Insurance changes stress Hampton ambulance revenue

Feb. 23--Changes in the way people buy insurance are threatening the money Hampton relies on to support the fire department's ambulance service and will sooner or later force the City Council to a tough choice: asking that patients dig deeper into their own pockets or asking all the city's taxpayers to pick up more of the bill, City Manager Mary Bunting said Wednesday.

The challenge comes as more people opt, or are forced into, health insurance plans that require them to pay more out of their own pockets before the insurer starts covering their bills, so called high deductible policies, assistant city manager Steve Bond told the council at its semi-monthly work session.

It is a challenge for Hampton because the city's longstanding policy has been not to charge residents for the portion of an ambulance bill their insurance does not cover, he added.

Normally, for a $750 ambulance ride covered by the state's largest health insurer, Hampton would get an insurance company check for $400, Bond said. That reflects an agreement with the insurance company to discount the official charge by $250, and the insurer's promise to the patient that it will pay 80 percent of the discounted amount, or a total of $400. For city residents, Hampton writes off the remaining $100, though it will bill nonresidents for that.

The problem is that high deductible plans often require people to pay several thousand dollars worth of medical bills out of their own pockets before the insurer's promise to pay its 80 percent share kicks in. If the insurer won't pay in this situation, Hampton currently won't try to collect the bill from a resident. It will for nonresidents.

Rising costs and aging equipment are straining Hampton's trash and recycling operations, so city officials are floating the idea of a fee increase.

A presentation prepared for the City Council work session Wednesday says the current $5.88-a-week fee would push the city's trash operations, which...

Rising costs and aging equipment are straining Hampton's trash and recycling operations, so city officials are floating the idea of a fee increase.

A presentation prepared for the City Council work session Wednesday says the current $5.88-a-week fee would push the city's trash operations, which...

As more people buy high deductible policies, Hampton could see fewer payments for ambulance calls. But medics still must be paid, and gas must still be bought, and new ambulances will still be needed from time to time.

And, Bunting said, the money has to come from somewhere.

"Do you want a fee on everyone who uses the service or do you want to say it's a general expense of government that we cover with higher real estate or personal property taxes?" she asked. "It's not really a good choice."

She said the issue is likely to come to head sooner or later -- and possibly sooner because Hampton's partner in an automated mutual aid system, Newport News, bills patients for the portion of its charges that the insurer doesn't cover.

Bunting is afraid Hampton residents are going to start directing 911 dispatchers to call Hampton ambulances rather than nearer Newport News ones because of the two cities' different billing practices.

Hampton receives about $3.9 million in payments from insurers and patients for ambulance services. Bunting said that only covers a portion of the cost of the service.

Bond's report was for information, and the council took no action.

Earlier, Peninsula Pilots owner Henry Morgan asked the council to give a green light for his plans to use about $1.2 million of city funds promised for improvements at War Memorial Stadium, including a new entrance gate, restrooms and an indoor facility to replace the third base bullpens and batting cages. The project would help improve drainage, and would be the first step in a series of improvements to the field itself and the main stadium structure.

Also, public works operations manager Jason Mitchell suggested raising the weekly trash fee by 22 cents to $6.10.

That would generate enough money to cover operating cost increases next year, as well as paying for six replacement vehicles, Mitchell said.

Going forward, the city would stay ahead of projected increases in costs and maintain that pace of vehicle replacements by keeping the fee at $6.10 for fiscal year 2019, raising it to $6.45 in fiscal year 2020 and 2021, and then raising it to $6.95 in fiscal year 2022.

The proposed increase for next year leaves the rate below the current Newport News, Norfolk and Portsmouth rates, Mitchell said. City officials will ask residents for reactions at a town hall meeting early next month, and it will then be up to the council to decide whether or not to increase the fee.

Ress can be reached by phone at 757-247-4535.

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