20 Tough Questions For the Fire Chief: Are You Prepared To Answer Them? Question 15

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This question is a continuation of last month’s discussion about fire-based EMS. While it is widely considered a best practice by efficiency consultants to benchmark and compare your organization to others, this question implies, ironically, that such a comparison is irrelevant.

Perhaps the basis of the question is the notion that the decision to provide, or not provide, fire-based EMS transportation in any jurisdiction is uniquely individual to the community and not a decision that should be influenced based on what other communities are doing. To a great extent, this is true. However, it is worthwhile to look at like-sized communities that provide or don’t provide fire-based EMS transportation and to ask them why they do or why they don’t. It may also be advantageous to look at fire service organizations that have recently (say, within the past five years) started or stopped providing fire-based EMS transportation and seek to understand what compelled that decision.

Department’s mission

The decision to provide, or not provide, EMS transportation is one based on the mission of the fire department. For most departments, the mission includes a focus on protecting life and property and the prevention of injuries and loss (perhaps not in those exact words). EMS transportation is a logical fit and within the scope of purpose for many fire departments. However, that does not make the decision to start providing EMS transportation easy. In fact, the decision can be quite complicated. This article looks at a few of the factors.

Competition

If the fire department does not currently provide EMS transportation, someone is doing it and that someone is most likely a private EMS provider. As we discussed last month, the decision for a public agency to provide services that may otherwise be provided by a private entity is a policy decision to be made by elected officials and, hopefully, after great consideration to the benefits and detriments of doing so.

Where a private EMS agency provides the transportation services for multiple communities, the revenue it may lose if one community decides to have its fire department provide EMS transportation services could have a significant impact on its ability to provide EMS to the other communities. And while the elected officials are only required to do what is best for the community they are elected to represent, there is a humanitarian (if not ethical) obligation to at least give consideration to the broader impact of policy decisions. A policy decision to start providing fire-based EMS transportation that, in turn, causes the current provider of EMS transportation for multiple communities to go out of business could have a significant impact. It may be especially detrimental if the other communities did not know the change was coming or if the other communities are not in a position to provide their own fire-based EMS services.

Of course, this could provide an opportunity for the fire department to become the EMS transportation provider of choice for the region and serve the needs of other communities as well. This sort of cross-jurisdictional provision of services can quickly become complicated and very political, especially where neighboring community relations (or neighboring fire department relations) have historically been strained.

Quality of service

One of the key drivers in the decision for a fire department to implement transportation services should be a focus to improve the quality of service. However, to improve the quality of service, there should first be an assessment of the existing quality of service. That should include identifying what defines quality and then measuring the existing level of service to the definition of quality. It would be bad business to start transportation services only to find the quality of services declined as a result.

A vital (and sometimes overlooked) factor in determining whether a fire department should enter the EMS transportation business, or be providing EMS of any form for that matter, is whether the existing fire department personnel are capable of providing EMS. While it may be a logical extension of the mission, it should not be assumed that individuals who signed-on to be firefighters will be quality medical providers.

A top-notch firefighter who faints at the sight of blood or who suffers from trypanophobia (a fear of medical procedures and/or hypodermic needles) may not be suited to serve as an EMT or paramedic. Involving the membership in the EMS transportation decision process is vital and you need to determine, in advance, how to get members on board and, equally important, how you will resolve the issue of those who cannot or who do not want to support EMS transportation. As the employer, you may have the legal and contractual right to determine the scope of services, but involving the members in the process of changing the scope is critical to the success of implementing EMS transportation services.

Financial factors

As communities experience the financial strains of a changed economy, the natural course of action is to look for ways to reduce costs or to enhance revenues. One way revenue can be enhanced is through EMS transportation. However, according to the White House website (http://www.whitehouse.gov/our-government/state-and-local-government), revenue generation should never be the primary function of a government-provided service (excluding the Internal Revenue Service).

The website also says the function of a municipality is to “…generally take responsibility for parks and recreation services, police and fire departments, housing services, emergency medical services, municipal courts, transportation services (including public transportation) and public works (streets, sewers, snow removal, signage, and so forth).”

Local governments can charge fees for services so long as state law does not prohibit them from doing so. While taxation has long been the primary source of revenue for most municipalities, many charge fees for services ranging from building permits and inspections to CPR classes and recreational programs and more.

“A fee charged by government is just another form of taxation,” a resident once exclaimed during a public meeting I was attending where the elected officials were debating whether to start billing for what had previously been free EMS services (that included transportation). The lure to start EMS transportation for the benefit of revenue generation can be strong. However, healthcare reform, including changes in Medicare and Medicaid laws, has reportedly made reimbursement more challenging than ever.

The problem with predicting future revenue from EMS transportation in the future of healthcare remains very unpredictable. This means the solid financial projections generated today could quickly change and EMS transportation could become a financial burden on the community in the future. It would be unfair for elected officials to hold fire department administrators accountable when changes in healthcare impact EMS transportation revenues. But we all know that is a real threat. One way to reduce the possibility of being caught off-guard is to create three sets of financial projections based on best-case, most likely and worst-case scenarios.

Cost of entry

There is a cost for entering the EMS transportation business. The first, and perhaps most obvious, cost is the need to have vehicles to transport patients. Those vehicles must also be provisioned with medical equipment and supplies. Add the cost of maintenance, fuel and insurance.

EMS transportation will also require trained personnel to staff the ambulances. This will most certainly require the addition of personnel to avoid the creation of a dangerous depletion of firefighting resources to staff ambulances. EMS transport personnel also require training and ongoing continuing education to ensure skills remain sharp. Some of the training and continuing education may be done on shift, but some classes are so extensive that attendance may have to be done off shift and require paying overtime. This is a financial consideration that should not be taken lightly as labor costs are the single largest expense in an EMS transportation system.

System demand & system abuse

EMS transportation creates a demand on resources that should be considered prior to entry. Depending on community demographics, the size of the community and the location of hospitals, the resource commitment to provide transportation services can be significant. While it may not be broadly known throughout society, issues with how healthcare is managed nationally have an impact on EMS systems. For many citizens, their first (and only) means of medical care is through the hospital emergency room. Often, the perceived means of access to the healthcare system (for medical issues as non-emergency as poison ivy or constipation) is through EMS transportation to a hospital. This has led to a tremendous load on the EMS system and a fair amount of system abuse.

Only a small fraction of EMS transports are truly emergencies. A vast majority of patients transported did not need to be taken to the hospital emergently by ambulance. In fact, most didn’t need care or treatment in a hospital at all. But the absence of alternative means of transportation and alternative forms of healthcare have created a system ripe for heavy use (and abuse). EMS providers know the system is broken, but the issue is much larger than EMS. In fact, EMS in many respects is a victim of failings of the broader healthcare system.

Nonetheless, until the system gets fixed, EMS will be saddled with the responsibility of responding to every call for service and providing transportation services to hospital emergency departments for patients who really did not need the service.

Paying the bill

The challenge is compounded when customers do not have a means to pay their bills for EMS transport services. For those who cannot pay, government then assumes the financial cost of providing the service. If those without a means to pay become system abusers, the drain on city resources can become significant.

One exercise worthwhile is to determine the fixed costs to provide EMS services. These would include facilities, vehicles, equipment, personnel, training, utilities, insurance and opportunity cost (the cost of lost productivity for other things the staff might have done had they not been on an EMS call). These are the costs that would not change based on the call volume. Next, calculate the variable costs. These are the costs that would change based on the call volume. Examples would include supplies, fuel, maintenance and billing-services fees (if the fee is based on a percentage of billings). Based on fixed and variable costs, calculate the average cost per call for service based on an estimate of the number of calls. Keep in mind the cost of a transport will be greater than the cost of a non-transport, so estimate the percentage of EMS calls that would result in transports.

 

Richard Gasaway presents “Fireground Command Decision Making and Situational Awareness” at Firehouse Expo 2013, July 23-27 in Baltimore, MD.

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