San Diego to switch ambulance providers for first time since 1997

City officials made the decision based on responses to a request for proposals issued in August


David Garrick
The San Diego Union-Tribune

SAN DIEGO — San Diego officials said Monday they plan to switch the city's ambulance provider for the first time in more than two decades.

Fire-Rescue Chief Colin Stowell said the city has decided to engage in exclusive contract negotiations with Falck, a Danish-owned company that provides ambulance services in nine U.S. states including California.

City officials chose Falck over the city's existing ambulance provider, American Medical Response, based on how the two companies responded to a 73-page "request for proposals" issued by the city in August.

The decision to switch comes after a series of disputes between AMR and city officials over response times, staffing levels and fines levied on the company for not meeting city goals.

Relations between the city and AMR have stabilized since the company's operating agreement was amended in 2017 to soften some requirements and boost the company's revenue with higher patient fees.

But city officials have repeatedly said they plan to explore having another ambulance provider take over when AMR's contract ends on June 30, 2020.

That contract has been extended multiple times since 1997, when the city selected Rural/Metro to provide ambulance services in San Diego. AMR bought Rural/Metro in 2015 and has continued operating under the same contract.

Stowell said city residents should be upbeat about the possible switch to Falck, which he says has a strong track record in emergency services and which suggested some creative and innovative ideas in its proposal to the city.

"They're the biggest ambulance company in the world; they are just not well-known here," said Stowell, noting the company took over ambulance services last summer for Alameda County in the Bay Area.

Falck also serves parts of Los Angeles and Orange Counties with its subsidiary Care Ambulance Services, and it has separate contracts in Oregon, Washington, Florida, Georgia, Alabama, Colorado, Maryland and Michigan.

While details of Falck's proposal must remain confidential until after a contract is reached, Stowell said the proposal addressed growing concerns the city has about wasted trips when ambulances respond to non-emergencies.

"What we're looking at on the innovation side is alternative ways to provide services to the folks calling 9-1-1 who are not necessarily in a life-threatening situation," he said. "That's taxing the 9-1-1 system, not just in the city of San Diego but all across the United States."

Stowell also said Falck's proposal includes new equipment and possibly some new facilities. But he stressed that many details must still be worked out during contract negotiations, which he said should take roughly one month.

"Although they've pledged a lot of things in the bid, contract negotiations is where all the things will get worked out -- all the pricing, all the staffing hours, all of the logistics as far as ambulances, equipment and facilities," Stowell said. "Because this is a new provider and we need a long transition time, our hope is that within 30 days we either have an agreement or we don't have an agreement."

If no agreement is reached, the city could turn back to AMR or issue a new request for proposals.

Stowell said the decision to choose Falck is not based on any current turbulence with AMR.

"Everything is going just fine with AMR," he said. "We're not having any problems. We have not gone back into the concerns we've had. The only reason this RFP went out is that this contract is termed out."

Stowell said city residents should be optimistic.

"I think change always provides opportunity," he said. "I think residents in the city of San Diego should be assured that we are not going to decrease any of the services — we're only looking to improve our services."

Stowell declined to say whether Falck is proposing increases to what patients pay for an ambulance. A 24 percent increase two years ago moved San Diego's fees into the top one-third of local jurisdictions in San Diego County.

He did say that patient fees were one of the four main criteria city officials used to evaluate the proposals from Falck and AMR. The other criteria were staffing, company track record and responsiveness to the city's request for proposals.

Stowell said he also couldn't say what annual fee Falck would pay San Diego to operate its ambulances. AMR has been paying the city $10.7 million per year for the right to operate ambulances and then charge fees to patients and their medical providers.

Chris Heiser, a deputy fire chief in charge of emergency medical services, said a roughly six-month transition from AMR to Falck seems to make sense.

"We need to give them a reasonable amount of time to purchase equipment, move staff over and set up their infrastructure to start providing services," said Heiser, noting that a new contract will require the purchase of more than 60 new ambulances at nearly $300,000 per vehicle.

Heiser and a team of city officials plan to visit Alameda County soon to analyze the transition there from Paramedics Plus to Falck that began July 1. Falck has faced some fines for not meeting response times, but company officials have blamed them on depleted staff when they took over.

The contract with San Diego will require Falck to make a "good faith" effort to hire the emergency medical technicians working for AMR. In San Diego EMTs must be paid at least the city's living wage, which is $12.21 per hour.

Alameda County, which includes Oakland and some suburbs, is similar in size and demographics to San Diego, Heiser said.

San Diego has no plans to change its response time standards, which require arrival at acute emergencies within 12 minutes of receiving a 9-1-1 call, Stowell said.

He said there are also no plans to return to having eight response zones, which the city was using until AMR complaints prompted a shift to four response zones.

The goal of having eight zones was greater equity among communities. Four zones instead of eight means larger zones, which increases the potential for the company to provide subpar service to some communities and still meet the response-time goals by posting stellar times elsewhere in a particular zone.

Stowell said he wasn't concerned that the city choosing Falck would lead to declining efforts by AMR between now and July.

"They still have a reputation and pride in their level of service," he said. "There's always a chance that things don't work out with Falck, and the last thing they want to do is damage their relationship with the city."

If there are problems, he noted that the ongoing contract with AMR includes a penalty of more than $10 million if the company stops providing adequate service.

"If they do just walk out and leave the keys on the table, we would be able to provide services with that money," he said.

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©2019 The San Diego Union-Tribune

McClatchy-Tribune News Service

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