A county decision not to award a promised contract to a San Dimas ambulance company has left the firm in a financial bind, saddled taxpayers with extra costs and left city officials wondering what happened.
Medic-1 Ambulance Service was notified last December that it had won a county contract to respond to 911 emergency calls in the city.
As a result, the company bought two ambulances, hired and trained eight employees and spent about $100,000, according to Daniel G. Gold, the company’s president.
But the agreement was killed by the county a week before it was to go into effect on Feb. 1, leaving company and city officials mystified.
The county Department of Health Services withdrew the Medic-1 contract just before it was to be acted upon by county supervisors. Gold said he believes the contract was stopped by Supervisor Pete Schabarum, but Judy Hammond, Schabarum’s press deputy, said the matter “never reached his level.”
Tom Hibbard, a senior deputy who handles health matters for Schabarum, said that he and other aides to county supervisors raised objections to the San Dimas contract at a health department briefing. He said the objection was not to Medic-1, but to awarding any contract in San Dimas while the county is planning to put cities, including San Dimas, into large zones for ambulance service.
Hibbard said the concern was that other cities would want contracts awarded separately, jeopardizing a plan under which the county has created 11 ambulance zones to serve more than 50 cities. The county is soliciting bids for the zones and is planning to award contracts effective next year. The zone plan is a response to a 1986 court decision that makes the county responsible for emergency ambulance service in cities that do not run their own systems.
Gold said his experience with the county is the worst thing that ever happened to his company.
“If the county’s goal was to hurt us,” Gold said, “they could not have planned it any better.”
Medic-1 recently lost another contract because of a city’s dispute with the county.
Claremont had contracted with the company to provide paramedic service for the city. But county fire officials balked at the arrangement, citing the department’s policy that fire protection and paramedic service are a package deal--a city cannot receive one without the other. Claremont is served by the county Fire Department.
Although he has exchanged letters with Supervisor Schabarum, San Dimas Mayor Terry L. Dipple said he still does not understand why the county dropped the Medic-1 contract for his city and is retaining another ambulance company at higher cost. “It’s a mystery to me,” he said.
Crippen Ambulance Service, which has served San Dimas since 1983, will continue to serve the area at least through the end of this year, even though it lost to Medic-1 in the bidding process. Meanwhile, the county is soliciting proposals for ambulance service in a large foothill area from La Canada Flintridge through San Dimas to Claremont, starting in 1990.
Audrey Bahr, chief of the contract program office of the county Department of Health Services, said she can understand why Gold, only 26 years old and one of four stockholders in Medic-1, is disappointed. “He has a nice little company. He’s young, eager and wants to do a good job,” she said.
$40,000 Performance Bond
But, Bahr said, Gold should have realized that he did not have the contract locked up until it was approved by the County Board of Supervisors, even though the health department told him he had won the contract and asked for and received $40,000 as a performance bond.
Gold estimated that the three-year contract would have produced $800,000 in revenue. He started Medic-1 six years ago with a single ambulance and has built it into a major enterprise with 46 employees and ambulances stationed in Duarte, Claremont, Hacienda Heights, Pomona and San Dimas.
Medic-1 and Crippen were the only ambulance companies that responded when the county asked for bids on the San Dimas area last fall. A panel representing the county health and fire departments and San Dimas reviewed the bids and recommended Medic-1.
Francis J. Dowling, who was director of the health department’s office of contracting and management until his recent promotion to deputy director of mental health services, wrote a letter to Gold last Dec. 9 that said Medic-1 had won the contract.
“Effective Feb. 1, at 01 hours, Medic-1 Ambulance Service will be the primary emergency ambulance responder to the City of San Dimas,” the letter said.
The county Department of Health Services recommended approval of the Medic-1 contract in a report to the Board of Supervisors on Jan. 19. It was not until Jan. 24, Gold said, that he learned that his contract would not be submitted to the board in time for his company to begin serving San Dimas on Feb. 1.
Dowling followed this notification with a letter to Gold saying, “At this point we are unsure when we will present the proposed agreement to our board, if at all.” Dowling wrote that the county was “increasingly of the opinion” that San Dimas should be included in a large ambulance service zone and should not be contracted for separately. Gold said repeated telephone calls to county officials to obtain clarification of the status of the contract went unanswered. He said the only explanation he ever received were hints from county officials that the contract had been blocked by Schabarum.
Gold said he wrote to Schabarum for an explanation, but has received no reply. While aides said the contract never came to Schabarum’s attention, they said his office did play a role in the matter.
Hibbard said that both he and Schabarum had discussed ambulance issues with Jim Decker, owner of Crippen Ambulance Service. Hibbard and Decker said the conversations never touched on the San Dimas contract, but dealt with broader concerns about ambulance service.
Dowling said there was never any pressure from Schabarum’s office to drop the Medic-1 contract. “There was never any directive or request out of that office,” he said. “I’ve never had that kind of pressure.”
Health Department Decision
He said the health department dropped the contract with Medic-1 after hearing the objections from supervisorial aides and weighing the impact on the zone program.
Dowling said Gold should not have been misled by his Dec. 9 letter. He said Medic-1 “has been around long enough to know there is no contract until it is approved by the board.”
County health officials acknowledged that retaining Crippen for the remainder of the year instead of hiring Medic-1 will cost the county money, but because of the terms of the county’s financial arrangements with ambulance companies, the exact amount is unknown.
The county pays Crippen and a consortium of 15 other ambulance companies $3 million a year to compensate them for uncollected bills for emergency runs in unincorporated areas and in cities that do not have their own ambulance systems. The companies divide the money among themselves without county supervision. Decker said his company’s share for serving San Dimas is only $125 a month. The county had planned to seek a reduction in payments to the consortium once the San Dimas contract was awarded, but had not specified an amount.
Crippen, which is headquartered in Covina, and Medic-1 were the only bidders when the county solicited proposals for the San Dimas contract last fall. Both companies would have charged patients the same fees since ambulance rates are set by the county. Crippen’s bid called for a county subsidy of $11,800 a year to offset the cost of serving indigents and others who do not pay their ambulance bills. Medic-1 offered to serve the area without cost to taxpayers.
Both Medic-1 and Crippen claimed to offer superior service, but Dowling said that the review panel concluded that neither company offered a service advantage. The preference for Medic-1 was based entirely on cost, he said.
The county solicitation of bids for San Dimas came after the city had solicited its own bids last year and also had chosen Medic-1 over Crippen. The county intervened to stop the city contract from taking effect, citing the 1986 court decision giving the county responsibility for emergency ambulance service.
Mayor Dipple said that San Dimas preferred that the county award an ambulance contract for San Dimas separately rather than lump the city into a zone, and county officials agreed. He said he was surprised that the county would go through the bidding process and then raise the zone issue just as Medic-1 was about to begin serving the city.
‘It Does Not Make Sense’
In his letter to Schabarum, Dipple said, “I am frankly surprised that the county would not allow us to be served by a firm which . . . will cost the county less than the existing provider . . . . It does not make sense to us for the county to continue to pay Crippen for indigent care when an equally or better qualified company is willing to do it for free.”
Schabarum in reply said that county health officials had determined that contracting separately for San Dimas was “not practical or efficient” and “might touch off similar requests by other cities, which could seriously jeopardize the viability of the zone plan.”
Dowling said the zones were designed to be economically balanced so that ambulance companies could earn enough revenue to offset unpaid bills from indigents, without requiring taxpayer subsidies. But Bahr and other county officials said that adding San Dimas to the foothill area, which is labeled Zone 4 in the county plan, will neither add nor detract from that zone’s economic balance.
And both Gold and Decker said the county zone plan is badly flawed, noting that Zone 4 stretches across 45 miles and would be difficult for any company to serve.
“The idea has not been well thought out,” Decker said, adding that the county is destroying an ambulance system that has worked well for decades.
Medic-1 and half a dozen other companies have been fighting to break into the emergency ambulance business that Crippen and the 15 other companies have traditionally controlled. Gold said he supports the idea of competitive bidding for contracts, but that the zones drawn by the county are not workable.
He noted that his company is based in San Dimas and is the first-response emergency ambulance service for Claremont and California State Polytechnic University, Pomona. Both Claremont and San Dimas have been put in Zone 4, he said, and the only way his company can retain those areas is to submit a bid that also includes service to La Canada Flintridge, Irwindale, Glendora, Azusa, Bradbury, Duarte and Monrovia.
Bridget Distelrath, assistant city manager in Claremont, said Claremont has asked the county to exclude it from the zone. She said Claremont is receiving excellent service from Medic-1 at no cost to taxpayers and she sees no advantage to the city in having its ambulance service put out to bid as part of a vast zone. She said the county seems “more concerned with the financial well-being of ambulance operators than with service to the public.”
Even Hibbard, who said the San Dimas contract should be withdrawn to protect the zone system, said there are many complaints about the way the zones have been drawn. “I don’t think there is anyone who is willing to stand up and say these zones make sense,” Hibbard said.