New ambulance service in N.H. town lost more than $1.3M in first 10 months of 2023, documents show
In February, Westmoreland chose to sign a one-year deal with Cheshire EMS, replacing the Keene Fire Department as the town’s main ambulance service
By Christopher Cartwright
The Keene Sentinel, N.H.
CHESHIRE COUNTY, N.H. — Cheshire EMS, the year-old county ambulance service, operated at a deficit between January and October that totaled more than $1.3 million, according to financial records.
The budget information documents financial shortfalls in a service that has drawn significant local scrutiny and that county officials have said would ultimately be self-sustaining.
But while self-sustainability is still the goal, according to Cheshire County Administrator Chris Coates and Finance Director Sheryl Trombly , they say the county plans to use discretionary funds in coming years to help shore up the balance.
Both said in a recent interview that financial challenges were expected for a new venture that only acquired most of its town contracts over the summer. Coates also described industry-wide challenges affecting ambulance services’ finances.
“We’re going to wait until the year is finalized to determine how much ... to carry over to [the] future year,” Trombly said. “Sometimes it takes a few years to ... pay off initial start-up costs.”
The monthly financial documents, which The Sentinel obtained via a right-to-know request, show monthly losses for Cheshire EMS ranging from $41,617 in April to $201,078 in August. The most recent document provided to a reporter, showing the service’s finances in October, indicates a loss of $186,317 that month.
Although the county used federal American Rescue Plan Act money to start the Swanzey -based service in November 2022 , the October financial document indicates no ARPA funds had been spent in 2023, though $206,838 are allocated for the year. It lists total revenue in the year’s first 10 months as around $1.6 million, with around $1.3 million of that coming from interfacility transfers, about $232,000 from 911 calls and just under $69,000 from town contracts. Year-to-date expenses came in at just over $3 million, the October budget states.
Revenue from all three of these sources fell well below projections.
According to the county’s proposed 2024 budget, the county expected to receive around $3 million from interfacility transfers, about $1.45 million from 911 calls and about $280,000 in town contracts this year. Those estimates for 2024 have been revised down to about $2.28 million from interfacility transfers, approximately $1 million from 911 calls and around $166,000 from town contracts.
Coates and Trombly said that despite the shortfall, the county has a track record of financial stability.
“We’ve been constantly doing right by the citizens of Cheshire County,” said Coates, who pointed to the small increase of 2.7 percent in the county’s portion of the tax rate since 2019. He added that there was no increase in 2021 and 2023.
“I always will understand concerns, but our track record shows that we are really responsible to our fiscal duties,” he added.
N.H. Rep. Dan Eaton of Stoddard , chair of the Cheshire County delegation, told The Sentinel Tuesday that “it was fully expected that there would be a gap” between expenditures and revenue as the EMS venture started up.
“It was partially exacerbated by the fact that we had to ramp up much heavier [and] much quicker in the beginning,” he said, adding that the county knew DiLuzio Ambulance Service — which the county initially planned to buy and which served many area towns — would likely close soon because of the tax lien in the county’s registry of deeds. “We had to be ready to fill that gap ... and we did that, and that was not cheap.”
Federal funds not covering all costs
Over its 13 months of operation, Cheshire EMS has drawn criticism from some area fire departments, including Keene’s , especially over its perceived use of ARPA dollars to keep initial costs low.
In May, Coates told The Sentinel that most of the budgeted revenue would come from interfacility transfers, adding that “there are no ARPA funds being utilized except for the $206,000 that we’re utilizing so that we can ease towns into the three years.”
The county’s contracts with towns show this plan, with prices for Swanzey increasing from $46,865 to $81,548 over three years.
This has put other agencies at a competitive disadvantage.
In February, Westmoreland opted to sign a one-year contract with Cheshire EMS instead of with the Keene Fire Department, which previously served as that town’s primary ambulance service provider. Westmoreland was followed by other towns, including Swanzey , where officials cited the price difference between Brattleboro-based Rescue Inc. and Cheshire EMS as their main reason for choosing the county.
At a meeting in Swanzey in May, Andrew Wallace , a Richmond selectboard member, and other attendees raised an overarching concern about Cheshire EMS’ long-term sustainability: What happens when the ARPA funds run out?
Keene City Manager Elizabeth Dragon alluded to similar fears last month when the Keene City Council agreed to let her execute a no-cost agreement for Cheshire EMS to provide backup ambulance service to the city.
“The County continues to reassure us that the ambulance service will remain an enterprise fund, meaning it will be exclusively funded by the revenue generated by the service,” she wrote in an attachment to the Nov. 16 meeting agenda.
According to previous Sentinel reporting, County Commissioner Jack Wozmak said in 2021 and 2022 that the service would be self-sustaining, and Coates reiterated that to a reporter this past March.
In the agenda attachment, Dragon added that the proposed 2024 county budget shows the county helping pay for Cheshire EMS through “Proshare funding,” which she said would take money away from county nursing facilities.
“My concern is the future impact to the county’s tax rate by shifting the use of these funds,” Dragon wrote. "... the initial contracts with area towns for primary ambulance coverage by the County included greatly subsidized rates utilizing ARPA funding. These rates will likely need to be substantially increased at the conclusion of those ... What will this mean to county revenue projections and EMS stability in the future?”
Integrated Delivery Network funds
In a Nov. 29 budget letter to Cheshire County delegation members, the three county commissioners wrote that for 2024 they intend to use Integrated Delivery Network funds to help pay for Cheshire EMS.
“We plan on using these funds for our own IDN as we continue to work towards self-sufficiency,” Commissioners Terry Clark , Robert Englund and Wozmak added.
Coates told The Sentinel Monday that these funds are “indirectly” part of the ProShare funds that Dragon mentioned and can be applied to a variety of projects, such as home weatherization.
According to previous Sentinel reporting, the Integrated Delivery Network program distributed around $150 million over five years through the Centers for Medicare and Medicaid Services to seven regions in the state. These regions were created in 2016 to improve the delivery of care for Medicaid beneficiaries across New Hampshire .
The county continues to receive funds through this program, Coates said, adding that the county received $5.3 million in 2021, $4.9 million in 2022, and $5.4 million in 2023.
The 2024 proposed county budget shows a plan to use around $740,000 in these funds and about $239,000 in ARPA funds for Cheshire EMS.
Coates told The Sentinel he expects Cheshire EMS’ $1.3 million deficit to shrink next year.
“We’re looking at different funding streams,” he said. “We believe revenue is going to start picking up ... it’s only since July or August that we’ve had the full town partnerships.”
He and Eaton also pointed to a major problem plaguing both private and county EMS providers: payment from insurance providers.
Area ambulance services have previously told The Sentinel that Medicare, Medicaid and private health insurance reimbursements don’t adequately compensate for the care they provide. This results in agencies having to rely on town contributions, grants and donations.
Medicaid provider payments increased this year by 3 percent, according to a September letter N.H. Health Commissioner Lori Weaver sent to the fiscal committee of the N.H. General Court, and Eaton said the “significant” increase would be felt in the coming months.
Coates said that with current insurance payment reimbursements, services can’t “live off” 911 calls or interfacility transfers to survive.
“Across the state, private [ambulance providers] are struggling throughout because insurers are paying less than what’s coming through the door,” Coates said. “Fire chiefs, other service providers of EMS and [we] are all trying to figure out how to have private insurance companies pay at a level that’s fair for everyone involved.”
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