First Response (AL) Sounds Warning as Hospital’s Ambulance Fleet Expands

The photo shows the hood of a blue ambulance.
File Photo

Eric Fleischauer

The Decatur Daily, Ala.

(MCT)

Proposed amendments to Decatur’s ambulance ordinance include several concessions to First Response, but the head of the company said other amendments could result in the granting of an ambulance certificate to Decatur Morgan Hospital and the demise of his own business.

Decatur Morgan Hospital CEO Kelli Powers on Thursday said First Response director David Childers is exaggerating the risk to his own company, but also said the hospital has bought three new advanced life support ambulances in the last month at a cost of $180,000 each, in addition to the three older units it already had, as she prepares to establish a full-scale ambulance service that can handle citywide transports and emergency calls.

The amendments to the 2019 ambulance ordinance were proposed in May by the Ambulance Regulatory Board. Concessions to First Response included increasing by one minute the time by which an ambulance must arrive at the scene on emergency calls and cutting in half the financial penalties if it fails to meet those time limits over the course of three months.

The recommended amendments also would allow First Response to run ambulances with a mileage of up to 250,000, up from the current max of 200,000, and they could be up to 7 years old rather than the current 6. The proposal would also eliminate the unfulfilled requirement that the company obtain a $1 million performance bond.

Assistant City Attorney Chip Alexander last week presented these and other Ambulance Regulatory Board recommendations to the City Council, along with one that in May appeared more administrative than substantive. The proposed amendment makes changes to language throughout the ordinance so it is clearly applicable to any “government or quasi-government entity” that obtains authorization to operate ambulances within city limits.

One example of a “quasi-government entity,” Alexander explained to the council at a work session, would be a hospital authority.

Decatur Morgan Hospital made the first inroad into First Response’s monopoly on citywide ambulance service in February when the council gave it temporary authorization to handle non-emergency transports between medical facilities due to the dramatic increase in needed transports brought about by COVID-19.

‘Not a Conspiracy’

Childers last week claimed the hospital orchestrated that exception not to deal with a crisis, but to gain a corner in the market that his company has monopolized for seven years as the sole ambulance service licensed to operate in the city.

“I will bet you my paycheck they were building the case for the hospital (ambulance service) to come in. Decatur Fire is already in cahoots with the hospital. They’re going to say there’s a need,” Childers said.

Powers says Childers’ allegation makes no sense.

“He can think whatever he wants to think. During COVID we were in a crisis. When you’re holding 18 patients in your emergency room and he’s still bringing you patients and you can’t get them out, we had to do something,” Powers said. “In order to admit patients into the hospital we have to get patients discharged and transported out, and we couldn’t do that. We were forced into having to do something to help him and us and the city. It’s not a conspiracy.”

Powers declined to say exactly when the hospital would apply for the certificate of public necessity and convenience (CPNC) that would allow it to accept emergency and non-emergency calls even when First Response ambulances are available.

“It will probably be when we’re all fully equipped. So today I know we’ve got at least three new ambulances. I’ve got some that are getting remounted. There’s lot of things in the works,” she said. “I just want to be able to provide the excellent care that the citizens deserve.”

She said First Response’s lack of staffed ambulances has meant more and more emergency calls are being forwarded to the hospital’s ambulances because First Response trucks are unavailable.

“We’re already doing 24/7 now for transport and anytime there are rolled calls — when First Response can’t respond timely, they roll it — we’re picking up some of those as well,” she said. “We did 12 or 13 911 calls in one day the other day, because (Childers) doesn’t have enough trucks.

“The other issue I’m having is he can’t do our transports either. It really clogs up our emergency room when we can’t get the patients out to be transported, mainly mental health patients and people that need to go to Huntsville.”

If the hospital is granted a CPNC for its growing ambulance fleet, Childers said, it would mean the end of First Response. Decatur is not large enough to support two ambulance services, he said.

Two obstacles prevent the co-existence of First Response and a Decatur Morgan Hospital ambulance service in Decatur, he said. One is the lack of EMS personnel to staff the ambulances and the other is the high percentage of emergency calls that involve uninsured patients.

“You have a pool of employees north of Birmingham,” Childers said. “That pool’s not getting larger, it’s getting smaller.” If the hospital hires more EMS workers, First Response will have fewer. “You’re dealing with the same people, they’re just going to be wearing a different colored shirt.”

Powers said she’s so far hired 13 people to staff hospital ambulances, some of whom may have come from First Response. She said many, however, are former employees of Decatur Emergency Medical Service Inc. (DEMSI), an ambulance company that went out of business in 2014, two years after it lost its monopoly when the city granted First Response a CPNC. She said many of those employees live in Decatur but have been working for out-of-town ambulance services.

Indigent Care

The second obstacle to having two ambulance services, Childers said, is financial.

“Each company has to make a certain profit margin to continue in business. In the city of Decatur we have a very high indigent care rate,” he said. Because First Response takes a loss on many emergency 911 calls, it depends on non-emergency transports — which are more likely to involve insured patients — for revenue.

Splitting up these more lucrative transports between any two companies would prevent either from making a profit, he said. If one of the two ambulance services is owned by Decatur Morgan Hospital, a part of the sprawling Huntsville Hospital System, he said First Response’s fate would be sealed.

“We’re speaking about a hospital that controls discharges, transfers. It controls every patient except the 911 patient,” Childers said. “So at that point if you license the hospital (to operate an ambulance service), the other provider will go out of business financially.”

Childers argues that the city would be worse off if Decatur Morgan Hospital obtains a monopoly than it is with First Response maintaining its monopoly because even the possibility of competition would come to an end as other services interested in entering the city would realize the hospital controlled the transports.

“You have a hospital service that gains control over the city of Decatur. That ends your competition forever, because no other provider will come to Decatur and try to obtain a certificate of necessity and convenience because they’re never going to get the paying calls, the non-emergency calls. The hospital is always going to control that flow of non-emergency transports. You’ve ended competition,” he said.

The hospital’s monopoly, he said, would effectively eliminate the control the city now exerts over First Response through Decatur Fire & Rescue and the Ambulance Regulatory Board.

“Once that move is made and that Pandora’s box is opened, this city is locked in with that service. The hospital becomes omnipotent. If the hospital service doesn’t provide the response times that are required by the ordinance, is the city going to change the ordinance? Is it going to change the penalty? If they hit that final penalty point, is the city going to say, ‘Your CPNC is revoked’? No, because the city won’t have any other ambulance service waiting to come in.”

Alexander said Childers’ suggestion that a hospital ambulance service would fail to follow the requirements of the city’s ambulance ordinance has no foundation.

“I have no reason to believe that (Decatur Morgan Hospital) would ignore any mandate imposed on it by the city,” Alexander said. “I do think if I were looking for information on ignoring mandates imposed by the city, David (Childers) would be the first person I would go to for a quote because he has many years of experience in that exact role.”

Powers said Childers’ argument that the hospital would funnel all transports to its own ambulance service is disingenuous. She said many non-emergency transports — such as those involving nursing homes and dialysis clinics — are not in the hospital’s control. Moreover, she said, the city can do as it did when First Response and DEMSI competed and alternate the non-emergency transports between the ambulance services.

‘Need not Being Met’

“My whole interest in an ambulance service is I want the people of Decatur to be proud of their ambulance service and get the best possible treatment that they can,” Powers said.

Alexander was critical of Childers’ theory that competition between two ambulance services is a negative, and he noted that Childers argued the opposite when he obtained a CPNC for his service, allowing it to compete with DEMSI. The argument Childers made then, Alexander said, was accurate.

“When they were both operating, the service was better than it has been at any other time,” Alexander said.

Alexander said the overwhelming issue for the city is not whether First Response wins or loses, but whether people in need of emergency care can get it.

“My only interest since I started dealing with the ambulance services in 2010 is to have competent, efficient, professional ambulance service for the people who live and find themselves in our city. It is one of the most basic needs of our people. It makes no difference to me if one or 20 services are operating in the city as long as the sick and hurt people get where they need to go for treatment … rather than being left languishing for hours for transport.

“That need is not being met at this time. However the need is going to be met, regardless of the identity or number of providers involved, it needs to be met and it needs to be met as soon as is humanly possible.”

— eric@decaturdaily.com or 256-340-2435. Twitter @DD_Fleischauer.


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