Ambulance rates in communities south of Boston are rising by leaps and bounds, as much as 145 percent over the last few years.
Providers of emergency medical services say a complex array of factors, from Medicare reimbursement to the increasing sophistication of care, is driving the trend.
One of the most recent communities to approve a price hike, Sharon, raised rates 40 percent in January, its second 40 percent increase in two years, and Fire Chief James Wright said other towns are getting ready to consider increases of their own, since the cost of providing paramedic-level services is high.
“The issue is the expense of doing business,” he said. “I don’t consider these ‘exorbitant’ rates by any sense of the word, quite frankly.”
Wright said the price increase will have no effect on most residents, because they have insurance coverage for ambulance service.
But the cost of health care affects the price of insurance, as Fire Chief William Scoble of Westwood pointed out. “And who’s paying the premiums?” he added.
In Cohasset, where Fire Chief Robert Silvia said the town raised its base rates last year, the town charges 200 percent of the Medicare reimbursement rate. Sharon’s new base rates are slightly lower, but prices are hard to compare across towns. Most communities have a long menu of services that carry separate charges on top of the base rate.
Cohasset is in the minority, with no extra charges beyond the base rate and a mileage charge of $21.09 per mile. The town’s base rates are $1,159.56 for basic life support in an emergency; $1,376.97 for Level 1 advanced life support; and $1,992.99 for Level 2 advanced life support.
Sharon’s base rates are $1,048.45, $1,245.05, and $1,802.04, respectively, but mileage in Sharon is $36.11, and the town charges separate fees for items such as defibrillation, intravenous medication, and oxygen.
Wright said the January increase could yield about $100,000 in revenue, depending on usage and collection rates, but as with most, if not all, public ambulance services in the region, it does not pay for itself. Sharon’s rescue service brings in just over $600,000 in annual revenue, he said, compared with a fire and rescue budget of about $3 million, not including employee health insurance and pensions.
Fire and rescue budgets are typically handled as one, chiefs said, because departments employ cross-trained personnel who fight fires and provide paramedic care.
James Finger, past president of the American Ambulance Association and chief executive administrator of an ambulance service in Vermont, said upward pressure on prices stems from an array of costs. Not only must ambulance services pay for high-level training and continually advancing medical equipment, they also face rising insurance and fuel costs.
Reimbursement for Medicare and Medicaid patients is another significant factor in ambulance budgets, he said. While Medicare reimbursements do not cover the cost of service, Medicaid reimbursements vary from state to state and are often substantially lower than those for Medicare, he said.
Therefore, a community with a high Medicaid population might charge higher rates to offset the loss.
“Each individual market is so different,” he said.
In Westwood, which is reviewing its rates after three years without an increase,
Scoble said the town’s high proportion of patients on Medicare — which covers Americans 65 and older and some younger people with disabilities — limits the ability of a price increase to actually change a department’s bottom line.
“I can double or triple my rates, and Medicare is still going to pay me the same amount of money,” he said.
Likewise, private insurance companies do not necessarily reimburse for the full amount billed, he said.
Additional costs go unpaid when uninsured patients do not or cannot pay their ambulance bills. Municipalities’ collection efforts meet with limited success, fire chiefs said.
Westwood does not set its rates as a percentage of Medicare. Its base rates are some of the lowest in the region, at $525 for basic life support, $625 for Level 1 advanced life support, and $900 for Level 2. Mileage is just $15 per mile.
Foxborough’s rates are more than double that, but they were far less until about a year ago, when, according to Fire Chief Roger Hatfield, the town hiked prices by about 145 percent to compensate for a lag in keeping up with costs.
“We did it all in one mighty swoop,” he said.
Foxborough was trying to reverse an imbalance in which about 80 percent of the cost of rescue service came from taxation and 20 percent from users. Now, about 20 percent comes from taxation, which he said is fairer to taxpayers.Continued...