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Finance Department

Finance Department. EMS Ambulance Cost of Service Analysis. November 8, 2010 Michelle Mitchell, Director. Table of Contents. Background Issues Collection Rates (2009 vs. 2010) Cost of Services Receivables Outstanding Billed in the Last 24 Months Recommendations

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Finance Department

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  1. Finance Department EMS Ambulance Cost of Service Analysis November 8, 2010 Michelle Mitchell, Director

  2. Table of Contents • Background • Issues • Collection Rates (2009 vs. 2010) • Cost of Services Receivables Outstanding Billed in the Last 24 Months • Recommendations • Response to Community Concerns • Process Improvement Detail • Appendix A – New Ambulance Forms • Transport Information Form • Follow Up Information Form • Invoice • Past Due Notice

  3. Background • Houston’s ambulance base transportation rate is the lowest in the state of Texas for major cities at $415. Fort Worth charges $1,146; Austin charges $850 and Dallas charges $800. • Houston’s cost of service to transport is approximately $1,128 per transport. 90% of all collections currently come from insurance companies. • Billings and collections are done by ACS, a third party contractor. Currently, ACS receives a fee of 14% of current collections and has an opportunity to earn an additional 6% annually based on productivity targets.

  4. Issues • Houston’s cost of service to transport is approximately twice the amount of our current rate. • Houston is not getting its fair share of available insurance reimbursement dollars. • Medicare and private insurance reimbursement rates are depressed due to Houston’s low base transportation rate. • Current process of billings and collections. • Transports billed vs. gross collection: • 131,000 in 2010 - $68 million billed vs. $24 million collected • 139,000 in 2009 - $74 million billed vs. $29 million collected

  5. Collection Rates2009 vs. 2010

  6. Cost of Services Receivables Outstanding Billed in the Last 24 Months

  7. Recommendations • Increase the base transportation rate from $415 to $1,000. • The estimated revenue impact from insurance providers is $5.5 million annually or approximately $3.2 million for FY2011 as of 12/1/10. • Eliminate the City’s policy of pro-rating charges for multiple riders in the same ambulance. • The estimated revenue impact is $500,000 annually. • Billings and collections process improvement. • Implement annual fee escalators based on appropriate indexes.

  8. Response to Community Concerns • Implement procedures to identify low income qualifying individuals at time of transport. • Implement procedures to allow low income transport individuals not previously identified to show proof of qualification at time of billing. • Implement procedures to bill the uninsured at a discount rate. • Implement new intake forms for improved clarity and readability.

  9. Process Improvement Detail • Improve transport identification process for billing. • Improve the automated hospital sharing information. • Improve debt collection techniques for transported individuals (e.g. phone calls, mailings, negotiated settlements and credit bureau reporting). • Implement ongoing oversight of the outside billers and collectors ensuring productivity measure are maximized.

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