ELY- The financial woes of the Ely Area Ambulance Service, or EAAS, prompted a special city council meeting here last Wednesday evening to approve another emergency funding allotment to allow the ambulance to meet its Dec. 14 payroll. With little alternative, the council approved a payment of $32,090 to fill the service’s funding gap.
City officials called the special meeting in the wake of last week’s meeting of the Ely Area Ambulance Joint Powers Board, where ambulance service personnel informed JPB members, including the cities of Ely and Winton along with Morse and Fall Lake townships, of the service’s latest funding crisis.
Unlike previous financial discussions between the EAAS and the joint powers board, the looming payroll, without the funds to cover the checks, put the situation in crisis mode. EAAS board member Chuck Novak put much of the blame on a lag in its revenues and he noted that if the nonprofit service fails the Ely-Bloomenson Community Hospital will be on the hook to operate the service unless other arrangements can be made.
Billing problems
The EAAS replaced its billing service earlier this year due to lengthy delays in payments and it still hasn’t received all of the funds it expects to be paid from the old service, according Bob Berrini, who sits on the boards of both the EAAS and the joint powers board.
Novak said that revenues can take up to six months to arrive after the EAAS issues an invoice. “It will take a crystal ball to determine when exactly that money is actually coming,” Novak reported, sketching out how the EAAS accounts receivable are at the mercy of the medical payments systems, including Medicare, Medical Assistance, and private insurance.
The shortfall between the tardy payments and EAAS’s expenses is what left the service $28,000 short on its recent payroll.
No costs cut
“What adjustments have been made to try to try to balance things out so you can survive?” asked Al Forsman, the joint powers representative from the Ely City Council.
Novak, in response, said the EAAS no longer has building expenses, now that the joint powers board owns the ambulance facility in Ely, a reply that seemed to largely avoid Forsman’s question.
Novak did mention that going to a paid on-call model instead of 24/7 staffed service would be a possible savings, but argued that the service would lose a lot of its trained staff if the service opted for that model. He predicted Ely ambulance personnel, especially those who don’t live nearby, would look for work elsewhere. “Those people aren’t going to drive up here for four hours pay, then drive home and maybe be here once or twice a week. They’re going to get other employment. I would. You would. Everybody would. You need stable income these days.”
Novak also argued that an on-call system would be a degradation in the standard of care for the area served by the EAAS, which includes a portion of the Boundary Waters.
Criticism
JBP chair Marlene Zorman asked Novak and EAAS board member Scott Kellerman for an estimate of what it would take to keep the EAAS running until a more permanent solution to the financial situation could be devised.
Kellerman stated he didn’t have an exact figure, but Novak had a number in mind.
“If you don’t want to meet here every month” Novak said, “to talk nickels and dimes. But (with) $120,000, (in addition to) what we got in the bank, that should take us to January.”
Zorman questioned it. “The last budget I saw predicted (operating expenses) like $330,000,” noting that this didn’t match with a figure of $120,000 through just January.
Berrini said the EAAS expenses “aren’t going to cost you $120,000 if you do the math.”
Kellerman responded. “I would say $100,000 would carry (the EAAS) through February.”
Morse Township Supervisor Terry Soderberg, who was attending remotely by phone, had harsh words for the management of the EAAS.
“How did we get to this point where we’re coming to a meeting and you’re thinking you can’t make payroll three days from now? What kind of management is that?” Soderberg asked.
Zorman remarked, “It was Dusty (Moravitz, executive director of the EAAS), and he said he will talk to you later, but that he brought it up in a meeting last week.”
Soderberg responded, “Even ten days ago, what kind of management does it take (to address not meeting payroll) just 10 days before? I know there’s no response to that. It’s just my soapbox.”
Meeting payroll
Zorman, who wasn’t shy to use the gavel, steered the meeting back to the immediate operation of the EAAS, noting the appropriate short-term response to the current problem was meeting payroll on Thursday.
The city of Ely acts as the financial agent for the JPB and Ely Clerk-Treasurer Harold Langowski calculated the current monthly shortfall for the EAAS, based on the revenue and expense figures provided by Kellerman for Monday’s meeting.
“From (Kellerman’s) spreadsheet, the average monthly loss is $26,000,” Langowski calculated.
The JPB voted for Langowski to invoice the four JPB members, Ely, Winton, Morse, and Fall Lake on a per capita basis immediately for $52,000 to cover two months of operating losses. The four members noted that payment of the amount was contingent on the approval of each municipality’s local government and was not certain.
The JPB chose funding the operating shortfall for two months based on the projected delivery of the the hospital’s ongoing EMS feasibility study. The focus and subject of the study was covered in the Sept. 1 edition of the Timberjay.
On a per capita basis, Ely was invoiced $32,090, Winton $1,670, Morse $11,750, and Fall Lake $6,400. The invoice would also include the budgeted and already agreed-upon 2024 expenses for the ambulance building which the JPB owns.
“I’m going to have to hold a special meeting in Winton,” noted Zorman, who is also Winton’s mayor. “I don’t know if it’s going to be till next week. I don’t know if I can get that. I don’t think any of us are going be able to get you enough money by Thursday.”
Berrini, the JPB representative for Morse, commented he would have it added to the agenda for the Morse meeting on Tuesday night. Ely, knowing that an action might be needed before the JPB met, had already scheduled a special meeting for Wednesday, Dec. 13.
Aftermath
At the time that this article was filed on Tuesday evening, the Timberjay attended the Morse Township meeting. The Morse Commissioners voted 2-1 to support the invoice from the JPB issued earlier in the day.
Soderberg was the dissenting vote, based on his stance that Ely was not pulling its weight based on its lower per capita funding of ambulance expenses back in September. “Once again, we’re paying for services for Ely,” he remarked, noting that it was unfair for the least populated joint powers members to be subsidizing the most populated. Morse, Fall Lake and Winton funded the EAAS subsidy at a per capita rate of $15.15 for 2023 while Ely funded at a rate of $10.60. These amounts are according to the figures reported in the agenda packet for the Dec. 11 JPB meeting.
Berrini, who attended a meeting regarding the Fall Lake invoice earlier on Tuesday, reported that Lake Co. had approved that invoice. Lake Co. is the agency which funds EMS expenses for Fall Lake.