VICKSBURG, MI – South County EMS is in a “financially precarious position” and has turned to the South Kalamazoo County Fire Authority for help so it can continue to provide ambulance services.
The SKCFA board Wednesday night heard from Wes Schmitt, South County EMS president, who asked the authority to reopen its operating agreement with the private, not-for-profit ambulance company that would ultimately provide needed funding to keep it in business.
The authority board said its finance/planning committee will study the request. But that decision may not be in time to save a broke South County EMS.
“What we are asking is that the fire authority communicate with the citizens and work with us and let’s come up with the best solution,” Schmitt said. “There are two other services in the area. If they can provide similar response times that we do, that’s the way the world works. But we feel we are the best.”
Like many of the 15,000 ambulance companies in the United States, South County EMS is a victim of changes that came with the Affordable Care Act.
It also receives no public tax dollars, unlike SKCFA that operates almost exclusively on special assessments and general fund dollars from area governments it serves with fire and emergency services.
In a recent letter Schmitt sent to municipal leaders and others in South County, he outlined some of the reasons that his company is “in a precarious financial situation.”
* Its revenue relies upon private insurance, Medicaid, and Medicare.
* Its cost per run is about $500 and they bill out at a rate averaging $1,000. Medicaid reimburses about $185 a run and prohibits billing the client for the balance. Medicare reimburses about $360 a run and also prohibits billing the client for the balance.
* The Affordable Care Act significantly increased the number of Medicaid clients in Michigan and life expectancy has increased the number of Medicare clients.
* The South County EMS write-off of non-collectible debt has increased from 20 percent a few years ago to more than 45 percent in 2016.
* The ambulance debt is about $130,000 “with the two vehicles easily worth that amount” and its facility debt is about $205,000. The building on Boulevard Street has been appraised at $350,000.
The company was saved, and turned a profit, last year when it entered into a transfer agreement with Borgess to provide ambulance services for non-911 calls. To meet the terms of that transfer agreement it had to hire additional crews and operate 24 hours a day seven days a week.
But unexpectedly, that agreement was terminated April 1, resulting in South County EMS having to reduce workers and hours of operation. The company now has a new transfer agreement again with Borgess, but it does not begin until July 5.
To meet the terms of that agreement, and to keep operating, South County EMS needs a quick infusion of cash. That’s where SKCFA could come in.
“We will talk and get back to them,” said Randy Smith, a SKCFA board member on the planning/finance committee.
Schmitt emphasized that the “current financial issues are specifically not the result of any actions by our employees, part-time management or board of directors.”
They are caused, he said, “by the expansion of Medicaid, the growth of Medicare and the lack of service reimbursement.” South County EMS, he said, meets the highest standards of the industry and is “proud we meet or exceed response times as dictated by the Kalamazoo County Medical Authority.”
It has also taken steps to pare its budget, including “a most difficult decision” to eliminate its operations manager position.
The company is coming to SKCFA for funding, Schmitt said, because “when the original SKCFA bylaws were adopted in, there was language which would allow this to happen.”
SKCFA options include provide that funding or bring in another ambulance service, such as Life EMS or Pride Care, from outside South County.
South County EMS provides services to more than 16,000 residents in a 144 square mile area.