BAR HARBOR — For several months, members of the Town Council have been asking why revenues from the town’s ambulance service, operated by the Bar Harbor Fire Department, are below budgeted amounts. This comes up when Finance Director Stan Harmon reviews regular financial statements with the council.
Ambulance revenue was down 19 percent this year, Harmon said at the Jan. 17 council meeting, and 20 percent the year before.
One issue is staffing. There are enough paramedics to respond to emergencies but not enough for some of the non-emergency patient transfers between medical facilities that the Fire Department has done in the past.
The proposed budget for the coming year includes one additional three-quarter time firefighter/EMT. The new position adds $35,778 to the department’s $492,698 proposed budget. That added person should help the agency be able to do more of those patient transfers, Fire Chief Matt Bartlett said.
Councilors have asked whether raising ambulance rates would help increase revenue, or conversely, if lowering rates would make the budgeted revenue numbers more realistic.
“In accounting terms, it looks lousy,” Councilor Clark Stivers said at the Jan. 26 budget workshop. “If we write off so much money every year, does it make sense to lower our prices?”
Bartlett said the department’s fees for ambulance services are “right in the middle” among comparable agencies.
Some ambulance runs are not billable at all, such as when an ambulance is called to a minor car accident and there are no injuries. In fiscal year 2016, 74 percent of total runs were billed, down from 81 percent the year before.
Others are partially paid, such as those billed to Medicare. Medicare only pays a portion of the sticker price for the service, Harmon said, resulting in a “mandatory write off.”
A typical run from Bar Harbor to Bangor covered by Medicare would be billed $1,186, Harmon said in an email. Medicare covers 43 percent of that bill, the patient or a supplemental insurance company pays 11 percent, and there’s a mandatory write-off of 46 percent.
The audit for the fiscal year that ended in July 2016 showed $497,000 in ambulance billings. The town wrote off $164,000, or 33 percent of the total billed. “Additionally, we wrote off $35,000 in bad debts, or 7 percent,” for net revenues of $298,000, Harmon said. “These percentages are consistent with our history.”
More than half of the agency’s billable runs have Medicare as the primary payer. Another 27 percent are billed to commercial insurance companies, 13 percent are billed to the patient, and 4 percent are billed to MaineCare (Medicaid), according to Harmon. Lowering the rates to reduce the write-off numbers also would mean less revenue from patients who pay full price.