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Cottage Grove EMS write-offs continue rising

An aging population more reliant on federally subsidized insurance programs like Medicare and Medicaid is increasing the amount of EMS write-offs in Cottage Grove.

The city is writing off roughly $1.9 million in EMS costs for 2013. City Finance Director Robin Roland said they are mandatory.

“We cannot recoup fees above and beyond what Medicare and Medicaid will allow,” Roland told the Cottage Grove City Council recently.

When a person in distress calls for an ambulance and is transported, the patient is billed for both basic and advanced life support at the time of the call. However, if the patient has Medicare or Medicaid, the amount is capped.

“This is an ongoing situation,” Roland said. “But as the population continues to age, more and more that are taking an ambulance are on Medicare. We will see those costs exceed even the amount that will be written off. We have no control over that.”

On average, she added, roughly 50 percent of a bill is written off.

As a primary care provider for the nearly 44,000 residents of Cottage Grove, St. Paul Park, Newport and Grey Cloud Island, paramedics are obligated to respond and provide care.

“We are not alone in the health care industry,” Director of Public Safety Craig Woolery said.

Throughout the last couple of years, EMS-related calls have increased significantly. The increase led the Cottage Grove Public Safety Department to transition from a police/EMS model to a firefighter/EMS model, because more firefighters than police officers have EMS training.

Woolery said there is a loose connection between the increased amount of write-offs and the rise in medical calls, but he attributed it to simply “more people are on Medicare.”

Other financial difficulties that result in an unpaid bill include worker’s compensation, bankruptcy and closed by collection.

In 2011, write-offs topped $1.3 million and increased to $1.7 million in 2012.

Despite the $1.9 million write-off for 2013, City Administrator Ryan Schroeder said the city is not losing money.

“A lot of people, when they hear write-off, they see we’re losing money,” he said. “But each year we’ve actually had a net income. At the end of the day, the Cottage Grove taxpayers are not subsidizing this operation.”

The write-offs have not been audited yet, but Roland said the numbers aren’t likely to change much.