EMS System Review Report - Merced County, California
Transcript of EMS System Review Report - Merced County, California
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EMSSystemReviewReport
Submittedby
January25,2017
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MercedCounty 2 EMSSystemReviewReport
TableofContents
ExecutiveSummary……………………………………………………………………………………………….3
SummaryofFindingsandOptionsPresented..................................................................................4
Introduction…………………………………………………………………………………………………………..7
Methodology…………………………………………………………………………………………………………8
LimitationsandDisclaimers…………………………………………………………………………………...9
BackgroundDiscussion………………………………………………………………………………………… 11
TheRealityofAmbulanceRevenues…………………………………………………………… 11
TheRealityofEMSOversight………………………………………………………………………18
Findings………………………………………………………………………………………………………………...23
SystemRevenues………………………………………………………………………………………. 23
Deployment……………………………………………………………………………………………… 28
ResponseTimePenalties–EmergencyResponse…………………………….………… 30
ResponseTimePenalties–NETsandIFTs………………………………………………… 33
AmbulanceRates…………………………………………………………………………………………35
EmergencyDepartmentOffloadIssues………………………………………………………...39
CriticalCareTransportProgram………………………………………………………………….45
ALSAmbulanceDeploymentVersusTieredResponse………………………………… 49
WestSideHealthCareDistrict……………………………………………………………………. 52
CommunityParamedicine………………………………………………………………………….. 56
Appendices
AppendixA:InitialListofDocumentsReviewed……………………………………….. 59
AppendixB:InitialListofStakeholdersInterviewed….................................................63
AppendixC:SummaryofSelectedStakeholderComments…………………………. 69
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ExecutiveSummary
TheMercedCountyEMSSystemutilizesacountywideExclusiveOperatingAreaforemergency911EMSresponse,aswellasfornon‐emergency,interfacilityandcriticalcaretransports.ThesystemwasimplementedinJanuary2015followinganRFPprocess.The911systemdesignreflectedprevailingindustrystandardsasahigh‐performanceEMSsystemincorporatingresponsetimestandardsandassociatedpenalties.However,numerousclinicallyandpoliticallydesirablebutexpensiveenhancementswerealsoaddedtothesystem,includingresponsetimeandbreachprovisionsapplicabletonon‐emergency,interfacilityandCCTtransports,afull‐time,dedicatedin‐countygroundCCTunit,theimpositionofavarietyoffeesassessedonthecontractor,andnegativesubsidiessecondarytothedesignofthesystem.
Theperformancestandardsinplaceinthe911systemintheCountyarecomparabletootherhigh‐performancesystemsinCaliforniaandnationally.However,stakeholdersareconcernedthatMercedCounty–beingoneofthepoorestcountiesinCalifornia–cannoteconomicallysustainsuchahighperformance911system–ortheenhancementsintheotheraspectsofthesystemasmentionedabove–asincountieswithhigherpopulationdensityandamorefavorablepayermix.ItshouldbenotedthatEMSsystemsarefailingorhavefailedevenincountieswithmorefavorabledemographicsthanMercedCounty.
AlthoughtheMercedsystemisostensiblya“zerosubsidy”EMSsystem,therealityisthatthecontractorissubsidizingaspectsofthesystembeyondEMSresponseandtransport,resultinginaneffectivenegativesubsidy.ExamplesincludeprolongedE.D.patientoffloadtimes;fees,finesandpenalties;CCTandBLSinterfacilityresponsetimerequirementsandothercoststhathavetheneteffectofsubsidizingotherentities,includingtheCountyandtheareahospitals.
InthisreportwebeginwithamacroviewofEMSeconomicsandoversight,thenexaminewhethertherevenuesintheMercedCountyEMSsystematpresentarecapableofsupportingallsystemactivitiesandperformancegoals.Weconcludethatrevenuesfallshortofsupportingsystemrequirementsbyapproximately23%.Weestimatethatadditionalannualrevenueofapproximately$3.3millionisnecessarytosustainthepresentsystemandmeetcurrentperformancegoals.WepresentavarietyofoptionsthatCountydecisionmakerscanconsidertoreachthisgoal,fromwhichtheycanchooseanycombinationofapproaches(i.e.,feeincreases,performanceincentivestoreducepenalties,strategicuseofEnhancementFunds,etc.)
Virtuallyallstakeholdersinthecurrentsystembelieveitisahigh‐functioningsystemthatdeliversqualitypatientcare.Wethereforestrivedtopresentoptionsthatwebelievewillnotmateriallydegradethesystemthatisinplace.DecisionsarecommittedtothesounddiscretionoftheCountypolicymakers.Implicitinthisdiscretionistheneedtomakechoicesontheallocationoflimitedresources,andresourcesinMercedCountyaremorelimitedthanmost.Theoptionspresentedfocusonareaswhere,inourexperience,costsavingscanberealizedwithoutmodifyingthemostsignificantaspectsoftheemergencycareandtransportsystem.Wheretheseoptionsreflectcompetingchoicesandpolicyinterests,wetendedtofavoroptionswhichbolsteredtheemergencyresponsesystemascomparedtothenon‐emergencyandinterfacilitytransportaspectsofthesystem.
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MercedCounty 4 EMSSystemReviewReport
SummaryofFindingsandOptionsPresented
Thefollowingisasummaryofthemajorsystemmodificationoptionsthatarediscussedthroughoutthisreport.Pleasenotethatthesearenottheonlyoptions,buttheoneschosenforpresentationinthisreportarebasedonstakeholderinput,thepresentEMSsystemdesign,andanalysisofpertinentdocuments.Belowwesummarizeeachoptionthatisdiscussedinthereportandprovidepagereferencestowherethecompletediscussionscanbefound.
1. SystemRevenues:Additionalsystemrevenuesofapproximately$3.295millionarerequiredannuallytosupportthecurrentsystem,increasedeploymenttoalevelwhereoutlierpenaltieswouldbeavoided,adequatelycapitalizethesystem,andassurecommerciallyreasonablereserves.Theserevenuescanderivefromanycombinationofthevariousoptionspresented,includingincreasingrates,reducingoreliminatingoutlierpenalties,subsidizingCCTstaffing,eliminatingnon‐emergencyandinterfacilityresponsetimepenalties,grantingresponsetimeexceptionsforoffloaddelays,implementingtieredEMSresponseunderprioritydispatchresponsedeterminantsandothers.(Seepp.23‐27.)
2. Deployment:ContractordeploymentissufficienttomeetperformancestandardsunderthezoneFractileResponseTimecriteria.DeploymentisinsufficienttoavoidtheimpositionofOutlierResponseTimepenalties.Theestimatedmarginalcostsforadditionalunithoursnecessarytoachievethelevelofdeploymentnecessarytosatisfythecurrentoutlierperformancecriteria(wereoutlierpenaltiestocontinuetobepartofthesystem)areestimatedtobe$1.25millionannually.(Seepp.28‐29.)
3. EmergencyResponseTimes:Thecontractorhasachieved100%complianceinallperiodsforFractileResponseTimecompliance.SubstantialpenaltieshaveaccruedforOutlierResponseTimenon‐compliance.TheCountyshouldconsiderprovidingaresponsetimeincentivetothecontractortowaiveoutlierpenaltiesforanyzoneinwhichfractilecomplianceimprovesbyaspecificbenchmark(e.g.,92%)foracomplianceperiod.Otheroptionsare(a)thattheoutlierpenaltiesbechangedfrommandatorytopermissive,(b)thattheoutlierpenaltiesbeassessedonlywhenfractilezonecompliancedropsbelow90%foracomplianceperiod,(c)modifyingthemethodologyforcalculating911responsetimesbyaggregatingPriority1and2responsesforeachzone;or(d)eliminationoftheoutlierpenalties(whichwouldthenreducetheneedforadditionalsystemsubsidiesbyanestimated$1.25millionannuallyfortheadditionalrequireddeployment).(Seepp.30‐32.)
4. Non‐EmergencyandInterfacilityResponseTimes:Whileresponsetimerequirementsfor911emergencyresponsesareexpensiveandhavelittledemonstratedclinicalbenefitformostconditions,thereisvirtuallynoclinicaljustificationforimposingresponsetime
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penaltiesfornon‐emergencytransports(NETs)andinterfacilitytransports(IFTs).TheCountycanincrease911systemperformancebyeliminatingNETandIFTpenalties,andtherearestillmarket‐basedincentivesforthecontractortomaintainperformancestandardsforNETandIFTservices.(Seepp.33‐34.)
5. AmbulanceRates:Locallimitationsonambulanceratesareperceivedasaconsumerprotection,butgenerallydonothavethateffect.Instead,theyserveprimarilyasasubsidytocommercialinsurancecompaniesinthattheypreventcost‐shiftingfromlossesongovernmentalhealthprogramstohigher‐payingcommercialcarriers.Accordingly,theCountyshouldgrantcontractorrateincreasesand/oreliminatelocalrateregulationfromthesystem.Alternatively,theCountycouldpermitautomaticannualincreasesona“not‐to‐exceed”basis.(Seepp.35‐38.)
6. EmergencyDepartmentOffload:ProlongedE.D.offloadtimeshamperefficientEMSsystemunithourutilizationandlielargelybeyondthecontroloftheambulanceprovider.Hospitalsbearlegalresponsibilityforpatientsoncetheycometothehospital,andaccordinglythehospitalshouldfundanE.D.OffloadCoordinatorpositionforperiodsofpeakE.D.demandsothehospitalcanmeetitlegaldutytoassumeresponsibilityforpatientsuponarrivalintheE.D.Inthealternative,theCountyshouldconsidertheuseofSystemEnhancementFundsforsuchaposition.Also,oncesufficientdataareavailableunderthestate’snewstandardizedAmbulancePatientOffloadTime(APOT)MethodologyGuidelines,stakeholdersshouldestablishaconsensusbenchmarkforacceptableaverageoffloadtimesintheCounty.ResponsetimepenaltyexceptionsshouldbegrantedasamatterofcourseforlateresponsesthatareattributabletoE.D.offloadtimesexceedingthisconsensusbenchmark.(Seepp.39‐44.)
7. CriticalCareTransportProgram:TheCountyCCTprogramisunsustainableascurrentlyconfiguredduetohighoverheadandlowutilization,andfurtherburdensthe911system.TheprogramdoesnotoperateasafacilitypartnershipandthehospitaldoesnotordinarilysenditsclinicalstafftoaccompanyCCTpatientsduringtransportdespitefederallawwhichhasbeeninterpretedtorequireitinsomecases.Asaresult,thecontractorincursdisproportionatelyhighcostswithlittleopportunitytorecoverthesecosts.ThecontractormustthereforeincreaseitsCCTvolumebyseekingbusinessoriginatingoutsideofMercedCounty,which,ifsuccessful,maynecessitatearenegotiationofCCTresponsetimestandardsand/orpenaltyprovisions.Otheroptionstoimprovesustainabilityinclude(1)hospitalstaffaccompanyingCCTpatientsduringtransport;(2)hospitalsubsidiesforCCTnurses;and/or(3)theuseofSystemEnhancementFundsforCCTnursestaffing.(Seepp.45‐48.)
8. TieredEMSResponse:NationalstandardsofcareandfederalregulationsclearlysupporttieredEMSsystemdeploymentwherebythelevelofservicedispatchedisbasedon
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medicallyvalid,differentialresponsedeterminants.Asaclinicallyappropriate,protocol‐baseddispatchsystemisalreadyinplaceinMercedCounty,theCountyshouldconsiderimplementingatieredEMSresponsesysteminwhichBLSambulancesmaybedeployedforany911callsforwhichBLSresponsedeterminantsaredeemedappropriateunderthesystemdispatchprotocols,asreviewedandapprovedbytheCounty.TheCountycouldrequirethecontractortoperform100%auditof911BLSresponsesforaprescribedperiodoftime,andconsiderstoppingtheresponsetimeclockforresponsesinwhichaparamedicarrives(forALS‐levelcalls)withintheprescribedtimeperiod,eveniftheparamedicarrivesinanon‐transportALSinterceptvehicle.(Seepp.49‐51.)
9. WestSideHealthcareDistrict:TheoverlappingjurisdictionoftwoLocalEMSAgencies(MCEMSAandMVEMSA)regardingambulancedeploymentintheWestSideHealthcareDistrictcreatesasituationinwhichcontractorcompliancewithbothagencies’directivesisrenderedpracticallyimpossible.ThetwoLocalEMSAgencieswithjurisdictionintheWestSideHealthcareDistrictshouldexecuteaninterlocalagreementsothatperformancerequirementsapplicabletooperationsintheDistrictareconsistent,andtheCountyshouldopenadialoguewithStanislausCountyregardingpossibleincreasesinthespecialtaxwhichsubsidizesambulanceservicesintheDistrict.(Seepp.52‐55.)
10. CommunityParamedicine:Communityparamedicineprogramscanimprovetheeffectivemanagementofmanypatientconditionsintheout‐of‐hospitalenvironment,thusreducingdeploymentcostswithintheEMSsystem.ThoughthereisnoexpressauthoritytoimplementaCommunityParamedicineprograminMercedCountyatthepresenttime,theCountyandthecontractorshouldexplorethefeasibilityofimplementingsuchaprogramattheearliestopportunity,asitappearsthatsystemefficiencycouldbeimprovedthroughCommunityParamedicine.(Seepp.56‐58.)
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Introduction
OnJune7,2016,theMercedCountyBoardofSupervisorsapprovedacontracttoengagePage,Wolfberg&Wirth,LLC,anationalEMSindustrylawandconsultingfirm,toconductafocusedreviewofcertainaspectsoftheEMSsysteminMercedCounty.ThisreviewwaspromptedbymonthsofongoingdialoguebetweenstakeholdersintheMercedCountyEMSsystemregardingconcernsoverthesustainabilityandeconomicviabilityofthesystem.
Thebackdropofthisdialoguewasseveralrecenthigh‐profileEMSsystemfailuresornear‐failuresinotherCaliforniacountiesthatnecessitated,tovaryingdegrees,subsidiesandcontractconcessionsduringthetermsofthosecontractstopreventatriggerofthetakeoverprovisions.Takeoverprovisions,whichgivecountiestherighttoutilizethecontractor’sassetsandresourcestomaintaintheoperationoftheEMSsystem,arerightfullyviewedas“optionsoflastresort”andpresenttheirowncomplexandexpensivechallengeswheninvoked.
TothecreditoftheCountyandtheEMSsystemstakeholders,theneedforanunbiasedandindependentoutsideassessmentwasrecognizedasapreemptivemeasuretomaintainahigh‐qualityEMSsysteminMercedCounty.Theoverridingpurposebehindthisproject,therefore,istopresentCountydecisionmakerswitharangeofpossibleEMSsystemmodificationoptionstoreducethepossibilityofanEMSsystemcollapse.
Thestakeholdersinterviewedforthisprojectgaveinsightful,candidandthoroughresponsestoourquestionsinthisprocess.TheCountyisfortunatetobeservedbysuchadedicatedandcooperativegroupofprofessionals.AsummaryofselectedstakeholdercommentsisattachedasAppendixC.
Tothemaximumextentpossible,ourreviewfocusedonpresentingoptionsintendedtopreservetheessentialelementsoftheEMSsystemthatiscurrentlyinplaceinMercedCounty.Itisnotourroletoredesignthesystem;thatisataskthatisproperlyaddressedduringthenextscheduledprocurementcycle.
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Methodology
ThisprojectinvolvedprimarilyareviewofdocumentsandinterviewsofidentifiedEMSsystemstakeholders.AlistofthedocumentsthatwereinitiallyrequestedfromtheCounty,thecontractor,andotherEMSsystemstakeholdersisattachedasAppendixA.AlistoftheinterviewedstakeholdersisattachedasAppendixB.
DocumentcollectionandoffsitereviewbyconsultantstaffwasinitiatedinJune2016andcontinuedthroughouttheperiodoftheprojectthroughnumeroussupplementaldocumentrequests,whichwerepromptlyfulfilledbothbyCountystaffandthecontractor.
OnsitestakeholderinterviewswereconductedinMercedCountyovertheperiodAugust16‐17,2016.AsecondonsitevisittoobserveEMSoperationsandevaluatecontractordeploymentinmoredepthwasheldonNovember9‐10,2016.
Thecontractorrevenueintegrityportionoftheprojectwasundertakenbyobtainingfromthecontractorareportofallclosed,paidaccountsfromJanuary1,2015throughAugust31,2016inwhichMedicarePartBwastheprimarypayer.ThecontractorthenutilizedtheRATSTATSstatisticalsoftwareprogram,fromtheUnitedStatesDepartmentofHealthandHumanServices,OfficeofInspectorGeneral,torandomlyselectasampleofthirty(30)paidclaimsforaudit.Followingselectionoftherandomclaims,thecontractorwasaskedtoassemblethedocumentsthatarepertinenttoreimbursementforservices,includingpatientcarereports(PCRs),physiciancertificationstatements(PCSs),beneficiarysignatureforms,computer‐aideddispatch(CAD)reports,ExplanationofBenefits(EOB)reportsandotherrelevantdocuments.AlldocumentswerethenreviewedinstrictaccordancewithapplicablestatutesandthereimbursementrulesoftheCentersforMedicareandMedicaidServices(CMS).
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LimitationsandDisclaimers
Thisprojectandreportwereundertakenwithseveralimportantlimitations.Ourfirmwasengagedinaconsultingcapacity,notinalegalcapacity.Accordingly,itisbeyondthescopeofthisengagementforustoprovidealegalanalysisoftheissuespresented.Nevertheless,theoptionspresentedinthisreportmayraiseimportantlegalissuesfortheCountyanditsstakeholders,including,butnotlimitedto:
‐ Whetheranyofthemodificationoptions,ifimplemented,wouldrequireanewcompetitiveprocurementprocess;
‐ Whetheranysuchmodificationswouldbesubjecttolegalchallengeand,ifso,thelikelihoodofsuccessofsuchpotentialchallenges;
‐ Whetheranycontractmodificationswouldbeapproved(orneedtobe
approved)bytheCaliforniaEMSAuthorityand,ifnot,whetherantitrustimmunitywouldbecompromisedwithregardtothecontinuedenforcementofexclusivityintheambulancemarket;
‐ WhetheranyorallsuchmodificationswouldnecessitatechangestoCounty
laws,regulations,resolutionsorordinances
Accordingly,weexpressnoopiniononthelegalityof(1)themechanismbywhichanysuchmodificationsmaybemade;or(2)thelegalityofanamendmentoftheprovidercontractinanysuchregard.WearehappytoprovidesuchlegalanalysisinafutureengagementifdesiredbytheCounty.Otherwise,ifanyoftheoptionspresentedinthisreportaretobeimplemented,itisuptoCountydecisionmakerstodeterminewhethersuchchangescanbeimplementedduringthetermoftheexistingprovidercontract,orwhethersuchchangeswouldhavetowaituntilafuturecompetitiveprocurementcycleafterthecompletionofthetermofthecurrentagreement.
Alsobeyondthescopeofthisengagementistheperformanceofanindependentauditorforensicanalysisofthefinancialstatementsorfinancialrepresentationsofthecontractor.Ourservicesdonotconstitutetherenderingofprofessionalfinancial,accountingorbookkeepingservices.Accordingly,wecannotindependentlyverifyrepresentationsregardingthecontractor’sfinancialsituationortheimpactofspecificEMSsystemstandardsonthecontractor’sfinancialposition.
Therepresentationsofthestakeholdersinthisregardaretakenastrueforpurposesofthisassessment.TheCountyisstronglyadvisedtorequirethatthecontractordemonstrate,totheCounty’ssatisfaction,thefinancialimpactofanystandardsconsideredformodificationaswellastheresultingcostsavingsoftheproposedmodifications.
Methodologiesemployedtoconductthisreview(i.e.,stakeholderinterviewsandreviewofcertainavailabledata)haveinherentlimitations.Stakeholderinterviews,whileimportanttoany
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EMSsystemassessment,naturallytendtoreflectbuilt‐inbiasesandpoliticalconsiderationsofthestakeholdersinterviewed.Inaddition,anyassumptionsoroptionspresentedbasedonavailabledatawillinevitablydependupontheaccuracy,completenessandsuitabilityofthedataprovidedbytherelevantstakeholders.
TheClaimsAuditReport,althoughspecificallyintendedtoassessthecontractor’scompliancewithapplicableFederallawsandregulationspertainingtoMedicarebilling,cannotbeinterpretedasaguaranteeofanysuchcompliance.Theclaimsreviewpresentedinthisreportisbasedondocuments,recordsandinformationsuppliedbythecontractorandcannotbeindependentlyverifiedbyus.Thecontractorbearssoleresponsibilityforitsbilling,codingandcompliancepractices,anditissolelyresponsibleforanyoverpayment,judgment,settlementordemand,andlegalfeesandcosts,incurredasaresultofanyaudit,actionorinvestigation.AnyidentifiedMedicareoverpaymentsmustberefundedinaccordancewithFederallawwithin60daysofbeingidentified.
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BackgroundDiscussion
TheRealityofAmbulanceRevenues
Attheoutset,itisimportanttoframetheissuethatunderlieseveryEMSsystemdesign:anEMSsystemcanperformonlytotheleveloftherevenuesthatsupportit.AnEMSsystemthatplacesmobileemergencydepartmentswithanemergencyphysicianandcriticalcarenurseevery3milesthroughoutacountywouldbepubliclyandpoliticallydesirable,bututterlyunaffordable.Ontheotherhand,asystemwithoneBasicLifeSupport(BLS)ambulanceserving100,000peoplewouldbehighlyaffordable,butcompletelyundesirablefromapublichealthandsafetyperspective.
SomewherebetweenthoseextremeexamplesliestheoptimumEMSsystemconfigurationforeachcounty.EMSsystemdesignisalwaysanaccommodationofnecessitybetweenthepublic’sdesireforthefastestEMSresponseandthehighestlevelofcarewiththerealityoftheresourcesavailabletosupportthatsystem.
ThechallengeineveryEMSsystemistofindthatbalance,thatequilibrium.
ToPayers,EMSisaTransportCommodity.EMSis,unfortunately,viewedprimarilyasatransportcommoditybyhealthcarepayers.Insurerspayforambulancetransports,notEMSsystems.Thus,revenuesareavailableonlyforcallsthatresultincoveredtransports.Mostpayercriteriarequirethatthetransportmeetmedicalnecessityguidelines,thatthepatientbetransportedtoacovereddestination,thatthepatientreceivecoveredservicesattheoriginordestination,andotherstringentcriteria.Unfortunately,reimbursementisinsignificantforcancelledcalls,“treatnotransport”responses,standbys,patientrefusalsofcare,waitingtime,extracrewmemberswhenneeded,non‐transportinterceptservicesandotherservices.PatienttransportisonlypartofwhatanEMSsystemdoes,butitcomprisesthevastmajorityoftherevenueavailabletosupportallofthesevitalEMSsystemactivities.
Summary
AnEMSsystemcandeployresourcesandperformonlytoalevelthatisallowedbytherevenuesthatsupportit.
EMSsystemrevenuesderiveonlyfromasubsetofpatienttransports,yettransportrevenuesfallshortofcoveringbroadersystemcosts.IntheMercedCountyEMSsystem,substantialcostsabovethosereimbursedtransportsareaddedviaresponsetimerequirementsnotonlyfor911callsbutalsofornon‐emergency,interfacilityandcriticalcaretransports,aswellas
penaltyprovisions,ahigh‐costbutunderutilizednurse‐basedgroundCCTprogram,andotherfactors.Certainaspectsofthesystemalsohavetheeffectofcreatinga“negativesubsidy”EMSsystem.ThehighlyunfavorablepayermixinMercedCountymakesthecurrentEMSsystemunsustainable,particularlywhentheneedforcapitalreinvestmentandreasonablereservesare
factoredin.OthersystemsinCaliforniahavefacedandarefacinginsolvencyorcollapsewithmuchmorefavorablepayermixesthanthatofMercedCounty.
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EvenwhenanEMSresponsedoesresultinapatienttransport,itisimportanttonotethatmanypayersarelimiting,denyingorretrospectivelyrecoupingreimbursementfortransportsthatthepayerbelievesfailtomeetmedicalnecessityandotherpaymentcriteria.ItisvitaltounderstandthatwhileEMSsystemsmustrespondtoall911calls,notevery911patientwillresultinreimbursement–evenwhentransported.ThisisbecauseMedicare,Medi‐Cal,andcommercialpayersoftenrefusepaymentfortransportswheretheyunilaterallydeterminethatthepatientcouldhavebeensafelytransportedbymeansotherthananambulance.Thesimplefactinmostcommunitiesisthatanumberofpatientswhocall911donothavetrueemergenciesanddonotgenuinelyrequiretransportbyambulancefromaclinicalperspective.1Yet,legaldutiesofcareobligateEMSsystemstorespondtoall911calls(withinthemandatedresponsetimes,ofcourse)andtransportthevastmajorityofthesepatients.So,eventhoughEMSsystemreimbursementisavailableonlyforpatienttransports,thereisasubsetofpatienttransportsthatsimplyarenotreimbursable.
Therefore,mostdirectrevenueavailabletoanEMSsystemisstrictlytransport‐related,despitethefactthatmanyresponses–andevensometransports–donotresultinreimbursement.Manyresponsesarenotreimbursable,eventhoughthecostofreadinessforthoseresponsesissubstantial.Thefederalgovernmentisthesinglelargestpayerforambulanceservices,yetfederalstudieshavedemonstratedthatambulancetransportrevenuesfallshortofcompensatingmostambulanceservicesfortheirtransportcosts.Andagain,reimbursementisgenerallynotevenavailableforthemultitudeofresponsesthatdonotresultinpatienttransport.Putsimply,anon‐subsidizedEMSsystemmustsurviveonlyontherevenuesgeneratedbyasubsetofthatEMSsystem’sresponses.Andtherevenuepictureisbleakevenforthosecallsthatdogenerateacoveredtransport.
MostEMSReimbursementFallsShortofCosts.AstudybytheUnitedStatesGovernmentAccountabilityOffice(GAO)2foundthatMedicarereimbursementresultsinanaverageMedicaremarginofnegative6percentforambulanceproviderswithoutsharedcosts.3Putanotherway,theratespaidbyMedicare,whichisthesinglelargestpayerinthepayermixformostambulanceservicesintheUnitedStates,fallsshortofcoveringcostsbyanaverageof6%.Again,reimbursementfromMedicareandmostotherpayersisavailableonlyforcallswhichresultinamedicallynecessaryambulancetransport,notforresponseswhichterminatewithouttransport, 1OnestakeholderwithdirectknowledgeofthisphenomenonindicatedthatsincetheadventoftheAffordableCareAct(ACA),hehasseenananecdotalincreaseinthenumberofpatientswithcomplaintsofquestionablemedicalnecessity,suchas“generalmalaise.”2AmbulanceProviders:CostsandExpectedMedicareMarginsVaryGreatly.UnitedStatesGovernmentAccountabilityOffice,ReportGAO‐07‐383,May2007.3InthecontextoftheGAOreport,“providerswithoutsharedcosts”meantthoseambulanceservicesthatwerenotpartofahospitaloramunicipality.TheGAOconcludedthatitwasimpracticaltoevaluatecostsinEMSagenciesthatwereoperatedasdepartmentsoflargerentitieslikehospitalsorcities.Accordingly,theGAOreportfocusedonindependentambulanceserviceswhoserevenuesandcostscouldbeallocatedonlyamongambulancetransportservicesandnotother,unrelatedproductsorservices.Inthisregard,thecontractorfitsintothetypeofambulanceservicesstudiedinthisreport.
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orfortransportsdeemedtobemedicallyunnecessary.Byextension,thecostsformostresponsesthatterminatewithouttransportorthatresultinnon‐coveredtransportsmustthereforenecessarilybeshiftedontothosepatientswhoreceivecoveredtransports.
InCalifornia,theaveragelossesfromthetransportreimbursementofferedbygovernmentalpayerslikeMedicareandMedi‐Calareevenmorepronounced.Onestudyidentifiedtheaveragecostsofaprivatesectorambulancetransporttobe$589.4Medi‐Calpaysanaverageof$130to$150pertransport.Medicarepaysabout$507foranaverageALStransport.Governmentalpayerscompriseabout85%ofthepayermixinMercedCounty,andvirtuallyallofthosetransportsaredoneatalossbasedonthesereimbursementrates.
TheRealityof“Zero‐Subsidy”EMSSystems.Thechallengeofoperatingahigh‐performanceEMSsystemisparticularlyacutein“zerosubsidy”systems;thatis,systemsinwhichtheambulancetransportproviderisrequiredtosubsistentirelyonthetransportrevenuescollectedfrompatientsandthirdpartypayers.Thiscreatesazerosumproposition.However,amacroeconomiclookattheMercedCountyEMSsystemrevealsthatitis,inreality,a“negativesubsidy”system,inthatthecontractorisobligatedtoessentiallysubsidizeotherfacetsoftheEMSsystem.Thisisthroughthedirectimpositionoffees(approximately$100,00peryear)andpenalties(whichcurrentlyexceed$600,000peryear),andthroughindirectsubsidieswhichbenefitotherEMSsystemstakeholders,suchasinterfacilityandCCTresponsetimerequirements,CCTnursestaffing,E.D.offloaddelaysandothercostswhichhavetheeffectofsubsidizingotheraspectsofthesystem.Thisconceptwillbediscussedinlatersectionsofthisreport.
Theneteffectofa“negativesubsidy”EMSsysteminacountywithanunfavorablepayermixisthatsystemfailureortheneedforsubsidiesareinevitable.SuchhasbeenthecaseinotherCaliforniacountiesthathaveevenmorefavorabledemographicsthanMerced.EMSagenciesinCaliforniathatwishtosustainoneormoreExclusiveOperatingAreasmustrecognizethatanEMSsystemcanbarelysustainitselfinthenewhealthcareenvironmentwhenitmustsubsistsolelyontransportrevenues.Whenasizableportionofthoserevenuesmustgotopenalties,feesandsubsidiestoothercomponentsoftheEMSsystem,therecipeisunsustainable.ArecentwhitepaperfocusedonEMSreimbursementinCaliforniapointedlyconcluded,“EMSsystemsinCaliforniamayrequiresubsidies,mayhavetosignificantlyrestructuretheiroperationsorwillbecomeinsolvent.”5
CountyDemographicsCreateBuilt‐inObstacles.Tocompoundthealready‐uglyrealityoftransport‐basedEMSeconomics,systemswhichserveareaswithbuilt‐indisadvantagessuchashighunemployment,anunfavorablepayermix,alargelyrurallowpopulationdensity,andothersimilarsocioeconomicandgeographicfactorsmakethesustainabilityofzeroornegativesubsidyEMSsystemshighlyquestionable.AlthoughtheACAhasostensiblyresultedinahigher 4CaliforniaAmbulanceAssociation,California’sGroundEmergencyAmbulanceTransportation(GEMT)CertifiedPublicExpenditure,July17,2013.5Petrie,M.,EMSReimbursementinCalifornia:DiscerningtheFacts,April2016.
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percentageofinsuredpatients,manyofthosepatientsareinsuredbyMedi‐Cal,whichbyfarpaysthelowestreimbursementrateofanypayer(wellbelowthecostofprovidinganambulanceresponseandtransport),andmanycommercially‐insuredpatients,whichusedtobethemostdesirablepayerclass,arecoveredbyhigh‐deductibleplans.Thedeductiblesinsuchplanstypicallyexceedtheentirechargesfortheambulancetransport,whicheffectivelyconvertsthepayerstatusfrom“insured”to“self‐pay,”theneteffectofwhichistoresultinanunreimbursedserviceduetothedifficultyinobtainingpaymentfromthepatient.
In2015,theestimatedpopulationofMercedCountywas268,455.Thepercentofthatpopulationinpoverty,baseduponearninglessthan200%oftheFederalPovertyLevel(FPL),was53.1%.Incomparison,thatpercentageinCaliforniais35.9%andintheUnitedStatesis34.2%.In2014theunemploymentratewas12.8%inMercedCountycomparedto6.8%statewideand5.4%nationally.
In2014,16,048ofMercedCountyresidentswereenrolledinMedi‐Cal,with13,805newlyeligibleduetotheMedi‐CalexpansionbasedprimarilyonthemaximumincomerequirementforparticipationinMedi‐Calincreasingfrom100%oftheFPLto138%oftheFPL.Also,8,403residentswereenrolledinCoveredCalifornia,with94%ofthemeligibleforsubsidies.DespiteAffordableCareAct(ACA)enrollmentincreasingthenumberofMercedCountyresidentsenrolledinMedi‐CalandCoveredCalifornia,38,259patients(25.2%ofallpatients)servedattheMercedCountyhealthclinicsin2014wereuninsured.Also,allofMercedCountyisconsideredaHealthProfessionalShortageAreaduetoaverylownumberofprimarycareproviders.
IthasbeensuggestedthattheimplementationoftheACAshouldbeincreasingproviderrevenues,asmoreindividualsbecomeinsured.However,arecentwhitepaper6onEMSreimbursementinCaliforniastatedthenatureofthisfallacysuccinctly:
_____________________________________________________________________________
“ThesignificantgrowthinthenumberofMedi‐Calinsured,Medi‐Cal’sexceptionallylowreimbursementrate,andMedi‐Cal’sprohibitionagainstbalancebillingsuggeststhatEMSsystemthathavehighproportionsofMedi‐Calinsuredarenotfinanciallysolventnow,orwillnotbefinanciallysolvent,if:(1)theproportionofhighpayingcommercialinsuranceplans
decreases;or(2)theaverageamountpaidbycommercialplansdecreases;or,(3)populationstransitionfromhigher‐payingcommercialinsurancetoMedi‐Cal.Conversely,inthoseEMSsystemswheretheproportionofuninsuredandprivatepaydecreases,whilethe
proportionofMedi‐Calinsuredincreases,andtheproportionandreimbursementofotherpayergroupsremainunchanged,
averagenetrevenuemayincrease.”_____________________________________________________________________________
AvailabledatasuggestthatitisthefirstofthesetwoscenarioswhichisoccurringinMercedCounty.Thatis,thepercentageofMedi‐Calpatientsisgrowing,thepercentageofcommercially‐ 6Petrie,M.,EMSReimbursementinCalifornia:DiscerningtheFacts,April2016.
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insuredpatientsisdeclining,andmoreofthecommercialinsurersarepayinglessduetotheimpositionofarbitrary“usualandcustomarycharge”limitationsandthroughtheincreaseinhigh‐deductibleplans.7
Clearly,MercedCountyhasaverypoorpopulation,withlimitedaccesstoprimarycare.Thisisarecipeforincreasedvisitstohospitalemergencydepartments.In2015,11.7%ofvisitorstoMercedCountyemergencydepartmentscitedlackofaccesstocareasthecause.
WiththeincreasednumberofpersonsinsuredbyMedi‐CalandCoveredCalifornia,thecontractorisreimbursedmoreoftenforitsservicesthanRiggsAmbulanceServicehadbeenreimbursed,butthepaymentsitreceivesfromMedi‐Calarebelowitscosts,andmanypersonscoveredbyCoveredCaliforniaareunabletopaytheircost‐sharingamountforanambulanceserviceduetoahighdeductible.Also,thecontractorhasexperiencedadecreaseinthepercentageofcommercialpayersforitsservices,andcommercialinsurersordinarilypayhigherratesthanMedicareandMedi‐Cal.
Thepayermixaspresentedinthe2014RFP,comparedtothepayermixona12‐monthlookbackperiodfrom10/31/16isfoundinTable1.
NoReliefinSightontheRevenueSide.NeithertheEMSAgencynorthecontractoristoblamefortherealitythatbothfindthemselvesfacingwhenanEMSsystemappearstobeheadedtowardcollapse.Thefactisthatthelargestpayersforhealthcareservices–thefederalandstategovernments–havebeenutterlyneglectfulinassuringadequatereimbursementratesthatrecognizetherealitythatEMSismorethanaridetothehospital.Yet,thatistheonlyserviceforwhichthesepayersreimburse,andatanamountlessthancostevenforthatservice.
7Asofthewritingofthisreport,thefutureoftheACAappearstobeindoubt.Itislikelythatduringthetermofthecurrentambulancecontract,theACAMedicaidexpansionwillberepealed,aswilltheavailabilityofACAhealthinsuranceexchangesandtheindividual/employercoveragemandates.However,itislikelythathigh‐deductiblepremiumplanswillpersistandcommercialinsurancecoveragewilldecreasefollowingthelikelyrepealofallorpartoftheACA.Thisislikelytoexacerbatetherevenueproblemsexperiencedbyhealthcareproviders.8AvailableestimatesatthetimeofthisreportsuggestthattheMedi‐CalpopulationinMercedcontinuestogrowandnowexceeds50%.
Table1:PayerMixComparison:2014vs.2016
Payer 2014PayerMix 2016 PayerMix %Change
Medicare 23.85% 25.70% ⬆1.85%Medi‐Cal 31.45% 41.02%8 ⬆9.57%Medicare/Medi‐Cal 21.78 18.53% ⬇3.25%CommercialInsurance 11.50% 9.91% ⬇1.59%PrivatePay 10.45% 4.29% ⬇6.16%Agency 0.96% 0.56% ⬇0.40%
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UntilMedicareandMedi‐CalrecognizethatEMSsystemsincurlegitimatecostsforresponse/notransportservices,andforothernon‐transporthealthcareserviceslikeALSintercepts,communityparamedicineandotherintegratedhealthcareservices,thencountiesandEMSagencieswillhavetocontinuetomakehardchoiceswhenitcomestoallocatingalreadyscarceresourceswhendesigningorredesigningtheirEMSsystems.
TheupshotisthatEMSrevenuesbarelycoverEMSresponseandtransportasis.Everydollarthatacontractorisrequiredtopayinfines,penalties,franchisefeesandothercosts,andeverydollarthecontractorisrequiredtousetoeffectivelysubsidizeotheraspectsofthehealthcaresystem,thereisonelessdollartocoverthebasicEMSresponseandtransportsystem.Inthewordsofone(non‐contractor)stakeholderinterviewedforthisproject,“evenacontractorthatisstillintheblackdoesn’ttakemuchtogetpushedintothered.Achestcoldcanbecomepneumoniaprettyquicklyinthisbusiness.”ThataptlydescribesthesituationfacingMercedCountyatthebeginningof2017.Thoughouranalysisshowsthatthecontractorhasnotyetencounteredanegativenetincomepositioninitsyear‐endfinancials,thecontractorhasconsumedtheoverwhelmingmajorityofitscashreserves,andanegativenetincomepositionislikelybasedonthecurrenttrajectory.
MeetingOperatingExpensesisOneThing,MakingCapitalInvestmentsisAnother.Evenwhenacontractorcancoveroperatingexpenseswiththeirtransportrevenues,otherneededinvestmentsinpeopleandcapitalmaylag.Partofeverydollarearnedoughttogotothereplacementofvehicles,medicalequipmentandothercapitalexpenditures,andpartshouldideallybeinvestedincashreservestocovercontingencies.Theseissuesarediscussedlaterinthisreport.Inaddition,investmentisalsonecessaryintheretentionofhumancapitalintheformofbonuses,retirementmatchingandotherincentives.Contractorfinancialreportsandstakeholderinterviewsdemonstratethattheseareasarenotbeingadequatelycapitalized.Asdiscussedinmoredetailbelow,theselonger‐terminvestmentsalsoneedtobetakenintoaccountwhendesigninganEMSsystemthatrequiresthecontractortobeself‐sufficientinrelianceonitstransportrevenues.
TheBottomLine.Thebottomlineoftheseeconomicrealitiesisthatprovidercontractsinlow‐density,poorpayermix,highperformanceEMSsystemsmustbemindfulnottoburdenthesystemwithcostsbeyondthosewhicharealreadyincurredtoprovidetheessentialservicesofEMSresponseandtransport.Moreover,thosesystemssimplyneedtomakepublicpolicyandpublichealthchoicesonhowthoseresourceswillbestbefocused(e.g.,onemergencyresponsevs.non‐emergencytransfers).Systemsinwhichpatientsarebetterinsuredwithcommercialplans,wherethereisahigherpopulationdensity,wheremedianincomeishigherandwhereresourcesaremoreabundantmaybeabletogleansubsidiesoutoftheirambulancetransportcontractorswithoutinvokingfinancialdistress(thoughsystemsinfarricherandmorepopulatedcountiesinCaliforniahavefoundeventheycannotdosowithoutultimatelyhavingtograntsubsidiesorconcessionstotheircontractors).
Tworecentcasesareparticularlynoteworthy:
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‐ InAlamedaCountyin2015,thesystemwasdeemedtobeunsustainableandthecontractorwaspaidanoutrightcashsubsidyof$4millionduringthetermofthecontract.
‐ InSantaClaraCountyin2016,concessionsgivenduringthetermofthecontractsuchaseliminationoffranchisefeesanddispatchfees,eliminationofcontractornegativesubsidyrequirementssuchasfundingcountysoftwareandequipmentpurchases,eliminationoflatepenaltiesandothersuchmodificationswereestimatedatavalueof$7millionincontractorsubsidies.
Notably,theSantaClaraCountyExecutive,inhismemostotheBoardofSupervisorsregardingthesecontractualchanges,wrotethefollowingrevealingpassages:
_______________________________________________ __________________________________________________
“Wecontinuetobeconcernedaboutthe “Whiletherehavebeencriticismsregardingsustainabilityofthesystemand[the [thecontractor’s]originalbid…wemustfocuscontractamendment]attemptsto onthecurrentstateoftheEMSsystemandthecontinuebalancingcostsandresponse needtotakestepstoassurethecontinuitytimesisawaythatwebelievestillyields ofeffectiveemergencymedicalservicesintoahighquality,costeffectiveproduct thefuture.”foreveryoneinvolved.” ‐SantaClaraCountyExecutive9
_______________________________________________ _____________________________________________________
9May5,2015andFebruary9,2016memorandafromJeffreyV.Smith,CountyExecutive,totheSantaClaraCountyBoardofSupervisors.
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TheRealityofEMSOversight
Ontheothersideofthecoin,EMSoversightagenciesmustensurethattheircontractorsareaccountableandthattheyprovidequalitycareandresponsiveservicetotheirconstituents.WhenaLocalEMSAgency(LEMSA)electstocreateoneormoreexclusiveoperatingareas(EOAs)andutilizesacompetitiveprocesstoawardcontractstoservethoseEOAs,theEMSAgencyhasarighttoreceivethebenefitofitsbargainandensurethatthecontractordeliversonthepromisesitmakeswhenitsubmitsaproposalandsignsacontractwiththeLEMSA.10
TakeoversandSystemProcurementsareExpensive.EMSAgenciesmustbalancetheirdesireforfirmoversightwiththerealitythatifanEMSsystemfails,itisthecountythatisvestedwiththeresponsibilitytoorganizeandmaintainthatsystem.AlthoughtheMercedCountyambulanceRFP,likemostsuchEMSprocurements,containsatakeoverclauseasasystem“safetyvalve,”atakeoverwouldbeanexpensivepropositionforacounty.Inaddition,shouldacountyelecttoreplaceitssystemwithanewcompetitiveprocurementpriortotheexpirationofitscurrentterm,aprematureprocurementaddssignificantcoststothesystemaswell.Therefore,totheextenttheEMSAgencycanlawfullymakenecessarymodificationstoitsEMSsystemandprovidercontractduringthetermoftheagreement,thatmaybethemostdesirableoptionfromthestandpointofminimizingthecoststothesystem.
Asdiscussedabove,othercountyEMSAgenciesinCaliforniahavealsofacedimminentoractualsystemfailuresbroughtonbyfinancialnon‐viabilityoftheircontracts.Itisalwaysdifficulttoattributepreciselythecausesoffinancialdistressinanylarge,complexentitywithmultiplecostcentersandrevenuesources.Butthesesystemshaveconcludedthatthearrayofpenalties,fees
10ItisundisputedthattheCountyissuedanRFP,thecontractorsubmittedaproposalandwon,andthepartiesenteredintoacontractknowingfullwellalloftheirrightsandobligations.ThepurposeofthisprojectisnottoaddresswhethertheCountyhasthelegalrighttoholdthecontractortoitsobligationsassetforthintheRFP.Thepurposeofthisprojectistoassesswhetherthesystemissustainable,whattheprimarydriversofunsustainabilitymaybe,andhowthesystemcouldbemodifiedtoimprovethelikelihoodofachievingsystemsustainability.
Summary
LocalEMSagencieshavearesponsibilitytothepublictoensurethatprovidersareaccountabletofurnishhigh‐qualitycare.ThatoversightmustoccurwithrecognitionofthefactthatEMSsystemfailures,
takeoversandprocurementsarecostly,andimprovingthesustainabilityofanexistingsystem–wherethatsystemisalreadygood–shouldbeapriority.LocalEMSagenciesmustensurethatprovidersareheldaccountablebyassessingmetricsthattrulyassure
quality.Unfortunately,responsetimesareoftenusedasaproxyformeasuringquality,whentheevidencesuggeststhereislittlecorrelationbetweenthetwoin
mostcases.Responsetimestandardsinhigh‐performanceEMSsystemsconstitutethesingle
biggestcostcenter,yettheirclinicalbenefitisnotwellestablished.Totheextentresponsetimestandards
leadtotheoverutilizationofredlightsandsirens,theyalsoposeanincreasedrisktothesafetyofEMS
providersandthepublic.
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andsystemenhancementsrequiredtobepaidbythecontractorhadtobemodifiedtopreventcollapseofthesystems.11
AreWeMeasuringtheRightThings?Onechallengethathasemergedwiththeadventofhealthcarereformandthe“tripleaim”of(1)improvingpopulationhealth,(2)improvingtheexperienceofcare,and(3)reducingthepercapitacostofhealthcare12istheproperroleofEMSAgencyoversightinthepost‐reformhealthcaresystem.Withtheemphasisonevidence‐basedmedicineandoutcomemeasurement,ithasbeensuggestedbymanycommentatorsthatwearesimplymeasuringthewrongthingsinEMSoversight,withexcessivefocusonresponsetimesandinsufficientmeasurementof
outcomes.ThetwolargestitemsofexpenseinanyEMSsystemarepersonnelandvehicles–andresponsetimeperformancestandardsdictatehowmuchofeachwillbenecessaryinanyEMSsystem.MeasuringEMSresponsetimesisattractivebecauseitisrelativelyeasytodo,andthenecessarydataarereadilyavailabletodoso.
Measuringoutcomes,ontheotherhand,isnotaseasy,aselectronichealthrecords(EHR)havenotyetwidelyachievedintegrationbetweenprehospital,hospitalandpost‐hospitalcareproviders.Therefore,whilemeasuringtheimpactthatEMScarehasonpatientoutcomemeasurementslikemortality,lengthofstay,functionalstatusandotherhealthstatusindicatorsisthe“holygrail,”oursystemsofmeasurementdonotyetallowforthistobedoneinameaningfulway.Asaresult,othermetricsserveasaproxyforquality,namely,themeasurementandenforcementofresponsetimestandards.
DoResponseTimesMatter?BecauseresponsetimecomplianceisthesinglebiggestdriverofEMSsystemcost,witheveryminuteofreducedresponsetimesnecessitatingincreasingmarginalcosts,itisimportantforpolicymakerstolookatthestateofthedataandliteraturewhenitcomestoresponsetimes.Inotherwords,decisionmakersshouldhaveagoodhandleonwhethertheexpenseofresponsetimestandardsyieldspublichealthbenefitsfortheinvestment.
11Asmentionedabove,intheAlamedaandSantaClaraEMSsystems,therewerenotableamendmentsmadetoprovidercontractsduringthetermofthoseagreements.InAlameda,theproviderreceiveddirectcashsubsidiesof$4millionpaidbythecounty,andinSantaClarathe$7millionsubsidiestooktheformofpenaltyconcessions,franchisefeeeliminations,zonereclassificationsandothersubstantialchanges.Inneithercasewasthesystemre‐bid,andtoourknowledgetherehavebeennoobjections(thusfar)bythestateEMSAuthorityorbydisappointedbidders.Ofcourse,thisdoesnotmeanthatanymodificationstotheprovidercontractinMercedCountywon’tbemetwithobjectionorlegalaction,butitisnoteworthythatinother,largercountieswithmorevaluableprovidercontracts,nosuchlegalchallengesorEMSAuthorityobjectionswereforthcomingwhenthosecountiesnegotiatedmodificationstotheircontractsthatresultedinmillionsofdollarsofsubsidies,givebacksandconcessionsduringthetermsofthoseexistingcontracts.12InstituteforHealthcareImprovement,http://www.ihi.org/engage/initiatives/tripleaim/pages/default.aspx
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TheliteraturesuggeststhereisnostrongcorrelationbetweenEMSresponsetimesandpatientoutcomesforthevastmajorityofmedicalconditionsforwhichEMSisutilized.
Ultimately,MercedCountyshouldconsiderworkingtowardtheimplementationofafullyevidence‐basedEMSsystem.Wheretheclinicalevidencedoesnotsupporthigh‐costfeaturessuchasstringentresponsetimestandards,thosepracticesshouldbecurtailed,de‐emphasizedoraltogetherabandonedinfavorofdesigningasystemaroundmetricsthathaveaprovenpositiveimpactonclinicaloutcomes.Forinstance,metricssuchasdoor‐to‐balloontimesforappropriateSTEMIpatients,door‐to‐needletimesinpatientswithacutestroke,timetoaspirinadministrationwithacuteMIonset,andotherevidence‐basedclinicalmetricsshouldultimatelytaketheplaceofmetricswithdubiousclinicalbenefits,highcosts,andunwarrantedsafetyrisks.
Theassociationbetweenambulanceresponsetimesandpatientoutcomeshasbeendebatedforyears.Severalstudieshavebeenconductedtohelpresolvethedebateanddeterminewhetherthereexistsadirectcorrelationbetweenthelengthofresponsetimeandpatientoutcomes.Manypeer‐reviewedstudieshavearrivedattheconclusionthatresponsetimes,asacontributingfactorofpatientoutcomes,arelargelyarbitrary.Ultimately,butforafewconditions,therehasbeennoconclusiveempiricaldatathatashortenedresponsetimeisassociatedwithbetter
patientoutcomes.Someofthestudiesthatsupporttheconclusionthataresponsetimeisnotindicativeofpatientoutcomearesummarizedhere:
A2002study,conductedinametropolitancountywithapopulationof620,000,examinedthecorrelationbetweenspecifiedresponsetimesandsurvivalinanurbanEMSsystem.TheEMSsystememployedasingletierresponseattheALSlevelanda90%fractileresponsetimespecificationof10:59minutesforPriority1(emergencylife‐threatening)callsand12.59minutesforPriority2(emergencynon‐life‐threatening)calls.AllstudiedcallsresultedinpatienttransportstoaLevel1traumacenter.Thereviewcovered5,424transports.Seventy‐onepatientsdied,butthestudyfoundnosignificantdifferenceinmedianresponsetimesbetweensurvivorsandnon‐survivors.Thestudy’sconclusionwasthat“changingthesystem’sresponsetimespecificationstotimeslessthan[10:59minutesforPriority1callsand12.59minutesforPriority2calls],butgreaterthan5minutes,would[not]haveanybeneficialeffectonsurvival.” 13
Aretrospectivecohortstudypublishedin2005evaluatedtheeffectofparamedicresponsetimeonpatientsurvivaltohospitaldischarge.Thepatientswere
13Blackwelletal.,Responsetimeeffectiveness;comparisonofresponsetimeandsurvivalinanurbanemergencymedicalservicessystem,9AcademyofEmergencyMed.,(2002).
Theassociationbetweenambulanceresponsetimesandpatientoutcomeshasnotbeenconclusivelyestablishedbythepeer‐revieweddata.Response
timebenefitshavebeendemonstratedonlyforaverysmallsubsetofthemostcriticalcalls,suchascardiacarrestandnear‐arrest.
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transportedtoasingleurbancountyteachinghospital.Thestudyrevealedthat“aparamedicresponsetimewithin8minuteswasnotassociatedwithimprovedsurvivaltohospitaldischargeaftercontrollingforseveralimportantcofounders,includinglevelofillnessseverity.”14
In2006,theresultsofastudywaspublishedexaminingparamedicaccountsofthe
effectsonpatientcareandontheirownhealthandsafetyinanefforttorespondwithin8minutesofdispatchincasesinvolvingprehospitalthrombolysis.Theconclusionreachedwas“[t]he8minuteresponsetimeisnotevidencebasedandisputtingpatientsandambulancecrewsatrisk.”15
Astudypublishedin2009conductedareviewofmortalityofandthefrequencyof
criticalproceduralinterventionsperformedon373Priority1patients.Thestudywasconductedinacountyinwhichasingle‐tieredALSresponsetimelimitof10:59minuteswasimposedforPriority1calls.Thestudyfoundthatforthose373Priority1patients,patientswhowaitedlongerthan10:59minutesforanambulance,whencomparedtopatientswhodidnotwaitlongerthat10:59minutes,experiencedbetweena6%increaseanda4%decreaseinmortality.Thestudyconcludedthat“[n]eitherthemortalitynorthefrequencyofcriticalproceduralinterventionsvariessubstantiallybasedon[a]prespecified[advancedlifesupportresponsetime].” 16
Aone‐yearretrospectivestudypublishedin2012evaluatedresponsetimesin7,760
casestodeterminewhetheran8minuteEMSresponsetimewasassociatedwithmortalityattimeofhospitaldischarge.Thestudyfocusedonadultswithalife‐threateningeventasassessedatthetimeofthe911call.Forpatientswhohadaresponsetimeof8minutesormore,7.1%died,whileforpatientswhohadaresponsetimeof7:59minutesorless,6.4%died.Thosewhoconductedtheresearchconcludedtherewas“[questionable]clinicaleffectivenessofadichotomous8‐minuteALSresponsetimeondecreasingmortalityforthemajority...[n]otsuggest[ing]thatrapidEMSresponseisundesirableorunimportantforcertainpatients.”17
Theresultsofanotherstudydesignedtodeterminetheinfluenceofshorter
ambulanceresponsetimesonpatientoutcomeswerepublishedin2013.Thestudy
14PeterPonsetal.,ParamedicResponseTimes:DoesitAffectPatientSurvival?,12AcademicEmergencyMedicine,(2005). 15LPrice,Treatingtheclockandnotthepatient;ambulanceresponsetimesandrisk,15QualitySafetyinHealthCare,(2006).16Blackwelletal.,Lackofassociationbetweenprehospitalresponsetimesandpatientoutcomes,13JournalPrehospitalEmergencyCare,(2009).17IanBlanchardetal.,EmergencyMedicalServicesResponseTimeandMortalityinanUrbanSetting,16JournalPrehospitalEmergencyCare,(2012).
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wasconductedinanEMSsystemcoveringbothurbanandruralareas.ItreviewedresponsestoPriority1dispatchesforpatients13yearsofageorolderinvolvingmotorvehiclecrashinjuries,penetratingtrauma,difficultybreathing,andchestpaincomplaints.Thereviewcovered2,164transports,569ofwhichweretransportstoatraumacenter.Thestudyfoundthat“[i]ncasesseenatamajortraumacenter,longerresponsetimeswerenotassociatedwithworseoutcomesforthediagnosticgroupstested.”18
Arecent2016studyof503ambulanceresponsetimesforpeople65yearsofageor
olderwhohadfallentothefloorfoundthat8%ofthemdiedwithin90days,butthatthosewhodiedwithinthatperioddidnotwaitsignificantlylongerforanambulancethanthosewhosurvivedwithinthatperiod.19
Takentogether,theseandotherstudiestellusthatultimately,butforafewspecific,criticalandrelativelylow‐volumecases,therehasbeennoconclusiveempiricalorevidence‐baseddatathatashortenedresponsetimeisassociatedwithdecreasedmortalityratesoradropinotherpoorpatientoutcomes.Baseduponthesepeer‐reviewedstudiesitappearsthatresponsetimeasanindicatorofqualityisspeculativeatbest,withthepossibleexceptionofaverylimitedgroupofpatients,suchasthosewhoareincardiacarrestorinimmediateriskofcardiacarrest.20
ItisimportantthatpolicymakersunderstandthatwhileresponsetimemeasurementisthemostcommonproxyforEMSsystem“quality”inusetoday,responsetimestandardsareveryexpensivetoachieveanddonotconclusivelyyieldbetterpatientoutcomesfortheinvestment.AnyEMSsystemthatisfacedwitheconomicconstraintsandfindsitnecessarytomakehardchoiceswouldthusbewell‐advisedtoconsidertheresponsetimedatafromtheliteraturewhendecidinghowbesttoallocaterelativelyscarceEMSsystemresources.
Finally,itshouldbenotedthatresponsetimecomplianceencouragestheuseofredlightsandsirens(RLS)onthevastmajorityof911responses,whentheevidencenotonlysuggestslittleclinicalbenefitfromRLSuse,butasignificantlyhigherriskofaccidents,injuriesanddeathsinemergencyvehiclesdeployingRLS.21ThisshouldconcernanypublichealthagencywithEMSoversightresponsibilities.
18StevenWeissetal.,DoesAmbulanceResponseTimeInfluencePatientConditionamongPatientswithSpecificMedicalandTraumaEmergencies?,106SouthernMedicalJournal,(2013).19EmilyCannonetal.,AmbulanceResponseTimesandMortalityinElderlyFallers,33EmergencyMedicineJournal,(2016).20Areductioninresponsetimeswouldincreasecardiacarrestsurvivalas“[f]asterresponsetimesmeansearlier[interventions].”MarcusEngHockOngetal.,ReducingAmbulanceResponseTimesUsingGeospatialTimeAnalysisofAmbulanceDeployment,17SocietyforAcademicEmergencyMedicine,(2010.);“[I]tispossiblethatrapidresponsetopatientsinimmediateriskofarrestmaybeatleastasbeneficialasrapidresponsetothosewhohavearrested.”ColinO’Keeffeeetal.,Roleofambulanceresponsetimesinthesurvivalofpatientswithout‐of‐hospitalcardiacarrest,10EmergencyMedicineJournal,(2009).21Wolfberg,D.,EMSUseofRedLightsandSirensisaDangerousSacredCow,EMS1.com,June6,2016.
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Findings
SystemRevenues
WhyareAdditionalRevenuesNecessary?MercedCountyenjoysahigh‐performing,accountable,high‐qualityEMSsystemdespitethenumerousfinancial,geographicanddemographicchallengesitfaces.Thesystemdesigninthe2014RFPreflectedlong‐establishedindustrystandardsregarding911systemdesign.However,theRFPcontainedadditionalprovisions,suchasadedicatedgroundCCTunit,non‐emergencyandinterfacilitytransportresponsetimestandardsandotherfactorswhich,thoughdesiredbythestakeholders,addedcoststothesystemthatitnowappearsthesystemcannotsustain.Inaddition,changedcircumstancesincludingadeclineincommerciallyinsuredpatients,theproliferationofhigh‐deductiblehealthplans,theeliminationoftheairambulanceEOA(andwithit,thesubsidiesitprovidedforthegroundCCTprogram)andotherfactorshavegivenrisetoconcernsamongEMSsystemstakeholdersthatthesystemisnotsustainable.Thecollapseornear‐collapseofothercounty‐basedEMSsystemsinCalifornia(oneswithconsiderablymorefavorabledemographicsthanMercedCounty,itshouldbenoted)hasalsobeenadrivingfactorinpromptingthisreview.
Asdiscussedbelow,thelevelofcontractordeploymentissufficienttomeetfractileresponsetimestandardsbutisinsufficienttoavoidtheimpositionofoutlierresponsetimepenalties.IftheCounty’sgoalistoassuredeploymenttothelevelofavoidingoutlierpenaltyassessments,itisourjudgmentthatadditionalresourceswillberequired,bothduringthetermoftheincumbentcontractandinfutureprocurementcycles.Further,inourassessment,revenuesareinsufficienttoassureadequatecapitalreplacementandtoestablishnecessaryreserves,aswillbediscussedbelow.Whilethesetwocategoriesarenotdirectoperatingexpenses,theyarenolessimportant.
Additionalrevenuescanderiveeitherfromfeesforserviceorfromdirectorindirectsystemsubsidies.OurreportidentifiesarangeofoptionsavailabletotheCountythatwouldhavetheneteffectofincreasingsystemrevenues,eitherfromfeeincreases,directmonetarysubsidiesorindirectfinancialsubsidiesthatwouldaccruefromthemodificationofcertainaspectsofthesystem.Someoftheseoptionshavedirectmonetaryimpact;othersarein‐kindorindirect
Summary
Asthecontractorreportsthatincomeisapproachingbreak‐evenornegativelevels,systemrevenuesappeartobeinsufficientto
ensuresustainabilityoftheCountyEMSsystemandtomeetestablishedperformancestandards.Additionalannualrevenuesofapproximately
$3.295millionarenecessarytoensureadequatecapitalization,maintaincommercially
reasonablereserves,andsupportadditionaldesireddeployment.Thoserevenuesmustcomeeitherfromdirectsubsidies,indirectsubsidies,increasedincomegenerationthroughrateincreases,oracombinationoftheseoptions.
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benefits.WeprovidethisrangeofoptionsbecauseultimatelyitisuptoCountydecisionmakerstoselectthepolicysolutionsthatarebestfortheCounty.
Forinstance,manyofthesystem’sgoalsofsustainability,capitalreplacement,deploymentandtheestablishmentofnecessaryreservescouldbemet,whilemaintainingallcurrentperformancestandards,withoutanydirectcashsubsidiesfromtheCounty,ifrateincreaseswerefullyimplementedandpenaltieswerereformed.Ifrateincreasesarenotgranted,thenecessaryrevenuewouldhavetocomefromothersources,likeeliminationofpenaltytiers.Itissimplyamatterofaligningprioritiestoavailablerevenuesources,whetherdirectorindirect.
ItisworthreiteratingthatAlamedaCountyveryrecentlygaveitscontractoranoutrightcashsubsidyof$4millionduringthetermofanexistingcontract.AnyneedtomodifyanyaspectsoftheMercedCountyEMSsystemwouldbeobviatediftheCountyweretochoosetosimplypayacashsubsidytoitsprovider.Otheroptionsinvolvecontractualconcessionsormodificationsthathaveindirectvalueasopposedtocashsubsidies.Inthissense,theoptionspresentedinthisreportarea“menu”fromwhichtheCountycanselectparts,rejectothers,andcombineoptionstoobtainastateofeconomicequilibriuminthebalancebetweenservicevs.cost.
WhatAmountofAdditionalRevenuesareNecessary?ThenextlogicalquestioniswhatamountofadditionalrevenuesmayberequiredtoensurethesustainabilityoftheMercedCountyEMSsystem?
Beforeaddressingthatquestion,thefirsttaskistoanswerthequestion“whatissustainability”?Itisimportanttodistinguishbetween“survivability”and“sustainability.”Accordingtothecontractor,itsfinancialpositionwithregardtoMercedCountyisapproachingabreak‐evenproposition,withdwindlingcashreserves.Anegativenetincomepositionisforeseeable.IfanEMSsystemismerelybreakingevenwithrevenuescoveringongoingoperationalexpensesandlittleelse,thereisnoabilityforthesystemtoreplacecapitalandmeetunexpectedfinancialobligationssuchaslarge‐scaleMedicareorMedi‐Caloverpaymentrefunds(inanageofincreasingauditsandenforcementactivitybygovernmentalpayers,thisisarealpossibilityinanysectorofhealthcare).RunninganEMSsystemonabreak‐evenbasiswithlittlereservesandscantcapitalfundingisnotaformulaforlong‐termsustainability.
Withthisinmind,weattemptedtolookmorecloselyatthecontractor’soperatingmargins,reservesandcapitalreplacementneeds.Whilethecontractorappearstobemeetingitsoperatingexpenses,22theredonotappeartobesufficientrevenuestomaintainreservesorreinvestinnecessarycapital.
Maintainingcashreservesisimportantforanybusiness,butisespeciallyimportantformission‐criticalorganizationssuchasEMSagencieswith911contracts.Whilemanybusinessadvisors
22Atcurrentlevelsofdeployment,withoutconsiderationoftheeffectofoutlierpenalties,whichhavebeenbilledbutnotcollectedbytheCounty.Collectionofunpaidpenaltieslikelywouldresultinanegativenetincomepositionforthecontractor.
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recommendfourtosixmonthsofexpensesinreserve,evenreservesofthreemonthsofexpensesispreferabletozeroornear‐zeroreserves.Ina$14.4millionsystem,athree‐monthreserveconstitutes$3.6million.Thecontractor’scurrentreservescantypicallycoveronly2‐3weeksofoperatingexpenses.Whilethreemonthsisontheminimumendofcashreservesrecommendedforamission‐criticalcommercialoperation,wewillusethisasbenchmarkforpurposesofestimatingrevenuerequirementsinthisanalysis.Thisamountofreservesisnotbeingbudgetedasaone‐yearorone‐timeexpense.Rather,thisisfactoredintotheannualizedsubsidyanalysisovertheremaining8yearsofthecontractassummarizedbelow.
Itshouldbenotedthattheneedforreservesshouldnotbeconsideredaluxuryorafancifulindulgence.Thereareseveralplausibleandrealisticscenariosunderwhichthecashflowofahealthcareprovidercanbesignificantlyinterrupted.ChiefamongtheseisthefactthatcurrentfederallawpermitsCMSandstateMedicaidagenciestoplaceprovidersonprepaymentreview,suspendpaymentstoaproviderincertainsituations,andtounilaterallyrecoverlargeoverpaymentsfromprovidersthroughaprocesscalled“offset,”wherebyfuturepaymentsdueaprovideraredivertedbyMedicaretorepayoverpaymentsthatMedicaredeterminesareowedtoCMS.2324InadditiontodraconianactionsbyMedicareandMedicaidthatcaneffectivelyshutoffaprovider’scashflow,therearealltheotherusualthreatsastherearetoanybusiness.
Asforcapitalreplacement,anEMSsystemisheavilydependentuponassetsthatsufferwearandtearintheusualcourseofbusiness.Vehiclereplacementoccursat250,000milespursuanttothecontractor’sproposal.Expensiveequipmentsuchascardiacmonitorsandgurneyshavelimitedlifespans.Andasmedicaltechnologyevolves,theneedforneworbetterequipmentisalwaysarealpossibility.Tobesustainable,anEMSsystemmustensurethatsufficientresourcesarededicatedtothenecessaryreplacementofcapitalequipment.Thecontractorestimatescapitalreplacementneedsof$5.72millionovertheremainingeightyears25ofthecontract.26
Inthefollowingsectionofthisreport,weexaminethesufficiencyofthecontractor’scurrentlevelsofdeploymentandwhetheradditionaldeploymentisnecessarytomeetsystemdemand.
23Weshouldnotethatthisprojectincludedabillingandcodingauditofarandomsampleofthecontractor’sclaimstoexaminepotentialMedicarecomplianceissuesthatmaycomprisethecontractor’sfinancialstability.Astheattachedclaimauditanalysisdemonstrates,whilewemakenorepresentationsthatthecontractorwillnotbethesubjectofanypayerauditsorotheractions,thecontractor’srevenuecyclemanagementpracticesappeartobesoundandwesawnobasistoconcludethatthecontractorhasanysignificantcontingentliabilitieswithregardtopotentialMedicareoverpaymentsbasedontheinformationpresentedtousbythecontractor.24EvenifaproviderthroughtheMedicareappealsprocessultimatelysucceedsinsecuringarefundofallegedoverpayments,intheshorttermtheoffsetscanhaveacripplingeffectonaprovider’scashflowandthesustainabilityofitsoperationsifreservesareinadequate.25Eightyearsisusedforthisanalysistoincludetheremainingthreeyearsoftheinitialtermofthecontractplusapossibleextensionoffiveyears.26Whilethisprojectdoesnotincludeareviewofthecontractor’sinventoryorassessmentofcapitalassets,aftervettingthisfigurewiththecontractor,itdoesnotseemtobeanunreasonablenumbergiventhesizeandscopeoftheoperationsinvolved.Thecontractorreportsthatthisfigureincludes$4.9millionforreplacementofvehicles,powerloaders,gurneysandcardiacmonitors,and$820,000foranupgradeofitsdispatchcenter(whichwouldincludeadditionalconsoles,softwareandassociatedcosts).
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Asdiscussedinmoredetailbelow,itisestimatedthatapproximately$1.25millioninadditionalunithourcostswouldbenecessarytodeployatalevelthatwouldavoidtheimpositionofoutlierpenaltiesifallperformancestandardsaremaintainedatcurrentlevels.Thoseadditionaldeploymentcoststotal$10millionovereightyears.Inaddition,increasingdemandandincreaseddeploymentnecessitatesadditionaldispatchpersonnelestimatedbythecontractortocost$880,000peryear($7.04millionover8years).
TheultimatepolicychoicesaboutEMSsystemconfigurationandachievingequilibriumintheservicevs.costtradeoffareuptoCountydecisionmakers.IftheCountychoosestomaintaintheoutlierpenaltystructure,thisadditionallevelofdeploymentiswhathasbeenestimatedtobenecessarytoavoidthosepenalties.Iftheoutlierpenaltytieriseliminated,theseadditionalunithoursandtheassociatedcostswouldnotbenecessarytoachievepenaltyavoidance.
Toensurethesustainabilityofthesystem,thecontractorindicatedthatadditionalrevenueswouldberequiredandthatanadditionalcostcenterforwhichasubsidymightbenecessarywasthesatisfactionofapromissorynotepayabletotheownerofRiggsAmbulance.27Itisourviewthatthisexpenseshouldnotbeconsideredintheanalysisofanysustainability/improvementsubsidiesthatmayberequiredforthesystem.Wearenotconcludingthatthisisaninappropriateorunreasonablebusinessexpense,orthattheRiggsAmbulancepurchasepriceorfinancingtermsareinappropriate.ForpurposesofthisprojectweareconsideringonlyissuesofEMSsystemsustainability,notcorporateperformance.
Table2belowillustratestheadditionalestimatedEMSsystemrevenuesnecessarytoensureadequatecapitalreplacement,modestreservesandadditionaldeploymenttofullymeetthecurrentsystemstandards.28
27Onthispoint,somequestionshavebeenraisedastomonthlyamountsbeingpaidtotheownerofRiggsAmbulanceServiceunderthebuyoutagreement,itbeingsuggestedthatpartofthecontractor’sfinancialstrainsweredueto$125,000monthlypaymentsbeingmadetoRAS’sowner.OurreviewofpertinentdocumentsindicatesthemonthlypaymentamountforthebalancedueontheRASpurchaseisnowherenear$125,000permonth.Althoughthecontentsofthebuyoutagreementareconsideredtobeproprietary,themonthlypaymentamountisapproximatelyone‐tenthofthatamount,whichdoesnotseemtobecommerciallyunreasonable.28Itmustagainbeemphasizedthattheassumptionsmadeherearebasedonfinancialinformationsuppliedtousbythecontractor;wedidnotperformanindependentfinancialaudit.Despitethefactthatthisprojectdidnotentailsuchanindependentaudit,wedidvetthesenumberswithcontractorrepresentatives.Otherthantheareasofdisagreementnotedaboveaboutwhatitemsshouldbeincludedinthisanalysis,wedidnotfindthecontractor’sestimatestobeobjectivelyunreasonable.Thisanalysisalsopresumesthatthecontractor’srepresentationsofnear‐break‐evenstatus,withforeseeablenegativenetincomepositioninthenearfuture,anddepletedreservesarealsoaccurate.
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Table2:EstimatedNecessarySustainabilitySubsidies:
CapitalReplacement,ReservesandIncreasedDeployment,MercedCountyEMSSystem,2017–2024
CostCenter(s) 8‐YearCost AnnualizedCost CumulativeAnnual
SubsidyCapitalReplacement
$5,720,000 $715,000$715,000
AdditionalReserves
$3,600,000 $450,000$1,165,000
AdditionalDeployment
$10,000,000 $1,250,000$2,415,000
AdditionalDispatchPersonnel
$7,040,000 $880,000$3,295,000
TOTALS
$26,360,000 $3,295,000$3,295,000
Basedonthecontractor’srepresentationsthatcurrentlevelsofdeploymentaresustainableonlyasa“breakeven”propositionfromexistingavailablerevenues(withlittleornoallocationstoeithercapitalreplacement,reservesoradditionaldeployment),adequatefundingofthesethreeprioritiesappearstoexceedavailablerevenues.Thismeansthatanannualsubsidyof$3.295millionisnecessarytofundallthreeoftheseprioritiesfortheremainingtermofthecontract.29Putanotherway,thesystem’savailablerevenuesfallabout22.8%shortofthesegoals.
AnyDirectSubsidiesShouldbeTreatedasPublicFunds.ItshouldbenotedthatbecausethisanalysisisfocusedonEMSsystemsustainabilityandnotnecessarilythefinancialwell‐beingofthecontractor(althoughthosetwoconceptsareintertwinedinanyEMSsystem),anysustainability/improvementsubsidiesthattaketheformofdirectcashpaymentshouldinuretothebenefitoftheEMSsystemandnotthecontractor.IntheeventthattheCountyelectsdirectsubsidiestowardcapitalreplacementand/ortheaccumulationofcontractorreserves,attheendofthecontractperiod,anyunexpendedportionofthosepublicly‐subsidizedfundsshouldnotberetainedbythecontractor.AnysuchfundsshouldbeheldinescrowtobemadeavailabletothebenefitoftheEMSsystem.
29Thecontractorestimatesthatapproximately$1‐$1.5millionofthisneededamountwillalreadyberealizedasaresultoftherateincreasesthatbecameeffectiveinJuly2016.Aswillbediscussedinmoredetailbelow,itisimportanttonotethatthisestimateisbasedonlyon60days’worthofaccountsreceivableexperiencefollowingimplementationoftheJuly2016rateincreases.
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Deployment
IsContractorDeploymentSufficient?Aspartofitsanalysis,PWWwasaskedtoaddresswhetherthecontractorhadsufficientresourcestomeetdailysystemdemand.Althoughaformal,completedeploymentanalysisisbeyondthescopeofworkofthisproject,wedidaddressdeploymentsufficiencyduringoursecondsitevisitinNovember2016,andmadenumeroussupplementaldocumentrequeststoassessthisissue.
Thesufficiencyofthecontractor’sdeploymentdependsentirelyuponhowsufficientdeploymentismeasured.Intheframeworkoftheexistingcontract,twowaysthataremostlogicalwaystoaddressthesufficiencyofdeploymentare:
(1) Whetherthecontractor’sdeploymentissufficienttomaintaincompliancewithitscontractualfractileresponsetimeobligations;and
(2) Whetherthecontractor’sdeploymentissufficienttoavoidtheimpositionofoutlierpenaltiesunderthecontract.
Underthefirsttest,deploymentissufficient.Underthesecondtest,deploymentisinsufficient.
TherearenumerousothercriteriathatshouldbeassessedtoanswerthequestionofwhetherEMSsystemdeploymentissufficient.Forinstance,withregardto911deployment,theCountyreportsnopatientorcitizencomplaintsregardingresponsetimeperformancesincetheinceptionofthecontract.Patientsatisfactiondataregardingtimelinessofcarearegood.Althoughmutualaidhasbeendeployed,asitwouldbewithanyEMSsystem,nocallshavebeenmissed.
SincetheinceptionofthecontractinJanuary2015,nopenaltieshavebeenassessedagainstthecontractorfornon‐compliancewiththefractileresponsetimestandards.Putanotherway,thecontractorhasmetorexceeded90%complianceforeachemergencyresponsezone.Fractileresponsetimeanalysisistheestablishedindustrystandardmethodologyforassessingemergencyresponsetimecompliance.Therefore,usingthismethodology,thecontractorisdeployingsufficientresourcestosatisfysystemdemand.
Withregardtothesufficiencyofthecontractor’sdeploymentwhenanalyzedunderthesecondtestabove,itisclearthatdeploymentisinsufficienttoavoidtheimpositionofoutlierpenalties.
Summary
Currentlevelsofcontractordeploymentareadequatetomeetestablishedfractileresponsetimestandards.However,deploymentlevelsareinadequatetoavoidtheimpositionofoutlier
penalties.Additionaldeploymentisnecessarytoavoidtheimpositionofoutlierpenaltiesas
currentlystructured.Becausesystemrevenuesappeartobeinsufficienttosupportthismarginalincreaseindeployment,subsidieswouldbe
necessarytoachieveit.
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Therefore,thequestionofwhetherthecontractor’sdeploymentis“sufficient”tomeetsystemdemandisultimatelyaquestionforCountypolicymakerstoanswerbasedupontheparticularphilosophytheybringtothatquestion.Asthereisnoevidencethatcallsarebeingunanswered,deployment(plusmutualaid)isensuringthatresponsesarebeingmadetoallcallsintheCounty.Clearly,deploymentissufficientwhenmeasuredbyfractileresponsetimeperformance(whichisconsideredtheindustrystandardbenchmark).Therearefewhigh‐performanceEMSsystemsinwhichcontractorsavoidalloutlierresponsetimepenalties,butifthisisthemethodologydesiredtoaddressdeploymentsufficiency,thenagain,theansweristhatdeploymentisinsufficient.
HowMuchAdditionalDeploymentisNecessary?Asdiscussedearlierinthisreport,EMSsystemdesignisatrade‐offbetweencostandresponsiveness.Reducingresponsetimesbyeveryminutehasanescalatingmarginalcost,meaningthatitbecomesincreasinglymoreexpensiveasresponsetimecompliancegoesupto95,97,98,99andultimately100percent.Thatis,themarginaldollarsrequiredtoanswerthelastcall–theone‐hundredthpercentilecall–withintheprescribedresponsetimestandardaremorethanthedollarsrequiredtoachieve90%.Itshouldbenoted,incidentally,that100%compliancewithprescribedresponsetimestandardsispracticallyimpossibleandthereforepredominantlyatheoreticalexercise.
Itishelpfultoconsiderthemarginalcostsofdeploymentsufficienttoachievealevelofresponsetimecompliancethatwouldavoidtheimpositionofoutlierpenalties.Toaddressthis,weexaminedtheestimatedcostassociatedwiththeincreaseinunithoursthatwouldbenecessarytodeploysufficientresourcestoachievethistarget.Todeployatalevelsufficienttoavoidoutlierpenalties,thecontractorestimatesamarginalannualcostof$1.25million.30Systemrevenuesappeartobeinsufficienttoachievetheselevelsofdeployment.
30Theseestimatesarebaseduponproprietaryunithourcostestimatessuppliedbythecontractor.Again,asafulldeploymentanalysisandassociatedanalyticsarebeyondthescopeofthisproject,wereliedupondataandcostestimatessuppliedbythecontractor.Thoughtheseestimatesarecontractor‐derived,wehavenoreasontoquestiontheiraccuracy.
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ResponseTimePenalties–EmergencyResponse
ResponseTimePenaltiesAreSubstantial.Oneofthemost‐discussedsubjectsraisedbystakeholdersintheinformation‐gatheringphaseofthisprojectwasthemechanismfortheassessmentofresponsetimepenaltiesagainstthecontractor.SincetheinceptionofthecontractinJanuary2015,penaltiestotalingover$900,000havebeenassessedbytheCountyagainstthecontractor,averagingapproximately$40,000permonth.31
Thecurrentpenaltymechanismessentiallymandatestwotiersofresponsetimenon‐compliancepenalties:
(1)FractileResponseTimePenaltiesand
(2)OutlierResponseTimePenalties.
Thefractilepenaltiespenalizethecontractorforzoneresponsecomplianceoflessthan90%foranysubsetof911callsinanyemergencyresponsezone(ERZ)intheCounty.Fractilepenaltiesarealsoassessedfornon‐emergency/interfacilitytransfersandCCTs.Theoutlierpenalties(alsoknownas“late”penalties)penalizethecontractorforso‐called“excessive”responsetimesforaparticularcategory.Alateresponseisclassifiedas“excessive”whentheresponseexceedsacertainpre‐determinednumberofminutesassetforthintheRFP.32
Thecontractorstakeholdersinourinterviewsdescribedthetwo‐tieredpenaltystructureasessentiallyimposinga100%responsetimeperformancerequirement.Ouranalysisdiffersfromthatofthecontractor.Becausetheoutlierpenaltiesonlyaccrueafter17:59/29:59(HCD/LCDzones)anddonotaccrueforeachminutetheresponsesexceedthefractilestandards,thistwo‐tieredpenaltystructuredoesnot,infact,createadefacto100%compliancestandard.Tothe
31DuringthecourseofourstakeholderinterviewsforthisprojectwewereinformedthattheCountyhasstayedcollectionofperformancepenaltiesfromthecontractor.Forpurposesofthisanalysis,wedrawnodistinctionbetweenassessedpenaltiesandcollectedpenalties.32Greaterthan17:59forPriority1and2responsesinHCDzones,andgreaterthan29:59inLCDzones.Thesegoto29:59and39:59forPriority3responses,accordingly,andtherearealsoresponsepenaltiesfornon‐emergenciesandCCTsaswell.
Summary
Responsetimepenaltieshavenotaccruedforfractileresponsetimecompliance,buthave
accruedsignificantlyforoutliercompliance.TheCountycanrestructureoutlierpenaltiestobaseitsenforcementonpositiveincentivesthatimproveresponsetimesratherthanpenalize
non‐compliance.Thecontractcouldbemodifiedtoincludeanincentivefortheeliminationofoutlierpenaltiesintheeventthecontractorachieveszoneresponsetimecompliancein
excessofthecurrent90thpercentilerequirements.Forinstance,ifthecontractorweretoachieve92%fractileresponsetime
complianceinaparticularzoneforaparticularcomplianceperiod,outlierpenaltieswouldnot
beassessedforthatperiod.
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contrary,thestructureoftheoutlierpenaltiesmeansthatthereareresponsesthatfallintotherangebetween10:59‐17:59(HCDzones)andbetween19:59–29:59(LCDzones)thatareclassifiedaslate,butforwhichpenaltiesdonotaccrue.
Ourreviewoftherecordsrevealsthatthecontractorhasmetorexceededfractileresponsetimerequirementsineverycomplianceperiodinwhichtheyhavebeenmeasured.Allofthepenaltiesassessedfromtheinceptionofthecontracttothedateofthisreporthavebeenoutlierpenalties.
WhilemanyEMSsystemsdoimposeadditionalpenaltiesforoutliereventsinadditiontofractileresponsetimepenalties,thoseadditionalpenaltiesareoftenclassifiedas“optional.”Thisway,theycanbeusedbytheEMSAgencyasadiscretionarytoolincontractoroversight,dependingonthelevelofmotivationthecontractorrequiresforcompliance,andoverallfiscalconsiderationsofthesystem.TheRFPcurrentlyappearstomaketheassessmentoftheoutlierpenaltiesmandatoryontopofthefractilepenalties.
AnotherissuethathasledtotheassessmentofahighamountofpenaltiesistheseparatemeasurementofallemergencyresponsesinboththeHCDandLCDzones.SincetheresponsetimeperformancestandardsareidenticalinbothzonesforPriority1andPriority2emergencyresponses,thesecanbeaggregatedforcalculationpurposes.SincethecontractorhasputinplaceasecondaryPSAPwithMPDSprotocolsandtrainedEMDs,thiswillallowthecontractortheoperationalflexibilitytodeploybasedonacuityandpatientneedwhilereducingthepossibilityofbeingpenalizedforit.ThiswouldlikelyresultinmoreresponsiveservicetomoreacutelyillorinjuredpatientsasthoseconditionsareassessedundertheMedicalPriorityDispatchprotocols.
ConsideranIncentive‐BasedSystemtoImproveResponseTimesandReducePenalties.Inlightoftheabovediscussion,webelievethatthebestoptionistomodifythecurrentOutlierResponseTimePenaltiestoprovideanincentivetothecontractorwhichcanresultintheeliminationofthesepenalties.Forexample,waiversofoutlierpenaltiescouldbeearnedforanycomplianceperiodinanyzoneinwhichfractileresponsetimeperformanceexceedsthe90%benchmark(forinstance,thisincentivetargetcouldbesetat92%orsuchothernumbertobenegotiatedwiththecontractor).33Thiswouldhavetheeffectofincentivizingimprovedresponsetimeperformanceandraisingsystemstandardsratherthanpunishingcomplianceinthemaintenanceofexistingsystemstandards.
Otheroptionswithregardtomodificationoftheoutlierpenaltieswouldbe:
(a)Convertingtheoutlierpenaltiesfrommandatorytopermissiveandutilizingthemjudiciouslyandonlyforextremecases;
33Notethattherearesubstantialbilledbutuncollectedoutlierpenalties.Thecontractorassertsthatthecollectionofthesebackpenaltiescouldposeafinancialhardship.Iftrue,thepartiesshouldconsiderwhethersuchapolicycouldbeappliedretroactivelytotheinceptionofthecontractperiodforanycomplianceperiodsinwhichfractileresponsetimeperformancemetorexceededthisgoal.
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(b)Allowingfortheassessmentofoutlierpenaltiesonlyincomplianceperiodswherezonecompliancefallsbelow90%;
(c)Modifyingthemethodologyforcalculating911responsetimesbyaggregatingthePriority1and2responsesinthezones;and/or
(d)eliminatingtheoutlierpenaltytieraltogether.
Whileeachoftheseoptionswouldhavetheeffectofprovidinganindirectsubsidytothecontractor,webelievethattheoutlierpenaltiesdoserveavalidpurposesimplybyfocusingontheimportanceofcontractoraccountabilityinaresponsetime‐basedsystem.So,themostappropriateoptionmaybetokeeptheoutlierpenaltytierbutallowthecontractortoavoidtheimpositionofthesepenaltiesthroughimprovedzoneresponsetimecompliance,coupledwithmodificationofthecalculationmethodology,arethemostconstructiveoptionsthatmeetthetwingoalsofeconomicreliefandsystemaccountability.
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ResponseTimePenalties–NETsandIFTs
NET/IFTResponseTimeStandardsDivertResourcesFrom911Response.AnotherpolicychoicereflectedintheRFPistheassessmentofpenaltiesforlateresponsesfornon‐emergencytransports(NETs)andinterfacilitytransports(IFTs).
CertainlytheawardofacountywideEOAforalllevelsofservice,includingemergency911,NETsandIFTsnecessitatesaccountabilitystandardswithregardtotheexclusiveprovider.34However,becausetheRFPcontainspenaltyandbreachprovisionsthatapplyequallytoresponsetimedeficienciesforNETandIFTresponsesasitdoesforprehospital911responses,theeffectisallocationofresourcesawayfrom911deploymentsoasnottoincurperformancedeficienciesfortheNET/IFTresponsesandplacethecontractorinapotentialbreachsituation.
Theresponsetimeperformancestandardsforeachlevelisasfollows:
Table3:ContractorResponseTimePerformanceStandards,NET/IFTs
PriorityLevel Compliance HighCallDensity LowCallDensityNET
90% <19:59 <29:59
IFT
90%
+/‐ 15minutesofscheduledtimeor<59:59
NET/IFTResponseTimeRequirementsareaNegativeSubsidy.Moreimportantly,assetforthintheBackgroundDiscussionsectionofthisreport,theeconomicrealityofimposingresponsetimestandardsontheNET/IFTcallsistoprovideanindirectsubsidytothehospitalsand
34WenotethatthecontractualresponsetimestandardsarenottheonlymeasureofaccountabilityregardingIFTresponses.Unlikethe911aspectofthecontract,thereismarket‐basedaccountabilityintheIFTservicesofthecontractor.Thecontractorprovideswheelchairvanandothernon‐emergencypatienttransportationservicesthatarenotregulatedbytheEOAcontract.Shouldthecontractor’sperformanceonIFTsbedeficient,itsfacilitycustomerswouldbefreetodiscontinueusingthemforthesenon‐ambulancemedicaltransportationservices,sotheNET/IFTsystemisnotwithoutmarket‐basedperformanceincentives.
Summary
While911responsetimerequirementsareexpensiveandthereisscantevidencethatresponsetimestandardsimprovepatient
outcomes,thereisevenlessclinicalevidencetosupporttheimpositionofresponsetime
penaltiesfornon‐emergencyandinterfacilityresponses.Accordingly,theCountycan
improvesustainabilityofthe911responsesystembyeliminatingresponsetime
performancestandardsfornon‐emergencyandinterfacilitytransports.
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healthcarefacilitiesthatservetheCounty.Promptnon‐emergencyandinterfacilitytransportationimprovesfacilitythroughput,whichhasvaluetohealthcarefacilities.Asdiscussedearlierinthisreport,thishastheeconomiceffectofimposinga“negativesubsidy”onthecontractortothebenefitofotherstakeholdersintheCountyhealthcaresystem,i.e.,thehospitalsandotherfacilitiesthatservetheCounty.
Itisrelativelyunusual(thoughnotunheardof)foranEMSoversightagencytoimposeresponsetimeperformancestandardsonnon‐emergencyandinterfacilitytransports.Underthecurrentcontract,thefailuretomeetNETandIFTresponsetimerequirementsforthreeconsecutivemeasurementperiodsisanexpressconditionofbreach.Therefore,thecontractorcanbeincentivizedinsomeinstancestodivert911resourcestonon‐emergencytransportswhennecessarytoavoidperformancedeficienciesontheNET/IFTservices.
ThereisnoClinicalJustificationforNET/IFTResponseTimeStandards.Asdiscussedabove,theevidence‐basedcorrelationbetweenresponsetimesandpatientoutcomesinthe911contextishighlyquestionable;whenitcomestoresponsetimestandardsforNETsandIFTs,theevidenceofpatientbenefitsimplydoesnotexist.TheimpositionoftheseNET/IFTresponsetimestandardswasoverlyambitiousgiventheperformancestandardsapplicableto911calls.ThisisaluxurythattherevenuesoftheMercedCountyEMSsystemdonotappeartoafford.
OneoptiontheCountymaywishtoconsiderasanindirectsubsidyistheeliminationoftheresponsetimeperformancestandardsforNET/IFTcalls.Thereisnodemonstratedclinicalbenefitforthesestandards.Thesestandardscandetractfromcompliancewith911responsetimestandards,andhavetheeconomiceffectofsubsidizinghealthcarefacilitiesattheexpenseofanEMSsystemthatisalreadystrugglingforsustainability.
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AmbulanceRates
AmbulanceRateRegulationintheCurrentSystem.Section3ofthecontractstatesthat“allratesandchargesforservicesbytheContractorshallbeapprovedbytheDirectorofPublicHealth,”andthat“allbills…forservicesrendered…shallnotexceedtheratesandchargeswhichhavebeenapprovedbytheDirectorofPublicHealth.”Inaddition,Section(IV)(G)(3)(b)oftheRFPcontainsprovisionsregardingadjustmentstothecontractor’sapprovedrates.Notably,thissectionoftheRFPprovidesthat“changedcircumstances”whichsubstantiallyimpactcostsorrevenuescanserveasabasisforconsiderationofrateincreases.
Invokingthe“changedcircumstances”provision,thecontractorrequestedrateadjustmentsinMarch2016.IncreaseswereapprovedforALS‐Emergency,BLS‐Emergency,MileageandNightFee.IncreaseswererejectedforBLSNon‐EmergencyandCriticalCareTransports,basedontheCounty’sfindingthattheproposedfeeswere“wellaboveindustrystandard.”35
Table4onthefollowingpagesummarizesthehistoryofcontractorratesunderthe2015agreement.
RateIncreasesAlreadyApprovedAreProvingtobeBeneficial.Forthelevelsofserviceforwhichrateincreaseswereapproved,thoseratesbecameeffectiveasofJuly1,2016.Aspartofourreviewofthisissue,weaskedthecontractorforinitialdataregardingtherateincreasesandtheresultingimpactonrevenues.Using60days’worthofdatafromaccountsbilledsincetheincreasesbecameeffective,thecontractorprojectsanannualincreaseof$1‐$1.5millioninrevenueresultingfromtheapprovedrateincreases.36
35CertainlythecontractoritselfbearssignificantresponsibilityfortheunusuallylowBLSNon‐Emergencybaserate.EventhoughtheapprovedrateatthetimeoftheRFPwas$1375,thecontractorbid$400initsproposal,presumablyinordertomaximizepointsintheproposalscoringprocess.Nevertheless,forthereasonsenumeratedhere,thereislittletobegainedforthesysteminmaintainingtheBLS‐NErateatthecurrentlevelof$400simplybecausethecontractorunderbidtheBLS‐NEratesinits2014RFPproposal.36Sincetherewereonly60days’worthofdataonwhichtobasetheseprojectionsatthetimeofthewritingofthisreport,theseestimatesshouldbeverifiedwithadditionaldatapriortoanydecisionsbeingmadebasedonrevenuesderivingfromratemodifications.
Summary
Aslocalratecontrolshavelittleeffectonprotectingconsumersfromout‐of‐pockethealthcarecosts,theCountyshouldapprovethecontractor’srateincreaserequestsforBLSNon‐EmergencyandCCTlevelsofservice,approvefuturerateincreasesandeliminaterateregulationfromfutureRFPs.Inthealternative,anannual“not‐to‐exceed”capshouldbeimposedtoallowcontractorrateincreasesuptothatlevelwithouttheneedforapproval.Increasedrevenuesrealizedbyanysuchincreasesshouldoffsetbyequalamounts
anysustainabilitysubsidiesthatmightotherwiseberequiredtoachievethedesired
levelofsystemperformance.
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Theprojectedneteffectoftherateincreaseapprovalsispronouncedandiftheseprojectionsturnouttobeaccurate,thegrantingofrateincreasescomprisesasubstantialportionoftheprojectedsubsidies($3.295million)necessaryforincreaseddeployment,capitalizationandreservesthatarediscussedearlierinthisreport.
Table4:ContractorRateHistoryUnderCurrentAgreement,
January2015–Present
Level of Service
Initial Rate
3/16 Request
Current Rate
ALS ‐ Emergency Base Rate
$2,000 $3,500 $3,500
ALS – Non‐Emergency Base Rate
$2,000 $ ‐‐‐‐ $2,000
BLS Emergency Base Rate
$2,000 $3,500 $3,500
BLS Non‐Emergency Base Rate
$ 400 $1,600 $ 400
Critical Care Transport Base Rate
$3,500 $15,000 $3,500
Mileage (per loaded mile)
$ 45 $ 59 $ 59
Treat/No Transport*37
$ 300 $ ‐‐‐ $ 300
Night Charge*
$ 100 $ 200 $ 200
Oxygen Fee*
$ 100 $ ‐‐‐ $ 100
LocalRestrictionsonAmbulanceRatesareNottheConsumerProtectionsTheySeem.Inourview,theapprovalofrateincreasesisakeyareainwhichthesustainabilityoftheMercedCountyEMSsystemcanbeimprovedwithoutdirectsubsidyfromoraddedcosttotheCounty.Thisisbecausethevastmajorityofpatientaccountsarereimbursedbygovernmentpayersthatpayaccordingtoafixedfeescheduleandnotonprovidercharges.Inotherwords,theprovider’schargesareirrelevantundertheMedicareandMedi‐Calfeeschedules;theamountofreimbursementisprospectivelyestablishedbyfeeschedule,andthedifferencebetweentheprovider’schargesandtheapprovedfeescheduleamountsis,bylaw,deemedanuncollectable“contractualallowance.”
37*Itshouldbenotedthatsomeoftheseitemizedcharges,includingnightcharges,oxygenfees,andtreat/notransportchargesaretypicallynotrecognizedbythemajorhealthcarepayers,mostnotablyMedicareandMedi‐Cal.
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Thoughlocalcontrolsandlimitationsonproviderrateincreasesareperceivedasbeingbeneficialconsumerprotections,therealityisthattheselimitationsprimarilybenefitoneconstituency:thecommercialinsuranceindustry.Putanotherway,whenproviderchargesareartificiallysuppressed,itis,inreality,asubsidyforcommercialinsurers.
Becauseover85%ofthecontractor’spayermixismadeupofMedicareand/orMedi‐Calbeneficiaries,thosepatientsareautomaticallygrantedtheprotectionsfromout‐of‐pocketchargesthatcomewiththemandatoryfeeschedulesimposedbythosepayers.Providersareprohibitedbylawfrom“balancebilling”thesepatientsforanyamountsabovethoseapprovedunderthefeeschedules.TheonlyamountsthatmaybebilledtoaMedicarepatientareunmetcopaymentsanddeductibles,notthefullbalanceoftheprovider’scharges,andapproximately86%ofMedicarebeneficiarieshavesupplementalinsurancetopaythesecost‐sharingobligations.38
Because85%oftheMercedCountypayermixareMedicareandMedi‐Calbeneficiaries,thisleavesabout10%ofpatientswhoarecommerciallyinsured,andabout4.3%ofpatientswhoareclassifiedasuninsuredor“self‐pay.”Theself‐paycategoryisarelativelysmallpercentageofpatientsinoverallambulanceutilizationinMercedCounty.Inaddition,thecontractorfollowsafinancialhardshipwaiverpolicywhichpermitsthewaiverofout‐of‐pocketchargesforpatientswhomeetestablishedfinancialcriteria.39
Thebottomlineisthatmostpatientaccountsarenotself‐pay,andnopatientissubjectedtocollectionactionforout‐of‐pocketexpensesiftheymeetthefinancialhardshipguidelinesandcannotaffordtopay.Therefore,theneteffectofrateincreasedenialsistobenefitcommercialinsurancecompanies,whichcompriseabout10%ofthecontractor’spayermix,ascommercialpayersaremorelikelytoreimbursetheprovideratahigherratethangovernmentinsurers(though,asnotedearlierinthisreport,morecommercially‐insuredpatientsareshiftingintohigh‐deductibleplans,andfewercommercialplansareautomaticallypayingtheprovider’sfullbilledcharges).
LocalRateControlsBenefitInsurers,NotConsumers.BecausegovernmentalpayerslikeMedicareandMedi‐Calreimburseaccordingtofixedfeeschedules,andbecausethoseamountsgenerallyfallshortofcoveringprovidercosts,asdiscussedabove,theresultisthathealthcareprovidersmustshiftcostsfromgovernmentalpayersanduninsuredpatientstotherelativelysmallpercentageofaccountsthatarecoveredbycommercialinsurersandreimbursedathigheramounts.Inreality,ratecapsinhibitthisinevitablecost‐shiftinginwhichprovidersmustengagetoensuresustainability.
38KaiserFamilyFoundation,APrimeronMedicare:KeyFactsAbouttheMedicareProgramandthePeopleitCovers,2015,http://kff.org/report‐section/a‐primer‐on‐medicare‐what‐types‐of‐supplemental‐insurance‐do‐beneficiaries‐have/39Thisfinancialhardshippolicywouldapplytoanypatientbalances,specificallytoincludenon‐coveredservicesandunmetcopaymentordeductiblecharges.
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Toenforcelocalcapsonproviderchargesthereforeofferslittlebenefittoconsumers,mostofwhomdonotpayfortheseservicesoutoftheirownpockets.Localratecapsofferawindfalltocommercialinsurers,whothereforepayfewerdollarsinclaimsandretainmoreoftheirpremiumdollarsasprofit.And,inthecaseofambulanceservices,thesechargesaresuchanegligibleportionofhealthinsurancebenefits40thatthereisnodocumentedassociationbetweenambulanceratesandincreasesinhealthinsurancepremiums.Therefore,totheextenttheCounty’sregulationofthecontractor’sratesisperceivedtohelpholdthelineoncommercialhealthinsurancepremiumincreases,whileallhealthcarecostsnodoubteffectpremiums,thereisnodirectcorrelationbetweenretailambulanceratesandcommercialhealthinsurancepremiums.Inaddition,inthepost‐ACAhealthcareenvironment,marketforcesmuchlargerthanambulancechargesarereshapingthehealthinsurancepremiumlandscape.
ThereforetheCountyshouldreconsiderandapprovethepreviously‐deniedrateincreasesforBLSNon‐EmergencyandCriticalCareTransportlevelsofservice,andapprovefuturerateincreaserequestsunderthecontract.Inaddition,thedeletionofsimilarlocalratecontrolprovisionsintheRFPsforfutureprocurementcycleswouldbewell‐advised.Inreturn,itisappropriatefortheCountytorequireanaccountingfromthecontractoroftheeffectoftherateincreasesonrevenues,andforthoseincreasedrevenuestooffsetotherareasofprojecteddirectorindirectsubsidiesnecessarytosustainthesystem.Forinstance,themorerevenuethecontractorderivesfromfeeincreases,thelesssubsidywouldberequiredintheformofpenaltyrelieforotherconcessions.
IfaMorePoliticallyDesirableAlternativeisNeeded…Werealizethatthisoption(removingrateregulationfromthecontract)maynotbepoliticallypalatable,eventhoughwestronglybelievethepublicisnotprotectedbylocalambulancerate‐settingandwouldbebenefitedbyremovingratecaps.Itwouldbeourhopethatthepubliccouldbeappropriatelyeducatedonthispoint.However,itmaybemorepoliticallypalatabletolimitautomaticrateincreasestoacertainamount,forinstance,nomorethan20%onanannualbasis.Increasesinexcessofthisamountwouldberequiredtogothroughanapprovalprocess,butincreaseswithinthatpredeterminedrangewouldbeavailabletothecontractorasamatterofcourse.
40UsingCMSdata,ambulancechargescompriselessthan1%ofallMedicarehealthcarebenefitexpenditures.https://www.cms.gov/research‐statistics‐data‐and‐systems/statistics‐trends‐and‐reports/medicare‐provider‐charge‐data/physician‐and‐other‐supplier.html
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EmergencyDepartmentOffloadIssues
“Emergencydepartmentoffload”referstotheprocessofambulancesarrivingatahospitalemergencydepartment,transferringcaretoE.D.staff,andreturningtheambulancetoservice.OneoftheareasconsistentlymentionedbystakeholdersintheinterviewsconductedforthisprojectistheprolongedE.D.offloadtimesbeingexperiencedatMercyMedicalCenter(MMC)inMerced,thefacilitytowhichthevastmajorityofpatientsaretransportedintheCounty.
AlthoughThereisVariabilityinCurrentOffloadTimeMeasurement,StakeholdersAgreeThatDelaysareaProblem.AlthoughtherewassignificantvariationintheE.D.offloadtimesbeingreportedbyhospitalstakeholderscomparedtothosebeingreportedbythecontractorandothersystemstakeholders,andthestakeholderssuggestthatthisissueisimproving(atleastatpresent),therealityappearsthatoffloadtimesareafactorinEMSsysteminefficiencyinMercedCounty.41Inaddition,a2014statewidereportindicatedthat“verysignificant”or“extremelysignificant”offloaddelayswerebeingreportedinMercedCounty.42
TherearenumerousreasonsforE.D.offloadinefficienciesandthepurposeofthisanalysisisnottoassignblame,buttoidentifycontributorstotheunsustainabilityoftheMercedCountyEMS
41SomeevidenceofthevariabilityofthestakeholderreportsonthisissuewereseenintheaverageoffloadtimesreportedbyMMC(lessthan5minutesaverage)anddataprovidedbytheCounty(showingbetween11and37minutesonaveragedependingonthetimeperiod)andanecdotalreportsbythecontractor(whichreportedthatoffloadtimesexceeding60‐90minuteswereoccurringwithmoderatefrequency).Ourreviewofthehospital’smethodologysuggeststhatMMCisunderestimatingoffloadtimes,astheclockisbeingstoppedwhenaroomassignmentismade,eveniftheroomisnotyetphysicallyreadyforthepatient.42ToolkittoReduceAmbulancePatientOffloadDelaysintheEmergencyDepartment,CaliforniaHospitalAssociation,August2014.
Summary
ProlongedE.D.offloadtimeshamperefficientEMSsystemunithourutilizationandlielargelybeyondthecontroloftheambulanceprovider.Hospitalsbearlegalresponsibilityforpatientsoncetheycometothehospital,andaccordingly
thehospitalshouldfundanE.D.OffloadCoordinatorpositionforperiodsofpeakE.D.
demandsothehospitalcanmeetitlegaldutytoassumeresponsibilityforpatientsuponarrivalintheE.D.Inthealternative,theCountyshouldconsidertheuseofSystemEnhancementFundsforsuchaposition.Also,oncesufficientdataareavailableunderthestate’snewstandardizedAmbulancePatientOffloadTime(APOT)
MethodologyGuidelines,stakeholdersshouldestablishaconsensusbenchmarkforacceptableaverageoffloadtimesintheCounty.Responsetimepenaltyexceptionsshouldbegrantedasamatterofcourseforlateresponsesthatare
attributabletoE.D.offloadtimesexceedingthisconsensusbenchmark.
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systemandofferoptionsforimprovingsustainabilityoverthetermofthecurrentEOAcontractandbeyond.
SomeofthereasonsforE.D.offloadinefficienciesinclude:
‐ LackofaccesstoprimarycarecausinginappropriateE.D.demand;
‐ PhysicalE.D.design;‐ Hospitalthroughputissues;‐ Lackofhospitalbedsanddelayedbed
turnover;‐ Nursestaffingissuesandnurse‐patient
ratios;‐ Decreaseincommunitymentalhealth
resourcesleadingtoincreasedE.D.utilizationforpsychiatricholds;
‐ Delaysinradiology,laboratoryandotherhospitalancillaryservices.
But,regardlessoftheunderlyingcauses,theresultingimpactontheEMSsystemisindisputable.Whereambulancesaretiedupatthehospitalforprolongedperiodsoftime,unithourutilizationisreduced,responsetimeslengthen,penaltyassessmentsincrease,andtheEMSsystembecomeslessefficient.
OffloadDelaysHaveSubstantialEMSSystemCosts.Nationaldatarevealedanaverageincreaseinoffloadtimesfrom20minutestomorethan45minutesoveraten‐yearperiod.43ThecoststotheEMSsystemresultingfromoffloaddelaysaresignificant,directandquantifiable.Forexample,offloaddelaysinanEMSsystemwith10,000annualE.D.transportsexperiencingthenationalaverageoffloaddelaysof45minutesandcostsof$150perunithourofdeploymentwouldleadtoadirectcostof$1,125,000inthatsystem.
E.D.offloaddelayscanbeseenasanotherexampleofa“negativesubsidy”inaction.WhereambulancecrewmembersarerequiredtoremainwithpatientspriortotheE.D.staffassumingcare(apracticeknownas“waitingonthewall”or“walltime”44),thehospitalcanemployfewerstaffandrelyupontheprehospitalpersonneltomaintainresponsibilityforthepatientuntilthehospitalisreadytoassumethetransferofcare.
EMTALAPresentsanIssuefortheHospital.Despitethefactthatambulancecrewsareoftenpressedintowalltimeservice,theCentersforMedicareandMedicaidServices(CMS)hasindicatedthatsuchpracticescanresultinaviolationoftheEmergencyMedicalTreatmentand
43ToolkittoReduceAmbulancePatientOffloadDelaysintheEmergencyDepartment,CaliforniaHospitalAssociation,August2014.44See,e.g.,http://www.latimes.com/opinion/op‐ed/la‐oe‐newton‐wall‐time‐waste‐in‐fire‐department‐20140818‐column.html
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ActiveLaborAct(EMTALA)bythehospital.InaJuly31,2006memofromtheDirectoroftheCMSCenterforMedicaidandStateOperationstoStateSurveyAgencyDirectorsregarding“ParkingofEMSPatientsinHospitals,”45CMSstated:
____________________________________________________________________
“TheCentersforMedicare&MedicaidServices(CMS)haslearnedthatseveralhospitalsroutinelyprevent
EmergencyMedicalService(EMS)stafffromtransferringpatientsfromtheirambulancestretcherstoahospitalbedorgurney.ReportsincludepatientsbeingleftonanEMSstretcher(withEMSstaffinattendance)forextendedperiodsoftime.Manyofthehospitalstaffengagedinsuch
practicebelievethatunlessthehospital“takesresponsibility”forthepatient,thehospitalisnotobligatedtoprovidecareoraccommodatethepatient.Therefore,
theywillrefuseEMSrequeststotransferthepatienttohospitalunits.
ThispracticemayresultinaviolationoftheEmergencyMedicalTreatmentandLaborAct(EMTALA)and
raisesseriousconcernsforpatientcareandtheprovisionofemergencyservicesinacommunity.Additionally,thispracticemayalsoresultinaviolationof42CFR482.55,theConditionsofParticipationforHospitalsforEmergencyServices,which
requiresthatahospitalmeettheemergencyneedsofpatientsinaccordancewithacceptablestandardsofpractice.”
‐CentersforMedicareandMedicaidServices____________________________________________________________________
ItisclearthatunderFederallaw,hospitalsareresponsibleforpatientsoncetheyarriveintheE.D.46CMSinasubsequentpolicymemoindicatedthat“ahospitalwillnotnecessarilyhaveviolatedEMTALAifitdoesnot,ineveryinstance,immediatelyassumefromtheEMSproviderallresponsibilityforthe[patient].”CMSnotedthatwhenE.D.staffisoccupiedwith“multiplemajortraumacases”itmightbe“reasonableforthehospitaltoasktheEMSprovidertostaywiththe[patient]”untilE.D.staffisavailable.47(Emphasisadded.)ItiskeythatCMSspecificallyusedtheword“ask”inthiscontext;thehospitalcannotlegallyrequiretheEMSprovidertostaywiththe
45https://www.cms.gov/Medicare/Provider‐Enrollment‐and‐Certification/SurveyCertificationGenInfo/downloads/SCLetter06‐21.pdf46Infact,EMTALAappliesassoonasthepatientiswithin250yardsofthehospital’sproperty.42C.F.R.§413.65.47 https://www.cms.gov/Medicare/Provider‐Enrollment‐and‐Certification/SurveyCertificationGenInfo/downloads/SCLetter07‐20.pdf
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patient.Inotherwords,thepatientclearlyisthehospital’sresponsibilityunderFederallawuponarrivalatthefacility.48
SinceitisclearthatpatientsarrivingintheE.D.aretheresponsibilityofthehospitalupontheirarrivalatthefacility,itisthehospital’sresponsibilitytoassureithasadequatestafftosatisfythislegaldutyofcare.Atpresent,stakeholdersindicatethatMMCdoesnot.Thecontractor(andthustheEMSsystem)isthereforesubsidizingthehospitalwhenambulancecrewmembersareservingasproxyhospitalstafftocareforpatientsduringprolongedwalltime.This“negativesubsidy”hasdirectandsubstantialcoststothecontractorandtheEMSsystemaswediscussed.ThehospitalshoulddeployduringtimesofpeakE.D.demandan“OffloadCoordinator”–adedicatedclinicalstaffpersonintheE.D.–whosesoleresponsibilityistomonitorpatientswhoarewaitingonthewallpriortoreceivingabedassignment.
Theimplementationofthebulkofthestrategiesnecessarytomitigatehospitaloffloaddelaysmustnecessarilyrestwiththehospital.StrategiesidentifiedinaseminalCaliforniaHospitalAssociationreportareidentifiedinTable5.
Table5:E.D.OffloadMitigationStrategies49
E.D.Intake E.D.Throughput E.D.Output E.D.Overall
Bedsideregistration Effectiveorderingoflabandimaging
Acceleratedinpatientintakeprocess
ManagementofE.D.throughputmetrics
Ordersfromtriage Innovativestaffingutilization
Dischargeczar/accelerator
E.D.management“rounding”
Acceleratedintakeprocess
HospitalCodeAlertforE.D.overcrowding
UseofClinicalDecisionUnit(CDU)
ChargeE.D.physician‐nurseconcept(shiftleaders)
“Directtobed”policy Dischargeinstructionsuponarrival
UsepharmacistinE.D.
Wenotethatthehospitalstakeholdersduringourinterviewsseemedtobesincereintheireffortstoaddresstheoffloaddelayproblem.Again,thisisamultifacetedproblemthatisnotsolelyahospitalproblemoranEMSsystemproblem;itprimarilyreflectslargerhealthcaresystemissues.
48IthasbeensuggestedthatanEMSproviderwholeavesapatientinanE.D.priortotheE.D.staff“acceptingresponsibility”forthepatientwouldcommitthetortofabandonment.Legally,itwouldbeextremelyunusualforacourttoholdanEMSproviderliableforpatientabandonmentwhenanotherprovider,i.e.,thehospital,hastheaffirmativelegaldutytocareforthepatient.Whilethismaybeaninterestingtheoreticalquestion,therearenocasesofwhichweareawareinwhichanEMSproviderwaseverfoundtobeliableforpatientabandonmentonthesefacts.49ToolkittoReduceAmbulancePatientOffloadDelaysintheEmergencyDepartment,CaliforniaHospitalAssociation,August2014.
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WhattheCountyCanDo.SincetheEMSAgencyhasnoregulatoryjurisdictionoverthehospitalinthisregard,itcannotrequirethedeploymentofanOffloadCoordinatorormandatethatthehospitalimplementanyoftheseotherstrategies.Therefore,intheremainderofthissectionwewilldiscussstrategiesthatarewithintheCounty’scontroltoaddresstheE.D.offloadproblem.
TheCaliforniaEMSAuthorityhasdevelopedstandardizedAmbulancePatientOffloadTime(APOT)MethodologyGuidelinesformeasuringE.D.offloadtimes.Weanticipatethatthiswillresultinmuchmorereliableandstandardizeddata,thoughdataunderthatmethodologyisnotavailabletouspresentlyforpurposesofthisreport.AssoonastheAPOTMethodologyGuidelinesareimplemented,theCountyshouldensurethatallstakeholdersreportthisdataandthatitbemeasuredandmonitoredovertime.OnceAPOTproducessufficientdatafromwhichreliabledeterminationscanbemade,thestakeholdersshouldagreeuponanacceptableaverageE.D.offloadtime.
Suchabenchmarkshouldbedevelopedwithinputfromallstakeholders,withtherecognitionthatoffloadtimesareasignificantcontributortodecreasedEMSsystemefficiency.InAlamedaCounty,forinstance,a30minutebenchmarkwasestablished.InContraCostaCounty,“optimal”E.D.transfertimeis15minutesorless;transfertimeisconsideredtobe“delayed”after30minutes;andtransfertimeinexcessof60minutesisdeemedtobea“neverevent.”50AccordingtotheCaliforniaHospitalAssociation,theoffloadtimeintervalstandardmostfrequentlyusedbyLocalEMSAgencieswas15minutes.51
OnceaconsensusaverageE.D.offloadbenchmarkforMercedCountyisdecidedbythestakeholders,penaltyexceptionsshouldbegrantedasamatterofcourseforanylateresponseswhichexceedresponsetimerequirementsandareattributabletoE.D.offloadtimeswhichexceedthisconsensusbenchmark.
Wenotethatvariousstakeholders(bothCountyandcontractor‐affiliated)indicatedthatSectionIV(C)(6)(b)oftheRFPprohibitedtheconsiderationofoffloaddelaysasacriterionforgranting“goodcause”exceptionsforresponsetimedeficiencies.However,thecontractspecificallyindicatestheagreementofthepartiestointerpretthatprovisioninamannerwhichpermitsoffloaddelaystobeconsideredagoodcausecriterionwhen“reviewedandapprovedbytheLEMSADirector.”52Yetstakeholdersindicatedduringtheinterviewsthatoffloaddelayswere“notpermitted”asgoodcausecriteria.Ifso,thisCountypolicyappearstobecontrarytotheagreement;thecontractclearlypermitsE.D.offloaddelaystobeconsideredforgoodcause
50CountywideEmergencyDepartment911AmbulancePatientTransferofCarePerformanceReport,ContraCostaEMS,February11,2016,https://cchealth.org/ems/pdf/Hospital‐Transfer‐of‐Care‐Performance‐2016‐0211.pdf51ToolkittoReduceAmbulancePatientOffloadDelaysintheEmergencyDepartment,CaliforniaHospitalAssociation,August2014.52Section31ofSeptember9,2014contractbetweenMercedCountyandSEMSA.
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exceptions.Giventhefactthatthisproblemforthemostpartliesbeyondthecontractor’scontrol,thesedelaysshouldbeconsideredforgoodcauseexceptions.53
IfthehospitaldoesnotdeployanOffloadCoordinatororimplementotherstrategiestomitigateE.D.offloaddelays,anotheroptionistoutilizeEMSSystemEnhancementFundstoaddressthemitigationofthisproblem.Forinstance,enhancementfundscouldbeusedtopurchaseextraambulancecotsandtosupporttheE.D.OffloadCoordinatorpositionsuggestedabove.ItisalsopossiblethattheR.N.assignedtodutyontheCCTunitcouldfulfillthisfunctionwhennotengagedinCCToperations.
Ofcourse,theseareessentiallytemporaryor“bandaid”solutions;theabilitytotrulysolvetheoffloaddelayproblemrests,bynecessity,primarilywiththehospitals.
53Wealsonotethatthe“orderofprecedence”clauseinSection1ofthecontractprovidesthatintheeventofconflictsbetweentheRFP,proposalandthecontract,thetermsofthecontractgovern.Therefore,thisnegotiatedlanguagewhichpermitsoffloaddelaystobeconsideredforgoodcauseexceptionsshouldbeutilizedasamatterofcourse.
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CriticalCareTransport(CCT)Program
LowCCTVolumesMaketheProgramUnsustainable.TheRFPprovidesthatthecontractorshalldeploy(orsubcontractfor)adedicatedCriticalCareTransport(CCT)unittorespondtoCountyhealthcarefacilitieseither(1)within15minutesofthepreviously‐scheduledpickuptime,or(2)within90minutesofunscheduled/urgentrequests.Whilethedeploymentofanin‐CountyCCTunitiscertainlydesirablefromaclinicalstandpoint,thelow‐volumeofCCTs,whencoupledwiththehigheroverheadofstaffingaCCTunit,maketheoperationofadedicatedCCTunitinfeasibleandcontributestotheoverallunsustainabilityoftheMercedCountyEMSsystem.
ThelowtransportvolumeoftheCCTprogramwastobeexpectedand,accordingtostakeholders,wasfactoredintothesystemasreflectedinitsRFPresponse.However,thecurrentunsustainabilityoftheCCTprogramresultedfrompost‐contractchangesintheairmedicalcomponentofthesystem.Priorto2016,theCountyrecognizedanEOAforairmedicalservices.TheEOAwaseliminatedduetoconsiderationsoffederalpreemptionoflocalregulationundertheAirlineDeregulationAct(ADA).54Becausethecontractorimplementedanintegratedair/groundapproachtocriticalcarestaffing,deploymentandoversightthroughaclinicalandoperationalpartnershipwithAirMethods,revenuesfromitsairmedicaltransportvolumedirectlysubsidizedthegroundCCTprogram,whichisunsustainableonitsown.TheeliminationoftheairEOAhasreducedtheairmedicaltransportvolumeand,withit,greatlyreducedtherevenuesavailabletosubsidizeCCTdeploymentatthelevelsrequiredunderthe
54AlthoughananalysisoffederalpreemptionoflocalairambulanceregulationundertheADAisbeyondthescopeofthisproject,inbrieffederallawpreemptslocalorstateregulationoftherates,routesandservicesofaircarriers.However,federalcaselawhaspermittedstate/localregulationoftheclinicalaspectsofairambulanceservices.Thelinebetweenwhatisconsidered“clinical”regulationand“rate/route/service”regulationisnotanentirelyclearmatterunderfederallaw.
Summary
TheCountyCCTprogramisunsustainableascurrentlyconfiguredduetohighoverheadandlowutilization.Theprogramdoesnotoperateasafacilitypartnershipandthehospitaldoes
notordinarilysenditsclinicalstafftoaccompanyCCTpatientsduringtransport
despitefederallawwhichhasbeeninterpretedtorequireitinsomecases.Asaresult,the
contractorincursdisproportionatecostswithlittleopportunitytorecoveritsinvestment.
ThecontractormustthereforeincreaseitsCCTvolumebyseekingbusinessoriginating
outsideofMercedCounty,whichifsuccessfulmaynecessitatearenegotiationofCCTresponsetimestandardsand/orpenaltyprovisions.Otheroptionstoimprovesustainabilityinclude(1)hospitalstaff
accompanyingCCTpatientsduringtransport;(2)hospitalsubsidiesforCCTnurses;and/or(3)theuseofSystemEnhancementFundsfor
CCTnursestaffing.
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contract.ThiswasasignificantchangeincircumstancescomparedtowhentheRFPandproposalswereoriginallysubmittedandthecontractexecuted.
ImprovingSustainabilityRequiresIncreasingVolume.ThegroundCCTprogram,onaverage,respondstolessthan20callspermonth(lessthanoneperday),yettheprogramisrequiredtoprovidededicated,nurse‐levelstaffingona24/7basis.GiventheeliminationofthesubsidizingeffectofanairEOA,theprimarymechanismtoensuresustainabilityoftheCCTprogramistoincreasetransportvolume.
However,thevolumeoriginatingfromwithinMercedCountyisarelativelyfixedandstaticnumber;theneedformorerevenuescannotincreaselegitimateCCTdemand.Therefore,thecontractorisleftwiththeoptionofregionalizingitsCCTprogrambyseekingvolumeoriginatingoutsideofMercedCounty.CertainlytheCountybearsnoresponsibilitytoincreasethecontractor’sCCTvolume,andwhetherthecontractorsucceedsinforgingnewfacilitypartnershipsorexpandingitsCCToperationisabusinessconsiderationforthecontractorandnotanoversightconsiderationfortheCounty.
TheCountyhasaninterestintheCCTprogramremainingsustainable.IfsustainabilityoftheMercedCCTprogramnecessitatesthecontractorincreasingCCTvolumefromfacilitiesoutsideofMercedCounty,theresponsetimerequirementsapplicabletoCCTresponseswilllikelyposeaformidableobstacletosucharegionalizedapproach.IntheeventthecontractorissuccessfulinestablishingnewbusinessrelationshipstoregionalizeitsCCTservices,itwouldbeinthebestinterestsoftheCountyEMSsystemtorevisittheCCTresponsetimestandardsandeitherreformthestandardsorallowforexceptionsincaseswherethecontractorisalreadyengagedinprovidingCCTservices(evenifthoseservicesarebeingfurnishedoutsideoftheCounty).
ATrueCollaborativeCCTModelDoesNotExistinMercedCounty.Again,whilemuchofthesustainabilityoftheCCTprogramrestsonthecontractor’sabilitytonegotiatenewbusinessopportunities,thereareotherareaswhereCountypolicycanaffecttheongoingviabilityoftheprogramandminimizethenegativeeffectsthatthishigh‐cost,lowvolumeprogramhasonthelargerEMSsystem.TheRFPoutlinedacollaborativemodelwithcountyhealthcarefacilitiesasamodelwhichcouldbeutilizedforthededicatedCCTunit.
Nationally,acommonmodelforCCTdeploymentisthatbasestaffingforaCCTunitconsistsofadriverandaCCTparamedic,withhospitalnursingstaffaccompanyingCCTpatientsduringtransportwhenthepatientrequirescareatthatlevel.However,stakeholdersreportedthatMercyMedicalCenterhas,forthemostpart,notalloweditsnursingstafftoaccompanypatientsonCCTsoriginatingfromtheirfacility.ThismeansthatthecontractorisrequiredtoemployorcontractwithnursesdirectlytofulfillitsCCTobligations,whichcreatesaddeddifficultiesduetooverallemergencynurseshortages.Totheextentthestakeholders’reportsaboutMMCrefusingtosenditspersonneltoaccompanypatientsonCCTsareaccurate,thispracticecanbeinconflictwiththeprovisionsoftheEmergencyMedicalTreatmentandActiveLaborAct(EMTALA)insomecases.
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EMTALAhasbeeninterpretedtoplaceresponsibilityforthecareofapatientonthesendinghospitaluntilcareisassumedbythereceivingfacility.Thishasbeeninterpretedtomeanthatinsomecasesthesendinghospitalitselfbearstheresponsibilitytosenditsownclinicalpersonnelalongwiththepatientduringtransport.55See42U.S.C.1395dd(c)(2)(D).5657Iftrue,thehospital’srefusaltopermititsstafffromaccompanyingpatientsduringtransport(exceptinextremecases)alsopresentsanotherexampleofthecurrentsystemcreatinganegativesubsidy,inwhichthecontractorisrequiredtosubsidizeotheraspectsofthehealthcaresystem.Here,fromamacroeconomicstandpointtheEMSsystemisessentiallysubsidizingthehospitalintwoways:(1)itsubsidizeshospitalstaffingbynecessitatingfewerhospitalemployeessincenoneareordinarilyrequiredtoaccompanyCCTpatientsduringtransport;and(2)therapidavailabilityofanunsubsidized,dedicatedin‐CountyCCTunittotransferpatientstoout‐of‐countyfacilitiesforspecializedcareobviatestheneedforthehospitaltoinvestinspecialtycarecapabilitiesin‐house.Thehigh‐costofdeployingadedicatedCCTunitdivertsresourcesthatcannotbeotherwisedeployedinthe911system.58GiventhatthehospitalisavoidingboththeclinicalandfinancialresponsibilitiesofsendingitsownproviderstoaccompanyCCTpatientsduringtransport,thereareafewoptionsthatcouldimprovethecontinuingfeasibilityoftheCCTprogram.59OptionstoImproveCCTProgramSustainability.First,thehospitalcouldreviseitspracticeofnotsendingitsclinicalpersonneltoaccompanyCCTpatientsduringtransportsanddeployitsprovidersonCCTtransportswherethepatientrequiresalevelofcarebeyondthescopeofaparamedic.60ThiswouldplacetheresponsibilityforadvancedclinicalstaffingontheappropriateentityandhavetheaddedbenefitofimprovingthesustainabilityoftheCCTprogram.Inaddition,CCTsshouldbemonitoredthroughtheQIprogramonanongoingbasistodetermineifnurse‐levelstaffingisappropriateorwhethersomepatientscansafelybetransportedwithALSresources.
55Thisinterpretationisnotnecessarilylimitedeventonursingstaff.InBurdittv.U.S.DepartmentofHealthandHumanServices,934F2d1362(5thCir1991),thecourtruledthatthehospitalwasrequiredtosendaphysiciantoaccompanythepatientwhenitwasclinicallyrequired.56SeealsotheaccompanyinginterpretationinEMTALA.com(http://www.emtala.com/faq.htm,#18).57WecannotconcludethatallCCTpatientswhoaretransferredfromMMCtootherhospitalsarenecessarilycoveredbyEMTALA.However,inourexperience,theverynatureofCCTsmakesitlogicaltoconcludethatasignificantproportionofCCTsaresubjecttotheprovisionsofEMTALA.58Stakeholdersreportedthatinsomecases,additionalunitsaredivertedfromthe911systemtosupplementCCTservices(forinstance,whentheCCTnursebelievesanadditionalALSprovidermightberequiredontheCCT,anALSunitisdispatchedtoassistwiththeCCT,thusremovingitfrom911service,oftenforaprolongedperiodoftime,asCCTsordinarilyinvolvetransportstoout‐of‐countydestinations).59WerecognizethattheCountydoesnothaveregulatoryauthorityoverhealthcareinstitutionsinordertorequirethehospitalstonecessarilyagreetoanyoftheseoptions.Nevertheless,wepresentthemhereinordertomaximizetheoptionsavailabletotheCountytonegotiatewithallrelevantstakeholderstoimprovethesustainabilityoftheEMSsystem.60WenotethatmanysystemsutilizeCCT‐trainedparamedicstofulfillthisrole,whichisalsoexpresslypermittedunderCMSregulations(42CFR§414.605),thoughnecessaryapprovalsfromtheStateEMSAuthoritywouldberequired.
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Second,thehospitalcouldsubsidizethereasonablecostofthenurse‐levelstaffingontheCCTunit.Afterall,forasubstantialsubsetofCCTpatients,thehospitalbearsthelegalresponsibilityunderFederallawforthecareofthepatientuntilcareisassumedbythereceivingfacility.Third,theCountycouldutilizeSystemEnhancementFundsforthenursestaffingonthededicatedin‐CountyCCTprogram.Althoughsomebenefitsofthismayinuretothecontractor,italsobenefitsthehospitalandimprovesdeployment–andthereforebenefitstheEMSsystemasawhole.
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ALSAmbulanceDeploymentVersusTieredResponse
All‐ALSDeploymentisRequired,ButUsuallyNotNecessary.MercedCounty’sEMSresponsesystemrequiresanALSambulanceresponsecoupledwithafiredepartmentfirstresponderBLSresponsefor911calls.
AllcontractorambulancesthatrespondtothesedispatchesarestaffedwithaparamedicandanEMT.UnderasubcontractthesameappliestoWestSideHealthcareDistrictwhenitrespondsinMercedCounty.Thefiredepartmentsdonottransportpatients.IfthereisadelayintheALSambulancerespondingtothescene,afiredepartmentEMTwillattendtothepatient’semergencycareneedswithintheEMT’sscopeofpracticeuntiltheALSambulancearrivesandthecareofthepatientcanbetransferredtotheALScrew.
Ithasbeenrecognizedthatthevastmajorityof911callsdonotrequireanALSintervention(lessthan5%),thatpatientsincardiacarrestaccountforfewerthan1‐2%ofcalls,andthatfewerthan15%ofpatientsrequireanytypeofALSprocedureorevenALS‐levelmonitoringbyALSpersonnel.6162IfthesefiguresapplyinMercedCounty,about15%ofthepatientsforwhomanambulanceresponseisdispatchedthroughthe911systemrequireALScare.TheEMSneedsoftheremainingpatientscouldbeprovidedbyEMTsperformingBLSskillswithintheirscopeofpractice.IfanALSambulanceresponseisrequestedonlywhentheconditionofthepatientisreportedasrequiringALS,thenparamedicswouldberespondingtofewercalls,asthosecallsthatclinicallyrequireonlyaBLSresponsewouldbehandledbyEMTs.AclinicaladvantageofthismodelwouldbemorefrequentexposurebyparamedicstopatientswhorequiretheperformanceofALSskills,thuscombatting
61PepePE,MattoxKL,FischerRP,MatsumotoCM.Geographicalpatternsofurbantraumaaccordingtomechanismandseverityofinjury.JTrauma.1990;30:1125‐32.62ForadiscussionoftheadvantagesanddisadvantagesofbothanallALSandatieredresponseambulancesystemseeStoutJ,PepePEandMosessoVN.All‐AdvancedLifeSupportvsTiered‐ResponseAmbulanceSystem.PrehospitalEmergencyCare.January/March2000,Vol.1,No.4.
Summary
NationalstandardsofcareandfederalregulationsclearlysupporttieredEMSsystemdeploymentwherebythelevelofservicedispatchedisbasedonmedicallyvalid,
differentialresponsedeterminants.Asaclinicallyappropriate,protocol‐baseddispatchsystemisalreadyinplaceinMercedCounty,theCountyshouldconsiderimplementingatieredEMS
responsesysteminwhichBLSambulancesmaybedeployedforany911callsforwhichBLS
responsedeterminantsaredeemedappropriateunderthesystemdispatchprotocols,asreviewedandapprovedbytheCounty.TheCountycouldrequirethecontractortoperform100%auditof911BLSresponsesforaprescribedtimeperiod,andconsiderstoppingtheresponsetimeclockforresponsesinwhichaparamedicarrives(forALS‐levelcalls)withintheprescribedtimeperiod,eveniftheparamedicarrivesinanon‐transport
ALSinterceptvehicle.
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theerosionofsuchskillsduetoinfrequentuse.Also,havingasmallergroupofparamedicsmightenhancetheabilityofthesystemmedicaldirectorstofocusonspecialareasofconcern.
UsingparamedicstorespondtoacallwhenonlyBLSservicesarerequireddoesnotgenerateanymorerevenuethaniftheresponsewashandledbyEMTsonly.MedicareandMedi‐CalarepayersformostoftheambulanceservicesprovidedintheCounty.RegardlessofwhetherthereisanALSresponse,ifonlyaBLSresponseisrequiredbasedonthedispatchedconditionofthepatient,theypayattheBLSrateofreimbursement,notthehigherALSrateofreimbursement.Also,asdiscussedearlierinthisreport,reimbursementfromthosegovernmentalpayersforambulanceservicesislessthanthecostsofprovidingthoseservices.
ThecostsofemployingparamedicsanddeployingALSambulancesaregreaterthanthecostsofemployingEMTsanddeployingBLSambulances.AddedtothosecostsisasigningbonusthecontractorpaystonewparamedicemployeesthatisduetotheshortageofparamedicsintheCounty.BecausetheyuseparamedicstorespondtocallswhereonlyBLSskillsarerequired,thecontractorisincurringgreatercoststhanwhatiswarrantedfromaclinicalperspective.And,asmentionedabove,reimbursementisnotbaseduponthelevelofvehicle(BLSvs.ALS)thatisdeployed;itisbaseduponthedispatchandtheservicesrequiredbythepatient.Therefore,thereisalargesubsetofresponsesforwhichcomparativelyexpensiveALSunitsaredeployedwhenonlyBLS‐levelreimbursementisbeingreceived.Thisisanotherexampleofhowtheeconomicrealitiesoftransport‐basedreimbursementfailtocoverthecostsofsystemdeploymentatanall‐ALSlevel.
TieredEMSResponseisaRecognizedStandardofCare.Ithaslongbeenrecognizedasanindustrystandardofcarethatmedically‐validateddispatchprotocolswithdifferentialALS‐BLSresponsedeterminantscansafelyandeffectivelysupporttieredEMSsystemdeployment.ThecurrentcontractrequiresthecontractortooperateasecondaryPublicSafetyAnsweringPoint(PSAP),whichutilizesMedicalPriorityDispatchProtocols.Theseprotocolsareimplementedatsignificantexpense(includingtrainingEmergencyMedicalDispatchers,payinglicensingfeesforuseoftheprotocols,etc.),yetthesystemisnotreapingthebenefitsthatcancomefromthatinvestment.Inotherwords,thesystemisalreadyinplacetoallowfortieredEMSresponse,buttheperformancestandardscurrentlyinplacedonotpermitthesystemtocapturethosebenefits.
Accordingly,MercedCountyshouldconsidertheimplementationofALS‐BLStieredresponseandpermitBLSresponsesforthosecallsinwhichthesystem’svalidateddispatchprotocolspermitaBLS‐levelresponse.Becausethisisafundamentalsystemdesignissue,thisisachangetheCountymaywishtoconsiderinthenextscheduledprocurementcycleasopposedtochangingthroughamodificationoftheexistingcontract,weretheCountytobeinclinedtomakesuchachange.Althoughtiereddeploymentisalong‐recognizedstandardofcareinEMS,theCountymaywishtoalsodirectthecontractortoperform100%QAreviewsof911BLSdeploymentsforaprescribedtimeperiodtoensurethattheresponsedeterminantsareresultinginappropriateBLSresponses.
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TheCountyshouldalsoconsiderstoppingthecontractor’sresponsetimeclockforanyALS‐levelcallsinwhichaparamedicisplacedonscenewithintheprescribedtimeperiods,regardlessofthevehicleinwhichtheparamedicarrives(i.e.,ambulance,supervisorvehicle,non‐transportparamedicinterceptunit,etc.)Complianceinthisregardwouldbepatient‐centered(i.e.,theprimaryclinicalgoalbeingtogetanadvancedlifesupport‐levelprovidertothepatientwithintheprescribedtime)andnotsystem‐centered(i.e.,theplacementofanALStransportresourceonthescenewithintheprescribedtime).
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WestSideHealthcareDistrict
Background.TheWestSideHealthcareDistrict(WestSide)comprisesanareaof475squaremiles,virtuallyequallydividedbetweenthesouthwestpartofStanislausCountyandthenorthwestpartofMercedCounty.Itwasestablishedin1957,initiallyastheWestSideHospitalDistrict.
Between1937and1956WestSideCommunityHospital,asmallruralgeneralacutecarehospital,operatedinwhatisnowWestSide.Thehospitalclosedin1956duetofinancialproblems,butresidentsofthecommunityconcernedwiththelackofemergencymedicalcarefacilitiesintheareaformedacommunitygrouptoestablishahospitaldistricttopurchaseandreopenthehospital.
Theproposedhospitaldistrictwasapprovedbythevoters,ahospitaldistrictwasestablished,andthehospitalwaspurchasedandreopenedinNovember1957withtheaidofspecialtaxeslevieduponthedistrict’spropertyownersinbothStanislausandMercedCounties.Onceagainthehospitalencounteredfinancialproblemsandwasrequiredtoclose.
ThroughoutthisentireperiodtheambulanceserviceoperationsthathadbeenconductedbyWestSidecontinued.ThoseoperationsremainineffecttodaysubsidizedbythespecialtaxeslevieduponWestSide’spropertyowners.
WestSidehastwoadvancedlifesupport(ALS)ambulances.BothambulancesarestationedatthelocationoftheformerWestSideCommunityHospital,howevertheyarerequiredtomoveuptolocations,vacatedbyotherambulances,ifdispatchedtodoso.ThelocationwheretheambulancesarestationedisinMercedCounty,buttheofficialaddressofthelocationisaCityofNewmanaddress.TheCityofNewmanisinStanislausCounty.
WestSideHealthCareDistrict’sContractwithMountain‐ValleyEMSAgency.Mountain‐ValleyEMSAgency(MVEMSA)istheLEMSAforStanislausCountyandservesastheLEMSAforWestSide’sambulanceoperations.IthascontractedwithWestSideforWestSidetoprovideemergencygroundambulanceservicesandALSgroundambulanceservices,onanon‐exclusivebasis,inthatpartofthehealthcaredistrictthatisinStanislausCounty.Thisincludesnon‐
Summary
TheoverlappingjurisdictionoftwoLocalEMSAgencies(MCEMSAandMVEMSA)withregardto
ambulancedeploymentintheWestSideHealthcareDistrictcreatesasituationinwhichcompliancewithbothagencies’directivesis
renderedpracticallyimpossiblebythecontractor.ThetwoLocalEMSAgencieswithjurisdictionintheWestSideHealthcareDistrictshouldexecuteaninterlocalagreementsothatperformancerequirementsapplicabletooperationsintheDistrictareconsistent,andtheCountyshould
openadialoguewithStanislausCountyregardingpossibleincreasesinthespecialtaxwhich
subsidizesambulanceservicesintheDistrict.
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emergencyinterfacilitytransfersrequiringALStransportwhendispatchedbyanauthorizedEMSdispatchcenterandprivaterequestsforambulanceservicesreceivedbyWestSidewhenreferredtoandthendispatchedbyanauthorizedEMSdispatchcenter.
ThecontractrequiresWestSidetoprovideemergencymedicalcareandtransportservicesinitsassignedarea24hoursaday,sevendaysaweek,andimposesresponsetimerequirementsonWestSideandfinancialpenaltiesforfailingtomeetthoserequirements.Inaddition,amongotherfinesthatmaybeimposed,thecontractprovidesfortheimpositionofper‐incidentfineswhenWestSiderefusestorespondtoaCode3or2call,orarequestformove‐up,mutualaidorapostlocation.
ThecontractalsorequiresWestSidetoredeployambulancesoraddadditionalambulancehoursiftheresponsetimeperformancestandardsarenotmet.ResponsetimerequirementsareexcusedwheneverWestSideparticipatesinadeclareddisaster.Thiscontractalsoallowsaresponsetimeexemptioncausedbyadelayintransferringcareinanemergencydepartment.
ThecontractpermitsWestSidetorespondtoanMVEMSAauthorizedmutualaidrequestifithasanambulanceandcrewavailablebutonlyifsuchresponsedoesnotinterferewithWestSide’sprimaryresponsibilitytoprovidethecontractedforambulanceservicesinitsassignednon‐exclusiveoperatingareainStanislausCounty.ItalsopermitsWestSidetoperformworkoutsideofthecontract,butdoesnotpermitsuchworktoexcuseWestSidefromsatisfyingitsobligationsunderthatcontract.
ThecontractrunsthroughApril30,2018,andimposesuponWestSideanannualEmergencyAmbulanceCallVolumeFeeof$3,504,anannualMonitoringFeeof$1,000,and$2foreachpatienttransport.
WestSideHealthCareDistrict’sSubcontractwithSEMSA.PursuanttoSEMSA’scontractwithMercedCounty,SEMSAsubcontractswithWestSidetoprovideambulanceserviceinthenorthwesternpartoftheCounty,Zone24D,whichisalsopartofthehealthcaredistrict.ThisincludestheunincorporatedareasofGustine,Stevinson,SantaNella,varioussectionsofHighways33and152,theInterstate5CorridorandtheSanLuisReservoir.
TheCounty’scontractrequiresthatSEMSA’ssubcontractwithWestSideimposeuponWestSidealloftherequirementstheCounty’scontractwithSEMSAimposesuponSEMSA.SEMSAhasdonethat.Therefore,WestSidemustrespondtoall911andotheremergencydispatcheswithinZone24DwithaparamedicandEMT‐staffedambulanceandtheCounty’sFractileResponseTimePenaltiesandOutlierResponseTimePenaltiesthatapplytoSEMSAalsoapplytoWestSide.
SEMSA’scontractwithWestSideprovidesthatthedeploymentofWestSide’sALSambulancesshallbeconsistentwithMercedCounty’sspecificationstobeutilizedforEMSresponsesdescribedinthecontractandshallonlyberelocatedoutsidetheWestsideZoneformove‐uporforemergencyEMSresponsesasdirectedbytheMercedCountyEMSDispatchCenter.ItfurtherprovidesthattheEMSDispatchCentermaydivertarequestforemergencyresponsefromthe
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primarydispatchedALSambulancetoasecondaryALSambulanceifthesecondaryambulanceisincloserproximitytothescene.
ThecontractalsoprovidesthatWestSideshallrespondtoallinterfacilitytransportrequestsasrequestedbySEMSAasspecifiedinMercedCounty’sInterfacilityTransfersPolicy.ItfurtherprovidesthatduringanyperiodthatWestSidehasinsufficientambulancesavailableforserviceinthezonedesignatedinthecontract,WestSideshallprovidenoticetoSEMSA.ThiscontractrunsthroughDecember31,2019.
WestSidehascontractedwithSEMSAtoprovidemanagementservicesforit.SoSEMSAisresponsibleforensuringthatWestSidecomplieswithitsresponsibilitiesunderbothitscontractwithMVEMSAanditssubcontractwithSEMSA.
TheZone24DDilemma.AmajordilemmaforWestSide,andinturn,theMercedCountyEMSSystem,isthatWestSidehastwocontracts—onewithMVEMSAandonewithSEMSA—andcompliancewiththetermsofonecontractmaycausenoncompliancewiththetermsoftheothercontract.WestSidesometimesviolatestheFractileResponseTimeandOutlierResponseTimerequirementsinMercedCounty.Thisisduetoitsambulancesbeingusedforlongdistantnon‐emergencyinterfacilitytransports,delaysinoffloadingpatientsathospitals,MVEMSArequiringitsresponsestoLevel3and2callsinStanislausCounty,andmove‐upstootherlocationswithinMVEMSA’sterritoryandMercedCountyvacatedbyotherambulances.WhenWestSideisunavailabletorespondtoacallinZone24DaSEMSAambulanceisgenerallydispatched.
FewpeopleinZone24Dhaveambulanceservicescoveredbycommercialinsurance.Consequently,thepayermixisverypoor.WhileWestSidereceivesthepreviouslyreferencedsubsidy,thatwiththelimitedrevenuesitcollectsforambulanceservicesisbarelyenoughtokeepitafloat.SEMSAreceivesnoneoftheWestSidesubsidymoney.
PursuanttoWestSide’scontractwithSEMSA,ifSEMSAdeterminesthatamaterialbreachofthecontractbyWestSidehasorwilloccur,oristhreatened,suchthatthepublichealthandsafetymaybeendangered,SEMSAmaybringthemattertotheMercedCountyEMSAgency.IftheMercedCountyEMSAgency,afterinvestigationdeterminesthatathreattothepublichealthandsafetyexists,itistogiveWestSidenoticeandareasonableopportunitytocorrecttheproblem.
Ifnocorrectionoccurs,thematteristothenbepresentedtotheMercedCountyBoardofSupervisors.IftheBoardagreesthatamaterialbreachhasoccurredandhasnotbeencorrected,andthatthepublichealthandsafetywouldbeendangeredbyallowingWestSidetocontinueoperationsinMercedCounty,SEMSAistothentakeoverforWestSideinZone24DandMercedCountymayinitiateactiontorequirethatthespecialtaxesfromMercedCountypropertyownersbeprovidedasasubsidytoSEMSAtosupportitsoperationsastheambulanceserviceproviderinZone24D,orinitiateactiontoeliminatethespecialtaxforMercedCountyresidents.
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TheWestSidesubsidyforambulanceserviceoperationshasbeendecreasingandthepayermixforambulanceservicesprovidedintheMercedCountypartoftheWestSideHealthcareDistrictissignificantlylowerthanthepayermixinStanislausCounty.
InlightoftheuniquechallengesofprovidingambulanceservicesintheWestSideHealthcareDistrict,wepresenttwooptionsfortheCounty’sconsideration.
Options.First,MercedCountyshouldnegotiatewithMVEMSAtoexecuteaninterlocalagreementregardingthedeploymentofWestSideambulanceswithintheWestSideHealthcareDistrictthatwouldsupersedeprovisionsinWestSide’scontractswithMVEMSAandSEMSA,andSEMSA’scontractwithMercedCounty,thatcausesWestSidetoviolateoneofcontractsbycomplyingwiththeother.
Second,theMercedCountyBoardofSupervisorsshouldopenadialoguewiththeStanislausCountyBoardofSupervisorstoreevaluatetheadequacyofthespecialtaxassessmentsthatsubsidizesWestSide’sambulanceserviceoperationsandagreetoincreasethoseassessmentstoadequatelyfinancetheambulanceserviceoperationsofWestSidedue,inpart,todecliningpayerrevenues.
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CommunityParamedicine
CaliforniaPilotProjects.InDecember2014theEMSAuthorityannouncedapilotprogramforcommunityparamedicineat12sitesinCalifornia,beginningwithtraininginJanuary2015.ThepilotsitesareinAlameda,Butte,LosAngeles,Orange,SantaBarbara,SanBernardino,SanDiego,Stanislaus,SolanoandVenturaCounties.63
Throughthesepilotprojectsparamedicsreceivespecializedtrainingtofunctionascommunityparamedicsoutsideoftheirtraditionalambulanceresponseandtransportroletoenhanceaccesstoprimarycareformedicallyunderservedpopulations.Theyoperateunderphysiciandirectionandtightlymonitoredprotocolsdesignedtohelpfilllocalhealthsystemneeds.Someoftheservicesincludeprovidingfollow‐upcareatpatienthomesforpatientsrecentlydischargedfromahospital,particularlythosewithchronicconditions;transportationtourgentcareandmentalhealthclinics;hospicesupport;follow‐uptreatmentoftuberculosis;andassistingindividualswhofrequentlyvisitemergencyroomsfornon‐emergencycaretoreceiveneededcarefromprimarycarepractitioners.
Attheconclusionoftheseprojects,whichisanticipatedtobein2017,aprojectevaluationteamfromthePhillipR.LeeInstituteforHealthPolicyStudiesandCenterfortheHealthProfessions,UniversityofCaliforniaSanFrancisco,willevaluatetheperformanceoftheprojects.64Ifthereportconcludesthattheexpandedroleofparamedicsintheseprojectsdemonstratesanappropriateandefficientuseofhealthcareresourcestoenhancehealthcareformedicallyunderservedpopulations,itispossiblethattheCaliforniaLegislatureandtheGovernorwillenactlegislationtoincludecommunityparamedicineasanewauthorizedhealthcaredeliverymodelinCalifornia.
IsThereaNeedforCommunityParamedicineinMercedCounty?AnincreasinglysignificantportionoftheMercedCountypopulationparticipatesinMedi‐CalinpartduetotheAffordableCareActexpandinghealthcareinsurancecoveragetomanypreviouslyuninsuredpersons.ManyotherMercedCountyresidentsareindigentoruninsured.Amajorityofallresidents,and2out
63“CommunityParamedicinePilotApprovedinCalifornia.”(Pressrelease)EmergencyMedicalServicesAuthority.December17,2014.64Id.
Summary
Communityparamedicineprogramscanimprovetheeffectivemanagementofmanypatient
conditionsintheout‐of‐hospitalenvironment,thusreducingdeploymentcostswithintheEMSsystem.ThoughthereisnoexpressauthoritytoimplementaCommunityParamedicineprograminMercedCountyatpresent,theCountyandthecontractorshouldexplorethefeasibilityofimplementingsuchaprogramattheearliest
opportunity,asitappearsthatsystemefficiencycouldbevastlyimprovedthroughCommunity
Paramedicine.
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of3childreninMercedCountyarelivingatlessthan200%oftheFederalPovertyLevel.65SeveraloftheseresidentsdonotroutinelyseekprimarycareandothersseekcareathospitalemergencyroomsduetocostconsiderationsorbecauseofthelackofprimarycarephysiciansintheCounty.
MercedCountyisahealthprofessionalshortagearea.In2015theCountywasranked43outofthe58Californiacountiesonprimarycare‐to‐patientratioand11.7percentofemergencyroomvisitswereattributedbyrecipientstolackofaccesstocare.66Theproblemisgettingworse.In2012only1.8percentoftransportstoemergencyroomswereattributedtolackofprimarycare.67
Duetothesefactors,amongothers,thereisanexcessiveuseofambulancetransportstohospitalemergencyroomsinMercedCounty,particularlytotheMercyMedicalCenter(MMC)emergencyroom.Onoccasion,especiallyinthewintermonthsofJanuarythroughMarch,MMCisnotabletoprocesspatientsthroughthehospitalquickenoughtopreventabackloadofambulanceswaitingtounloadtheirpatients.Thishasaripplingeffect.Ambulancesbackedupathospitalscannotrespondtoemergencycallsuntiltheirpatientsareoffloaded,andthereareonlysomanybackupambulancesandcrewsthatareavailable.Whenthesehospitalbackupsoccur,firedepartmentcrewsrespondingtodispatchedmedicalemergenciesasfirstrespondersarestuckatthepatientscene,sometimesforlengthyperiods,waitingforanambulancetoarrive.
EMSsystemsareanessentialpartofthehealthcaredeliverysystem,buttheyhavehistoricallynotbeenwellintegratedintothatdeliverysystem.Communityparamedicineprogramscanhelpmitigatethegapbetweenthedemandformedicalcareservicesandtheworkforceshortageavailabletoprovidethoseservices,decreasehealthcarecostsinMercedCounty,andfacilitateabetteruseofexpensiveemergencyroomresources.
ImplementingCommunityParamedicineinMercedCounty.MercedCountymaynotbeabletoimplementacommunityparamedicineprogramintheCountyatpresentduetoalackofstatutorylanguageexpresslyauthorizingsuchprogramsinCaliforniaandMercedCountynothavingbeenselectedbytheEMSAuthorityforapilotprojectcommunityparamedicineprogram.Regardless,theCounty,SEMSAandotherstakeholdersintheMercedhealthcaresystemshouldseriouslyinvestigatethemeritsofimplementingacommunityparamedicineprogramintheCounty.TheCountyshouldbepreparedtoquicklyimplementsuchaprogram,ifitdeterminessuchaprogramisfeasible,shouldtheLegislatureandtheGovernorenactlegislationtoauthorizesuchprogramsorshouldtheEMSAuthorityelecttoexpandthecommunityparamedicinepilotprogramtoincludeadditionalpilotprogramsites.
TopursueacommunityparamedicineprogramMercedCountyanditshealthsystemstakeholderswillneedtoconductacommunityhealthneedsassessmenttoidentifyhealthcare
65TheMercedCounty2016CommunityHealthAssessment,p.2.MercedCountyDepartmentofHealth.July2016.66Id.,pp.6,7.67Id.,p7.
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deliverygapsintheCounty.AfterthosegapsareidentifiedtheywillneedtofocusonhowEMSandotherhealthcareandsocialserviceproviderscouldcollaboratetofillthosegaps.AsinthecurrentCaliforniapilotprojectsparamedicscouldbetrainedtoprovidehealthcareandotherservicesoutsideoftheirtraditionalrole.Theycouldbetrainedtomakehomevisitstorecentlydischargedpatientsandcheckonthemtoensuretheyaretakingtheirmedicines,keepinghealthcareappointments,andotherwisecomplyingwithdischargeinstructions.Theirservicescouldalsoincludetransportingorreferringpatientswhoseconditionsdonotrequireemergencycaretosettingsmoreappropriatethanhospitalemergencyroomsforthecaretheydorequire.ThesearejustafewexamplesoftheservicescommunityparamedicscouldprovideintheCounty.
Reimbursementforcommunityparamedicineservicesmustalsobeconsidered.ItbearsrepeatingthatanEMSsystemcanonlydowhattherevenuesthatsupportitallowtobedone.Providingcommunityparamedicineserviceswillbecheaperforanambulancecompanytoprovidethanambulanceservices,yettheintroductionofcommunityparamedicineservicesshoulddecreasethenumberofambulancetransportstoemergencyroomsand,inturn,decreaserevenuesderivedfromambulancetransports.However,thereductionofunnecessaryambulanceutilizationwillalsoovertimenecessitatelessintensivedeploymentof911resources,whichcangeneratesignificantcostsavingswhileatthesametimeimprovingtheappropriatenessofcare.
Governmentpayers,suchasMedicare,donotatpresentreimbursecommunityparamedicineservices;theyreimburseonlyforambulancetransportsoftheirbeneficiaries.Consequently,othersourcesofrevenueforcommunityparamedicineservicesmustbeidentified.ForsomeprogramshospitalspayfortheservicesandtheyhavefoundthatthoseservicesreducehospitalreadmissionsofMedicarebeneficiariestosuchanextentthatpayingforthoseservicescostslessthantherevenuestheyhadbeenlosingundertheMedicareReadmissionReductionProgram.
Communityparamedicineprogramsareoperatinginotherstates.ThosethathavebeenoperatinginNevada,TexasandMinnesotahaveclaimedimpressiveimprovementinefficiency.Expandingtheroleofparamedicstoincludehomevisitstoassistinthemanagementofpatientswithchronicconditions,andtotransportthemtodestinationsalternativetohospitalemergencyroomswhenappropriate,coulddecreaseambulancetransportstoemergencyroomsbyasignificantamount.ShouldthatoccurinMercedCounty,hospitalstackupofambulanceswaitingtounloadpatientscouldbegreatlydiminished.
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AppendixAInitialListof
DocumentsReviewed
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EMS System Review
Merced County Department of Public Health
Initial Document and Data Request
June 17, 2016
Category Requested Documents
A. Ground EMS Documents
1 RFP for most current ground EOA competitive procurement 2 Proposal of winning bidder for ground EOA competitive procurement 3 Final, current ground EOA contract 4 Any ground EOA contract amendments 5 Any current mutual aid agreements 6 Any current first response, response time tolling or intercept agreements
B. Air Ambulance Documents and Data
1 RFP for most current air EOA competitive procurement 2 Proposal of winning bidder for air EOA competitive procurement 3 Any current LEMSA air ambulance contracts 4 Any LEMSA air ambulance contract amendments 5 Air ambulance utilization policy/protocol 6 Air ambulance utilization data (since ground EOA contract inception, by month, including air ambulance requests and air ambulance transports)
C. Ground EOA Contractor Performance Documents (all data should be monthly from the period of contract inception to report date)
1 Contractor self‐dispatch data (all emergency response requests received directly by contractor) 2 Response data (all contractor responses) 3 Transport data (all contractor transports) 4 Call declination data (all calls for which contractor was unable to respond and utilized mutual aid) 5 Service mix (contractor level‐of‐service transport data by HCPCS code) 6 Response time compliance data (including response time performance by month, deviations from required standards and financial penalties assessed by month)
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7 Average transport distance (contractor data of average loaded mileage per transport for HCPCS code A0425. If possible, include overall average loaded mileage‐per‐transport, and average loaded mileage‐per‐transport for each level of service – A0428, A0429, A0427, etc.) 8 Average total call time (contractor and/or dispatch center data measuring average interval of time responded through time available, both overall and for each level of service 9 Ambulance offload time data (if specifically measured; if not specifically measured, then average time interval from arrival at facility until time available for next response is a suitable proxy. If possible, provide overall average offload intervals and intervals by specific levels of service) 10 Transports originating at healthcare facilities (total number and percentage of total transport volume)
D. Dispatch Documents and Data
1 Current 911 center EMD protocols (no copy necessary if using standard MPDS version 11.1 or later, unless locally modified) 2 Current contractor internal EMD protocols (if different from 911 center EMD protocols) 3 Emergency dispatch data – contractor (all 911 dispatches of contractor) 4 Emergency dispatch data – mutual aid (all 911 referrals for mutual aid)
E. Clinical Documents
1 Current ground EMS clinical protocols 2 Applicable transport destination protocols (trauma, STEMI, stroke, peds, etc.)
F. EMS Resource Inventory Documentation and Data
1 Total number of contractor transport‐capable ambulances dedicated to in‐county utilization 2 Total number of contractor transport‐capable ambulances dedicated exclusively to 911 response 3 Identification of all contractor station and substation locations (including # of ambulances garaged at each location and staffing at each)
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4 Total number of contractor transport‐capable ambulances stationed out‐of‐county that are utilized for in‐county 911 response 5 Total number of air ambulances based in county 6 Total number of air ambulances based outside of county regularly utilized for in‐county response 7 Total number of ground transport‐capable ambulances based outside of county but utilized for in‐county mutual aid (non‐contractor owned) 8 Contractor staffing plan and/or staffing schedules
G. Hospital Resource Inventory Documentation and Data
1 Total number of hospital‐based EDs in county (including number of facilities and estimated ED bed capacity) 2 Total number of out‐of‐county based hospital EDs that regularly serve in‐county patients (including number of facilities and estimated ED bed capacity) 3 Designated specialty hospitals serving the county (trauma, PEDS, STEMI, stroke, etc.; include LEMSA‐designated facilities as well as “verified” facilities) 4 Non‐designated specialty care facilities serving the county (behavioral health, etc.) 5 Hospital E.D. payor mix data
H. Contractor Revenue Cycle Data
1 Total billable transports 2 Total billable transports by level of service 3 Chargemaster or contractor list of retail charges, by level of service 4 Identification of payor contracts to which contractor is a party (including payor and rates, by level of service) 5 Contractor financial hardship policy and forms 6 Contractor write‐offs (including hardship, bad debt, etc.) 7 A/R aging report by payor 8 Payor mix (contractor revenues by payor) 9 Net collection percentage (total and by payer) 10 Average revenue per transport (total and by level of service)
I. Stakeholder List
1 List of stakeholders recommended for interview (include names, titles, agency affiliation and contact information)
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AppendixBInitialListof
StakeholdersInterviewed
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260 E.15th Street, Merced, CA 95341-6216 (209) 381-1250 (209) 381-1259 (FAX) www.co.merced.ca.us/health
Equal Opportunity Employer
Kathleen Grassi, RD, MPH Director of Public Health LEMSA Director Ajinder Singh, MD, CPE EMS Medical Director James Clark, MICP EMS Administrator, MHOAC
DEPARTMENT OF PUBLIC HEALTH
Emergency Medical Services Agency
S T R I V I N G F O R E X C E L L E N C E
July 26, 2016 I-1 List of Stakeholders recommended for interview (include names, titles, agency affiliation and contact information).
1. Philip Brown, RN – 30 minutes Emergency Services Director Mercy Medical Center, Merced 333 Mercy Ave, Merced, CA 95340 (209) 564-5183 – Office (209) 564-4699 – FAX [email protected]
2. Theresa Azevedo, RN – 30 minutes
EMS Liaison Nurse Mercy Medical Center, Merced 333 Mercy Ave, Merced, CA 95340 (209) 564-5182 – Office [email protected]
3. Jennifer Nunes, RN – 30 minutes
Emergency Services Manager Los Banos Memorial Hospital (Sutter Health) 520 W. “I” Street, Los Banos, CA 93635 (209) 826-0591 ext 56306 [email protected]
4. Jeff Pate, RN – 30 minutes
E.R. Manager Los Banos Memorial Hospital (Sutter Health) 520 W. “I” Street, Los Banos, CA 93635 (209) 826-0591 ext 50255 [email protected]
5. Billy Alcorn – 30 minutes
Battalion Chief Merced City Fire Department 99 E. 16th Street, Merced, CA 95340 (209) 600-2814 – Office Cell [email protected]
6. Shawn Henry – 30 minutes
Fire Chief Merced City Fire Department 99 E. 16th Street, Merced, CA 95340 (209) 385-6891 - Office [email protected]
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7. Tim Marrison – 30 minutes Fire Chief City of Los Banos Fire Department 333 7th Street, Los Banos, CA 93635 (209) 827-7025 – Office [email protected]
8. Mason Hurley – 30 minutes
Assistant Fire Chief City of Los Banos Fire Department 333 7th Street, Los Banos, CA 93635 (209) 827-7025 – Office [email protected]
9. Jeremy Rahn – 30 minutes
Deputy Director – Administration Merced County Office of Emergency Services 3500 N. Apron Ave, Atwater, CA 95301 (209) 385-7548 ext 4866 [email protected]
10. Kevin Daniel, SEMSA Strategic Deployment & Compliance Manager – 30 minutes
100 Riggs Avenue, Merced, CA 95341 (209) 725-7034 – Office [email protected]
11. DeeAnn Dion, SEMSA Director of Clinical Services – 30 minutes
160 Country Estates, Suite 3, Reno, NV 89511 (775) 737-4200 – Office (775) 544-6681 - Cell [email protected]
12. Carly Alley, Operations Supervisor – 30 minutes 100 Riggs Avenue, Merced, CA 95341 (209) 728-5477 – Cell [email protected]
13. Mark Lawson, CAL FIRE Division Chief – 30 minutes
Merced County Fire Department 3500 N. Apron Ave, Atwater, CA 95301 [email protected]
14. Brian Neely, CAL FIRE Battalion Chief – 30 minutes Merced County Fire Department (209) 761-1974 – Cell [email protected]
15. Jerry O’Banion, County Board of Supervisors – 30 minutes 2222 ‘M’ Street, Merced, CA 95340 (209) 385-7434 - Office [email protected]
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16. Deidre Kelsey, County Board of Supervisors – 30 minutes 2222 ‘M’ Street, Merced, CA 95340 (209) 385-7434 - Office [email protected]
17. Barbara Hutchins, Westside Healthcare District – 30 minutes
President, Board of Directors 731 Peloquin Court, Newman, Ca 95360 (209) 862-5188 - Home (209) 595-5976 - Cell [email protected]
18. Bryan Donnelly, Professor – 30 minutes
Merced College, EMT Training Program 3600 ‘M’ Street, Merced, CA 95348 (209) 386-6769 – Office (209) 201-1504 – Cell [email protected]
19. Ajinder Singh, MD, CPE – 45 minutes Merced County EMS Medical Director 260 E. 15th Street, Merced, CA 95341 (209) 233-1467 [email protected]
20. Eric Rudnick, SEMSA Medical Director – 45 minutes
21. Richard Murdock – 60 minutes Executive Director, Mountain-Valley EMS Agency 1101 Standiford Ave, Modesto, CA 95350 (209) 566-7203 [email protected]
22. Dan Lynch – 60 minutes
EMS Director Central California EMS Agency Fresno County Dept of Public Health 1221 Fulton Mall, 5th Floor, Fresno, CA 93721 (209) 600-3387 [email protected]
23. Dale Dotson – 60 minutes EMS Specialist Central California EMS Agency Fresno County Dept of Public Health 1221 Fulton Mall, 5th Floor, Fresno, CA 93721 (209) 600-3387
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24. Roy Cox, Mercy Air Field Operations Manager – 60 minutes Air Methods Corporation 7211 S Peoria St Englewood, CO 80112-4199 (303) 792-7400 - Office [email protected]
25. Patrick Smith, SEMSA President – 60 minutes P.O. Box 18920 Reno, NV 89511 (775) 232-0180 [email protected]
26. Mike Williams, SEMSA Vice President and COO – 60 minutes
P.O. Box 18920 Reno, NV 89511 (775) 224-9208 – Cell (775) 737-4200 – Office [email protected]
27. Kraig Riggs, SEMSA Executive Director of Public Affairs – 60 minutes 100 Riggs Avenue Merced, CA 95341 (209) 777-0007 – Cell [email protected]
28. Steve Melander, SEMSA VP California Ops – 60 minutes
100 Riggs Avenue, Merced, CA 95341 (209) 725-7000 – Office (209) 769-8760 – Cell [email protected]
29. Rob Smith, SEMSA Merced General Manager – 60 minutes 100 Riggs Avenue, Merced, CA 95341 (209) 386-1974 – Office (209) 769-4392 – Cell [email protected]
30. Bill Tripp, SEMSA Merced Operations Manager – 60 minutes
100 Riggs Avenue, Merced, CA 95341 (209) 628-9620 [email protected]
31. Nancy Koerperich, CAL FIRE – 30 minutes
Merced County Fire Chief Director, Merced County Office of Emergency Services [email protected]
32. Mark Pimentel, CAL FIRE – 30 minutes
Battalion Chief, Atwater Fire Department (209) 761-6520 [email protected]
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33. Chuck Mosley, Lieutenant, California Highway Patrol – 30 minutes
Emergency Medical Care Committee Member, Law Enforcement Representative [email protected]
34. Mike Harris, Former Riggs Ambulance Service General Manager – 30 minutes Emergency Medical Care Committee Member, Supervisor District 1 Representative (209) 357-5566 [email protected]
35. B.J. Jones, Captain, Operations Division – 30 minutes
Merced County Sheriff’s Office (209) 385-7310 [email protected]
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AppendixCSummaryofSelectedStakeholderComments
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SummaryofSelectedStakeholderComments
HospitalRepresentative:WehaveagreatworkingrelationshipwithSEMSA.Wetrusttheirmedicsandtheirinstincts.
ContractorRepresentative:Progressisbeingmadeonemergencydepartmentoffloaddelays,butweneedtocontinuetoimproveonthisasatotalEMSsystemissueinvolvingallstakeholders.
EMCCMember:AllALSisawaste.FollowingtheEMDresponsedeterminantsmakesthemostsense.
ContractorRepresentative:MercedCountywantedadedicatedCCTunit.ItwouldnotletususearegionalCCTunit.Itcostus$1milliontoestablishaMercedCountydesignatedCCTunit.
EMSPhysician:TheEMSSystemisbeingstressedtothepointofcollapse.Thereareonlyaboutfourconditionswheretimematters:cardiacarrest,realtrauma,stroke,STEMI.
BoardMemberofWestSideHealthcareDistrict:WestSidewasstruggling3yearsago.Itwasreadytoclose,butSEMSAprovidedmanagementserviceformonthswithoutchargebeforechargingfortheirmanagementservices.WestSideisnowintheblack.
ContractorRepresentative:Weneedtobeabletogettherightresponsetothepatient.WeshouldbeabletodeploybasedsolelyonEMDprotocols.Wearestrippingthe911systemtomeetcomplianceonnonemergencytransports.NoncompliancewithresponsetimefornonemergencytransportscanputSEMSAinmaterialbreachofitscontract.
FireChief:OneofthebiggestEMSSystemissuesduringcertaintimesoftheyearareambulancesstackingupatMercyMedicalCenter.Hehasseen6or7ambulancesbackedupatthehospital.OurdepartmentrelationshipwithSEMSAisexcellent.
CountySheriffRepresentative:WehaveagreatrelationshipwithallpartiescomprisingtheCounty’sEMSSystem.
FireChief:Onascaleof1to10,with10beingthebest,ourrelationshipwithSEMSAisa9.SEMSAisverycommunityoriented.SEMSAmanagementisveryaccessiblecommunitywhichmakesiteasytogetproblemsresolved.
LawEnforcementRepresentative:HasstrongrelationshipswiththefiredepartmentsandtheambulanceserviceprovidersinMercedCounty.HehasneverhadanyissueswithSEMSA.
EMSProvider:TheallALSresponserequirementisfrustrating.Fromaclinicalperspectiveaparamedicdoesnotneedtorespondtoeverycall.Staffingofall911ambulanceswithaparamedicisahugeissue.
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ContractorRepresentative:HospitaldelayshaveseverelyimpactedSEMSA’sperformanceandhavealsocausedproblemsformutualaidresponders.ParamedicshortagehaspromptedSEMSAtoprovidea$5,000sign‐onbonus.
FireChief:WehaveaverypositiverelationshipwithSEMSAandlawenforcement.Firedepartmentpersonnelarerequiredtowaitwithpatientuntilambulancearrives,andsometimesthewaitislong.
FireOfficer:Hospitalstackupisaproblemacoupleoftimesamonth,butmoreofaprobleminJanuarythroughMarch.Allfiredepartmentsbelievethathospitaloffloaddelaysareasignificantproblem.Allfiredepartmentsareconcerned,becauseofthegoodrelationshipwithSEMSAthatifSEMSAfindsarenewalofthecurrentcontractisnotfinanciallyfeasible,SEMSSwilldecidenottorenew.
HospitalRepresentative:Thehospitalaveragesabout34ambulanceoffloadsperday,butbetweenJanuaryandMarchitaveragesabout55‐60offloadsperday.BelievesthatacommunityparamedicineprogramintheCountycouldhelptoreducethesenumbers.
FireChief:HasgoodaccesstoSEMSAmanagementifissuesarise.NotsureifthereareenoughSEMSAambulancestomeettheneedsoftheCounty,particularlyinsomeareas.BelievesfiningsystemundertheSEMSAcontractwithMercedCountyisexcessive.
NeighboringEMSAgencyRepresentative:GeneralperceptionisthatthenumberofambulancesinMercedCountyperpopulationislowincomparisontothatinthecountiesunderCentralCaliforniaEMSA’sjurisdiction.MercyMedicalCenterthroughputissueisamajorissueforambulancesprovidingmutualaidinMercedCounty.
ElectedOfficial:InadequatehealthresourcesisachronicprobleminMercedCounty.Acommunityparamedicineprogrammayhelp.
FireOfficial:Therehasbeenanincreaseinthenumberofpeoplewhocallforanambulanceanddonotneedanambulancetransport,inpartduetotheexpansionofMedi‐Cal.Communityparamedicinemaybeagoodoptiontohelpaddressthisproblem.ExcellentpartnershipofparticipantsintheEMSSystemasbestreflectioninthecoordinatedresponsetoarecentbusaccident.
FireOfficer:WorkingrelationshipwithSEMSAisexcellent.Finesareextremelyhigh.
EMSOfficial:SEMSAisgoingaboveandbeyondwhatisneededforcriticalcaretransports.Insteadofhavingacrewavailableforcriticalcaretransportsforbothairtransportsandgroundtransports,itmakesmoresense,anditismorecosteffectiveforSEMSAtohaveonecrewavailableforeitherairambulanceorgroundambulancetransports.