| >
Joint Report – October 2002
CAO and Emergency Medical Services Manager
This joint report is designed to give the Board and member municipalities
an overview of the issue of charges between Delivery Agents and upper-tier municipalities
(UTM) for land ambulance services. This
topic is commonly referred to as the cross-border billing issue.
Background:
Prior to ambulance services been downloaded, the issue of
cross-border billing did not exist. There
were costs associated with each individual ambulance service and each service
was separately funded. However, up to
Between
Effective
Since
For example, if the Algoma EMS ambulance was to enter the
Applicable legislation
Concurrent with the Local Services Realignment, the
provincial government set out a regulation to address the matter of cross
border billing. This regulation can be
found as Part Four of Regulation 129/99of the Land Ambulance Act.
The legislation reads as follows:
PART
IV
16. (1) In this section,
“municipality” means a
delivery agent or an upper-tier municipality that is not part of a designated
area;
“provider municipality”
means a municipality whose ambulance services provide land ambulance services
in areas outside the municipality;
“recipient municipality”
means a municipality that receives land ambulance services from ambulance
services situated in a provider municipality.
O. Reg. 256/00, s. 4.
(2) This section applies only where,
(a) a provider municipality and
a recipient municipality have not entered into an agreement under subsection 6
(3) of the Act; and
(b) Part III does not
apply. O. Reg. 256/00, s. 4.
(3) For the purposes of the application of this
section to a delivery agent, any reference to the territory of a municipality
shall be deemed to be a reference to the designated area for which the delivery
agent is designated. O. Reg.
256/00, s. 4.
(4) Subject to subsection (6), every year, a
provider municipality to whom this section applies may charge a recipient
municipality the amount determined under subsection (5) as compensation for the
costs of land ambulance services provided during the previous year in the
recipient municipality. O. Reg.
256/00, s. 4.
(5) The amount that a provider municipality may
charge under this section is determined in accordance with the following rules:
1. Determine the provider
municipality’s total costs associated with the provision of land ambulance services
for the year.
2. Determine the total number
of calls made in and outside of the provider municipality by its ambulance
services.
3. Determine the average cost
per call by dividing the amount determined in paragraph 1 by the amount
determined in paragraph 2.
4. Determine the number of
calls made to the recipient municipality by the provider municipality’s
ambulance services.
5. Multiply the number of
calls determined under paragraph 4 by the provider municipality’s average cost
per call, as determined under paragraph 3.
6. Determine, in accordance
with paragraphs 1 to 5, the costs of any land ambulance services provided in
the provider municipality by ambulance services from the recipient
municipality.
7. Subtract the amount
determined under paragraph 6 from the amount determined under paragraph 5. O. Reg. 256/00, s. 4.
(6) A recipient municipality who is charged an
amount under this section shall pay the amount to the provider municipality on
demand. O. Reg. 256/00, s. 4.
(7) If the recipient municipality fails to pay the
amount due at the time required by the provider municipality, the provider
municipality may charge interest on the amount due at a rate to be set by the
provider municipality and the recipient municipality shall pay the interest. O. Reg. 256/00, s. 4.
(8) The provider municipality shall give the
recipient municipality prior written notice of the day on which interest begins
to accrue and of the interest rate.
O. Reg. 256/00, s. 4.
The Legislated Options
In simple terms the regulation contains two options.
1.
Each delivery agent is to meet with
their neighboring Delivery Agents and try to work out a mutually agreeable
formula for cross border billing of ambulance services.
2.
If they cannot agree on a formula
for cost sharing, then the default option of the provincial government will
fall into place. The default option means that each entity will calculate their
cost per call (total cost of operations/no. of calls per year). After
contacting each other, each declares the number of pickups in the others area,
the one with the most calls done in the others area gets to send the bill for
only the excess number of calls done times their cost per call.
Delivery Agents’ Response
Each of the above two legislated options has been
extensively debated by local and provincial staff, to confirm the government’s
intent regarding the wording and the ultimate operation of the regulations. To our knowledge, none of the 49 Delivery Agents
have implemented either of these two options. In addition, although some Delivery Agents
have billed another area, as far as we can determine no billings have been
paid.
This reality is not surprising given the slipshod manner in
which the Ministry of Health dealt with the transition of this essential
service. As noted previously, there was
a lack of formal transition planning, no transition funding and no post transition
follow up. The cross border billing regulation shows a stunning lack of
understanding related to delivery realties, Delivery Agent staffing and budget
pressures.
The Problems
Option One
Even if the two of the parties come to a mutual agreement on
a costing factor between themselves, it is imperative that their adjacent
Delivery Agents agree to the same solution.
To clarify, if all parties in the North (Parry Sound northward) where to
agree on a cross border funding formula, the deal breaker may be the community
of Muskoka, not agreeing with that same funding formula. Therefore, Parry Sound would be disadvantaged
by having to utilize two formulae in an effort to collect their out of district
call costs. As soon as it does so, other
jurisdictions could ask a variance to their agreement.
Because ambulance services commonly cross multiple Delivery
Agents jurisdictions, each Delivery Agent would need multiple agreements. At an absolute minimum, ADSAB would need
agreements with the City of
Option Two
The provincial default formula has its own inherent problems.
There is a lack of clarity as to whether we count calls which are Codes One,
Two, Three and Four, or to include Code Eight calls (which are standbys), to determine our total cost per call. In some cases, where services do a lot of
standbys, this could significantly decrease their cost per call and therefore
decreased revenues.
In addition, when calculating the calls done by Algoma EMS,
are we expected to break down the cost per call on a base by base basis? For
example, do you take Elliott Lake operational costs divided by Elliot Lake
calls or do we divide the Algoma EMS budget by the total calls done by a the
Algoma District in order to determine our cost per call. The regulation does not answer this simple
question.
Present Situation
In the regulations the Ministry failed to address the
realties of
The Land Ambulance Implementation Steering Committee (LAISC)
has sought to have the provincial government clarify these issues prior to
anyone implementing the cross-border billing issue. After 22 months this issue is still
unresolved. Following is the latest information
provided from LAISC.
“The issue of cross border billings was discussed at length
at the LAISC yesterday. It was suggested
by Minister Newman and supported by the committee that the province hire a
consultant to help address this very complex issue. We have been asked to provide advise on what
the terms of reference should be for this and the ministry would like your
recommendations by the end of the week or early next week at the latest.
Based on the discussion I would suggest the following as
minimum:
To review the current default provision in the legislation
and discuss the concerns, difficulties
and/or deficiencies in respect to the
legislation with a representative group of UTMs and DSSABs. This must include interviews with
administrative/financial and
To prepare options and recommendations in respect to
modifying the current legislation to be more fair and equitable to UTMs and
DSSABs while ensuring UTMs and DSSABs continue to receive sufficient funding to
maintain the ambulance programs being provided.
Should you wish to add to this or be more specific please
respond directly to:
Marjorie Wilcox
Senior Manager
Planning, Finance and Corporate Services
Emergency Health Services Branch
Budgetary Impacts
Despite the lack of a consensus on this issue, the Ministry
of Health unilaterally included cross border revenues and expenditures into the
2001 and 2002 budgets with each of the 49 Delivery Agents. In many cases, the
government has estimated cross-border billing to be a major revenue income to
some delivery Agents. This revenue
decreases the amount of the grant provided by the Ministry. These delivery
Agents find themselves increasingly strapped for operating revenue as the
provincial government has seen fit to remove this anticipated estimated revenue
from their base budget allocation. So,
each year that goes by without these issues resolved, there is another year of negative
financial impact for these Delivery Agents.
The Algoma DSAB was assumed to be receiving revenue of
$10,000. in 2001 and 2002. Essentially, the Ministry position is that that
Algoma should receive a net revenue of $10,000. from other Delivery Agents. We do not have confidence enough in the existing
database to either confirm or refute this assumption. Like all the other jurisdictions we have
neither paid nor received any monies related to cross border billing.
We do know that our Eastern Divisional transfer unit finds
itself doing more and more calls in the Greater City of Sudbury. Under Central Ambulance Communications Centre
(CACC) protocols, CACC assigns calls to the most available ambulance. If the Eastern Division Transfer Unit has
dropped off their patient in
Cross border billing does not apply to First Nations
communities. This is one area in which
the province was quite clear. The number of calls also was unilaterally calculated
by the Ministry prior to downloading with the provincial government assuming
100 percent responsibility for these costs. We have received funding in our
base budget template for doing these calls at the 2000 call volume. Any calls done in excess of that, must have a
business plan supplied to the Ministry for any remuneration of costs.
Summary
No resolution of this problem can occur until such time as
the consultant reports to LAISC and the province makes a decision. Contrary to Ministry statements, we do not
believe that a common approach can be reached among the 49 Delivery Agents on
the basis of a consensus. Ultimately the
Ministry will have to take responsibility for this problem which they created
with the decision to include land ambulance costs as part of Local Services
Realignment.
We hope for a solution which is simple to administer because
otherwise all Delivery Agents will need significant clerical support to
determine the allocation of calls and arrange the collection of costs. The real
solution is 100% provincial funding of this service not a complex system to
attribute costs among geographic areas.
Thomas Johns, Manager Emergency Medical Services (
|