Understanding the Proposed Ambulance Fee

From Marc Korman:

On June 10, the County Executive sent the County Council a proposal to allow the Montgomery County Fire and Rescue Service to impose a fee when transporting patients by ambulance. The proposal is not new. It was put forth previously by the County Executive during the budget deliberations and by the previous County Executive in 2004. Opposition has been expressed to the proposal from many parties on the grounds that it will adversely affect healthcare, while proponents cite the overwhelming budget and healthcare needs to justify the fee. But what is really being proposed and what are the implications?

What Is Being Proposed?

The County Executive’s formal proposal is available here, beginning on page two. Although articles have cited the exact cost of the fee, the legislation only authorizes a regulation establishing the program and not a specific fee amount. The County Executive’s revenue projections assume a $247 fee in fiscal year 2009, rising to $253 in fiscal year 2012. The fee would only be assessed against non-County residents and residents with “available insurance coverage.” The legislation also includes a requirement that individuals must receive medical service, regardless of their ability to pay. The proposal is similar to current policy in Prince George’s County, Washington, DC, and New York City to name just a few examples. Based on the above numbers, the County Executive projects $14.8 million in additional revenue in FY2010. The legislation also requires that the funding gained from the fees not offset existing emergency rescue funding, but supplement it.

So Who Would Pay?

If you are not a County resident the legislation would require you to pay regardless of insurance. But for County residents, who would pay depends on the meaning of the term “available insurance coverage.” Based on the public rhetoric, the fee would be invisible to patients because it would be entirely dealt with through insurance companies. But does “available insurance coverage” mean the fee will only be assessed if an insurance company will fully cover it? What if an insurance company requires a co-pay from the patient for the ambulance service? What if the use of the ambulance, and the required payment, leads to increased premium costs for the patient? The answers to these questions are not self-evident from the County Executive’s proposal.

What Does It All Mean?

If you listen to the critics, the County Executive’s proposal means that those who need medical assistance will think twice before calling an ambulance and could suffer. If you listen to the proponents, the insurance companies will foot the entire bill. As usual, the truth is probably somewhere in between.

The fear that patients will not get the healthcare they need is valid. But the ambulance proposal would just ameliorate, not create, the existing problem with the private sector driven healthcare status quo. Due to the extreme costs, even those with insurance must still self-ration care to avoid increased premiums or paying the full cost of care while meeting their high deductible. The conservative approach to healthcare, market driven proposals like Health Savings Accounts, only worsen the problem by making those in need even more sensitive to the cost of care. People should be aware that healthcare is costly, but they should also not be dissuaded from seeking needed care.

When it comes to the insurance companies paying the bill, there is no such thing as a free lunch. Insurance companies have proven themselves quite capable of making money despite increased healthcare costs. If the County Council manages to keep the fee from being charged against those who do not receive 100% ambulance coverage from their insurers, we will likely either see fewer health insurers offering that benefit (health insurance plans are not national and can be tailored for specific locations) or an increase in premiums.

What Can You Do?

Given the complexities of the issue and the County’s real healthcare and budgetary needs, the County Executive and County Council need to carefully consider the proposal. As always, you can weigh in by contacting your Councilmember or attending the public hearing tentatively scheduled for July 8^th.