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An Offer Even City Unions Can’t Refuse — Or Can They?

The City Council, faced with stiff union opposition, reluctantly takes up the issue Tuesday of outsourcing bill collection for ambulance services — contracts that could net the city tens of millions of dollars a year.

The unions oppose this although “no layoffs will result from this proposal as the Fire Department will absorb the remaining personnel by filling currently vacant positions in other divisions,” according to top city financial advisers (EMERGENCY MEDICAL SERVICES.pdf)..

This is the dream deal of all time even by the standards of City Hall where sweetheart deals have become an art form, a destructive art to be sure.

How LAFD and other city officials have been unable to find 52 jobs at a time of layoffs, furloughs and job freezes is utterly miraculous, if not fiscally sound.

Even the city’s employee unions — who have yet to make significant concessions at this time of crisis with the city’s, and their own, futures at stake — ought to have a hard time saying no to the deal to outsourcing ambulance services billing to bring money needed to avoid more layoffs, more service cuts, more chaos.

True, the unions have suffered betrayal, endlessly mixed signals and duplicitous pandering by the same elected officials who have turned tough economic times into a fiscal calamity by slashing core services at the same time they have increased fees, taxes and rates and done next nothing about the underlying cost of city government..

Thousands of workers got sweetened pensions to retire or reassignment to other jobs, often with pay raises up to 50 percent, but all the unions have had to do is defer pay raises or at worst pass on raises for a year or two and contribute a little more to their pensions.

They have valid reasons for refusing to make concessions because the mayor and City Council have deceived them about what has to be done for years and now can’t even promise that the cycle of layoffs and furloughs now just beginning will ever end.

Now, the unions are fighting to preserve the wage and benefits deals they were handed at the bargaining table in exchange for electing city officials who do their bidding. Even in this crisis, they resist allowing citizen volunteers to fill gaps in services at the libraries and parks or the outsourcing of programs that have been beset by years of mismanagement by the grotesquely overpaid top officials, elected and appointed.

Among the vast array of managerial disasters that have come to light in the last year is the disastrous performance of LAFD’s ambulance billing and collection union.

A recent audit by Controller Wendy Greuel
, in line with previous audits and studies, found LAFD only collected $53 million of the $151 million for ambulance services.
The city’s Ad Hoc Committee on Revenue Efficiency headed by Ron Galperin has done its own research and weighed in heavily in support of outsourcing to two companies the billing and collection of bills for ambulances services.

The Council has been paralyzed by opposition from unions that want a net $16 million investment in giving workers the tools needed to do a better job.

Apart from widespread skepticism about the city’s ability ever to collect any of the hundreds of millions of dollars owed it, there is the problem that the budget for this year — hypothetical and unrealistic as it is — counts on more revenue now from ambulance fees, not a risky investment.

As hard as it is to understand why the unions are fighting this, it is incomprehensible why the Council has stalled a decision this long and why there is so much doubt about how they will vote Tuesday.

It is a no-brainer that even the most brain dead Council member ought to be able to see.

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11 Responses to An Offer Even City Unions Can’t Refuse — Or Can They?

  1. Outsourcing in this situation makes great sense. The City does not have the technology, systems, personnel, and experience to do the job in a timely and efficient manner. Plus, the City avoids the liability that is associated with the breach of privacy rules associated with medical billing.

  2. Walter Moore says:

    We already pay taxes for ambulances.
    To charge people extra for a ride — at a moment when they have absolutely zero bargaining power because their life is at stake — is unconscionable.
    The City should lay off everyone involved in trying to bill and collect for this, and just provide this emergency service the same way that it provides police and fire.
    Our taxes are the equivalent of an insurance policy with respect to 9-1-1 services. Your insurer doesn’t charge you all over again when you’re sick.

  3. Bob G says:

    Walter makes this into some sort of moral imperative. I think it’s just a matter of inability to pay. If you don’t have medical insurance but somebody calls 911 and you are taken to the emergency room, you will be billed a huge amount. Whether it goes up to $800 or $1000 for the ride, it’s too much for a lot of people to afford. That’s probably the main reason that lots of ambulance bills aren’t paid.
    It may also be an indirect cause of people dying in their cars from heart attacks, because they won’t risk that $1000 price for what might be an upset stomach.
    The same argument is true regarding $80 parking tickets. Bloggers reflexively complain that the city isn’t collecting on lots of parking tickets. I think it’s understandable.
    Believing that everybody who is billed $1000 for an ambulance ride will pay it is the same as believing in magic.

  4. Walter Moore says:

    I don’t like paying for the same thing twice.
    It’s unfair.
    It’s especially unfair when the “customer” is in no position to bargain.

  5. Bob G says:

    I think there may be some argument you can make that we should provide emergency transportation services for free, but those services are linked to the overall cost of emergency room services. The latter are not for free, so why should the transportation, which isn’t just transportation but often includes the beginnings of time critical procedures that are continued at the emergency room?
    In other words, the ambulance ride is part of the overall cost of emergency medical care, and the cost question must therefore be linked to the cost of medical care in the aggregate. This is particularly true if the services are all supplied by one governmental entity such as the county.
    Where this story starts to get creepy is when the price is set by the city council as a budget balancing item.
    By the way, I don’t find the argument all that convincing that we have already paid for the service in the form of taxes. It’s true that I pay taxes to the city in the form of sales taxes and to other entities in the form of property taxes and income taxes. Somehow, the sum total of taxes that the city of L.A. takes in comes up a little short in terms of funding the medical care and ambulance services we would like to have available, so it is equally true to say that taxes don’t actually cover all the services we think we need. (I think this is what conservatives have been saying for years.) Governments balance these competing needs and income streams in various ways, one of which is to put an additional price tag on some of its services.
    As to the customer being in no position to bargain, I think this is a symptom of our entire health care system, but would you argue that your heart surgeon should not send a bill if you were brought into the ER by that expensive ambulance, found to have a serious coronary occlusion, and taken to the operating room for a bypass? You are not actually in much of a position to bargain once you enter the realm of emergency medicine, no matter what your ailment.
    I think a more legitimate argument is to calculate the actual cost of maintaining and running public ambulance services and from that number, calculating what a legitimate price would be. Is the city engaging in gouging those people whose insurance companies will pay, in order to make up for those who will never pay? Is there a “Blue Cross price” for this service that is substantially lower than the official price?
    But no, I don’t agree that you have already paid for ambulance services, unless we as the electorate agree that those services are included as a public entitlement.

  6. Anonymous says:

    This reminds me of my friend who used to be rich, but he blew all his money until he was down to trading in his used music CDs for cash.
    City Hall just blew their riches and are now reduced to trying to collect outstanding payments they’ll never receive? Maybe they can pick up some spare cash by selling the office furniture in Jimmy Blackman’s office. And have a bake sale for the rest.

  7. Insurance companies usually don’t pay the full price of the bill. They tend to cap certain services. The blances are genrally forgiven if the provider is in the network (which would not be the case for the Fire depat’s ambulance).
    So the Fire Dept may have partially collected bills. Some of those amounts may be payable by, say, Medicare.
    My guess is that most of the rest is uncollectable.
    An important first step in outsourcing would be for the collection service to evaluate the recovery potential and triage the cases, focusing on the ones with the highest potential for collection.
    I sure hope the city is not banking on receiving too much of the monies owed.

  8. Anonymous says:

    This is amazing given the millions of dollars we pay in taxes and how the city council continues to just spend widly. They didn’t think twice about paying a calligrapher $1 million for their political payback certificates. They don’t blink when it comes to helping their friends and developers but when it comes to a horrible economy and people on the verge of bankruptcy these fools could careless. I hope the grass roots movement to get rid of all of them is on. I’m hearing certain council members already are taking polls to see how they will do. Those polls mean nothing if ONE piece of corrupt stuff comes out.

  9. Sandy Sand says:

    Think any of the ‘brain dead’ on the council realize there’s a very high price to pay to collection agencies for their high-handed services?
    Knowing how the ‘brain dead’ operate, this will probably cost us even more money…like the red light cameras.

  10. Anonymous says:

    Outsourcing makes sense – when you are a corporation and not a bureaucracy! What type of oversight will be provided by the Council? I fear that collection will be turned over to a crony of someone downtown, who will gauge the city by taking 40% or more, from every bill, and then engage in behavior which is is underhanded to say the least in order to collect those bills. Moreover, the city will, unwittingly, participate in a shakedown of its own citizens who, should have paid the bill, but obviously didn’t have the means or insurance to cover the costs.
    I agree with one writer that the underlying motive of raising fees is one that deserves more consideration. What does it really cost the city to provide those services, etc.?
    As for the unions, they lack foresight because they refuse to see the handwriting is on the wall. No matter what the city’s past conduct has been, the changing economic parameters in this country will force them back to the bargaining table once they realize that their days of “entitlement” are over. Who do they think is going to keep paying for their salaries, pension costs and??? 10% of jobs in Los Angeles are in the retail sector (and, I suspect that’s growing since we are no longer manufacturing but a service economy). Tell me how someone working at Target is going to afford a home, let alone pay property taxes which the city continually relies upon to pay its bills instead of restructuring government just as Ron said.

  11. Sandy Sand says:

    We all know city officials don’t give a damn if we pay double, triple or any ‘uple’ configuration for services. Paying a grand for a ride to the hospital is like taking a taxi from downtown to LAX via the Simi Valley: Highway robbery.
    Where haven’t they “upled” what they charge us. We pay taxes for street maintenance and sidewalk repairs, yet when we sell our houses we have to repair any damages to the sidewalk in front of our house. And why is it called a sidewalk when it’s in the front of houses and stores. Adjacent to the side of the street?
    We pay taxes for libraries and schools, but when they overspend they hit us with more taxes through bond measures. Lif or death, it doesn’t matter, no city service is safe from “upling.”

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