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No More Free Ride

The days of free ambulance service in the Chicago area are over – but how municipalities establish transport rates, and collect fees, is raising good-governance questions.

By Katie Drews/BGA, with NBC 5

April 9, 2014 9:27 PM

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Need an ambulance? Better brace yourself for the pain of paying a steep price for that ride to the hospital.

Free ambulance rides, once a common practice among Chicago-area municipalities, have become increasingly rare for the sick or injured, according to a Better Government Association analysis of rates and billing procedures of about 130 fire departments in Cook County.


If you don't see the video above, click here and watch it on NBC5.

Moreover, the BGA review found that ambulance fees, standards and practices vary widely among communities.

Fees, for example, for emergency transports range from $0 to $2,587 depending on the level of care provided, the residency of the patient and other factors, according to documents obtained through the Illinois Freedom of Information Act, and interviews.

Yet despite the lack of comparative data, there is one constant: Ambulance fees are here to stay because cash-strapped villages, towns and cities have come to depend on these "user fees" to cover emergency service costs, and create new revenue opportunities designed to help contain or ease local tax increases.

"We didn't have an ambulance fee in town for many years. The board would fight against it," said Wheeling Fire Chief Keith MacIsaac. "Then we had to recognize the demand for service and the costs of service. . . . You have to realize that if you didn't have a fee, how would you get that money? You'd have no choice but to raise property taxes."

Among the BGA's findings:

  • Many fire departments and municipalities base their ambulance fee schedules off rates of other departments and insurance providers, rather than actual expenses.
  • Costs of emergency medical services, or EMS, are difficult to trace since many expenses overlap with other areas of a fire department.
  • Ambulance rates do not accurately reflect how much agencies are collecting in ambulance fee revenue. In fiscal year 2012, agencies in suburban Cook County billed out more than $111 million in ambulance fees and, during the same time period, received about $55 million.
  • Billing policies are generally more lenient on residents compared to non-residents, who are more likely to pay out of pocket and face a collections agency.
  • EMS programs come in many different shapes and sizes. Some departments handle ambulance services entirely in-house, while others contract out part or all of the work to private companies.

"You have really big differences within the ambulance industry," said James Cosgrove, director of health care at the U.S. Government Accountability Office. "It's very unclear how people are setting up their fee schedules."

In Cook County, a "basic life support," or BLS, ride could cost residents anywhere from $0 to $1,200, with an average rate of $587, the BGA found. Along with emergency transportation to a hospital, BLS may include basic care such as CPR, splinting fractures or controlling bleeding. For non-residents, who are often charged a higher price, BLS fees range from $365.42 to $1,400, with an average rate of $732.



"Advanced life support," or ALS, fees range from $0 to $1,900 for residents and $433 to $2,587 for non-residents. ALS is typically divided into two categories based on the level of support, which includes more advanced care such as cardiac monitoring and giving medication.

Most departments charge additional mileage fees based on the distance traveled to the hospital, and some agencies add extra fees for supplies and specialized services.

The City of Chicago, for example, charges residents $900 for BLS, $1,050 for the lesser ALS care and $1,200 for the more sophisticated ALS care, plus $17 per mile and $25 for oxygen. Non-residents pay an additional $100 fee.

Billing policies vary just as much as the rates. Some agencies accept insurance as payment in full, while others bill the patient for any remaining balance, and, in some cases, employ a collections agency to recoup the debt.

"There are different philosophies," said Scott Franzgrote, fire chief of Rolling Meadows. His city's approach is to get the money that's "left on the table," or, in other words, collect what they can from insurers since many people are already paying for the service through their health care premiums.

"Other chiefs have told me they want to bill for what the service costs," Franzgrote said. "And then there's some that say let's generate whatever revenue we can."

Prior to 2002, Medicare, a federal program that helps pay for medical expenses for seniors and people with disabilities, reimbursed municipal ambulance providers based on charges, which created an incentive for providers to raise fees, according to Christopher Vandenberg, president of the Illinois State Ambulance Association, a trade group that represents private ambulance companies.

"It became a game," Vandenberg said. Today, "you still have retail rates based on that old formula. So now you get stuck with these ridiculous retail rates, which, for the most part, people don't end up paying anyway."


 Highest Ambulance Rates in Cook County

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In 2002, Medicare instituted a standardized rate schedule that increases annually based on inflation. Regardless of what a provider charges, Medicare pays according to its reimbursement rates, which range from $367.32 to $436.20 per ambulance transport.

Since Medicare is the largest payer for ambulance services, the fees that are set by each local governing body become less meaningful.

"You can charge $800 or you can charge $8,000 a trip, and you're only going to get what Medicare assigns" for most transports, said Hinsdale Fire Chief Rick Ronovsky.

Many public officials in the Chicago area don't necessarily compute the costs of their EMS programs when they determine what to charge, the BGA found.

"Generally I would say many EMS agencies – both public and private – price their services without adequate understanding of their costs," said Doug Wolfberg, an attorney with Page, Wolfberg & Wirth, an EMS law and consulting firm based in Pennsylvania. "In this market where reimbursement is often fixed without regard to cost, most providers don't have a strong incentive to look at their costs closely."

Even still, Wolfberg said ambulance providers should know their costs and determine their rates with reference to those numbers.

"I think it's good business in the private sector and good government in the public sector," Wolfberg said.

The Hinsdale Fire Department estimates each ambulance transport costs roughly $1,500 on average. Costs can change per department, depending on the size and structure of the EMS program, proximity to a hospital and other factors.

Agencies also must bear the cost of readiness – being prepared for an emergency 24/7 – regardless of the number of transports they make.

Since Medicare is the largest payer for ambulance services, the fees that are set by each local governing body become less meaningful.

"If an ambulance never goes to a call, the cost is the same," said Jay Fitch, president of the EMS consulting firm, Fitch & Associates, which is based in Missouri. "That's why it is such an expensive operation."

Ultimately it's up to local board members, who are elected or appointed to govern the municipality or fire protection district, to decide if and what to charge.

Forest View, McCook and Rosemont are the only remaining places in Cook County that do not charge residents for ambulance service (though non-residents will get a bill.)

Rosemont Mayor Brad Stephens said his village is, financially, "managing just fine without it."

Residents "pay that in their real estate taxes," Stephens said. "Just like they don't pay for police, it's in their tax bill."

Sheila Weinberg, founder of Truth in Accounting, a Chicago-based fiscal watchdog, had never heard of municipalities charging for ambulance rides and questioned whether citizens can make educated decisions without the information being widely known.

"If you don't know this is going on, you assume it's in your taxes," Weinberg said. "Are you content in paying more taxes when you really aren't getting that service? I urge governments to be more transparent about this and inform the public."

User fees – whether related to EMS or other areas of government – have been popping up more and more over the years in municipalities as a source of revenue that replaces tax money, according to Michael Pagano, dean of the College of Urban Planning and Public Affairs at University of Illinois at Chicago.

"If people are reluctant to have their taxes raised, it forces municipalities to start charging for purchases such as ambulance trips," Pagano said. "Now cities are being much more deliberate and cautious in what they do and how they pay for it, and ambulance service is just one of those areas."

This story was written and reported by the Better Government Association's Katie Drews, who can be reached at (312) 821-9027 or kdrews@bettergov.org.

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My daughter was at St Alexius hospital emergency room in Hoffman Estates .Had to be transferred to a building next store with no medical equipment .Just a ride by ambulance , which was mandatory by the hospital. Was less than a half a block and if im not mistaken it was over $350.00 dollars. And they wonder why health care is so expensive.
10:37 PM Apr 9th

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