G-833 - 02/27/2007 - FIRE DEPT. - Ordinances Supporting Documents1 •,
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SUBJECT: Ambulance Fees
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AGENDA ITEM
Regular Board of Trustees Meeting
of
February 27, 2006
FROM: Darrell Langlois
BUDGET SOURCE /BUDGET IMPACT: N/A
RECOMMENDED MOTION: I move that the Village Board approve Ordinance G -833,
"An Ordinance Amending Section 3 -2 -5A of Chapter 2 of Title 3 of the Village Code of the
Village of Oak Brook and Increasing the Fees for Use of Emergency Medical Services
Provided by the Oak Brook Fire Department ".
Background/History:
The Village of Oak Brook assesses a user charge for all ambulance calls involving transportation
of the patient (those refusing transportation are not billed). The Village charges a "bundled" rate
for providing the service plus a mileage amount for the distance to the hospital. At the present
time the Village charges differing rates for three service levels -Basic Life Support (BLS),
Advance Life Support I (ALS I) and Advance Life Support II (ALS II). Most of the charges
assessed are for BLS or ALS I as ALS II is a very high service level that we have only billed for
on 14 occasions in the last year. In addition to these three service tiers, the rate structure charges
differing rates for residents and non - residents.
The starting point involved in setting ambulance fee rates is the Medicare allowed fee schedule.
By law the amount the Village can charge any patient covered by Medicare is published annually
in a schedule provided by the Centers for Medicare and Medicaid Services (CMS). What this
means is that although the Village can legally charge whatever it decides for an ambulance
transport, the Village is limited on what it can charge Medicare patients. Thus, if the Village
assesses a charge greater than the Medicare fee schedule amount, we are required to write off
any amount over the Medicare rate. Other than deductibles and co -pays, we are not allowed to
balance bill the patient. For patients not covered by Medicare, the Village has authority to set
whatever rate it chooses bearing in mind that if you set rates too high, many insurance companies
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will limit reimbursement to reasonable and customary charges. Balance billing for excess
charges not covered by insurance can be difficult.
The ambulance fee charges currently in effect were last adjusted in 2003. Since that time the
Medicare allowed fees have increased and now all of the Village's resident rates are below the
Medicare allowed amount. Historically, approximately 75% of resident ambulance billing is
covered by Medicare, with much of the remainder being covered by private insurance. Thus, to
have a resident billing rate that is below what Medicare allows leaves "money on the table" since
Medicare and insurance will be paying less that they normally would. The resident rate should
be set at least at the Medicare allowed amount, with the resulting increase only impacting
residents in those very few instances where they do not have Medicare or private insurance. The
proposed rates noted below have been set based on the Medicare fee schedule currently in effect,
rounded to a the next $50 increment for ease of administration.
As it related to non - residents, since the rate was last adjusted in 2003 it make sense to increase
those rates also The proposed rates have been increased by approximately the same dollar
amount that the resident rates have been increased. The mix of patients for non - residents is
much different than residents as only 12.5% of these calls during 2006 involved Medicare. Thus,
the Village will not be able to collect the higher non - resident fee in those cases and must accept
the Medicare rate for non - residents.
The following table illustrates the current and proposed rates:
The final analysis in setting rates is a comparison with what other jurisdictions charge. Based on
a City of Naperville survey done in January, 2006 involving over 100 responses, the average
BLS /ALS rates for residents were $333.33 and $446.34, respectively. For non - residents the
average BLS /ALS rates were $443.77 and $556.77. Although the proposed rate for non-
residents is above the average, it should be noted that many other jurisdictions charge for
different treatments, supplies, and special services in addition to the flat rate charge. Thus, while
it may appear that the proposed rate is higher than average, in many cases that is not true as our
bundled rate may in fact be less than the total bill once all of the charges are added together.
Recommendation:
I recommend approval of the attached ordinance increasing the fees charged for ambulance
service.
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Current Rates
2007
Proposed Rates
Res
Non -Res
Medicare
Res
Non -Res
BLS
300.00
500.00
336.55
350.00
550.00
ALS I
300.00
50000
399.65
400.00
600.00
ALSII
345.00
545.00
578.44
600.00
800.00
Mileage
5.53
5.53
6.25
625
6.25
The final analysis in setting rates is a comparison with what other jurisdictions charge. Based on
a City of Naperville survey done in January, 2006 involving over 100 responses, the average
BLS /ALS rates for residents were $333.33 and $446.34, respectively. For non - residents the
average BLS /ALS rates were $443.77 and $556.77. Although the proposed rate for non-
residents is above the average, it should be noted that many other jurisdictions charge for
different treatments, supplies, and special services in addition to the flat rate charge. Thus, while
it may appear that the proposed rate is higher than average, in many cases that is not true as our
bundled rate may in fact be less than the total bill once all of the charges are added together.
Recommendation:
I recommend approval of the attached ordinance increasing the fees charged for ambulance
service.
Last saved by Default J \WORD \ambulance2007 #2 doc
Last printed 2/20/2007 12 30 PM