News

Fire Department set to launch ambulance insurance program

City Council's Finance Committee unanimously backs program, which will allow residents and businesses to pay a monthly fee to avoid steep copays

The Palo Alto Fire Department is preparing to launch an insurance program for its ambulance service. Embarcadero Media file photo.

The Palo Alto Fire Department's new insurance program, which allows residents and businesses to pay a monthly fee for ambulance transfers, is nearly ready to debut after getting unanimous support from the City Council Finance Committee on Tuesday.

The program, which the department has been refining for more than a year, has two major goals: help the department obtain a new revenue source during a period of budget cuts and provide peace of mind to customers seeking some assurance that they would not face steep bills if they suffer a medical emergency and need to be taken to a hospital.

Under the terms that the Finance Committee approved on Tuesday, residents would have the option to pay an $8 fee per month to participate in the program. For businesses, the rate would depend by the number of employees, with fees ranging from $20 for companies with a head count between one and 10 employees and $1,000 for those between 251 and 1,000 employees.

The Fire Department estimates that if about 25% of local residents and businesses enroll in the program — a rate that would be comparable to ambulance-insurance programs elsewhere in the state — the city would receive about $1.2 million in annual revenues. The city plans to start marketing the program in the coming months, according to a report from the Fire Department. Those who choose to participate would see the charge show up on their monthly utility bills.

The city expects most of the participants to be residents and employees who are not covered by Medicare and who, as such, are billed hundreds of dollars for a transport fee. Palo Alto fire, which is the only department in Santa Clara County that has an ambulance service, runs about 3,500 transports annually and its base fee is $2,509 for transport. While Medi-Cal and Medicaid cover that entire cost, and Medicare covers up to 90% of the costs, those who rely on private insurance face a copay that typically ranges from $386 to $650, according to the department's analysis. These individuals, who make up about 27% of the department's patients, are the main targets of the new program.

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The program will be available to all permanent residents and will also cover their guests, should they need medical transport. The employer program would not, however, cover customers but only employees.

Since initially presenting the program to the Finance Committee last December, the department has conducted a survey and a focus group to gauge interest in the program. About half of the survey responders said they believe the program would be extremely or very valuable, which includes 57% of the commercial insurance responders and 43% of Medicare responders, according to the Fire Department's report. The focus group participants also expressed interest in the program, with members suggesting that the program charge a monthly — rather than an annual — fee and that the rate be set somewhere between $6.67 and $10.

The rate in Palo Alto would be somewhat higher than in other jurisdictions. The Fire Department identified five other agencies that offer ambulance insurance, according to the report. Each charges a flat annual fee, which ranges from $43 to $60. According to the report, the fees were set when the respective programs started and had not been adjusted since.

The committee enthusiastically supported the new program on Tuesday, paving the way for its approval by the full council.

"I hope this brings a little bit of stability and comfort to people who might need to use that ambulance service frequently," council member Alison Cormack, who chairs the Finance Committee, said during Tuesday's discussion.

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Fire Department set to launch ambulance insurance program

City Council's Finance Committee unanimously backs program, which will allow residents and businesses to pay a monthly fee to avoid steep copays

by / Palo Alto Weekly

Uploaded: Wed, Sep 22, 2021, 9:43 am

The Palo Alto Fire Department's new insurance program, which allows residents and businesses to pay a monthly fee for ambulance transfers, is nearly ready to debut after getting unanimous support from the City Council Finance Committee on Tuesday.

The program, which the department has been refining for more than a year, has two major goals: help the department obtain a new revenue source during a period of budget cuts and provide peace of mind to customers seeking some assurance that they would not face steep bills if they suffer a medical emergency and need to be taken to a hospital.

Under the terms that the Finance Committee approved on Tuesday, residents would have the option to pay an $8 fee per month to participate in the program. For businesses, the rate would depend by the number of employees, with fees ranging from $20 for companies with a head count between one and 10 employees and $1,000 for those between 251 and 1,000 employees.

The Fire Department estimates that if about 25% of local residents and businesses enroll in the program — a rate that would be comparable to ambulance-insurance programs elsewhere in the state — the city would receive about $1.2 million in annual revenues. The city plans to start marketing the program in the coming months, according to a report from the Fire Department. Those who choose to participate would see the charge show up on their monthly utility bills.

The city expects most of the participants to be residents and employees who are not covered by Medicare and who, as such, are billed hundreds of dollars for a transport fee. Palo Alto fire, which is the only department in Santa Clara County that has an ambulance service, runs about 3,500 transports annually and its base fee is $2,509 for transport. While Medi-Cal and Medicaid cover that entire cost, and Medicare covers up to 90% of the costs, those who rely on private insurance face a copay that typically ranges from $386 to $650, according to the department's analysis. These individuals, who make up about 27% of the department's patients, are the main targets of the new program.

The program will be available to all permanent residents and will also cover their guests, should they need medical transport. The employer program would not, however, cover customers but only employees.

Since initially presenting the program to the Finance Committee last December, the department has conducted a survey and a focus group to gauge interest in the program. About half of the survey responders said they believe the program would be extremely or very valuable, which includes 57% of the commercial insurance responders and 43% of Medicare responders, according to the Fire Department's report. The focus group participants also expressed interest in the program, with members suggesting that the program charge a monthly — rather than an annual — fee and that the rate be set somewhere between $6.67 and $10.

The rate in Palo Alto would be somewhat higher than in other jurisdictions. The Fire Department identified five other agencies that offer ambulance insurance, according to the report. Each charges a flat annual fee, which ranges from $43 to $60. According to the report, the fees were set when the respective programs started and had not been adjusted since.

The committee enthusiastically supported the new program on Tuesday, paving the way for its approval by the full council.

"I hope this brings a little bit of stability and comfort to people who might need to use that ambulance service frequently," council member Alison Cormack, who chairs the Finance Committee, said during Tuesday's discussion.

Comments

tmp
Registered user
Downtown North
on Sep 22, 2021 at 10:31 am
tmp, Downtown North
Registered user
on Sep 22, 2021 at 10:31 am

This is ridiculous. The city of Palo Alto drastically overpays for too may fire personnel/emts. We should have an outside contracted ambulance service that will cost the city a fraction of what they pay the unionized and little working fire personnel. Yes we need some fire staff to fight real fires but that is a VERY rare occurrence here. The ambulance services should be a separate entity that is contracted out where the people are not on the city pay role and don't get to sleep on the job. This will keep the cost down for both the users of the system and the city taxpayers. It is time for an over hall of the fire department. They need to work a real schedule, get paid hourly like the police and stop sleeping on the job. I'm sure we can find work for them to do since their fire fighting duties are so few.


ndn
Registered user
Downtown North
on Sep 22, 2021 at 11:09 am
ndn, Downtown North
Registered user
on Sep 22, 2021 at 11:09 am

Yes, we could have a lower cost ambulance service and a at the same time :
higher response time
no control over staff
uncertain qualifications and ratios (patient/staff member)
contract negotiations every single year with the correspondent time payment for the effort no way at all of anticipating costs

Just out of curiosity, how much exactly would Palo Alto and Palo Altans expect to save?


Online Name
Registered user
Embarcadero Oaks/Leland
on Sep 22, 2021 at 11:55 am
Online Name, Embarcadero Oaks/Leland
Registered user
on Sep 22, 2021 at 11:55 am

If the city hopes to make $1,200,000 from this service, let me suggest a another way to find that money -- and more! The city owes residents $12,600,000 in long-awaited refunds from its practice of overcharging us for utilities. $3,000, 000 of that amount iis legal fees for the plaintiff's attorneys who will keep up the pressure until we get our refunds -- while city keeps running up more legal fees on BOTH sides of this case that WE, the taxpayers, are expected to cover.

How about if the city finally accepts the judge's findings that A) it owes us the refunds and B) that it's not entitled to another wasteful trial and C) stops its endless attempts to find more ways to gouge the residents/taxpayers?

Just a thought.


mjh
Registered user
College Terrace
on Sep 22, 2021 at 12:55 pm
mjh, College Terrace
Registered user
on Sep 22, 2021 at 12:55 pm

Listening to an earlier presentation to council, the advantage with using Palo Alto's ambulance services is the often quite substantial difference in response times. While our own ambulance services can arrive within about 5 minutes, the data collected on response times for ambulance services located elsewhere can result in a longer wait. While I don't remember the exact context, a typical wait of 20 minutes stuck in my mind.


Anonymous
Registered user
Fairmeadow
on Sep 22, 2021 at 2:40 pm
Anonymous, Fairmeadow
Registered user
on Sep 22, 2021 at 2:40 pm

Perhaps this program will raise less revenue than expected, for the simple reason that those who are mostly likely to use the ambulance service are probably also those mostly likely to purchase the ambulance insurance.


Bystander
Registered user
Another Palo Alto neighborhood
on Sep 22, 2021 at 3:12 pm
Bystander, Another Palo Alto neighborhood
Registered user
on Sep 22, 2021 at 3:12 pm

In all the years we have lived here, we have not once called for an ambulance. If there is an emergency in our home, I certainly do not expect to worry as to whether or not we have paid into the insurance to pay for it! Should this not be covered by our health insurance? Or would this give carte blance to those who have the insurance to call for an ambulance for any vague reason they choose? If that is the case, then perhaps someone who really does need an ambulance for an emergency would find there is none available. That does not sound like a good idea to me.


chris
Registered user
University South
on Sep 22, 2021 at 11:45 pm
chris, University South
Registered user
on Sep 22, 2021 at 11:45 pm

How many residents will really fall for this scam?


Hinrich
Registered user
Old Palo Alto
on Sep 24, 2021 at 7:55 pm
Hinrich, Old Palo Alto
Registered user
on Sep 24, 2021 at 7:55 pm

This is simply a new tax carefully disguised and packaged as a benefit. Will probably require a new Director of the 'Service', six administrators, a publicist and a publicist's assistant. It's a 'budget enhancement'. Premiums sure to rise. Bad program.


Chris Dewees
Registered user
Leland Manor/Garland Drive
on Sep 27, 2021 at 9:08 am
Chris Dewees, Leland Manor/Garland Drive
Registered user
on Sep 27, 2021 at 9:08 am

The real issue is the potential for increased demand for ambulance services (and the consequent impact on response times, equipment, personnel and cost) if a significant number of residents enroll in the program. I suspect the current extreme cost of an ambulance ride deters usage. Remove that cost and the incentive to use an ambulance will increase. I wonder if anyone studied this issue before making the proposal.


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