Any person who receives emergency medical services from paramedics or fire department personnel in Long Beach will now be charged a $250 first-responder fee.
The Long Beach City Council approved the new fee in an 8-1 vote at its July 21 meeting. Fire officials brought the fee forward as an alternative funding source to recover costs and prevent further cuts to the fire department in coming years.
Though the city is projecting a $630,000 budget surplus next fiscal year, which starts October 1, city officials anticipate $15.3 million in budget shortfalls in fiscal years (FY) 2017 and 2018 primarily because of rising pension costs and declining oil revenue.
The new fee comes after more than a decade of cuts in which the fire department had to eliminate 77 sworn firefighters, six fire engines and one fire truck. Though the new revenue isn’t expected to be enough to restore any past cuts, it would assist the fire department in maintaining its current operations, city officials said.
Fire Chief Mike DuRee said during the city council meeting that the only time a first-responder fee would apply is if a person calls 911 and agrees to a medical evaluation and medical treatment by fire personnel, requiring the use of medical training and equipment.
“A first-responder fee would help us recover costs of first responding personnel as well as the cost for use of emergency apparatus equipment and emergency medical supplies,” he said.
Currently, about 85 percent of all calls requiring fire department assistance are emergency medical calls, DuRee said, adding that duties have shifted over the years and are now more related to medical services than to putting out fires.
“[Emergency medical calls have] become the cornerstone of what we do,” he said. “It’s not just a Long Beach thing. It’s a nationwide, fire service thing.”
As such, ambulance transport services revenue, which is about $11.3 million a year, isn’t enough to cover the entirety of medical service costs, which is currently approximately $22.1 million per year, DuRee said.
The fire department estimates that adding a first-responder fee, which is on top of a more than $1,000 fee charged for ambulance transport services, would generate at least $1.6 million in additional net revenue per year, DuRee said. The new revenue would help cover a projected $1.7 million budget deficit for the fire department in FY 2017, he said.
Administering the new fee is expected to cost about $200,000 annually for billing, fee collection, staff supplies and software maintenance, already accounted for in the FY 2016 budget, DuRee said.
The fire department won’t allocate any new funds until after the first year of implementation is evaluated next year as the city begins calculating the FY 2017 budget, he said.
Ninth District Councilmember Rex Richardson said holding off on budgeting new funds until the revenue stream is evaluated is “smart,” noting that the city council had budgeted state ground emergency medical transportation (GEMT) funds that never materialized.
“We thought we were going to be able to restore additional facilities into service but it didn’t happen,” Richardson said.
DuRee assured that fire agencies that implement a first-responder fee, such as those in Anaheim, Sacramento, Glendale and Pasadena, consider it a “stable” revenue source. He added that the revenue projection is a “very conservative” estimate based on a 20 percent rate of return on billing.
DuRee added that imposing a first-responder fee might also provide the city with opportunities for future funding. He said state legislation has been introduced that may enable the fire department to claim reimbursement for a portion of costs for providing medical transportation services to individuals covered by Medi-Cal.
Still, some councilmembers expressed concerns about whether the new fee would deter people from calling 911, subsequently reducing revenue while posing a risk to public welfare and safety.
DuRee explained that, for the Sacramento Metropolitan Fire District, in some cases, adding a first-responder fee did deter some people, particularly those with a high propensity for calling 911, adding that the patients were forced to find alternatives. However, for the most part, the new charge was not a deterrent because Medicare, Medi-Cal and most private health insurance companies cover the fee, he said.
Though Vice Mayor Suja Lowenthal said having health insurance companies cover the fee is an “arduous battle,” she said the fire department’s request is not an “onerous one.”
Third District Councilmember Suzie Price said some residents have expressed concerns that the fee appears to merely be a new tax, adding that emergency medical services should already be covered through property taxes.
In response, DuRee explained that, while property taxes pay for the fire department and the General Fund currently subsidizes emergency medical service, paramedic and emergency medical service in Long Beach have meant to be paid for through a separate “fee-for-service business” that has been in place since 1972.
Another concern brought forward by councilmembers, including 1st District Councilmember Lena Gonzalez who cast the lone dissenting vote on the item, is how low-income, senior citizen and homeless residents would pay the fee if they don’t have health insurance and can’t cover the cost.
The city currently offers a hardship waiver program for ambulance transport bills through a process reviewed by the city attorney, city staff said, adding that the same program would be applied to the first-responder fee. Still, Jack Smith, a 7th District resident, said the program is “cumbersome” and involves “a lot of paperwork.”
The city council directed city staff to come back with more clarification on the hardship waiver program. In addition, at the request of 7th District Councilmember Roberto Uranga, the city council directed staff to come back with a report on a subscription fee program. Currently implemented in Huntington Beach, such a program adds a fee to utility bills to cover emergency medical service costs but allows residents to opt in or out.