City readies sharp increase in ambulance fees

FDNY ambulance

The price of an ambulance ride in New York City will jump nearly 40 percent this winter. Photo: Martin Wippel/Flickr

At a price of $515 for a simple trip to the hospital emergency room, not counting mileage, a ride in a New York City ambulance isn’t cheap. But the city Fire Department (FDNY) now seeks to increase the price of a ride to $704 – a nearly 40 percent increase over the current rate. The fees previously saw a hike three years ago.

“We periodically revisit our rates for our services,” wrote FDNY spokesman Frank Dwyer in an email to The New York World. “This is being done to help defray the costs for the services we provide – the best pre-hospital care in the world.”

The City of New York spends approximately $380 million per year to provide ambulance services through the Fire Department and currently anticipates recouping $189 million in payments this fiscal year from insurance companies and patients. Last year, the FDNY collected a total of $176.5 million.

Once the fees increase, the Fire Department projects, ambulance rides will generate about $205 million for the city each year. The rate jumps are part of the department’s plan to close its budget gap, adding projected revenue of nearly $50 million over the next five years.

But the city’s gain promises to add to health care consumers’ pocketbook pain. About half of the FDNY’s ambulance revenue last year came from Medicaid and Medicare. The federal government caps those insurance programs’ base ambulance payments to the city at $243.57 a trip, well below the proposed $704 rate. Private insurers typically pay more. As a result, they are likely to bear the brunt of the fee increase, said Ellen Melchionni, President of the New York Insurance Association, a trade group. “Given New York’s budget problems I’m not surprised the FDNY is looking to increase rates,” said Melchionni. “It’s premature to determine future provider rates, but this increase certainly doesn’t help.”

The burden of payment has already shifted from public insurance to private plans, figures from the city’s Independent Budget Office show. In 2009, private insurers and their patients accounted for a little less than one-third of ambulance revenues and Medicaid and Medicare for nearly two-thirds. Following the last rate hike, the share of revenue coming via patients holding private insurance shot up to 47 percent of the total.

Increased ambulance rates put upward pressure on health insurance premiums – costs that are passed on to employers and to workers who depend on them for coverage. And some insurance plans do not pay the entire bill. When an insurer does not cover the full cost of an ambulance ride, the FDNY bills patients directly and seeks to collect payment.

Under the proposed changes more advanced levels of care will also see price hikes, bringing the top rate up to $1,290 for a ride with two paramedics. The cost for each mile traveled will jump nearly 60 percent, to $12 a mile, up from $7.

Once the planned rate increases are in place – the published announcement notes an unspecified date in February – the price of a basic ambulance trip in New York City will have doubled in a decade. The cost of advanced support will have nearly tripled.

In contrast, between 2002 and 2010, the Consumer Price Index increased 20 percent and U.S. personal health care costs per capita rose nearly 50 percent.

The Fire Department will hold a public hearing about the proposed increases on Feb. 6. The department is accepting comments online until that date.

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