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County digs into ambulance contract

by: PHOTO COURTESY: AMR - American Medical Response paramedic Michael Templeton brings a patient to Good Samaritan Medical Center's emergency room in Portland. “If you want to drink water from a fire hose, then ambulance contracts are it,” noted Clackamas County Commissioner Martha Schrader last week.

Commissioners have been doing their best to gulp down new provisions in an increasingly controversial multimillion-dollar contract with American Medical Response. Despite three new commissioners taking office this month, there’s still a majority that wants to look at alternatives to AMR.

Commissioners decided in February 2012 to renew the AMR contract until May 1, 2014. County officials discussed during their Jan. 22 work session the process to seek proposals for a new contract to replace the AMR pact.

Users of ambulance service — mainly through Medicaid, Medicare and private insurance — netted AMR $12.5 million last year, of which profit was about $157,000 or 1.2 percent margin. AMR pays the county an annual $365,000 franchise fee, and another $640,000 that goes to fire departments and the system enhancement fund, so another bidder would have to lower labor costs to pay for startup and still make a profit.

“Ambulance contracts are notorious in having subjective areas, because you’re talking about quality. And what does quality mean?” Schrader asked.

Ask that question of AMR Oregon General Manager Randy Lauer, who was “blindsided” by the county’s decision not to renew the contract expiring in May 2014, and he’ll give a long list of responses. First, he’ll cite Moore Information’s telephone survey last year of 300 likely voters that showed 61 percent are satisfied with ambulance service in the county and just 4 percent are dissatisfied.

“There’s an overwhelming opinion that we should renew this contract and move forward,” Lauer said. “Clackamas County just pulled the rug out from under us.”

With the county moving forward on a bidding process, Schrader expected it is “highly likely” that a “provider war” between AMR and Metro West Ambulance will result in litigation. She doubted that going out for a bid would reduce ambulance costs at the current level of service.

Schrader’s predicted war has already started in earnest, even if it hasn’t yet headed to court. Metro West points to AMR’s ambulance transport rate in Clackamas County that’s 23.5 percent higher than in Multnomah County and 73.5 percent higher than in Washington County. But AMR says Metro West is “immune to competition” in Washington County because of an auto-renewing contract.

As for the price difference between Multnomah and Clackamas counties, AMR points to challenging geography around Mt. Hood National Forest and special programs related to recreation here. Clackamas County residents request ambulance services about 17,000 times a year.

Clackamas County Sheriff’s Office often requests AMR’s “Reach and Treat” team to respond to falls and other Mt. Hood wilderness incidents with medical care during hazardous search-and-rescue situations. AMR also provides a lifeguard-safety program at High Rocks, a regionally popular Clackamas River swimming hole between Gladstone and Oregon City.

Janelle Meredith, executive director of Clackamas-based Oregon Impact, was among many regional leaders who wrote letters to the county encouraging commissioners not to waste time and money by putting the contract out to bid. AMR is the lead organization and one of the founding members of Safe Kids Portland Metro serving Multnomah and Clackamas counties, dedicated to preventing childhood injuries.

“AMR is a valuable community partner and one who provides support to community-service programs,” Meredith wrote.

‘Splitting hairs’

by: PHOTO COURTESY: AMR - American Medical Response personnel bring 10 ambulances  to the scene of the Dec. 11 Clackamas Town Center shooting within 30 minutes.When a gunman fired on shoppers in the Clackamas Town Center on Dec. 11, off-duty AMR personnel stepped up to bring 10 ambulances to the scene within 30 minutes. While the number of patients fortunately did not reach the magnitude of an anticipated “mass casualty incident” such as the movie-theater shooting in Aurora, Colo., AMR demonstrated its capability to respond to such an incident.

Earlier last year, Clackamas Fire District No. 1 was the only one of nine fire departments in the county to request that the county initiate an ambulance bidding process, but since the shooting, the district declined to comment further. After emergency crews responded to the Clackamas mall last month, Fire Chief Fred Charlton said, “I was extremely impressed with the integration and coordination of our fire crews and AMR.”

New commissioners spent nearly two hours last week parsing out the details of how to request for proposed contracts. Eventually, they came to one major change: Price should be more important in selecting an ambulance provider. Weighted with such considerations such as “quality” and “innovation,” price would be 25 percent of the score for selection, instead of 20 percent.

“We may be splitting hairs,” said Cindy Becker, county health and human services director, “but we’re trying to find a compromise.”

County steps in

Schrader expressed concern last week that the board was micromanaging a standard procedural contract.

The sad thing about the whole county process, according to AMR officials, is wasted time and costs. County officials could have simply renewed the contract that AMR already has.

Commissioners and AMR have perceived Commissioner Jim Bernard as instigating the contract negotiations unnecessarily, an accusation he denied. AMR came to the county for help when it was losing money, Bernard pointed out, and now he’s concerned that AMR’s Teamster union contract has raised costs for Clackamas County taxpayers. AMR’s employees voted to unionize in 2007; Clackamas County employees, excepting the county administrator and elected officials, are also unionized.

At AMR’s request, the county last year increased payments per patient-loaded mile from $17.33 to $21.33 to offset fuel costs and changes in Medicare reimbursement. Of the typical $1,200 ambulance bill, AMR only collects $516, when 10 years ago, before Medicare and Medicaid cut reimbursement for half its patients, its collection rate in Clackamas County was 78 percent.

Lauer said that AMR has recovered financially and posted its first profit in 2011 after six years of losses. He considers it noteworthy that AMR “never threatened to walk away” from its contract while it was losing money.

“In some respects, we’re being punished for being honest with the county about our financial situation,” he said. “However, we’re committed to Clackamas County and to speeding up response time through a pilot project that’s reducing duplication of services with fire departments. We’d like to put a half-million-dollar investment into upgrading ambulance equipment here, but the county’s early RFP had really put the skids on that.”

County officials spent more then $50,000 to hire consultant Polaris Group to construct a contract for the county, and Bernard admitted at the Jan. 22 work session that elected officials have gone too far.

“We stepped into it,” Bernard said. “We got way further than any of us thought we were gonna get, even into the points that we agreed we weren’t going to do and was recommended that we did not do, but we did it anyway, and that in my opinion confused it and made it much more challenging to move forward in what the consultant advised.”

Commissioner Paul Savas has also been concerned about the board’s level of involvement.

“I don’t think it should be us — I don’t see the need for the expertise that we have as commissioners to start tweaking something,” Savas said.

Bernard said that his original memo was concerned with citizen comments. What started with five EMS Council recommendations later turned into commissioners, in Bernard’s words, “playing around with” a point structure that would decide which ambulance company gets the contract.

“I wasn’t me who said this — it was the folks out there who reviewed the RFP who suggested these five things,” he said.

The RFP was set to go out next week to potential bidders, who can formally object to its content and demand to have it revised again.by: PHOTO COURTESY: AMR - American Medical Response  provides a lifeguard-safety program at High Rocks, a regionally popular Clackamas River swimming hole between Gladstone and Oregon City.




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