‘Way Out of Whack’

That’s what one councilman calls Acadian’s proposed contract renewal. By Leslie Turk • Photo by Robin May

Wednesday, Feb. 22, 2012

Acadian Ambulance is asking the council to increase the cost of an emergency transport from $622 to $877 and a non-emergency trip from $348 to $593 — and it wants an automatic annual 6 percent increase on top of that.

It’s time to meet the so-called “14 percent.”

That’s who Acadian Ambulance says would be most affected by its proposed rate increases. It’s the percentage of self-payers, those who have to cough up hundreds if not thousands of dollars for emergency or non-emergency transports. In other words, it’s the poor among us.

And the Lafayette City-Parish Council’s Feb. 28 decision on a rate increase for Acadian Ambulance could put a major financial burden on this group should it need an ambulance in an emergency or non-emergent situation. In 2003, when the current nine-year contract (five-year contract with a couple of two-year extensions) between Lafayette Consolidated Government and Acadian was negotiated (there was no request for proposals nor bid process), the council approved an automatic 3 percent annual increase and then took special action in awarding the company a significant 12 percent increase a year after the 2005 storms. When the contract was signed in 2003, the cost of an emergency transport was $465 and a non-emergent trip was $260; after the increases of the past nine years, it’s now up to $622 for an emergency and $348 for a non-emergency. That’s 34 percent more.

But if Acadian has its way with the council at the end of the month — it already has the blessing of the five-member (two of the seven seats, those previously held by Dr. John Stroy and Jerry Morgan, are vacant) Emergency Medical Services Advisory Board — that figure will skyrocket to $877 for an emergency transport, 41 percent more than the current rate, and $593 for a non-emergency ride, a whopping 70 percent increase. It’s part of the ambulance provider’s “customary rate” strategy, explains Acadian Senior Vice President of Operations Jerry Romero, a plan to get every government entity in Louisiana and Texas on the same rate schedule. The price per mile (up to 50 miles) will go up from the current $19.50 to $20.50. It was $12.50 in 2003.

Acadian also wants to double the automatic 3 percent rate hike that was built into its 2003-2012 contract, which expires March 24. That means nine years from now, should LCG go to customary rates that grow 6 percent annually, residents will be paying $1,398 for an emergency transport, 60 percent more than the $877 Acadian proposes for 2012. And there is a mechanism in the proposed ordinance for Acadian to seek even greater increases if it gets approval from the EMS Advisory Board and council. In early February, the EMS Advisory Board, which is charged with monitoring the contract and advising the council, recommended both the “customary rate” structure and the 6 percent automatic annual increase.

“It seems fair to us as a group and we’re OK with it, but ultimately it’s for the council to figure out,” says banker André Frugé, who chairs the board. Frugé, however, acknowledges that all the board has to go on is the data and industry trends Acadian presents it with — and the fact that other municipalities are jumping on board. According to Acadian’s records, there are currently about 36 parishes and Texas counties paying the same rates. “Most of them now just ask us to provide a rate schedule,” Romero says. Last year, for example, the Calcasieu Parish Police Jury — which put out an RFP in 2003 and ultimately awarded the contract to Acadian — amended its ordinance and moved to customary rates, increasing its non-emergency rate from $609 to $861, according to Dick Gremillion, director of the Calcasieu Parish Office of Homeland Security and Emergency Preparedness. That represented a 41 percent hike in a single year.

View the proposed Lafayette ordinance here. Note that the customary rate increases affect more than just transports and mileage, as they include all supplies and procedures, and medications medics might administer.

The EMS Advisory Board is also supposed to regularly monitor Acadian’s response times, but it has not fulfilled that duty in years. Documents obtained by The Independent appear to indicate that Acadian is in compliance with the response times built into its contract, and is providing good service, but the newspaper was not able to get a straight answer on who dropped the ball on the monitoring.

“LCG instructed us to send compliance reports to [the Purchasing Department] a few years ago, which we have done every month,” Romero says, noting that the EMS Advisory Board recently asked that the new contract stipulate that the reports be turned in to Chief Administrative Officer Dee Stanley, who will share them with the board. Frugé says the board has met only twice in the past year, both times to discuss the contract renewal.

In addition to the 14 percent of self-payers (Acadian claims a 7 percent collection rate among this group), 72 percent of Acadian’s business is Medicare/Medicaid (which Romero says reimburses at below cost), 1 percent is negotiated with Blue Cross and the remaining 13 percent is negotiated with other private insurance companies. Among third party insurers, Acadian says it has a 75 percent collection rate. Acadian, as one might expect, makes a strong case to justify the increases: Medicare and Medicaid cuts, the uncertainty of the federal health care reform act, increased fuel and insurance costs, investment in technology, equipment and training. Romero also stresses that some areas subsidize their ambulance service — which Lafayette has never done.

City-Parish Councilman Jay Castille isn’t sure what the EMS Advisory Board thinks is “fair” about the proposal to move to customary rates, but you won’t hear that word come out of his mouth. And he couldn’t care less what other parishes are paying. “I’m worried about the people in Lafayette Parish; I’m not concerned about the people in Calcasieu Parish. I’m not concerned about the people in Baton Rouge,” Castille says. “It’s way out of whack. I met with [Acadian] during the week and told them there is no way I can go with that,” adds Castille. Last week the councilman said he was inclined to approve nothing more than a 5 percent automatic annual increase.

Fellow councilman Kevin Naquin is far from sold on the proposals as well. Naquin, a business development rep for a medical equipment company, has taken the lead on analyzing the suggested increases and is looking at ambulance industry trends and other rising medical costs. He’s still doing his homework. “I cannot support the [proposed] contract as is,” he says. “There needs to be some changes.”

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