EMS Industry Can’t Identify Its Costs

 

 
 
 

Gary Ludwig, MS, EMT-P | From the August 2012 Issue | Tuesday, July 17, 2012


What does your EMS system cost to operate? It seems like everyone is chasing the golden answer to that question.

I know it sounds simple. If you’ve got the answer, e-mail me. 

Now before you e-mail me, I need to know what your “system” costs you to operate—not just ground ambulances or what your budget is. When I talk about a “system,” I’m speaking about the whole system, which includes communications, first response and transport, and whether it is ground, air or both.

Defining EMS Systems
Even within my explanation of what an EMS system is, there’s debate. Some think an EMS system is just the ground ambulance costs. Others think it’s the ground ambulance coupled with the first response agency. Still others, like me, think an EMS systems comprises dispatch, the first response agency and ground ambulances. So if we can’t even agree on what an EMS system is, how can you determine its costs?

The quandary of trying to determine the true cost of EMS system has evaded EMS managers, consultants and city managers for years.

Some of the problems related to determining what your EMS system costs vary from place to place. As the saying goes, “If you’ve seen one EMS system, you’ve seen one EMS system.” Why? The theory is that no two EMS systems are alike. Systems may have the basic foundations of a third service, fire-based, private, volunteer or hospital-based, but they all have nuances.

Within those foundations, many systems have such variations as the level of service that might be provided, the size of the service area, response time requirements or the readiness of the EMS system and the cost of compensating the personnel. (Or in some cases, such as with volunteers, there’s no compensation.) 

Other Cost Factors
Other factors that can affect the cost of an EMS system are its levels of clinical sophistication. Is it an all-BLS EMS system for which first response (if first response is included) is BLS and the ground ambulance transport is BLS also? Or is it an all-ALS system for which every first-response vehicle and ground ambulance has paramedics with ALS equipment? Or is it a combination of BLS and ALS?
If there’s ALS within the system, what’s the clinical sophistication of your ALS delivery? Are there aggressive ST-elevation myocardial infarction programs, continuous positive airway pressure, mechanical CPR devices, auto-ventilators, a wide-array of drugs, intraosseous infusions and other levels of clinical delivery?

Other things to consider are the population size and economic and poverty levels of the community. Populations and economic conditions of a community affect EMS call volume. Poverty of the community is also a major factor that affects costs.

Traditionally, you’ll see higher call volumes in urban areas than in suburban and rural areas. My experience has shown me that an urban community of 800,000 may have 100,000 EMS calls with one in eight people calling for an ambulance during the course of a year, whereas a rural community of 3,000 with only 250 EMS calls may equate to one EMS call for every 12 people.

One major factor that makes it difficult to determine an EMS system’s costs is first response. Traditionally, fire departments provide first response in a community regardless of whether the ground ambulance is fire-based or not. But some fire apparatus and firefighters don’t handle medical calls, instead responding only on fire calls, as well as other service calls (e.g., child locked in a car). So the process of looking at a fire department budget and trying to determine a cost-allocation model to figure how much of the fire department is allocated to EMS calls, fire calls and other service type calls can be challenging.

Some would even argue that such government costs as the city manager, city attorney, finance manager, human resource manager and others add to the cost of the EMS system because part of their time in government is spent dealing with EMS issues.

Another component that makes it difficult to determine an EMS system’s costs is volunteers. Although they generally receive no compensation, their contributions should be factored into operating an EMS system. If it wasn’t for their volunteer status, the money needed to operate the system would be much higher. This makes it difficult to truly measure the labor cost of an EMS system.

Conclusion
Attempts have been made to determine an EMS system’s cost. An effort by the National Association of EMS State Officials and the Medical College of Wisconsin called the EMS Cost Analysis Project (www.nasemso.org/Projects/EMSCostAnalysis/) is designed to create a framework that would determine the cost of providing EMS care from a societal perspective. The framework includes a 12-step tool to determine the cost of an EMS system. Some contend that the framework isn’t complete and still needs additional revisions, but it’s a start.

One thing we know for sure is that the reimbursement many EMS agencies receive from Medicare, Medicaid, private insurance and from those who self-pay doesn’t come close to matching the costs of operating an EMS system. JEMS




Connect: Have a thought or feedback about this? Add your comment now
Related Topics: Administration and Leadership, Operations and Protcols, Gary Ludwig, EMS cost, Jems Leadership Sector

 
Author Thumb

Gary Ludwig, MS, EMT-P

is a deputy fire chief with the Memphis (TN) Fire Department. He has over 35 years of fire, EMS, and rescue experience. He is also the immediate past Chair of the EMS Section for the IAFC. He can be reached at www.garyludwig.com.

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