Patients overbilled
An audit shows that the private ambulance company serving Spokane residents has over-billed hundreds of patients and insurance companies a total of $320,689 since January 2003, while the Fire Department was supposed to be administering the contract.
The City Council now must decide whether to terminate its contract with American Medical Response or seek hundreds of thousands of dollars in fines that could be levied under the contract. AMR will refund the over-billed patients.
Fire Chief Bobby Williams – already dealing with a sex scandal involving a firefighter and teenage girl – now faces controversy over the way he has administered the city’s contract with AMR.
The over-billing by AMR, the nation’s largest private ambulance company, was made public Tuesday afternoon at a meeting of the City Council’s Public Safety Committee.
“This is a serious matter for the citizens of Spokane,” a stunned-sounding City Council President Joe Shogan said after the briefing.
He immediately called the City Council into an executive session, presumably to discuss terminating the contract or the amount of a fine to seek against AMR under a 2003 contract giving the ambulance company a government-sanctioned monopoly inside the city.
The Council also could urge Mayor Dennis Hession to take oversight away from the fire chief, who has assigned administration of the AMR contract to emergency services chief Rich Kness.
The fire chief has not done a good job administering the contract and should be stripped of that responsibility, Councilman Bob Apple, who headed an AMR contract subcommittee, said after the council’s executive session.
“I can voice a vote of ‘no confidence’ in Chief Williams,” Apple said an in interview.
Similar strong criticism of the fire chief’s relationship with AMR came at the public meeting and afterward from firefighters and their union officials.
“There are some fraud aspects involved here,” fire Lt. Bill Jackman told the committee at the conclusion of a briefing about the overbilling by the fire chief and AMR executive Randy Strozyk.
Jackman cited a dozen examples where firefighters’ families have been overbilled by AMR, including one instance where a fireman was charged for expensive advanced life support treatment in an ambulance ride he didn’t make.
The FBI opened a fraud investigation several months ago and served a search warrant for ambulance records at the Fire Department’s headquarters, but charges never materialized, Jackman said. There are reports that a Medicare fraud investigation currently is under way.
A class-action lawsuit was filed against AMR in December by three Spokane residents, who said they were overcharged.
A total of 881 city residents were overbilled $38,853, and insurance companies paying the bills for an undisclosed number of other patients were overbilled $281,836. Williams wouldn’t say how many individuals were represented by those insurance overbillings.
“We made this mistake,” Strozyk told the committee. “There’s no doubt we’re going to be made to look pretty stupid by this.
“I can say nothing more than, ‘I’m sorry,’ ” he said.
The AMR official said refund checks, ranging from 53 cents to $353, “were put in the mail today.”
Strozyk said the total amount of overbilling – $320,689 – represents only 1 percent of the revenue the ambulance company realized between 2003 and 2005 from its monopoly contract in the city of Spokane.
The contract gives the company a substantial presence in Spokane, allowing it to be the dominant ambulance provider in suburban areas, where its rates are governed only by Medicare reimbursement.
After saying he was embarrassed about the overbilling, Strozyk handed the committee a copy of AMR’s $225,000 external audit, conducted by an accounting firm in Denver, which examined 19,000 bills in the city of Spokane between January 2003 and last October.
Strozyk, based at the ambulance company’s regional office in Seattle, said AMR was billing all Spokane city patients at the more-expensive “advance life support” (ALS) rate.
Under the Spokane contract, the “basic life support” (BLS) rate is $358 and the ALS rate is $494. But if a city firefighter accompanies a patient to the hospital in an AMR ambulance, as often occurs, the company can only charge the lower $358 basic rate.
Under the contract, the city can seek a $1,000 fine for the first violation, $3,000 for the second and $5,000 for the third and any subsequent violation, Fire Chief Bobby Williams told the committee.
After the meeting, the fire chief wouldn’t disclose how many individual instances of overbilling were uncovered in a private audit paid for by AMR.
Williams said it will be a legal question whether to charge AMR for one violation, for the overall pattern of overbilling uncovered in the audit, or whether to seek multiple fines for each instance.
Williams requested the audit last June, but council members said they weren’t told until late last year when they began questioning details of the AMR contract.
“I believe there were some lies given to us today by Chief Williams,” an angry Councilman Apple said after Tuesday’s briefing.
Apple wondered, if the fire chief requested the audit last June, as he claimed on Tuesday, then why didn’t he disclose that late last year when the Public Safety Committee began raising questions about overbilling, excessive mileage charges and resupplying the ambulance company with medical supplies.
“There’s been a failure to provide information to the council and the citizens of this city by the fire chief,” said Apple.
“We’ve been taking these bills to Chief Williams and Chief Kness for five years, and they haven’t done anything about it,” said Lt. Greg Borg, president of Firefighters Local 29. “All they’ve done is give us blank stares.
“In our minds, there is some complicity between Chief Williams and Chief Kness and AMR,” the union president said.