By Pablo Quilantan
On Oct. 1, 2020 the City of Chula Vista slammed its residents with an astoundingly high ambulance transport rate of $3,881.56. This increase was part of a previously negotiated agreement by the City with its ambulance services contractor, American Medical Response (AMR).
However, AMR won’t profit from the increase.
The transport rate increase was arranged by contract with the City so that AMR is required to reimburse Chula Vista back for a firefighter paramedic program that the City cannot afford by shifting the cost onto its residents. The majority of the increased transport rate ($2,161.92) will go to the City in reimbursement for the fire department firefighter paramedic response service. The rate balance ($1,719.64), is the AMR charge for the paramedic care and transport to the hospital. This is why the current rate is so high and the public is paying more for an ambulance ride.
The City hopes to mitigate this high transport rate as it continues down an uncertain path toward its takeover of providing ambulance transport services. This, despite having no previous experience in providing such service.
The Fire department has only been providing paramedic service from its fire engines for the last 6 years. However, AMR has been providing both paramedic and transport service to the citizens of Chula Vista over the last 40 years. Once complete, the City will also take on the additional responsibility to provide service to the Exclusive Operating Area (EOA) that includes the South Bay unincorporated area of Bonita and the City of Imperial Beach.
The City could have avoided placing the burden of imposing a higher ambulance transport rate on the public by bidding out the service. Instead, the City Council awarded the ambulance transport service to its fire department, bucking a 40-year trend of having this service provided by a private contractor.
City officials avoided bidding out this service by employing grandfather clauses in the health and safety code that provided them necessary legal cover. They knowingly did so recognizing that its fire department would not be able to compete with the private sector on a cost basis for the provision of this critical public service.
By not bidding this service, the City denied the public and themselves the transparency resulting from an open bid process, and also failed to insulate its citizens from an unnecessarily high ambulance transport rate.
The City claims that citizens will receive better service if its fire department provides ambulance transport services, however there is little evidence of this.
Currently, the number of ambulance units provided by AMR varies as needed above the contracted minimum. AMR is required to meet its response times or face penalties for non-performance. Unlike the contractor provider service who can be held accountable for its performance, there are no requirements or transparency for the fire department to meet response times. The current provider has been accountable for meeting its performance standards for the last 40 years.
For its part, the city will not be offering the public any service improvement in response times with its takeover of the ambulance transport service. Under its proposal, the City adopted a response time standard of arriving to 90 percent of the emergency medical calls within 12 minutes.
However, this is the same response time standard applied to AMR when it was previously providing both paramedic and ambulance transport services at a much lower rate. Furthermore, the City does not have a plan for how it will hold itself accountable for achieving its response time standard. At this point, the City cannot assure the public that it can achieve the proposed response time as its system is yet untested.
The City will also not be offering a competitive transport rate to the public with its ambulance service take over. The City adopted a comparatively high $2,800 ambulance transport rate of its own in order cover the costs of its ambulance service. This City is requiring this high rate because it is unfairly charging for the costs of the firefighter paramedics who respond to emergency medical calls. The current County average for fire departments providing transport services is $1,268.73. The public is unaware that the firefighter paramedics are already funded through the City’s general fund.
Few are also aware that the City currently collects a public safety sales tax that could have been directed to decrease the transport rate for the public. However, the City refused to direct any of this tax revenue to lower the ambulance transport rates at a time when the country is in the midst of the COVID-19 pandemic and financial relief would have been most welcome.
Instead, the City finds itself ramping up to hire an additional 54 employees and will increase its budget liability by $14.7 million over the next five years. The City will be responsible for offsetting these costs by collecting sufficient revenues from its ratepayers or face financial jeopardy. Still, the proposed $2,800 transport rate may not be enough to offset all costs as there are other financial commitments associated with its ambulance service takeover, not to mention exposing the city to increased liabilities.
For example, the City assumed further financial risk by agreeing to reimburse the other members of the EOA for their paramedic first responder costs adding further financial pressure onto itself. The City has also agreed to meet response time standards in Bonita and Imperial Beach. This may result in the City having to fund additional resources if it fails to achieve the agreed response time standards.
The public will also likely face more frequent transport rate increases as the cost of union labor contracts continue to rise and drive up costs. Eventually, the City will have no choice but to increase the transport rate when the local firefighters’ union demand that the ambulance service personnel become fellow union public safety members. This will result in increased costs as the City will pay the higher employee pension costs associated with this inevitable change.
Overall, the City Council failed in properly vetting the impacts of their decision when they voted to change a system that was not broken. They chose to hastily pursue locking down a political endorsement from the firefighter union (Local 2180), rather than taking the time to understand the ramifications of their decision. They were told it would be “better”, however no data proving a discernible benefit to the public in terms of improved service performance or cost was ever presented.
In moving forward with this change, it sadly appears that the City Council has placed a higher value on political support from the City’s fire union, Local 2180 than assuring the well-being of the community. It appears that the public will not break even on this one as it will get neither the best rate nor service response time when it matters most. Unfortunately, the public may fare even worse if the City fails to deliver service at the minimum level.
Pablo Quilantan is a retired City of Chula Vista employee with more than 30 years of municipal government experience in the areas of financial management, budget and operations research. He holds master’s and bachelor’s degrees in economics from San Diego State University. He is a 30 year resident of the City of Chula Vista.