The Riverhead Volunteer Ambulance Corps will start billing insurance companies for all ambulance rides next year in an effort to boost revenue to offset the rising cost of first aid supplies and hire more staff members to respond to calls.
The new billing has the potential to collect up to $2.36 million annually, according to initial projections from RVAC’s billing company. That number is based on 5,000 rides per year, a three-mile average distance per ride and the number of advanced life support rides — which cost $300 more than the basic life support services — being 55%.
Many ambulance companies on Long Island have turned to billing services to increase their revenue, officials said during a Town Board work session on Thursday with ambulance company President Garret Lake and District Manager Pat Gugliotta. RVAC representatives received the verbal consent of the board to put the change, which would likely start at the beginning of next year, in motion.
“The price increases of materials, of first aid, supplies, medicines, rubber gloves, everything is tripled, quadrupled,” said Council Member Tim Hubbard, the Town Board liaison to the ambulance company. “It’s putting a burden on the town to have to raise taxes in order to maintain the ambulance company — and that’s something we certainly are always going to do is maintain an ambulance company. But this would give some relief to the taxpayer if there are other sources of revenues that can be brought in by charging, because all your insurance companies, whether it be health insurance, or your car insurance, all have coverage for this type of transport.”
The ambulance company has been billing auto insurance companies for ambulance rides connected with car accidents since 2017. Full billing would allow the company to bill health insurance companies for other ambulance rides.
Hubbard said the intention of the change is only to collect from insurance companies and the billing cost of the ride will not come out of anybody’s pocket. “We’re not looking to collect from anybody,” he said. “We don’t want anybody to feel that they could never call an ambulance because they can’t afford to pay for the ambulance ride. That’s not what it is.”
The billing company may send bills to the homes of people who have received an ambulance ride after insurance has been billed asking for more money. Lake said the ambulance company is mandated to make a “good faith” effort for medicare and medicaid to write-off the bills, which will result in three bills through mail — at 30 days, 60 days and 90 days — after which the letters would stop, even if the patient doesn’t pay.
Hubbard said the process is a “soft collection,” opposed to a “hard collection,” meaning that ignoring the bill will not result in the damage of an individual’s credit score.
Lake said if it doesn’t implement the billing system the town would likely have to raise ambulance district taxes above the 2% cap. “It’s money that you’re paying anyway when you pay your insurance premiums, that you might as well use it to help get what we need to supply the best service to Riverhead,” he said.
“Riverhead has gotten very big very fast — and for the good,” Lake added. “But we need to have the funding to have the staffing.”
Although RVAC has more than 100 volunteer employees, it also must employ non-volunteers, like paramedics, while volunteers are at their jobs. The ambulance company is only fully staffed with volunteers from 6 p.m.-12 a.m., Gugliotta said.
Aside from covering rising costs, the new money flowing into the budget will also allow RVAC to save for long-term purchases, like new vehicles and a new property to store equipment.
Town and RVAC officials agreed that they need to launch a public relations campaign to make sure residents know how the billing works. Board members proposed sending mailings to residents, partnering with the library, posting online and taking out an ad in the newspaper to spread the word.
Hubbard said the town wants to avoid a situation like that in Flanders, where residents complained about bills they received from the Flanders-Northampton Volunteer Ambulance Corps, which started billing four years ago, partly because they were unaware of the process.
Gugliotta said members of RVAC are embedded in the community and can also spread the word. “We’ll make sure that all of our members are on the same page when it comes to how to actually explain it to people so there’s no misunderstandings,” he said. “because the last thing we want is anybody to have questions that go unanswered, and then they come to you guys or they come to us already aggravated because they didn’t get an answer.”
Gugliotta said before now there was a “stigma” associated with ambulance billing. RVAC started billing for ambulance rides connected to car accidents in 2017, although the multi-year journey to an agreement to bill was met with resistance from RVAC board members and members of the Town Board. A compromise was reached in 2014 to bill for car accidents, but not for all services.
“I don’t think up until now, or up until like last year, it really wasn’t needed. We were kind of doing the best we can with what we had,” Gugliotta said.
Lake said the company would stick with Certified Ambulance Group of Wethersfield, Connecticut, the billing company it currently uses for auto accidents. The company takes 3.5% of the revenue, a cut RVAC officials said is significantly less than other bill companies emerging into the market.
“They’ve made a commitment to us not to change it and we have a great relationship with them,” Gugliotta said. Certified Ambulance Group was one of six companies to respond to a request for proposals issued in 2015.
RVAC is a nonprofit organization in contract with the Riverhead Ambulance District, a special taxing district governed by the Riverhead Town Board, that provides emergency medical services within the town except the area within the Wading River Fire District. RVAC responds to roughly 5,500 calls a year, according to Gugliotta, and covers a large number of senior citizens communities.
The Wading River Fire Department provides rescue services with the Wading River Fire District, which covers areas in Riverhead and Brookhaven. Wading River Fire Commissioner Matthew Wallace said in a call today that the fire department will also start billing for ambulance services starting next year, after a new law passed through the New York State budget this year gave volunteer fire departments the power to bill.
Although even the lowest revenue projections by Certified Ambulance Group, at just over $2 million, may look promising, the actual number may end up being less. The Flanders-Northampton Volunteer Ambulance Corps started billing four years ago and receives $200,000 to $250,000 a year, although it was originally estimated to bring in around $500,000.
Wallace was hesitant to give out any numbers for how much billing in the Wading River Fire District might generate. “There’s really no way of knowing until it’s actually rolled out and it’s actually running,” he said.
Gugliotta said RVAC has submitted its budget to the town without the projected increases from the new billings and will adjust its budget next year to reflect the added revenue. The revenue increases will become part of the organization’s proposed budget in 2024.
“The first year will be probably the lowest intake. But as you guys see the numbers, you know, even if we only brought in $800,000 the first year, that’s multiple crews,” Lake said.
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