HomeMy WebLinkAboutAgenda Statement 1980/04/29 Item 08
COUNCIL AGENDA STATEMENT
Item 8
Meeting Date 4/29/80
ITEM TITLE:
Resolution (Doti-
Approving increase in rates for ambulance ~nd paramedic
service and approving amendments to the agreements for
such services
SUBMITTED BY: City Attorney
(4/5ths Vote: Yes
No .JL)
The City Council has heretofore held a public hearing to consider rate increases for
ambulance and paramedic services and housekeeping amendments to the agreements with
Hartson's Ambulance Service.
RECOMMENDATION: The rate increases as approved by the Council have now been in-
corporated into a resolution and the appropriate amendments to
the agreements with Hartson's Ambulance Service have been included
therein and Council should adopt the resolution approving an
increase in rates and approving the amendments to the agreements.
BOARD/COMMISSION RECOMMENDATION: N/A
DISCUSSION:
Council has received a detailed analysis of operational cost increases for the
ambulance company from the Director of Finance and based upon said analysis and
testimony received at the public hearing o~ April 22, 1980, the Council has approved
the new rate schedule. The minor changes requested in the agreement include a
reduction in the minimum time to five days for notification, cancellation or changes
for insurance, which is standard in the industry, and a revision of the hold harmless
clause so that it does truly comply with legal limitations on indemnification.
Based upon the recommendations of the Director of Public Safety and the Director
of Finance, Council should now approve the resolution as prepared by the City Attorney.
b~-
Chula Vista, California
GDL: 19k
1 00 ~ 4
Dated '1-...2 9- 50
Form A-113 (Rev. 11/79)
EXHIBITS
Agreement~ Resolution~ Ordinance_____ Plat_____ Notification List
Schedule A
Other ENVIRONMENTAL DOCUMENT: Attached Submitted on
...
COUNCIL AGENDA STATEMENT
)5f
4/~80
Item
Meeting Date
ITEM TITLE:
Public Hearing - Consideration of Request for Rate Increase
Hartson "s Ambul ance Servi ce
SUBMITTED BY:
Director of Public Safety/Director of Finance (4/5ths Vote: Yes
No~)
Hartson's Ambulance Service, by letter of January 18, 1980, requested consideration
of a rate increase to replace those authorized by Resolution 8062, adopted on
February 24, 1976. The rate increase, if approved, represents an average increase
of 36%, including some new services previously not provided under our existing
reso 1 uti on.
RECOMMENDATIONS: 1. Hold Public Hearing
2. Approve the new rate schedule as submitted. (~chedule A)
3. Direct staff to prepare appropriate documents and bring back
a resolution.
BOARD AND COMMISSION RECOMMENDATION: Not Applicable
DISCUSSION:
Ambulance fees have not been changed in Chula Vista since February 24, 1976.
During the last four years the company has had substantial increases in the cost
of providing quality ambulance service. The following schedule indicates the
percentage increases the company has experienced since the current rates w~re
established by the City Council' in 1976.
Operational Cost Increases 1976'- 1979
Increase
Vehicle Gas, Oil and Maintenance 109%
Insurance (Public Liability, Worker's Compensation,
and Mal-Practice for Paramedics) 174%
Laundry 86%
Office Supplies 78%
Payroll Processing Service 42%
Payroll Taxes 99%
Telephone Service 32%
Utilities 77%
Salaries and Wages 92%
Taxes and Licenses 28%
The increases noted above were verified by the Finance Director from the annual
audit reports of the company prepared by Andrew Olson, Certified Public Accountant.
(See Schedule B)
} OOl9 q
Form A-113 (Rev. 11/79)
EXHIBITS
Agreement_____ Resolution_____ Ordinance_____ Plat_____ Notification List
Other Schedules A-D ENVIRONMENTAL DOCUMENT: Attached
Submitted on
v
-'j
...
Page 2,
&
Item jI
Date 4!~0
Meeting
In April of 19i9, the Cou~ty of San Dieg6, via the Director of Health Services,
revised the County~s Paramedic criteria requiring a driver when it is necessary
for the two (2) paramedics to be in the patient compartment during transportation.
The base station hospital personnel decide when the third person (driver) is
required. While this need does not arise in all paramedic calls, a third person
must be continuously available in the event the base station hospital requires
it. This forces Hartson's to staff their 'paramedic unit with a third person
-continuously.
Resolution 9491, of February 8, 1979, which establishes our agreement with the
Company to provide paramedic services (Section 5B) only requires the Company
to provide two (2) paramedics in the paramedic unit (MICU). However, the Company
has been providing the third person and absorbing the additional expense which
is currently running $26,000 annually. It can be argued that the third person
on the MICU is the responsibility of the City of Chula Vista and the Company has
no obligation to provide this additional person. It seems reasonable in our
opinion that if the Company provides this third person, it is a legitimate
cost and henefit to the City and the rates should be adjusted to comoensate them.
The Finance Director has prepared a summary analysis of the income statement for
the fiscal years ending June 30, 1976,1977, 1978 and 1979. (Schedule C) This
analysis shows the percentage increase in income and expense during this perfod
and the impact on the net profit or loss. The trend shows a consistent rise in
income and expense in 1977 and 1978. However, in 1979 the income percentage
increase dropped from 27% to 6% while expenses increased from 23% to 27%, This
combination resulted in a net loss for 1979.
Effects of the Proposed Rate Increase
Based on the Company's most recent six-month operating experience, which includes
the period July 1, 1979 .through December 31, 1979, Finance has prepared the
following income statement showing the effect of the proposed new rates in Chula
Vista. (Schedule 0) This summary shows that the proposed new rates would have
fncreased the ,net sales by 23.04%. .
Comparison of Fees w.ith Other California Counties
A Jariuary, 1980, survey of 28 Califor~ia Counties by the California Ambulance
Association revealed the following':
Californiil Current Proposed
Average CV Rate CV Rate
'. ~ "
Base Ambulance Ca 11 $69.83 $50.00 $65.00
~lileage Rate 3.56 2.00 3.00
Night Call . 13.27 7.50 15.00
Emergency COa 1'1 15.16 7.50 15.00
Oxyg en' n.74 7.50 15.00
St'a nd - by per .Hour 41..78 " 50.00 45.0fJ
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Page 3,
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Item ,/!f
Date ~
Meeting
This comparison indicates that the proposed rates are in line with average rates
in California counties.
Other Factors to be Considered
Hartson's is requesting that some minor changes be made in portions of Resolution
9490 and 9491 as follows:
Resolution 9490, February 8, 1979
Item 2. Substitute the following sentence for the last sentence of this section
which begins, "Said Certificates must verify coverage, state the policy
term, and assure that the City will receive a minimum of five days
notification prior to cancellation of, material changes in, or intent
not to renew said insurances."
This request for a reduction of notification and cancellation of insurance from
30 to 5 days is standard in the industry today and should be revised according
to the City Attorney.
Item 4. Hold Harmless. Delete entire section as currently written and substitute
the followin9 sentences:
Contractor agrees to indemnify and hold harmhss the City, its officers,
agents, and employees from and against all lo;s or eXDens~ (including
costs and attorney's fees) due to bodily injury, personal injury, pro-
fessional/medical malpractice, including death at any time resulting
therefrom, sustained by any person or persons or on account of damages
to property, including loss or use thereof, arising out of or in con-
sequence of the performance of this agreement, provided such injuries
to persons or damages to property are due or claimed to be due to
negligence of the Contractor, its officers, physicians, agents or
employees. Contractor shall have workers compensation coverage for its
employees under this agreement.
The expansion of the existing Hold Harmless clause in the agreement is to make it
clear that indemnification on the part of the Ambulance Company Service is
limited to their own wilfulness or negligence and could not encompass indemni-
fication for acts of the City.
Resolution 9491, February 8, 1979
Section 5-0. Correct "two (2) MICU's" to read "one (1) MICU'.
Section 5-E. Correct "two (2) additional ambulances" to read :"one (1) additional
ambulance."
Section 6-A.. Correct "ambulances" to read "ambulance."
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Page 4, Item
'. ~
y
4JeSO
Meeting Date
The basic requirements for maintenance of ambulances has been'clarified so that
it is clear that the requirement is to maintain one MICU and one additional
. ambulance.
In summary, we have been very satisfied with.the first year of operaticn of the
Company. They have always been willing to.discuss mutual problems in a very
professional manner. Their response time has been excellent., In our judgement,
the proposed rates and changes that the Company is requesting are justified.
If the new rates are approved, they will be equal to the rates they are presently
charging in all other areas of San Diego County, including. portions of the South
Bay other than Chula Vista. .
FISCAL IMPACT: Not Applicable
~
by the City Council of
Chuia Vista, California
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HartslOrrs Ambulance Service
Forty three eigllteen Forty seventh Street. San Diego, California 92115 . (714) 280-8111
.RECE1VED
January 18, 1980
CITY MA!\I/\GCR
CH')I/ ". ,- ~\ (~:\
J'I"'.' '; :' ';':>80
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Lane Cole, City Manager
City of Chula Vista
276 Fourth Avenue
Chula Vista, Ca 92010
f-..:':'......:'....l- ".,",,: ,:...:JlI. :.~ (:~._.
Dear Mr. Cole:
As you know, one year ago Hartson's acquired Bay Cities
Ambulance with the actual date of change being 09 February, 1978.
We are pleased to point out to you that during this time
Hartson's has not only maintained a high level of services to the
community, but in many ways have enhanced the program significantly.
Accomplishments of Hartson's includes a reduction in response
times to the entire service area according to the County of San Diego
Department of Emergency Medical Se~vices~
Among staff positions added has been that of Paramedic Coordin-
ator, namely Judith A. Ritchie, R.N., M.l.C.N. who was previously
employed in a similar position with Bay General Hospital. Ms. Ritchie
was significantly involved with the initial development and implemen-
tation of Paramedic Services in Chula Vista.
At a recent meeting of the Base Station Committee it was stated
that the Committee enjoyed the professional attitude of Hartson's
and the ~ffective ~esponses that Hartson's provides iri developing
solutions to the ever changing ope~ational needs of the program. The
Base Station committee consists of members of the medical community
as well as Police and Fire officials and other representatives of
local government.
Hartson's also has representation on the County Emergency Medical
Care Committee which is by Board of Supervisors appointment. This
results in ~ direct link between Chula Vista and the County E.M.S.
Planning AgE,ncy.
We cou~d go on at length demonstrating how we have enhanced the
E.M.S. program in Chula Vista. .
Excellence in performance in
sector is an expensive commodity.
is unacce~table and certainly not
the private 'sector, as
Anything less in life
subject to arguement.
in the public
saving services
/DcPq
In order to continue provision of a quality E.M.S. program in
Chula Vista certain adjustments in recovery of Revenue must be made.
For many reasons we feel that the most appropria'te method of
income adjustment at this time would be restructre Council Resolu-
tion 8062. Specifically our request is to gain a Council Resolution
to modify 8062 so that it will be in alignment with fees that we
currently charge throughout the San Diego County. In 1973 and again
in 1976 the Council adopted resolutions allowing increases in the
fees for ambulances service.
We feel that it is once again time to adjust the fee structre
thereby avoiding the need at this time of looking,to local government
for financial support.
The fees that we are asking the Council to adopt are as follows:
Present Rates
Proposed Rates
Paramedics Service
$50.
50
$65
50
Basic Rate Ambulance Response
Rate per Patient Mile
Additional Sit-up Patient
2
3
50
50
Additional Stretcher patient
(no mileage charge)
50
65
Refusal
'0
50,
65
Waiting Time per Hour
Resuscitator (Including Oxygenl
50
45
12.50
15
Oxygen Administered
7.50
15
Night Call (7 AM to 7 PM)
Emergency Ca 11 (Code 3)
Hair Traction Splint
7.50
7.50
7.5,0
15
15
12.50
Suction Equipment
10
Use of Obturator Tube
Bandaging and Dressing
17.50
5
Inflatable Splinting
Cervical Collar
7.'50 '
12.50
loo'\cl'l
Factors which we believe will help you with decision making
include:
(1) Increased operational costs
(2) California average costs per transport
(3) Our efficiency in containing operational costs
as compared with other California ambulance
operators
(4) Indirect, significant costs
(5) New regualtions and changes in the "State of
the Art"
Comparisons with fees charged by other agencies in California -
FACTOR I
By comparing costs in 1976 (when present fees were established)
with costs in 1979 the need for income adjustment becomes painfully
obvious.
Across the board 1979 costs exceed 1976 by 88%, however during
the same period Revenue has increased by 65%. Among the line items
significantly increased are the following: .
ITEM
COST INC~SASE '76 - '79
Auto Maintenance & Gasoline
Insurance
Laundry
Office Supplies
Payroll Processing
Payroll Taxes
Property Repair
General Supplies
Taxes & Licenses
Telephone
Utili ties
Wages
109%
174%
86%
78%
42%
99%
53%
101%
28%
32%
77%
92%
These items account for 85.14% of our total 1979 costs. The
owners/officers salaries have not increased one dime during this
period.
1 DO (o~
FACTOR II
State average - 1977 - 1978 Cost per Call of
$82.03 **
FACTOR III
When compared with Hartson's 1978 - 1979 Costs
74.50
favorably demonstrates cost containment resulting from our effici-
encies in operation and economies of scale.
FACTOR IV
Indirect expenses contribute to escalating costs also included
in this area are continuing-education courses for field personnel,
the City initiated false ~larms, the "fill in" or move up for cover
maneuver. There are also support departments including mechanics,
clerks and dispatchers.
Other"Indirect" essential costs include staff participation in
Disaster Drills, Base Station meetings, Tape Reviews, Regional E.M.S.
Planning meetings as well as data collection, which is required by
law and or contractual agreement.
"
FACTOR V
Since the existing fees were established in 1976 the the state
of the art has changed in many ways and many new regulations pertain-
ing to pre-hospital services have been developed.
An analogy might be to show how City government functioned in the
days before the Coastal camrission and the way things are today. Our
operations are subject to regulations and guidelines from Federal Agen-
cies such as H.E.W., D.O.T., F.C.C. and the Dept of Labor. State
Agencies include Dept of Health, California Highway Patrol, and the
Department of Motor Vehicles.
We are directly regulated by California Vehicle Codes, Adminis-
trative Codes, Health & Safety Codes, and Welfare and Institutional
Codes. We are also subject to labor laws and CAL-OSHA requirements.
On a local level there are contractual agreements with the County
and with Governments such as The City of Chula Vista.
Specific expense items that did not exist previously include the
following:
I CO 109
Survey of private ambulance costs
Association by Touche Ross & Co.
prepared by California Ambulance
March 22, 1979
**
----"...~ .
$ 6,000.00
To train and place a Paramedic in the
field.
15,000.00
Plus in Paramedic equipment items not used
in an E.M.T. Ambulance
26,000.00
Annually to provide additional staff (driver)
for the Paramedic Unit.
Other new items carried in the ambulances include such items
as:
The KED SLED, an extrication device $200.00
Protable, battery operated suction equipment 380.00
Infant resuscitation equipment 120.00
New insurance requirements include higher limits of coverage as
well as additional forms of insurance not previously needed.
FACTOR VI
The following comparison charts illustrate fees statewide.
Information from the California Ambulance Association Rate Survey
of January 1979 is shown below with the fee", permitted in Chula Vista
today shown in the right hand column.
Item
Highest
In Calif.
Calif.
Average
Limitations
Imposed By
Chula Vista
Ordinances
Base
$ 110.00
$ 67.64
Mileage 4.50
Night Call 20.00
Emergency Call 35.00
Oxygen 20.00
Stand-By Per Hour 80.00
3.18
$ 50.00
2.00
7.50
7.50
7.50
50.00
12.10
13.93
10.96
43.88
100 pO(
In January 1980 the California Ambulance Association surveyed
28 Counties. The average rates are shown below in the left hand
column.
Item
California
Chula Vista
Base
$69.83
$ 50.00
Mileage
3.56
2.00
Night Call
13.27
7.50
Emergency Call
15.16
7.50
Oxygen
11.74
7.50
Stand-By Per 80ur
41.78
50.00
Plainly the rates currently permitted in Chula Vista for the
essential charges such as base and mileage are well below the average
charge in California.
Furthermore the rates requested by Hartson by no means approach
the highest in California in any category and are competitive with
the State average.
In summary, we feel that the fees we are requesting are compet-
itive and the quality of service is excellent. Circumstances beyond
our control, such as inflation, training requirements, sophisticated
equipment requirements, and staffing levels, have driven our costs
upwards. Our ability to continue the present level'of service will
be hampered if this fee increase is not permitted.
We respectfully request and urge that you recommend that the
Council adopt the fee structure we have requested.
If you have any qyestions or if I can be of assistance to your
staff in preparation of your reports please do not hesitate to call on
me.
When your report and recommendations have been prepared I would
appreciate an opportunity to review them.
lDb0~
____L
.
.-
Special notice to us regarding the date of the Public Hearing
would also be most helpful.
Best Regards,
~)t J Cl - /; ("
~.. ';P(~ ~'7- L~ __..)~/~"l"':-r..{~r_, '(,/-..--"
/' - D',"_'-' - - ( i'
Robert A. Spradley
Chief Executive Officer
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