County Fire Department’s Bid May End AMR’s 33-Year Ambulance Monopoly

(June 18)  A confluence of events and circumstances has put the status quo of one of San Bernardino County’s major franchise contracts in doubt, as county officials contemplate ending the 33-year-long hold one company has had on the exclusive provision of ambulance service in the nation’s most expansive county.
Since 1981 American Medical Response, and its several corporate predecessors including Mercy Ambulance, has been the county’s ambulance service provider. Its current ten-year contract is coming to an end. County Chief Executive Officer Greg Devereaux and the board of supervisors have not yet decided on whether to simply extend the contract as it is and continue to lock out all other competitors in the 20,105-square mile county, renegotiate the franchise contract or put the contract up for bid.
The board of supervisors, per se, will not be making that decision, but will need to ratify it after the board’s members, acting in another capacity, pass judgment. In actuality, major policy decisions with regard to the county’s emergency medical services are made by ICEMA, of which all five supervisors are board members. ICEMA is an acronym for the Inland Counties Emergency Medical Agency, which serves Inyo, Mono and San Bernardino counties.
A myriad of factors is militating against American Medical Response retaining its exclusive – and very lucrative – status as the sole licensed ambulance provider in the vast unincorporated areas of San Bernardino County and in Inyo and Mono counties as well.
Known by its acronym AMR, American Medical Response has proven over the last three decades to be a major donor to the political war chests of members of the San Bernardino County Board of Supervisors. AMR’s primacy in the jurisdiction the supervisors rule has led to the perception that a pay-to-play ethos dominates San Bernardino County. A series of scandals and political corruption prosecutions aimed at San Bernardino County politicians, including ones that resulted in convictions, have incentivized rebidding the franchise contract to end the unseemly appearance of a single, and politically well-connected, company enjoying a monopoly that has moved into its fourth decade.
Simultaneously, the county fire department finds itself faced with both challenges and opportunities to meet those challenges by, perhaps, flexing and expanding its authority and service capability into the areas previously dominated if not entirely controlled by the private sector, namely emergency medical support.
Last year, the cities of Victorville, Hesperia, Apple Valley and Adelanto resurrected a more-than-20-year-old proposal to unify their police and fire services and the four municipalities sprung for putting up $200,000 collectively to determine the feasibility of creating unified police and fire services under the aegis of a public safety joint powers authority involving all four municipalities.
For law enforcement service, Adelanto pays the county $4,706,459 to have the sheriff’s department serve as its police department, which features 28 sworn and non-sworn employees. Apple Valley is now paying $11.255 million to have the county sheriff  provide a 71-employee presence of both sworn and non-sworn personnel, vehicles, equipment radio and dispatch. Hesperia pays $12.77 million for the sheriff’s department to serve as that city’s law enforcement provider.  In Victorville, the city is paying $19,417,318 annually to the sheriff’s department under its contract with them to provide law enforcement services.
Under its contract with the San Bernardino County Fire Department, Adelanto pays $3,117,634 per year for a force that consists of one battalion chief, six fire captains, six engineers, six firefighter/paramedics and one paid call firefighter.
The Apple Valley Fire Protection District is an entity that is independent from the town and currently functions on an annual budget of $7.72 million.
Hesperia expends $8,253,243 annually on fire protection service, including a contract with the San Bernardino County Fire Department and maintaining the vehicles and facilities of the Hesperia Fire Protection District.
Victorville’s budget for its fire department, which is also a division of the county fire department, is $13,643,541.
The study was undertaken to determine if the cities could save money and perhaps enhance services by pooling their financial resources and creating a valleywide public safety district with police and fire divisions, and terminating their contracts with the fire and sheriff’s departments of San Bernardino County.
Depending on what conclusions the decision-makers in Adelanto, Apple Valley, Hesperia and Victorville come to, San Bernardino County’s sheriff’s and fire departments may or may not retain their current contracts in the Victor Valley. Thus, the county fire department faces the potential prospect of seeing its contract with three of the county’s cities being terminated.
In the meantime, sources have told the Sentinel, San Bernardino County Fire Chief Mark Hartwig is on the verge of making an energetic proposal that would intensify the level of service his agency provides while simultaneously providing revenue to the county and his department by shifting emergency medical transportation away from the private sector.
Hartwig, a paramedic firefighter who rose through the ranks of the county fire district and then spent six years with the Rancho Cucamonga Fire District as a battalion chief and deputy fire chief before he was selected as county fire chief three years ago, is seeking to convince Devereaux and the board of supervisors to allow county fire to put non-fire suppression personnel, i.e., emergency medical technicians and paramedics, on ambulances owned and operated by the county and have the county assume authority to provide ambulance and paramedic service in all of the county transport areas now franchised to AMR.
One estimate was that through this program the department could generate a $50 million revenue stream per year that could then be reinvested in fire protection programs throughout the county.
A report received by the Sentinel is that Hartwig’s proposal has so alarmed American Medical Response’s corporate officers that they have offered to pay the county an annual $30 million exclusive franchise fee if the county will simply reject Hartwig’s proposal and essentially extend the current arrangement for AMR to continue operating for ten years.
Thus, if the county accedes to AMR’s offer, Hartwig and the fire department would avoid the level of activity associated with converting the fire department’s current operations to accommodate countywide emergency medical transport. At issue is how the county would use the $30 million per year to be put up by AMR and whether all of that money, or at least a substantial amount of it, will be routed to the fire department to augment current operations within it.
To ascertain the authenticity of these reports, the Sentinel went directly to Hartwig, who said that it is inaccurate to state his department has made a formal bid on the emergency medical transport function for the county.
“We don’t have a proposal,” Hartwig told the Sentinel. “The current emergency medical services contract will be up soon and while they are negotiating an extension what I am attempting to find out is does it make sense for the fire district to bid on it. We are the second largest ambulance provider in the county. We run about 20 ambulances a day depending on time of year. It is not like we would be entering into a business with which we are not familiar. We will position ourselves so if the county chooses to put it out to bid, we can take a look to see if it makes sense for us to make a bid.”
Whether his department would operate its ambulances in just unincorporated areas of the county or whether it would cross over into covering areas that fall within the city limits of the county’s 24 municipalities, Hartwig said, “all depends on how the bid is written. ICEMA would write it [the bidding parameters] and we would determine our interest based on what is in the bid, if in fact they put it out to bid. The board may just renegotiate it or continue the contract as it is.”
Hartwig stopped far short of confirming that his department could generate $50 million a year through the provision of ambulance service to paying customers.
“I’m not sure where you got those numbers,” he said, adding that his department has yet to make a calculation to estimate the revenue that could be realized through taking on the emergency medical transport franchise. “To determine what revenue could be available would be a simple exercise where we would take our current transport fee, multiply it by the number of calls, multiplied by our collection rate and then subtract our costs. That is the way we would figure out how much net revenue would be available. At this point, I don’t know if it makes sense to bid. There is some federal finance participation (FFP) money available to us from Medicare for performing medical emergency transportation. Medicare has started to reimburse public agencies for certified public expenditures. If people are discussing large revenue figures, that is likely because there is new Medicare financing available to public agencies delivering healthcare and transport.  Through the new program the fire department is collecting about $800,000 per five thousand transports.  County Fire has collected that revenue for the last three years. Once you figure out how many transports there are in the county and you determine what the reimbursement per transport is, then you can figure out how much all of this is worth.”
Hartwig said he did not believe that as a potential competitor in the bid process the county fire department would have a leg up on any others bidding.
“I don’t think it gives us any leverage,” he said. “The county  has the responsibility to provide ambulance service countywide except in those areas where prior to June 1, 1980 ambulance service was already being provided by some other jurisdiction. In this county that means  everywhere but Rialto and Hesperia.”
Hartwig said he is giving careful consideration to his and his department’s options, but said no decision or commitment has been made, primarily because he does not have all of the information required to make such a decision and it is not yet clear whether the county will put the ambulance franchise out to bid.
“If it is advantageous for the fire district and those that we serve, and bidding takes place, then absolutely, we would bid,” he said. “We know what our costs are. We don’t know what the revenue, or potential revenue, is. It is safe to say county fire is in a holding pattern until we find out what ICEMA and the county board of supervisors will do. County Fire is the second largest provider of medical transportation in the county. The county is the largest provider of pre-hospital care in San Bernardino County. If we could streamline the service and provide a revenue stream, reduce the costs for the users of medical service and provide better service for the taxpayers, sure, we would be interested on bidding.”

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