ICEMA Head Makes Subtle Move Toward End Of Ambulances’ Exclusive Operating Zones

Some four decades ago, what was then San Bernardino County’s largest ambulance consortium – Mercy Ambulance – established a political hammerlock on the region. That company, through generous donations to the county’s top local elected officials, was granted key franchises that made its operation very lucrative. In turn, the company would use a small percentage of the profits it was generating to increase the scope of its political contributions. In return, the grateful politicians ensured that Mercy retained its competitive advantage over its rivals, giving Mercy plum franchises in the county’s most heavily populated areas.
Mercy had formed in the late 1970s, when Terry Russ, Homer Aerts, Steve Dickmeyer and Don Reed, all of whom operated ambulance companies on the west and central portion of San Bernardino’s Inland Valley and had been competing against one another for years, smoked a peace pipe and resolved to merge their operations into one, consolidating and streamlining their dispatch service, and better coordinating it with the local fire and police departments. Through efficiencies and the sharing of resources, they were able to overwhelm the other ambulance operators they were in competition with, lower their prices, and induce most of those competitors to either go out of business, merge with them or sell out to them. After pooling their money and initiating a program of making substantial political contributions to local politicians at both the city and county level, Russ, Aerts, Dickmeyer and Reed They then used this newfound political clout and influence to have both the county board of supervisors and various city councils “regulate” the ambulance industry, which included essentially adopting the vehicle, equipment and employee training standards Mercy had in place as the minimum requisites for an ambulance operation within their jurisdictions. The politicians were able to do so by asserting that this enhanced public safety.
As Mercy solidified and expanded its domination of the local ambulance industry and it grew to become preeminent among the county’s campaign donors, the county and many of its cities moved to create franchises in which a single ambulance company was allowed to operate and from which any other companies were prohibited from operating. Not surprisingly, in San Bernardino County Mercy was granted the lion’s share of these exclusive franchises, not to mention the most lucrative ones.
As Mercy grew, so did the scope of its operations and its power. The company added helicopters to its line of service and extended its reach all over 20,105 square mile San Bernardino County – a land area the size of four New England states. But as Russ, Aerts, Dickmeyer and Reed aged and grew wealthier, they began, slowly at first, to disengage from and then inevitably pulled out of the stressful emergency response business entirely. A first step in that direction was selling off – at considerable profit – the Mercy Air wing. Thereafter, they sold or let their heirs take on the ground ambulance fiefdom that Mercy represented, and they withdrew into a retirement of luxury and comfort.
The new kid on the block was American Medical Response, a company which came into the region from elsewhere. American Medical Response, or AMR for short, filled the vacuum created by Mercy’s exodus. Simultaneously, AMR took a leaf out of Mercy Ambulance’s playbook, and it too made hefty political contributions. Over time, ICEMA – the Inland Counties Emergency Medical Agency – which oversees emergency service provision issues in San Bernardino, Mono and Inyo counties, would confer upon American Medical Response favored status in San Bernardino County that would rival that of Mercy Ambulance a generation before. Because it was ICEMA rather than the board of supervisors that drove the move to grant AMR its position at the top of the ambulance service heap, it at first glance appeared that AMR had achieved that favored status straightforwardly and without the interference of political influence or favoritism. The reality, however, is that ICEMA’s governing board consists of the five members of the San Bernardino County Board of Supervisors. So, by making contributions to the supervisors, AMR has been able to keep its nest feathered.
That feathering consists of what are referred to as exclusive operating zones. Thus, there are extensive areas in San Bernardino County where one ambulance company has not only primacy but a virtual monopoly in that it, and only it, is authorized and licensed to function there under normal circumstances. The ostensible rationale for granting these monopolies is that operating ambulances is an expensive proposition, not to mention one that is crucial to public health and safety. Competition between ambulance companies has the potential, so the reasoning goes, of driving down the prices those companies charge to the point that their operations will not be profitable enough for them to remain in business. Upon these ambulance companies going out of business, the public would be put into a position where there would be insufficient emergency medical transportation service available to ensure public safety. Thus these arrangements – the exclusive operating zones – have been established.
Some dispute that the exclusive operating zones are necessary, and they assert they are rather a ploy by which county politicians have further inculcated a pay-to-play ethos into the county’s governmental function. Among those critics of exclusive operating zones are some who maintain the monopolistic system has long endangered public safety. One of those was the county’s firefighters union, known as Local 935, which late last year suggest the exclusive operating approach has on occasion created critical shortages in the High Desert’s ambulance transport system.
Last month, in what some have hailed as an act of courage, Tom Lynch, the administrator with the
Inland Counties Emergency Medical Agency, brought forth a proposal that is seen as a first step in undoing the reliance upon exclusive operating zones in San Bernardino County. Nevertheless, Lynch’s action was very measured and low key, as it represents a blow against the pay-to-play ethos that is so ingrained in the approach of his political masters.
That subtle move came with Lynch asking the board of supervisors to approve an agreement with Schaefer Ambulance Service, Inc. authorizing “advanced life support and basic life support special event transportation services within San Bernardino County for a period of one year effective July 30, 2017.”
To be sure, Schaefer Ambulance is a major ambulance service provider in its own right, one of the largest such companies in adjoining Los Angeles County. Schaefer has had limited function in San Bernardino County over the years and currently takes up the slack in the far northeast extension of San Bernardino County. The concept Lynch put forth is that ICEMA and San Bernardino County formalize an agreement and a policy of letting Schaefer come into AMR’s exclusive operating zone during so-called special events, when the circumstances and demands on AMR may overwhelm its resources.
According to Lynch, “A special event is defined in the county code as: ‘Any situation where a previously announced
event places a grouping or gathering of people in one general locale sufficient in number, or subject to activity that creates the need to have one or more ambulances at the site.”
Still subtly, Lynch slipped into the proposal letting others beside Schaefer move into AMR’s exclusive operating areas during these special events. “This agreement is non-exclusive,” his report to the board stated. “Other advanced life support and basic life support ambulance providers in San Bernardino County have been authorized to staff special events. This agreement also does not prevent any other providers interested in seeking authorization to provide special event transport services from applying for medical control authorization if they desire eligibility to staff special event transport services outside of their own authorized area.”
The item was placed on the board of supervisors’ consent calendar at its July 25 meeting and was at first deferred but then approved unanimously as amended.
Lynch was cagey about celebrating the vote as a victory toward undoing the county’s reliance on exclusive operating zones. Asked what the county’s rationale for the exclusive operating zones was, Lynch said, “To provide organized ambulance coverage.”
Asked how often special events occur, Lynch said, “They occur frequently, but not necessarily daily.”
He deftly moved around a question as to whether the vote taken on July 25 betokened a change in the custom of utilizing exclusive operating zones. “I’m not sure what you are asking, but there are no changes proposed,” he said. The Sentinel then pressed Lynch, asking him point blank, “Is this the first step toward eliminating exclusive operating zones?”
“No,” Lynch tersely responded.
Lynch said that California Health and Safety Code Division 2.5 gives the government authority to grant an ambulance company an exclusive operating license as well as excluding another company that meets all of the equipment, training, licensing, and competency requirements from plying its trade in that zone.
He told the Sentinel that the ability of a non-franchised ambulance company to monitor dispatch broadcasts to put it on the footing of actually being able to respond to emergency calls is something that falls under Federal Communications Commission rather than county or regional regulations and law. He said that California Health and Safety Code Division 2.5 could be brought to bear to keep a non-franchised ambulance operator from horning in on a franchised ambulance operator’s territory.
The Sentinel asked Lynch to what extent the political largesse of the companies granted exclusive operating licenses influenced the decision makers – i.e., the board of supervisors – in granting exclusive operating permits and whether he was alive to the specter of political favoritism hanging over the process of granting those exclusive operating permits.
“County staff would not be in a position to know or speculate about what factors are taken into account in the making of policy decisions,” Lynch said. “The role of county staff is to provide policymakers with sound professional advice and then implement the resulting policies.”
-Mark Gutglueck

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