Title
A RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO AN AGREEMENT WITH LIFE FORCE MANAGEMENT, INC. FOR THE PROVISION OF BILLING, COLLECTION AND RELATED SERVICES; AND DECLARING AN EMERGENCY.
Executive Summary: This resolution allows the City of Hudson to contract with a new third party vendor that specializes in ambulance billing to manage its patient billing accounts. The practice of using a third party vendor has been in place in Hudson since ambulance user fees were first established in July of 2004.
Body
Legislative History
a. Ordinance No. 04-97 established a user fee for emergency medical services (ambulance transport billing) and provided for collection of user fees. City Ordinance 242.02 - User Fee for Emergency Medical Services.
b. Life-Force Management of Streetsboro, Ohio was authorized, under contract, to provide billings services for Hudson Emergency Medical Service at a rate of 7.5% on all collections received, effective June 30, 2004.
c. Ordinance No. 10-43 amended 242.02 User Fee for Emergency Medical Services in terms of rates, scheduled increases and the definition of a resident.
d. Resolution No. 10-44 authorized the City Manager to enter into an agreement with ADPI-Intermedix for the provision of EMS billing, collection and related services and equipment at a rate of 6.5% on all collections received, effective March 3, 2010.
e. Resolution No. 12-150 authorized the City Manager to enter into an agreement with EMS Management and Consultants, Inc. at a rate of 4.75% on net collections, effective January 1, 2013.
Purpose & Explanation
From the onset of Hudson’s adoption of ambulance user fees, it was determined that the cost of performing this function in house was cost prohibitive based on the expertise needed in personnel, equipment and software.
With the need to increase revenue from EMS billing and the desire to have a billing company located closer to Hudson, we believe this is our best available option. The confidence that Life Force Management will increase our collection rates is based on the historical facts when they were billing for us in the past as well as their current track record with neighboring communities. Life Force Management is a well-established billing company that all of the local hospitals share patient data and billing information with. This information increases our chances of having valid billing addresses and insurance information. The billing company that has been serving Hudson is located in Winston-Salem, North Carolina and has no local sharing agreements with any of our hospitals. Our revenue has decreased since leaving Life Force Management in December 2009 and despite aggressive participation from our office staff on attempting to gather insurance information and capturing signatures, we have been unable to recover from our deficit. We have spent many hours working with the billing company we had a contract with attempting to increase our revenue. We were able to increase the revenue a small amount but a reoccurring problem was that they were unable to work with the local hospitals to share patient information. On September 27, 2015, the City gave notice to EMS-MC that we will be terminating our billing contract with them effective December 31, 2015.
Staff is recommending Life Force Management Inc. of Ravenna Ohio to replace EMS-MC.
Exhibit A
Billing Service Agreement between Life Force Management Inc. and the City of Hudson.
Timing Considerations
This contract would run for three years (January 1, 2016 through December 31, 2018) and then would automatically renew each year for three more years, unless terminated by either party.
Fiscal Impact
X Currently Budgeted
Supplemental Appropriation Required
Appropriation Not Required.
Recommendation
Suggested Action
Staff recommends City Council authorize the City Manager to enter into an agreement with Life Force Management, Inc.
Submitted by,
Jane Howington, City Manager
Jerry Varnes, Fire/EMS Chief
Larry Nichols, EMS Deputy Chief