Billing company: waiving resident ambulance cost sharing would reduce collections by about $130,000; council weighs options

A representative of the city’s third‑party billing company presented ambulance billing data and explained how payer mix and contractual allowances shape revenue that reaches the city.

Jody (S1) told the council that, since the partnership began in 2012, the company has processed roughly 9,200 billable encounters and generated about $3.4 million in charges. For 2025 the company reported total charges over $1,000,000 and collected roughly $542,309 in revenue; resident collections were approximately $35,670. Jody said the payer mix is heavy on federal payers (Medicare and Medicaid), which she put at roughly 72%, and that approximately 14% of transports are private pay/uninsured.

The representative explained the mechanics: billed charges are reduced by contractual allowances (for example Medicare’s allowed amount) and many payers use fixed fee schedules, so raising a billed charge often does not change what federal payers remit. She gave a detailed example of a charge for an ALS transport showing what Medicare allows, the resulting insurance payment and the patient responsibility.

Council members pressed on collection practices: accounts are invoiced three times over 90 days before being turned over to collections, and collection agencies commonly retain about 30% of whatever they collect. Council members discussed whether the city could waive resident cost‑sharing (co‑pays/deductibles), observing that doing so last year would have reduced patient responsibility collections by approximately $130,000 (Jody’s calculation) but would not change the insurance reimbursement the city receives for federal payers.

Council also explored options for offsetting any revenue reduction, including raising nonresident rates (noting that most payers are federal and unaffected by list price changes) or shifting accounting/coding to recover some costs. Jody said some neighboring communities do waive resident cost sharing (through millage or program rules), but practices vary and legal/financial implications must be considered.

No formal vote was taken on waiving resident cost sharing; council asked staff and the billing company to provide more detailed options and to supply information about collection agency contracts and any past approaches other communities have used to reduce resident bills.