TOWER— Six months after implementation of a paid on-call staffing program by the Tower Ambulance service revenues are up by $105,174 over the same period last year, due to both an increase in the number of emergency calls over 2017 and an increase in the number of non-emergency transfers from area hospitals.

That’s right in line with a Timberjay projection back in March, which estimated a $200,000 increase in department revenues when considered on a 12-month basis. About $5,000 of the increase in revenues this year is attributable to a higher number of ambulance runs from January-March of this year, which occurred before the paid on-call staffing was initiated on April 1.

Meanwhile, the higher cost of staffing, house rental for staff, increased truck maintenance, and other factors have pushed the department’s expenditures higher as well—by $142,896 through the end of September. That’s according to budget data provided the city of Tower.

A Timberjay estimate produced in March indicated that the shift to paid on-call service would likely erode the ambulance service’s annual fund balance by between $43,000-$66,000, so the current data appears in line with that projection. The department’s tracking of both revenues and expenditures tend to lag, however, which means that the full picture won’t be available until the city’s audit is completed next spring.

Director paints

a rosier picture

At the Oct. 9 meeting of the Tower City Council, Tower Ambulance Director Steve Altenburg offered a far more upbeat assessment of the paid on-call service at the six-month milestone. In a brief report, Altenburg noted that the department remains cash positive for the year-to-date, with revenues through Sept.30 of $363,966 and expenses of $296,763. “The paid on-call isn’t draining anything,” he said.

Altenburg also cited expenses that he said were extraordinary, primarily truck maintenance and repair expenses, which are running about $12,000 higher than last year. Altenburg said those higher maintenance costs were unrelated to the shift to paid on-call staffing, yet Altenburg’s plan assumed a significant increase in the number of non-emergency, inter-hospital transfers, which significantly increase the miles that the ambulances are driven. The Timberjay had cited higher truck maintenance costs as a potential expense that Altenburg had failed to include in his budget calculations for the paid on-call plan.

Altenburg’s report to the council was potentially misleading, as well, because it failed to point out that the department had already received almost all of its revenues for the year from property taxes and training reimbursements, and the bulk of the township ambulance subsidies, all of which are unaffected by the paid on-call staffing. Actual operating revenue from ambulance service fees was $310,829 during the period.

And Altenburg mentioned, but did not include in his six-month financial summary, the cost of equipping a third ambulance. Altenburg, again, claims that that decision is unrelated to the shift to paid on-call staffing, yet the increase in the number of non-emergency transfers that the department is undertaking to help pay for the new staffing plan has increased the amount of time that at least one of the department’s two primary rigs is operating out of the area. That has undoubtedly increased the need to put the city’s third ambulance into service.

Altenburg estimated the cost of equipping the third ambulance at $75,000. The city council has already approved those expenditures, but those expenses were not added to Altenburg’s report. Altenburg did acknowledge, however, that the department’s budget will likely look “very poor” by the end of the year, an argument he used to justify an increase in ambulance rates effective in January. Altenburg told the council that the city’s billing contractor had recommended the increase in order to ensure that the department’s revenues keep pace with rising costs. The council voted 2-1, with Councilor Lance Dougherty voting against, to raise the ambulance rates by $100 per run for both basic life support and advanced life support as well to increase the loaded mile rate. The rate increases amount to 16 percent per loaded mile, 12 percent for BLS and seven percent for ALS. The department last raised rates in 2016.

Altenburg noted that other costs are going to further erode the department’s finances. He said the department is also planning to replace one of its existing ambulances in the near future, at a cost of around $200,000. According to City Clerk-Treasurer Linda Keith, the department only has about half that amount in the ambulance purchase account, which will require the department to tap its general fund to pay much of the cost.

Higher revenues

The increase in revenues in 2018 over the previous year (through Sept. 30), is attributable to an increase in the number of non-emergency transfers as well as a rise in the number of emergency calls over 2017. So far this year, the department has undertaken 91 non-emergency transfers, an increase of 40 over the same period last year. Based on the average revenue from such a transfer, the increase accounts for about $60,000 in additional funding so far this year. The department has also seen an increase in the number of emergency calls— which are up 22 over the same period last year. That likely accounts for much of the remaining additional revenue.

During his tenure as ambulance director, Altenburg has consistently argued that the demand for ambulance services, and therefore revenue, is on a steady rise, further justifying a shift to paid on-call staffing.

Yet, while call volume has varied from year-to-year, there’s no clear indication of an upward trend the past few years, at least for emergency calls. In 2016, for example, the department responded to a total of 449 calls, including 361 emergency calls. That declined to 425 calls in 2017, including 353 emergency calls. In 2015, the department responded to a total of 401 calls, although a breakdown of emergency versus non-emergency calls was unavailable. Through Sept. 30 of 2018, the Tower Ambulance had responded to 376 calls, although that number is enhanced by the increase in non-emergency transfers. So far this year, the department has responded to 285 emergency calls, which has the department roughly on pace with 2016 levels.

Use of volunteers has declined

As expected, the number of ambulance runs staffed by volunteers has dropped significantly since the beginning of the paid on-call staffing in April. That has provided a savings to the department, since the “volunteers” are paid $25/hour for call time.

Last year, through Sept. 30, department volunteer EMTs logged a total of 819 runs. That’s more than the total number of runs, which reflects the fact that a minimum of at least two people are needed to staff an ambulance. During the same period this year, volunteer EMTs have logged 575 runs, as the paid on-call staff are the primary responders during the work week.

The savings from reduced volunteer time is significant, although an exact number could not be determined based on available data. Still, it’s likely that the savings will reduce the department’s “volunteer” wages by as much as $20,000, which may be somewhat more than Altenburg had assumed as a result of the shift to paid on-call. At the time, Altenburg said one of the justifications for the shift was to reduce the burden on volunteers, and it appears that moving to paid on-call has achieved that objective.

The department should have a clearer picture of the costs of the shift to paid on-call in another six months, when a full year of financial data will be available. A new council may take a second look at the program at that time, and determine whether the program is sustainable and what, if any, changes might be necessary to maintain the department’s financial health.