AMR closes ambulance billing operations in Calif.
Billing and customer service positions to be handled by overseas contractor in India and Philippines
By Ken Carlson
The Modesto Bee
MODESTO, Calif. — Some billing employees of American Medical Response in Modesto returned their company-owned equipment and picked up their last paychecks Wednesday.
Some said it was a sorry way to close out 2014.
“It’s just part of corporate America,” said one employee who continues to work until offshore workers are trained to do her job. “They want to see higher profit growth. They are negatively affecting the American economy.”
AMR’s billing workforce used computers and other company-owned equipment to work from home, which reduced lighting and heating costs for their employer. But it will cost less for an overseas contractor to handle AMR’s billing and customer service work in India and the Philippines.
AMR said in October it was closing its regional billing operation in Modesto and cutting 210 positions. Next came the news that 48 customer service employees would lose their jobs. Some employees said the true number of job losses exceed 650 between Modesto and a similar operation in Southern California, including more than 300 job cuts in Modesto.
The majority of affected employees will lose their jobs in March after lower-paid workers in India and the Philippines are trained to handle billing and customer service for AMR. No count was available on the number of jobs eliminated Wednesday.
Among the stated reasons for the outsourcing decision were the business costs and regulatory environment in California, with its family-leave benefits and inflexible work-hour restrictions. According to employees, the pay for processing ambulance service bills averaged $17 an hour, far more than what foreign workers earn.
As of Friday, the remaining workers become employees of Centrex Revenue Solutions, a Florida business that is taking over billing functions for AMR. Centrex is outsourcing much of the labor to an overseas contractor, though some work will be handled in Colorado and Ohio. Local employees said they are not allowed to apply for the more than 100 jobs available in Denver and Akron, Ohio.
“They want to save a buck,” said an employee who remains on the job and feared disciplinary action if she’s identified. She predicted patients won’t like it when their billing inquiries are routed overseas and they learn a foreign contractor has access to their personal information.
AMR had planned for more layoffs to take effect Wednesday, but many employees were asked to keep working during the transition. Billing workers who stay until March are promised severance pay, and they’re afraid of losing unemployment benefits if they quit before then.
One billing worker expected to be needed beyond March because of mistakes made by the billing operation in India. “The incorrect insurance is billed or no insurance is billed,” the employee said. “Claims are sent to the wrong department. The problems just worsen when the work is outsourced.”
The affected employees have also been upset that local elected officials have not tried to help save their jobs.
AMR’s corporate headquarters in Colorado did not return messages from The Bee, and Centrex did not respond to calls.
Stanislaus County’s Alliance Worknet has furnished information for either the company or employees to apply for Trade Act assistance, which could provide up to $10,000 each to help with relocation, retraining, work clothing or tools. Employees contacted by The Bee did not know if anyone was applying for the assistance, which is provided to people who lose their jobs to offshoring.
The Centers for Medicare & Medicaid Services said there are no regulations preventing health care providers from using billing services outside the U.S. However, health care providers and subcontracted services that bill Medicare must comply with the security and privacy provisions of the Health Insurance Portability and Accountability Act, which has penalties for violating patient confidentiality.
The new billing operations will affect patients in states where emergency response is provided by AMR, a leading ambulance company in the U.S. The Modesto operation handled billing for Northern California, Nevada, Idaho and other Western states.
If mistakes are made processing bills overseas, it could result in Medicare denying claims for ambulance transports, overcharges for consumers or patient accounts sent to collections.
At any given time, the Health Insurance Counseling and Advocacy Program in Modesto is handling five to seven appeals for seniors whose claims were denied by Medicare. In those cases, the ambulance company tries to collect from the patients and HICAP counselors work to resolve the issues.
HICAP’s Frank Dotson said he can contact AMR for information to resolve the issue, but doesn’t know how things will work with an overseas contractor.
“I think definitely there would be a problem,” Dotson said. “Not only do they need to get them trained over there, so they know our (system), but seniors kind of resent not being able to understand people on the phone if there is a language difference.”
He added, “I imagine we will have some adventures after March.”
Attorney Robert Liles of Washington, D.C., said he advises health care provider clients not to use overseas billing services. It’s better to pay the cost of domestic service than risk fines or lawsuits for violation of HIPAA, he said.
While he’s not concerned about the quality of work of offshore contractors, the problem is maintaining security for patient records. “You have no idea who you are sending your patients’ information to,” he said. “Every day we hear about these massive HIPAA breaches. Hackers don’t want to know if you just had an operation but they want Social Security numbers, credit card numbers, addresses and all those things that have value to bad folks.”
The attorney said contractors promise to indemnify clients against monetary penalties for HIPAA violations, but clients needing to sue their contractors face an enormous case backlog in India’s civil courts.
AMR is owned by Envision Healthcare, whose stock is traded on the New York Stock Exchange. Envision reported revenue of $1.15 billion and $52.8 million in net income in the third quarter of 2014. The Clayton, Dubilier & Rice private equity investment firm acquired the company in a $3.2 billion deal in 2011, when it was named Emergency Medical Services Corp.
AMR employees said they don’t know much about their new employer, Centrex. The Florida Department of State and several other states show the business registered as a foreign limited liability company. According to its website, the company’s president is Robert A. Miller, co-founder of a firm that managed provider networks and developed medical facilities; Gira Shah is chief financial officer.
Eric Foust, a senior vice president for AMR, is the vice president of revenue management for Centrex. The business outsourcing company, Omega Healthcare Management Services, is believed to be the offshore contractor taking over the work. The information was not confirmed, but Omega has operations in the same cities where Centrex has international offices: Manila, Philippines; and the Indian cities of Bangalore, Chennai and Trichy.
©2014 The Modesto Bee (Modesto, Calif.)