Ill. Medical Transport Feeling Pinch of Late Payments

Oct. 16--PEORIA -- The only thing worse for a company's bottom line than having one contract with the state of Illinois is having two.

Advanced Medical Transport, which the state owes $750,000 to $1 million, deals with that painful budget situation every day -- but not for much longer.

After January 2012, the Peoria-based ambulance company plans to cancel its $1.6 million contract with the slow-paying state to transport behavioral patients, AMT executive director Andrew Rand said.

"We have been contracted to do this for a year-and-a-half. The state funded only half a year this year. Given the lack of the correct appropriation, we needed to provide notice under the agreement or we will get stuck trying to recover our costs in court," he said.

"Every Monday morning, we look at what's been received from the state to see where we are," Rand said.

A second state contract to provide transportation for Medicaid patients amounts to about $1 million a year, with payments now running about five months late. Rand contrasts that with federal reimbursements for Medicare, which make up about 40 percent of AMT's annual $10 million budget. Those run just 46 days late.

The ambulance company's decision to cancel the behavioral

contract is "certain to create chaos" for the state, Rand said. He estimates AMT provides transportation for 3,600 such patients a year -- patients who can be violent or suicidal -- in every Illinois county except for Cook.

Ending that contract is not something Rand takes lightly. "A behavioral health emergency requires special attention. These are the people in Illinois that can least defend themselves," he said.

But it's a non-ambulance and non-emergency service, with special vehicles used. Rand points out it's also non-paying unless the state commits to a full year of funding. "You have to have a little cash flow to meet the mission," he said.

That mission dictates that AMT maintain its Medicaid contract with the state, despite the slow pay, "because it's part of the health-care formula to take on all comers," Rand said.

Being owed $750,000 or more requires adjustments to AMT's operation.

"We've developed a cash profile to get us through the process," Rand said. "After so many years of being under-reimbursed and paid late, you learn to adjust your business plan to consider the pitfalls of state finances. You'll suffer if you don't."

Despite the state funding shortfall, AMT has been able to grow, with Iowa contracts in Cedar Rapids, Dubuque and Iowa City.

"In this business, if you're not growing, you're going the wrong way," he said.

When Rand took over AMT 20 years ago, there were four ambulances. Today, there are 40, with a total fleet of 70 vehicles.

AMT recently completed a $2.5 million renovation of its headquarters at 1718 N. Sterling Ave., which includes a high-tech control room that monitors activity in central Illinois as well as across the state and Iowa.

"It's a tool we use to get to the scene of the accident on a local basis and for dispatching vehicles (from five different centers) across the state," Rand said.

With 280 employees deployed across two states, AMT regularly receives offers from communities looking for help in handling medical transportation, he said. "We're considering two more now. We are in a growth mode."

But the outlook for state funding isn't so rosy. "The backlog of bills grows. Providers will continue to carry a portion of the state's debts like a major bond creditor. The problem is that our company, like other health-care enterprises, is not a bank," he said.

With no bailout in sight, Rand isn't optimistic about what lies ahead when it comes to state payments. "Illinois has such overwhelming structural financial challenges that, even after a tax increase on business and individuals, we resolved virtually nothing."

Steve Tarter can be reached at 686-3260 or starter@pjstar.com

Copyright 2011 - Journal Star, Peoria, Ill.