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Texas council considers $4.2M for MedStar shortfall

A spokesperson for MedStar said costs to retain staff since the COVID-19 pandemic have eaten into their reserve fund


The 2024 Fort Worth city budget proposal includes $4.2 million in transitional funding for MedStar. The ambulance authority says its expenses have increased since COVID-19, but the Fort Worth Firefighters Association is encouraging the city to transition away from MedStar in favor of another emergency medical services model.

Photo/Amanda McCoy via MCT

By Harriet Ramos
Fort Worth Star-Telegram

FORT WORTH, Texas — The Fort Worth City Council is poised to vote Tuesday on the 2024 budget, which includes $4.2 million in transitional funding for MedStar — the first money from the city that the area’s ambulance service would receive in over a decade.

Matt Zavadsky, the spokesperson for MedStar, said expenses to retain emergency medical technicians and paramedics have drastically increased since the COVID-19 pandemic and at the same time insurance companies are paying less. The result is a shortfall that MedStar has had to make up by using reserve funds, something Zavadsky said is not sustainable in the long term.

“Our expenses are going to exceed our revenues unless we can change the revenue,” Zavadsky said. “Because the expenses aren’t going down. Or we need to start having conversations with the cities about funding.”

MedStar originally asked city leaders for $1.5 million per quarter, or a total of $6 million for the 2024 fiscal year.

In early August, Fort Worth Mayor Mattie Parker announced the city would select an independent consultant to work with city leaders in “developing long-term sustainable funding options for medical emergency ambulance response,” according to a letter addressed to the Fort Worth City Council.

Parker also formed an Ad Hoc Council Committee on Emergency Medical Response to reassess MedStar’s services and review other EMS models.

The committee, composed of chair Carlos Flores, District 2; Charles Lauersdorf, District 4; Jared Williams, District 6,; Macy Hill, District 7; and Elizabeth Beck, District 9, has until April 30, 2024, to complete its review and recommend “the best path forward for Fort Worth’s Emergency Medical Services,” according to the mayor’s letter.

“As the immense growth of our region and city continues, it is evident that we owe our citizens a thorough, transparent and swift reassessment of these services to ensure that we are utilizing the best model for the fastest-growing city in the United States,” Parker said in the letter.

How MedStar operates

Fort Worth’s EMS system underwent a complete overhaul in the early 1980s. The result was the Fort Worth Ambulance Authority, now known as the Metropolitan Area EMS Authority, or MedStar. The new authority began service on April 1, 1986, according to MedStar records, with a call volume of 39,000 the first year.

MedStar operates as a public utility model, or quasi-governmental agency, and is governed by a board of directors. It is not an EMS contractor or a for-profit company, Zavadsky said.

The ambulance provider services 15 cities in Tarrant County, including Fort Worth, Haltom City, White Settlement, Saginaw and Sansom Park, according to the agency’s website.

MedStar received subsidies from Fort Worth and the other member cities until 2010. Expenses were low, Zavadsky said, and the income generated from insurance payments and a community paramedicine program made the ambulance service provider self-sustaining.

“Everything was good,” Zavadsky said. “You know, we could put some money in the bank, we could have a rainy day fund, and we didn’t need public subsidy.”

That all started to change in 2021, Zavadsky said. In order to retain personnel during the COVID-19 pandemic, MedStar had to increase paramedic and EMS wages by nearly 58% over 18 months. Insurance companies were paying less, and the government reduced a yearly supplement from Medicare and Medicaid from $3 million to $1 million.

MedStar operates on a $50 million annual budget, according to Zavadsky. Financial records show that MedStar ended its 2022 fiscal year with operating expenses of $57,005,553 and $52,657,929 in 2021.

Public utility model vs. fire department EMS

Steven Knight with Fitch and Associates, an organization that provides EMS consulting services, said emergency medical services all across the U.S. are struggling financially since the pandemic.

Knight’s organization was one of the ones that bid on providing the EMS independent consultant services for Fort Worth. Due to that, he said he would only be able to speak generally on the subject of EMS services and not specifically to Fort Worth or MedStar.

The cost of retaining EMS personnel is higher now, Knight said, and so is the cost of purchasing equipment. There is also a problem with supply chain shortages.

“If you were to try to buy an ambulance today, you might not receive it for two years,” Knight said. “So a lot of those costs have increased on the companies and it’s just difficult to to be able to afford to provide the services without subsidy.”

In recent years, large cities have started to run their ambulance service through the fire departments, according to Knight.

Dallas Fire-Rescue is run that way. In Arlington, the EMS is an integration of the fire department and a private ambulance contractor, American Medical Response.

Knight said the advantages some cities see in using fire-based EMS is that fire departments are already in a position to respond quickly from stations set up throughout the city, an edge ambulance services don’t have.

Michael Glynn, the president of the Fort Worth Professional Firefighters Association, said the union doesn’t believe the public utility model MedStar operates under is the most efficient model or the best use of resources for the city.

“We’re looking forward to the city diving in deeper to see what’s the most appropriate way to make use of the resources available to a city our size,” Glynn told the Star-Telegram.

In a July 28 letter, the firefighters association asked the city council to refuse the proposal to subsidize MedStar, and, among other requests, asked that the city “transfer the operation of 911-Emergency Medical ambulance dispatching from MedStar to the Fort Worth Fire Department” and “transfer the operation of the position of Medical Director for Emergency Medical Service and Ambulance from MedStar to the Fort Worth Fire Department.”

Glynn said if Fort Worth leaders opted for a fire-based EMS service, there would be transparency with funding, revenue streams and availability of resources, something the city doesn’t have with MedStar, according to Glynn.

“We have trained firefighters with a lot of years of experience in a busy 911 system that would be able to be responding on ambulances, if we were to go down the path of fire-based EMS,” Glynn said.

Changes ahead

Valerie Washington, the assistant city manager who oversees the fire department, said the firefighters association has raised some valid concerns, and she thinks the evaluation by the ad hoc committee and the independent consultant will lead to changes that need to happen in Fort Worth’s EMS system.

“I believe that it’s definitely going to be something different from what it is now,” Washington said. “I don’t know what that is, but I’m anticipating that there will be some, you know, some pretty big changes just to ensure that we do have ... a sustainable (EMS) system that meets the needs of our community.”

Washington said the city has been watching MedStar’s finances pretty closely the last couple of years and trying to figure out the best way to help the agency. MedStar coming forward and asking for funding gave city leaders the opportunity to get more involved, she said.

“We’re motivated to provide that transitional funding because we do not want our residents and visitors and businesses to see any difference in service levels,” she said.

After MedStar approached the city with the request for $6 million, Washington worked with MedStar, the fire department and the budget office to lower the amount to the $4.2 million that’s now in the proposed budget.

Washington said the reduced figure came from “very specific calculation and discussion,” and was based on the amount of reserve funds MedStar was having to spend each month, $350,000, multiplied by 12.

“We have a duty to our taxpayers and our elected officials to ensure that what we’re bringing forward we can defend,” she said. “And that was where we landed and felt that we had something defensible that we could talk to our elected officials about.”

Washington said there has also been conversation with the other cities MedStar services to help with the transitional funding. Any amount they contribute would reduce the amount Fort Worth would have to pay, Washington said, but it would not increase the $4.2 million.

The money for the transitional funding is in the non-departmental fund of the 2024 budget, Washington said. Even if it passes Tuesday’s vote, it would require another vote before the money could be turned over to MedStar.

“We would do an appropriation from what we call our non-departmental fund and that would be a separate mayor and council action,” Washington said.

Washington said city officials are still working through how and how often they would disburse the funds to MedStar.

“It definitely wouldn’t be a whole check, but maybe something on a monthly or quarterly basis where there would be, you know, a review of expenditures and revenues and kind of a reconciliation that would be done before we disbursed funds out,” she said.

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