Chesterton Tribune


Orlich vows: Town ambulance service would be killed if it doesn't pay for itself

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Chesterton Fire Chief Mike Orlich has made this pledge.

Should the Town Council act to create a municipal advanced life support (ALS) ambulance service, and should that service be unable to pay for itself through the fees charged to patients, then the service will be killed.

“That would be the unfortunate day we would have to discontinue the service,” Orlich told a roomful of folks on Tuesday, who had come to the town hall to hear his presentation on the ways and means of a municipal ALS service.

Orlich opened his presentation with a brief history of ambulance service in Chesterton. As recently as the early 1980s, there were four ambulances available in Chesterton to transport patients: two provided by the county-funded service, two—one an ALS unit, the other a basic life support unit—provided by a private service. Later in the decade, the private service closed, leaving the two funded by the county. That county service was contracted to Porter Memorial Hospital and its successor, Community Health Systems Inc.

Orlich’s point: since 1980 the Town of Chesterton’s population has grown by 53 percent—and the CFD’s annual calls have increased by 237 percent, two-thirds of which are EMS assists—but the number of ambulances serving Chesterton has remained unchanged.

As it is, Orlich noted, the CFD around 90 percent of the time arrives at the scene of an EMS assist before Porter Hospital EMS personnel do. That’s not a slam against the EMS personnel, he said, but an indication of how thinly stretched those EMS personnel are, tasked to cover the Tri-Towns, Beverly Shores, and unincorporated Westchester, Liberty, Jackson, and Pine townships. And when the two ambulances at the barn at East Porter Ave. and Ind. 49 are both on a call, one of Porter Hospital’s other three units—in Valparaiso, Union Township, and Hebron—must respond, or else a unit from the Portage or Valparaiso FD.

The CFD’s ALS service would work and look like this:

•It would be comprised of a single ALS unit staffed and operated 24/7/365.

•It would be a function of the CFD, not a separate municipal department.

•It would require the hiring of four new paramedics, which would bring the CFD’s total number of paramedics to six. Two would be assigned to each of the CFD’s three shifts, on 27 hours, off 48, bringing the total number of CFD personnel on each shift to six: two paramedics, four firefighters.

•The ALS service would be funded not through property taxes but through user fees based on the level of service provided each call. Basic life support, $500 per call; ALS1, $700 per call; ALS2, $850 per call. Plus a mileage fee of $10 per mile, with the average miles traveled per call at 3.5.

•Based on last year’s calls for service, Orlich calculated that with 40 percent BLS calls and 60 percent ALS—and adding mileage—the CFD would bill $523,500.

•A 60-percent collection rate would create a revenue of $314,100 (less a private billing service’s cut). A 67-percent collection rate, a revenue of $350,745.

•Next, Orlich projected total operational expenses of $284,512, for wages and benefits, a part-time clerk, fuel, equipment, and supplies.

•A 60-percent collection rate would yield a net revenue—less the private billing service’s cut—of $29,588. A 67-percent rate, a net revenue of $66,233.

•The ALS service would need a seed loan from the Town of Chesterton, made probably in CEDIT funds. That loan would be re-paid over 36 to 48 months but Orlich is hopeful that the ALS service would begin provide an actual revenue stream within 60 to 90 days of start-up, tentatively scheduled for April 1.

•All revenues would be deposited into a non-reverting fund for exclusive use by the ALS service.

•A separate expense would be the ambulances themselves. Orlich wants to acquire two, a new one and a used one, the latter as a back-up. He estimated the cost of two new ones—worst-case scenario—at $231,000. But Orlich believes he can find a new one and used one for less and is exploring a variety of funding options, including grants and private/public partnerships.

Public Concerns

Orlich then spent some time addressing the concerns voiced by some residents.

•There would be no duplication of services, Orlich said. The CFD has been responding to EMS assists for years. ALS would be an “enhancement” of a service which the CFD already provides.

•Residents would not be double-taxed, because the current ambulance service is not funded through taxes in the first place but—like the CFD’s proposed service—through user fees. Orlich also noted that the cost of the current contract which Porter County has with Porter Regional Hospital is not technically tax-funded either. Rather, he said, it’s funded with proceeds from the sale of Porter hospital.

•No new fire station or ambulance barn would need to be built. The ALS service would operate out of the current CFD station, Orlich said.

•Patients would have their choice of where the CFD transports them, except in the case of a life-threatening medical crisis, in which case the CFD would be legally obligated to transport the patient to the closest appropriate facility.

•Orlich emphasized, again, that the ALS service would be provided through the CFD, not through another, new, department.

•And he said that the CFD is not “pushing this project as fast as we can.” Rather, the CFD began exploring the feasibility of an ALS service in the summer of 2010 and made a report to the Town Council in the summer of 2011. The Chesterton Tribune covered that presentation.


Orlich also listed the advantages of a municipal ALS service.

•There would be a “quicker responses” to medical emergencies in town, given the fact that the CFD typically already arrives at the scene before Porter Hospital EMS personnel do.

•All paramedics would be cross-trained as firefighters, giving the CFD more manpower at fire and other scenes not requiring an ALS response. That could have a beneficial impact on the CFD’s ISO rating, which aids insurance companies in setting home insurance premiums.

•Most important, Orlich said, a municipal ALS service would improve the chances of a person’s surviving a medical crisis, because he or she would be treated more quickly.


Orlich then took questions from the audience.

If user fees work, one person wanted to know, why is Porter County subsidizing Porter Regional Hospital’s ambulance service?

“I can’t answer that,” Orlich said but he did acknowledge that the county is subsidizing the hospital’s service with the proceeds from the hospital sale.

What would the CFD do in the event of two medical calls at the same time?

The CFD would do what Porter Regional Hospital does now: call for back-up from one of the other three units or from the Valparaiso or Portage FDs, Orlich said.

To what extent would a private billing service cut into the CFD’s revenue stream?

Orlich was unable to give an exact answer. Some firms take a cut off the top of what’s collected, other a percentage, 3 to 5 percent. At this point Orlich noted that, if the ALS service proves financially unfeasible, it will not be continued. “We’re not going to do anything that doesn’t work,” he promised.

Will dispatching change in any way?

It will not, Orlich said. All calls will be dispatched through the county 911 center.

If the current system is working, why change it?

Porter Hospital’s EMS personnel serve nearly all of North Porter County, with just two ambulances. “They don’t serve just Chesterton,” Orlich said. “And sometime the local units are tied up.”

The question was raised again, what will happen if the CFD’s projections are wrong, if there isn’t a sufficient revenue stream to support a municipal ALS service?

“I don’t feel it’s a likely possibility,” Orlich said and noted that the CFD’s projected collection rate—in any case, a conservative projection—is based on the rates experienced by other regional fire departments.

“It’s all guess work,” a man replied. “You can’t be sure. You can’t go by other departments. You have to go by what you got here.”

Orlich responded by saying that the CFD is modeling other FDs’ collection rates but that all other numbers are based on the CFD own calls, in the Town of Chesterton.

What would happen, though, the question was asked once more, at the end, if the money just isn’t there.

Then the service will be dissolved and the equipment put on the market, Orlich said.



Posted 10/18/2012