After weeks of fierce debate, a divided Kansas City Council voted 7-4 on Thursday to outsource ambulance billing.
That vote came despite opponents’ arguments that the switch is unfair to the city employees who they say have been doing a good job.
The council authorized the fire chief to enter into a five-year contract with Advanced Data Processing Inc., a subsidiary of Intermedix Corp., which does emergency medical billing for the North Kansas City, Overland Park and Kansas City, Kan., fire departments and about 300 clients nationwide.
The measure needed all seven votes to pass. Those in favor were Mayor Sly James and council members Cindy Circo, Jan Marcason, Dick Davis, Russ Johnson, Jim Glover and Scott Wagner.
Those opposed were council members John Sharp, Ed Ford, Melba Curls and Michael Brooks.
City Manager Troy Schulte had pushed for the contract, arguing that it would save nearly $800,000 in personnel and software costs and had the potential to boost medical billing collections by $2 million a year. James has also argued that the city government should not be doing medical billing, which has become a highly specialized and technical function.
Opponents countered that the city’s medical billing employees should be given a chance to improve collections.
Sharp also argued that several cities have had serious problems with Intermedix’s customer service, billing mistakes and failure to meet collection projections. He said the Kansas City contract penalties for nonperformance are weak. He and others doubted the city will realize the promised personnel savings.
“It would be foolhardy to approve the proposed contract at this time,” Sharp warned. “It’s a risky gamble, with taxpayers’ money, at best.”
But Marcason said the city has to find ways to cut costs and many cities give high marks to Intermedix, which has a 95 percent client retention rate.
She said the decision to outsource was not a rejection of the current city staff.
“It’s just a reflection of efficiency and a different way of doing business,” she said. “For the taxpayers, for the city, this is a good deal.”
Marcason and others also noted that only 16 city employees will lose their current positions. Intermedix has pledged to offer jobs to up to 10 of those employees. Staffers who don’t choose to go with Intermedix will be offered different city jobs at their same salary.