Why ambulance service is a tough business
An ambulance passes by Cedars Sinai hospital in Los Angeles
Al Rapisarda buys lots of EpiPens for his company, Midwood Ambulance Service. They’re small medical devices – a bit bigger than a glue stick – and are used to help treat allergic reactions.
There’s just one problem.
“We never use them,” says Rapisarda, whose father started the company in the 1956. “So we threw out about $25,000 worth of pens about three years in a row.”
The EpiPen is a small, but striking example of why ambulances can be a tough business. The pens expire after about a year and Midwood Ambulance is required to carry them, even though they're a private company that does mostly non-emergency runs, like hospital transfers.
“It’s good medicine versus the money,” Rapisarda says, standing between a pair of brand new ambulances in his company’s Coney Island garage. Their sides are still a crisp white; they don’t even have his company decals yet. He estimates his cost to get each ambulance on the road is between $80,000 and $90,000, not including staff – his biggest expense.
Like most businesses, Rapisarda wants to keep costs down. On the other hand, he knows lives can be at stake.
“EMS is [a] cross between public service and healthcare,” says Scott Matin, northeast director of National Association of Emergency Medical Technicians, which represents EMS workers in public, private, and volunteer services. “Just like police and fire, you dial 911 and you get the service, regardless of whether you can pay for it or not pay for it.”
Unlike the police or fire departments, patients or their insurance companies are generally billed for the services they receive, regardless of whether the ambulance was provided by a local government, a hospital, or a private ambulance company. The setup can vary town by town.
Matin and Rapisarda say people are often surprised and confused when they receive bills.
“If you were here last week, the bills went out for the month, and everyone was on the phone,” Rapisarda explains.
Patients want to know why they have a $50 or a $200 co-pay, especially those who have new insurance plans.
That’s time his staff spends on the phone, chasing payments. Trying to get insurance companies to pay can also be difficult, but Rapisarda says his biggest billing headaches come from Medicaid.
“I do a Medicaid call below cost right now in New York State,” he says. “I’m subsidizing a Medicaid patient.”
Even after a slight increase in local reimbursement rates earlier this summer, Rapisarda estimates he loses money on each Medicaid run.