLINGTON -- The Arlington City Council recently approved the third rate increase in five years for its contracted ambulance provider, American Medical Response, which says it has implemented measures to ensure that patients aren't being overcharged.

Although city officials say AMR met its contractual requirements to earn the requested rate increase, an internal audit reviewing the company's performance between 2008 and 2011 identified a few areas for improvement, including how patients are billed for mileage.

"In any business, especially one of this size and complexity, there is always something you can do better," Assistant Fire Chief David Carroll said. "It's good that we had the audit. I do feel we are monitoring [AMR's performance] and watching it very closely for quality and reasonable service to the citizens."

Under the latest 3.61 percent rate increase, the maximum average bill for patients transported by ambulance in Arlington will rise from $1,202.07 in fiscal year 2012 to $1,245.46 in fiscal year 2013, which started Oct. 1. The average, which is monitored by the city, is calculated based on patient charges divided by the total number of transports.

"Clearly AMR appreciates the opportunity to serve the citizens of Arlington and be the exclusive contracted provider," AMR Arlington General Manager Shane Smith said. "The city believes that we provide a good and valuable service. They believe we do so in as cost-effective manner as really can be."

AMR has been Arlington's exclusive ambulance provider since 2001.

Exclusive provider

Like Fort Worth, Arlington contracts with a private company instead of providing ambulance service through the Fire Department. It would cost Arlington an estimated $12 million to $15 million to start providing the service itself, Carroll said.

Under its current contract, the city does not pay any subsidy to AMR to provide ambulance services, but it can fine the company for not meeting performance standards, such as having a minimum number of ambulances available or taking too long to respond to a call for service. The Fire Department uses that fine money to pay for medical supplies and equipment and training.

"We feel like the way it is set up now is the best system. We don't have any of the headaches or liabilities of running an ambulance service," Carroll said. "Not only are we not paying them a subsidy for them being in town, we receive money in fines to enhance our EMS system."

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For example, the company is required to respond to Priority 1 calls -- the most serious calls -- within 8 minutes and 29 seconds at least 90 percent of the time.

"If they drop below 90 percent, then we fine them. It's a pretty harsh fine," Carroll said.

AMR, which has 24 ambulances housed throughout Arlington, has transported almost 54,000 people in the city over the past two years, Carroll said. In that time, the city received only 21 customer complaints about the ambulance service, he said.

Mileage discrepancies

The city audit, recently released to the City Council, reportedly found instances where it appeared some patients were billed for more miles than they were transported. Out of 25 bills reviewed, 11 were identified as having overcharges that averaged $342, or 22 miles per bill, according to the audit.

But Carroll said the audit office's mileage calculations were based on the shortest routes suggested by online mapping applications, which may not have been the actual route driven in that case.

"They may have taken the most obvious route instead of the shortest route. They could have missed a turn," Carroll said. "There are probably just as many undercharges as overcharges." To reduce the risk of key-stroke errors, AMR has added new checks and balances to its mileage billing process, Smith said. Software automatically calculates the distance between the patient's reported pickup and drop-off locations and will prompt the driver to confirm the mileage entered into the system if the information differs significantly, Smith said.

"If the mileage entered should have been five miles and we entered 15 miles, it will identify that and it will give a prompt," Smith said. "It gives them an opportunity to review and confirm its accuracy."

Discounted rates

Arlington is working to raise public awareness about a program that limits residents' out-of-pocket expenses for ambulance transportation, officials said.

Only 325 out of Arlington's approximately 93,000 households are registered with American Medical Response's Ready Care subscription program, Smith said.

Under the program, subscribers would pay nothing out of pocket for ambulance rides determined to be medically necessary by their insurance providers and would only pay 50 percent of the bill for ambulance rides that were deemed not to be medically necessary.

Residents with primary and secondary insurance can subscribe for $60 a year, while residents with just primary insurance would pay $67.50 a year. Residents without insurance would pay $400 a year.

Susan Schrock, 817-709-7578

Twitter: @susanschrock

Copyright 2012 - Fort Worth Star-Telegram

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Fort Worth Star-Telegram
Susan Schrock
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