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Kalispell Fire Department
Randy Brodehl, Fire Chief
Arvin Mower, Assistant Chief/Operations
Jim Stewart, Assistant Chief/Fire Marshal (406) 758-7760 312 First Avenue East Kalispell Montana 59901
Workshop Date: 10/21/2002
REPORT TO: Honorable Mayor and City Council.
FROM: Randy Brodehl, Fire Chief
SUBJECT: EMS Fund
PURPOSE: To provide information to the Council regarding the financial status of the EMS
Enterprise ,Fund.
BACKGROUND: The Kalispell Fire Department has operated the EMS ambulance service in
the lower Flathead Valley since 1928. The ambulance service is operated as an enterprise fund.
15% of salaries and benefits for Operations personnel are paid out of the Fund. Forty percent of
salaries and benefits of the Fire Chief and the Assistant Chief/Operations are paid out of the
fund, as well as 1.5 FTEs for clerical staff personnel.
In February of this year, the fund began to lose money at an alarming rate. At that time,
Medicare/Medicaid was in six months in arrears for over $50,000.00. In addition,
Medicare/Medicaid reduced the amount their patients could be charged by 5.4 %, and began
requiring ambulance services to invoice Medicare/Medicaid directly, while also preventing
ambulance services from invoicing the patient for the remainder of the costs associated with an
ambulance response. Ambulance responses are billed an average of $600.00, and
Medicare/Medicaid responses average $220.00.
By June, the fund had been in the red four months. The fund was loaned $55,000.00 to prevent it
from carrying a negative balance into the new fiscal year. Collateral for the loan was considered
the four ambulances and the equipment carried in each. The Council approved a rate increase
effective 7/1/2002. This increase was designed to be a stopgap measure that would allow the fire
department to rebuild the invoicing system to the point the system is healthy again. While
Medicare/Medicaid is now only 60-90 days in arrears, the fund has not fully recovered to date.
However, you have a quarterly report before you. Please note the fve critical areas that are
graphed out. The first is the line showing the charges for responses. Coupled with that, is the
credits line. Basically, this shows what we have charged for responses versus what we are able to
collect. You will also note that supplies and personnel costs have stayed nearly flat.
As you compare the credits vs. charges, note that charges begin a significant rise in July that
reflects the increase in billing. Since the credit cycle is 60-90 days behind the charge cycle, the
`Asswing our eommuniA, in reducing, provnfing aryl miligalingemergencies.
line showing credits reflects the increase in charges, but is delayed due to the cycle. The data is
limited. However, the average increase in credits is $ 9,31.5.84 per month. The average monthly
increase in charges is$79,979.70. In May, we projected that the July rate 'increase would reflect a
credit increase of 9%. The actual increase, with the limited data we have to date is 11.6%. We
anticipate this will be closer to the 9% as more data develops.
Should this increase be typical; we could anticipate paying back the loan by July of 2003, and
beginning to build an equipment replacement schedule again.
The State of Montana allows up to 3 mils be collected that can be applied to EMS in the County. One
mil is currently being taxed, and the hinds are applied to training costs of the volunteer departments in
the Comity. The two additional mils are not being applied, and would have to be presented to the
voters for approval.
Annual ambulance responses are as follows:
% Calls Total Overtime Cost per call
City- 56% 1373 $24.26
County- 44% 1077 $55.35
Total 2451
RECOMMENDATION: Council considers pursuing additional funding measures to correct
enterprise fund deficits, including waiting for this to correct itself, ballot measure to collect the
additional 2 mils in our service district, and additional charges to the county for each response.
ALTERNATIVES: As recommended by Council.
Respectfully submitted,
Fire Chief C r—is Kukulski, City Manager
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