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A look at Amsterdam’s ambulance service revenues so far

According to a report which was recently released by the controller’s office, the City of Amsterdam’s ambulance service has brought in a total of $195,085 in revenue since the fire department began operations with a single ambulance in August 2017, through April 2018. However, the final total for the 2017-2018 fiscal year may not be known for several months. According to Controller Matt Agresta, payments received for invoices sent within the 2017-2018 fiscal year could be attributed to the same year even if they are received up to three months past June 30, 2018, the end of the fiscal year.

The report was prepared by MultiMed, which is a medical billing company contracted by the city to handle the claims generated by the ambulance service. The report shows the city submitted 1,065 claims for a total of $408,502 in “net charges” during the August 2017 through April 2018 time period. During the same period, a total of $41,254 was written off as noncollectable, and a balance of $172,163 still remains to be collected.

Fire Chief Michael Whitty said he couldn’t predict how much of the remaining balance would be actually be collected. He pointed out the city has only recently been able to submit its Medicaid claims, which have not yet been factored into MultiMed’s reporting. Whitty cited MultiMed as indicating Medicaid claims have accounted for an average of 39% of all claims, a rate slightly higher than was originally estimated by MultiMed back in January 2017.

The city was only able to obtain its Medicaid billing number in April. Under Medicaid rules, only claims for services in the last 90 days can be submitted.

Whity said that in the next few weeks, MultiMed should provide an updated report including Medicaid claims and figures for the month of May.

Analysis: Will revenues meet the budget projection?

It concerned me that the mayor and common council agreed on a projected revenue of $350,000 in the 2018-2019 budget without any public discussion on how revenues were shaping up in the current fiscal year. The council budgeted the same $350,000 amount during the last budget process. Obviously, it’s hard to come up with an estimate for the next year based on incomplete numbers for the current year. However, it seems there is enough data to at least make an educated guess as to what the final number might be.

Looking at the monthly data from the report from MultiMed, the first thing that seems apparent is that it takes about three months from when an invoice is issued to when the city sees payment for it. Payments in the report are attributed to the month they were billed, not the actual date they were deposited. Looking at the three most recent months (see chart below), we can see the payments are significantly lower for those months than prior months. Whitty mentioned this during the last budget workshop sessions and the numbers make it clear.

The second thing I noticed was that the collection rate seems much lower than the 86% rate that MultiMed quoted the city last year. If you disregard data from August which was incomplete, and the three most recent months, the average collection rate was about 60%.

The net charges in the report did not include Medicaid claims. The other types of claims are commercial, Medicare, and self-insured or self-paying. MultiMed’s quote estimated a 92% collection rate on commercial insurance claims, estimated to make up 12% of claims, a 96% collection rate on Medicare claims, estimated to make up 52% of claims, and a 6% collection rate on non-insured or self-paying patients, estimated to make up 5% of claims. Medicaid was quoted to have a 100% collection rate. Given that, it’s possible that once Medicaid claims are added to the report and begin to get paid, that average collection rate could increase. However, if it doesn’t, city officials should look into why.

To make a rough estimate as to what the final total could end up being once the books are closed around September or so, I made a proportional increase to the net charges for the past three months, figuring that the actual reported net charges made up 61% of total charges.  This method may be off because Medicaid charges are probably not the same as other types. However, I used the average collection rate of 60% to estimate what the actual payments could be and the actual Medicaid collection rate should be higher than that. To complete the year with estimated figures for May and June, I simply used the average of the figures for February, March, and April.

To be clear, the chart below combines actual charges reported by city officials, and estimated figures calculated by myself. City officials have not issued any estimates of future revenue.

Month Actual Claims Actual Net Charges Actual Payments Projected Net Charges Projected Payments
August 42 16,505 13,044 (Actual) 16,505 (Actual) 13,044
September 128 40,447 27,895 40,447 27,895
October 117 44,587 28,887 44,587 28,887
November 121 35,735 26,893 35,735 26,893
December 126 46,631 26,485 46,631 26,485
January 159 60,156 27,389 60,156 27,389
February 120 49,276 20,998 (Projected) 80,780 (Projected) 48,468
March 127 55,433 19,047 90,873 54,524
April 125 59,729 4,443 97,916 58,750
May ?  ?  ? 89,856 53,914
June ?  ?  ? 89,856 53,914
Totals: 1,065 408,502 195,085 693,342 420,162

 

So I think it’s still very possible we can meet or maybe exceed the budgeted amount for the current fiscal year and I think using the same revenue projection for the 2018-2019 was most likely a safe move by the council.  If revenues exceed the budgeted amounts for this fiscal year and the next, that will help us reduce our general fund balance deficit. But, we won’t know for sure for several more months until the actual numbers come in.

About Tim Becker

Tim Becker is the owner of AnthemWebsites.com LLC which publishes The Compass. He serves as both editor and a writer.

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