Hello readers. Today I am going to discuss the impact of a downward economy on EMS and the medical field in general. Until recently I actually believed that the medical field was immune to the economy. Like many others, I thought that since people can’t control when they get sick, that EMS and medical facilities would never suffer. That idea is absolutely wrong. Many things factor into financial hardships for medical facilities and EMS agencies during a recession. High unemployment rates and government cutbacks are just a couple examples.

Many American Citizens receive private health insurance as a benefit from their employers. When establishments are going out of business and people are frequently laid off, the number of insured patients significantly decreases. This can affect the medical field in general because people will not typically see a family physician for non life-threatening conditions, as they have no means to pay for it. While this may not affect the emergency call volume for EMS providers, it can certainly affect reimbursement. As it already stands, government provided insurance like Medicaid and Medicare already reimburse at an alarmingly low rate. In California, the average reimbursement rate is 14 percent. That means for every dollar that an ambulance service bills, they will only receive 14 cents. Even without a recession, this is still a huge obstacle for ambulance providers to overcome. With more and more people losing jobs, the amount of non-payers and government-assisted payers goes up.  Sounds bad enough right? It only gets worse.

When businesses collapse and people lose jobs, the government also suffers. People not working means people aren’t paying taxes. This equates to higher taxes and government cut backs. Medicaid and Medicare programs across the nation are tightening their belts, making reimbursement more difficult. Some states are even going as far as to delay payments. In addition to the decrease in cash flow, the state and federal government tend to place higher taxes on businesses, making daily operation even more difficult.

Despite all the doom and gloom that goes along with a recession, many agencies will prevail. Good financial planning, cutting overtime expenses and eliminating wasteful spending will be the key to success during these times of financial crisis.

As always, feel free to e-mail me with any comments or questions.

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