Sonoma County (California) Fire District replaced American Medical Response (AMR) as the provider of 9-1-1 ambulance service two and a half years ago. AMR accused the fire district of underbidding the contract. An article in The Press Democrat reports on a July 2, 2026, request to increase the billing rate by 16.36%. This is the second request to increase the billing rate. In March 2025, 15 months after taking over 9-1-1 ambulance service, the fire district asked to increase the billing rate by 25% (Espinoza, 2026).
Since the COVID-19 pandemic, more fire departments have added 9-1-1 emergency ambulance services. Some have been successful bidders on ambulance service contracts, replacing commercial ambulance providers like AMR and Falck. Others have resulted from a political decision by the authority having jurisdiction. Finally, some are functioning as the municipal safety net after a private or community volunteer ambulance service ceases to provide service.
Many of these transitions promise lower costs to the municipality. Once the ambulance service starts, the reality is that the fire department or municipality used unrealistic or naive financial analysis. This article provides a background and recommendations for chief fire executives.
A $3.65B Bolus of Federal and Robert Wood Johnson Funding to Start EMS
The current United States EMS system started in 1966, with Congress reacting to the National Academy of Sciences white paper on Accidental Death and Disability: The Neglected Disease of Modern Society. Congress included Emergency Medical Services (EMS) as a component of the National Highway Safety Act of 1966. The Federal Department of Health Education and Welfare’s (DHEW) five demonstration projects, the 1973 EMS Systems Act, and the Robert Wood Johnson Foundation poured $3.65 billion (in 2026 dollars) into 349 EMS systems (Shah, 2006; Bass, 2015; Sadler & Sadler, 2022).
DHEW funded demonstration projects in Arkansas, California, Florida, Illinois, and Ohio. The University of Oklahoma’s Center for Economic and Management Research (CEMR – economists and behavioral scientists) got the assignment in 1975 to study the performance of the DHEW EMS demonstration projects.
The Jacksonville (Florida) Fire Department got the highest assessment. They took over the emergency ambulance service from funeral homes in 1967 and used DHEW money to train and equip firefighters to better handle cardiac-related calls. Jack Stout, director for the Arkansas EMS demonstration project, recalled:
AIl five of the demonstration project directors were to speak, and I was scheduled (set up) to follow Jacksonville, Florida’s Captain John Waters. When Captain Waters finished, the audience of about 800 folks was rolling in the aisles from his truly professional comic delivery. Waters’ famous dual slide show presentation had convinced even me that death was a thing of the past in ]acksonville. Watching Captain Waters, I felt sorry for other department heads who had to compete with him for a share of the ]acksonville city budget (Stout, 1985, p. 55).
Birth of High-Performance EMS and the Public Utility Model
Jack Stout moved from the Arkansas EMS project to be a researcher at CEMR. An economist, Stout believed that under the right conditions private sector ambulance services could provide better services than the Jacksonville Fire Department’s “socialized medicine” (Stout, 1985, p. 55). This evolved into the High-Performance EMS (HPEMS) concept where the ambulance service was self-sustaining based on revenues and effective use of resources. There were nine “Public Utility Model” (PUM) high-performance EMS agencies in the 1980s. Many of the metrics we use today, like Unit Hour Utilization, came from HPEMS.
A key aspect of HPEMS is that every ambulance transport – 9-1-1, critical care, interfacility, and facility-to-home is provided by the HPEMS ambulance service (Overton & Stout, 2002). When I attended meetings of the Virginia State EMS Advisory Board, I heard complaints from volunteer rescue squads outside the City of Richmond that were not allowed to transport patients from city hospitals to their homes. The ordinance that established the Richmond Ambulance Authority (RAA), a public utility model, required that all patients transported on an ambulance stretcher in the city be moved by RAA.
When the Kansas City Fire Department took over ambulance duties from the Municipal Ambulance Services Trust (MAST) in 2010 (Mansur et al., 2009), and the Fort Worth, Texas, Fire Department replaced MedStar Mobile Health in 2025 (Wolf, 2024), the fire departments did not continue to provide interfacility transports. This dismantling of the Public Utility Model range of services affects the fire department EMS budget, as revenues from interfacility transports subsidized the cost of 9-1-1 responses in the PUM system.
A Look At Billing Revenues
The FY 2027 EMSA Strategy & Budget Book from the Emergency Medical Services Authority – a public utility model serving Tulsa and Oklahoma City – includes an EMSA Reimbursement Reality section. “The chart below underscores the vast difference between projected FY2027 billed charges and net revenue expected to be collected from the federal government Centers for Medicare & Medicaid Services (CMS) – two payors that account for nearly 70% of EMSA’s payor mix.” (EMSA, 2026, p. 4)
Breaking The Reimbursement Information Silo
While working as an assistant professor at The George Washington University, I did a deep dive into non-fire EMS. I remained active as an IAFC EMS Section member and engaged in committee work. Our tribal roots were clear, as it seemed that if the American Ambulance Association (AAA) advocated for a federal policy change, the fire service organizations would oppose it. I felt a bit like a stranger in a strange land when attending the AAA conference as an academic. Information was rarely shared between these tribes.
The first Fitch & Associates Pinnacle Conference in 2005 was an eye-opener. Dr. Jay Fitch exclaimed, “It reminds me of the Fourth Party!” The Fourth Party was an organization created by Jack Stout to provide training and advocacy for HPEMS. As with the AAA conference, some of the keynote speakers and many of the topics found at Pinnacle were not covered in fire conferences, including IAFC’s Fire-Rescue Med (FRM).
A lot has happened since 2005 …
Inadequate Ambulance Service Reimbursement
Until the Bipartisan Budget Act of 2018 directed CMS to build the Ground Ambulance Data Collection System (GADCS), the 2002 Medicare national ambulance fee schedule was established without actual cost data. Since 2004, Congress has added temporary add-ons to the fee schedule that have to be repeatedly reauthorized.
The Finance Committee of the National EMS Advisory Council, a nationally recognized council of EMS representatives and consumers to provide advice and recommendations regarding EMS to the federal government, issued a report on EMS Funding and Reimbursement in 2016. Their first conclusion:
The systematic cost of providing emergency ambulance services in the US exceeds currently available revenue. This mismatch can be resolved with one of two actions: 1) increase reimbursement or subsidies or 2) decrease costs. With fixed costs required to provide a clinically acceptable level of service, decreasing dollars spent on will result in a direct negative impact on the quality of care provided. The NEMSAC has previously recommended to FICEMS that it increase reimbursement for ambulance services utilizing the existing payment structure (NEMSAC Finance Committee Final Report, 2009). In the current economic climate, that recommendation is unlikely to be realized. (NEMSAC, 2016, p. 15)
Analyzing the Ground Ambulance Data Collection System (GADCS) Results
The first results of the GADCS surveys were published last year. Matt Zavadsky and the team from Page Wolfberg & Wirth LLC Advisory Group (PWW|AG) have been analyzing the data and interacting with the RAND Health Care’s lead author. The 2025 article Quantifying the gap between expenses and revenue for EMS services, posted on ems1.com, is the start of a continuing series analyzing the data, how the RAND author interprets it, and the implications for EMS operations. In PWW|AG’s January 21, 2025 webinar, “What We Learned From the First CMS Ambulance Cost Report,” they used CMS data to create Table X, which shows the stunning average revenue shortfall for all ambulance suppliers.
You can view this webinar and additional information on EMS reimbursement by enrolling in the PWW|AG Resource Hub, which includes a monthly EMS Financial Index. For policy issues, they have PWW|AG Industry Updates.
The post-pandemic 21% Solution that Unraveled Public Utility Models
Private-sector ambulance services poorly paid EMS caregivers before the pandemic. California is the only state to create an industry profile of the EMS caregiver workforce. The UCLA Labor Center identified “Private-sector EMTs and paramedics earned 39 percent less than their public-sector counterparts. Even when controlling for age, gender, geography, education, and race and ethnicity, public-sector wages were still much higher than private-sector wages” (Jacobs et al., 2017, p. 4). California public sector EMS employers are fire departments.
Non-fire municipal and commercial 9-1-1 paramedic ambulance services significantly raised salaries to fill EMS caregiver positions left vacant after the COVID-19 pandemic. Wake County EMS in North Carolina, a non-fire municipality, increased caregiver pay by 21% for existing and future caregivers to fill open paramedic positions and slow attrition. The 70-some open paramedic positions represent an 18% vacancy rate (Melmed, 2022). The Richmond Ambulance Authority increased caregiver salaries by 23%, raising the hourly rate by $4. Its employee turnover rate decreased from 43% to 17% (RAA, 2025, p. 13).
Similar pay raises were implemented at MedStar Mobile Health in Fort Worth, Texas; the Emergency Medical Services Authority in Tulsa and Oklahoma City; and the Three Rivers Ambulance Authority in Fort Wayne, Indiana. The increased salaries and the post-pandemic exponential jump in ambulance, medical equipment, and supplies costs placed all of these systems into financial peril. Stout’s High-Performance EMS process is financially unsustainable in the current healthcare environment.
Recommendations for the Chief Fire Executive
1) Identify and utilize a EMS reimbursement expert on your state’s regulations and practice
Medicine is a state-regulated activity. CMS regulations for reimbursement are complex. Especially now, with the dramatic DOGE initiatives and a chaotic federal government change process, you could benefit from having access to an insurance reimbursement expert in ambulance billing for your state.
2) Establish an effective audit process for submitting reimbursement claims
Some metro-sized fire departments have encountered significant potential federal fraud penalties for inaccurate or improper claim submissions. The municipal liability does not go away if you employ a vendor or subcontractor to process the claims.
3) Clearly show the expenses in adding an ambulance service
Some fire departments lump all of the operational expenses into a single budget category – if it has a siren and emergency lights, it goes in this bucket. Either internally or publicly, the municipality should be able to identify the direct expenses and the increase in existing services (911 center, apparatus shop, warehouse, training, etc.) associated with implementing a new ambulance service.
4) Consider EMS Services Going Beyond a Lights-and-Siren Rush to a Critical Patient
We will explore this in a later article, but only about six to seven percent of the patients treated and transported are clinically improved through paramedic street medicine. For those in cardiac arrest, stroke, sepsis, cardiovascular failure, allergic reaction, multi-system trauma, asthma attack, or acute metabolic crisis, we are lifesavers.
A recent study using 9.5 million EMS encounters in the 2024 ESO data revealed that:
Three percent of patients accounted for 16% of all encounters. Patients with very-high utilization were disproportionately covered by Medicaid, resided in socioeconomically vulnerable communities, and more commonly presented with chronic conditions. Despite higher transport rates, they were 40% less likely to be admitted than single encounter patients. The median time between encounters was 10 days for very-high utilizers (Fernandez et al., 2026).
Many of our 9-1-1 EMS calls are for situations never imagined in 1966. An ESO Solutions review of a little over ten million fire company responses (pumpers, ladder trucks, and heavy rescues) in 2025 shows that 66% are to EMS calls. Is this the best use of this resource?
References
Bass, R. (2015). History of EMS. In D. C. Cone (Ed.), Emergency Medical Services: Clinical Practice and System Oversight (2nd ed., Vol. 1, pp. 1-16). John Wiley and Sons, Ltd.
Crowe, R. P., Fernandez, A. R., Treichel, A., Gardner, B., & Myers, B. (2026). Fire Service Index: Insights and Best Practices for Fire Departments (8th edition) [White Paper]. ESO Solutions. https://www.eso.com/fire-service-index/
EMSA (2026) FY 2027 EMSA Strategy & Budget Book. Emergency Medical Services Authority. https://emsaok.gov/fiscal-strategy-and-budget/
Espinoza, M. (2026, July 26). Sonoma County Fire District, the regions largest ambulance service provider, seeks 16.36% rate increase. The Press Democrat. https://www.pressdemocrat.com/2026/07/18/sonoma-county-fire-district-regions-largest-ambulance-service-provider-seeks-16-36-rate-increase/
Finance Committee. (2016 ). EMS Funding and Reimbursement: FINAL. National EMS Advisory Council. Washington, DC: U.S. Department of Transportation.
Fernandez, A. R., Myers, J., Bourn, S. S., Crowe, R. P., Preusser, E. C., Muisyo, J., Treichel, A., Green, A. M., Onaeko, K., & Beck, E. (2026). A national description of emergency medical services patient utilization patterns. Health Affairs Scholar, 4. https://doi.org/10.1093/haschl/qxag144
Jacobs, K., Heller, N., Waheed, S., & Appel, S. (2017, February 7). Emergency Medical Services in California: Wages, Working Conditions, and Industry Profile. UC Berkeley Labor Center. http://laborcenter.berkeley.edu/emergency-medical-services-in-california-wages-working-conditions-and-industry-profile/
Mansur, M., Horsley, L., & Ochsner, C. (2009 Sep 28). MAST Takeover Won’t Change Service, Officials Say. The Kansas City Star.
Melmed, G. (2022, Mar 23). Wake County increases pay for EMS employees in effort to fill jobs and retain workers. CBS 17 https://www.cbs17.com/news/local-news/wake-county-news/wake-county-increases-pay-for-ems-employees-in-effort-to-fill-jobs-and-retain-workers/
Overton, J., & Stout, J. (2002). System Design. In Kuehi, A. E. (Ed.) Prehospital Systems and Medical Oversight. (3rd ed. pp. 114-131) Kendall Hunt Publishing.
Richmond Ambulance Authority (RAA). (2025). Presentation to City Council’s Public Safety Standing Committee. https://www.rva.gov/sites/default/files/2025-02/Richmond%20Ambulance%20Authority.pdf
Sadler, A. & Sadler, B. (2022). (P)LUCK: Lessons We Learned for Improving Healthcare and the World. Silicon Valley Press. ISBN 9781735873183
Shah M. N. (2006). The formation of the emergency medical services system. American Journal of Public Health, 96(3), 414–423. https://doi.org/10.2105/AJPH.2004.048793
Stout, J. (1985). Public Utility Model Revisited: Part 1: Origins. Journal of Emergency Medical Services (February), 55-58, 62-63. http://emsmuseum.org/wp-content/uploads/2021/05/Public-Utility-Model-Revisited-Part-1-_-Origins-55-58-62-63-1985-02-JEMS.pdf
Wolf, E. (2024 May 21). Fort Worth council approves switch from MedStar to fire-based EMS system. Fort Worth Report. https://fortworthreport.org/2024/05/21/fort-worth-council-approves-switch-from-medstar-to-fire-based-ems-system/
Zavadsky, M., & Wolfberg, D. (2025, February 17). Quantifying the gap between expenses and revenue for EMS services, ems1.com. https://www.ems1.com/ems-trend-report/quantifying-the-gap-between-expenses-and-revenue-for-ems-services