The URL can be used to link to this page

Home My WebLink About02/03/1993 B A K E R S.F I E L D Kevin McDermott, Chair Patricia J. DeMond Daniel Kane Staff: John W. Stinson AGENDA BUDGET AND FINANCE COMM1TI~EE Wednesday, February 3, 1993 12:00 noon City Manager's Conference Room 1. Ambulance Rates 2. Defibrillation Program 3. Gleaners Housing Project at 231 Quantico 4. Bid Process Involving Local Firms 5. Set Next Meeting BAKERSFIELD MEMORANDUM January 29, 1993 TO: ALAN TANDY, CITY MANAGER SUBJECT: BID PROCESS INVOLVING LOCAL FIRMS (COUNCIL' REFERRAL #11374) The possibility of utilizing a "local preference" or a "buy local" policy has been researched by City staff at different times over the years. Concerns have ranged from the definition of what determines a local firm to legal constraints in providing "incentives" to preferred vendors. Section 136 of the City Charter of the City of Bakersfield states that: "In the erection, improvement and repair of all public buildings and works, and in furnishing any supplies and materials for the same, or for any other use by the City, the City Council shall establish, by ordinance,.criteria including dollar amounts, requiring biddinq and award of a contract, if awarded, to the lowest responsible bidder submitting a responsive bid." The ordinance established by City Council for this purpose is reflected in Section 3.20.060 of the Bakersfield Municipal Code relates to Section 3.20.090, Formal contract procedures, and Section 3.20.100, Open market procedure. Awards greater than $20,000 use the formal contract procedures (3.20.090). For amounts $20,000 or less', the open market procedure may be used (3.20.100). Depending on the amount involved, the open market procedure followed can vary with need and complexity. The City has for several years followed an informal policy whereby bids on equipment or materials by local vendors are provided a 1% "preference" if their bids are comparable to the lowest bidder. These bids, for calculation purposes only, are reduced 1% to account for the sales tax revenues which would be generated locally on the purchase of the items. Thus, the local company--who has a City business license, is located within the city, and whose bid is tied or lower than the non-local lowest bidder (due to the 1% preference)--will be granted the award. I need to emphasize that this policy applies only to contracts/purchases where the sales tax revenues can be quantifiably identified (i.e., purchase of goods such as equipment or materials.) In 1979, the City (in 1979) surveyed 10 public agencies regarding their "buy local" policies. In that survey three cities and a county indicated they gave a 1% "preference" to local vendors for the sales tax generation. In mid-1992 the County conducted a Local Vendor Preference Study. The study's summary recommendation from staff indicated that local preference legislation: ALAN TANDY BID PROCESS INVOLVING LOCAL FIRMS (COUNCIL REFERRAL #11374) January 28, 1993 Page 2 (1) inhibited fair and open competition amongst otherwise qualified vendors; (2) invited retaliatory measures which would not be beneficial to the County, and (3) inherently provided and artificial economic "crutch" for favored local vendors. Staff recommended the County continue to award business in competitive bid situations to the lowest responsive and responsible bidder. Separately, the County Counsel provided an opinion on local preference for public works projects, concluding that "the County may not (emphasis added) establish bidding procedures for those projects subject to the bidding requirements of the Public Contract Code under which contractors are entitled to a preference on the ground that their places of business are located within the County." A similar opinion was reached in a memorandum from the City Attorney's Office on January 25, 1991, which indicated that Section 20162 of the Public Contracts Code prohibits the City Council from awarding the contract to the second lowest bidder because he is local, even if the bids were very close. I have attached a copy of the agencies the County of Kern contacted in connection with its survey 'on local preference policies. Please let me know if you need anything further. (m:0128931) Enclosure cc: Greg Klimko Laura Marino John Stinson MEDICARE Mail AddreSS: Medicare, P.O. Box 797, Turlock, CA 95381-0797 Any Inquiry Refer To: Provider Number: · ' Date: \ f~,~ IQ% Dear Provider: Enclosed are your Medicare Customary and/or Prevailing Area Profiles for Fee Screen Year 1993 (FSY 93). Only Health Care Financing Administration Common Procedure Coding System (HCPCS) procedure numbers will appear. In profile development, edits are~applied to exclude erroneous data. Then, each provider's charges for each procedure code are arrayed. The median charge becomes the Customary profile for the particular service. Prevailing profiles are established for each area and specialty, at the 75th and 5'0th percentile of physicians' Customary charges. For services rendered during 1993, Customary and Prevailing charges were updated based on actual charges during the period July 1 1991 through June 30 1992. ' , The amount allowed is the lowest of four possible charges: 1) The billed charge; 2)'The provider's Customary charge for a specific procedure; 3) The Prevailing charge made by other providers in the same area and specialty; and 4) the Inflation Indexed Charge (I.I.C.). In the absence of a Customary profile, the billed charge is compared to the 75th percentile Prevailing, the 50th percentile and the Inflation Indexed Charge (I.I.C.), with the lesser of these figures being the allowed amount. Effective for services rendered on or.after October 1, 1985, an additional factor, the Inflation Indexed Charge (I.I.C.), is added to the factors taken into consideration in determining reasonable charges for non-physician services. The I.I.C. is the lowest of the reasonable charge screens for the previous Fee Screen Year (FSY) updated by an inflation adjustment factor. The reasonable charge screens include the Prevailing charge, Customary charge and the I.I.C.. Page 2 The inflation adjustment factor is based on the current change in the Consumer Price Index for all urban consumers for the 12 month period ending June 30. For FSY 1993 the inflation adjustment factor is 3.1%. ' Beginning January 01, 1992, procedure code 93005 (Electrocardiogram, tracing only, without interpretation and report) will be reimbursed from the Physician Fee Schedule. The 1993 Fee Schedule amounts, by locality, are listed below: Procedure Participating Code Locality Fee Schedule '93005 01 $ 18.37 93005 02 18.66 93005 03 20.13 93005 04 19.72 93005 05 20.72 . 93005 06 20.72 93005 07 20.31 93005 08 17.93 93005 09 20.24 93005 10 16.12 93005 11 18.96 93005 12 19.93 93005 13 17.89 93005 14 18.95 93005 15 17.50 93005 27 19.07 We trust this information is helpful. Sincerely, Provider Certification and Profile Department ?YP~ SERVICE $ OME/PSYCN/OTHO~ iPROCl .MOOS~ ·PROVe 8SOT#I · [iC t ...................... DESCRiPTiON ................ AO020- il.O0 IS.O0 I1.10~ANIULANCE SERVICE |BLSJ PER NILE. TRANSPORT. DN! WAY A0222- 200.00 200.00 ITO.O,*A,,ULANC, SERVICE. ~ETU,, TNIP. TRANSPORT YO002- 6O.O0 4S.25 SI.,,~MED,CAL TRANSPORTATIDN AHBULANCE N,GHT CALL 7PM TO ?AN Y0022- 34.00 20.00 N/AIAIRAHBULANCESORVICE-LOADEDNILEAGE-PER,ZL! GOLDEN .EMPIRE AMBULANCE 801 18th STREET P.O.BOX 918 93302 BAKERSFIELD. CALIFORNIA 93301 325-9011 CITY OF BAKERSFIELD 1992 RATE REVIEW The attached documents are samplings of the cost centers we have experienced excessive increases in during 1992 and we further believe they will continue to have significant increases in 1993. Please note the "Relocating Main Office" under "1993 Cost Projections". This cost is due to the condition of our current building. It does not meet the earthquak~ codes and we are concerned with both civil and criminal challenges due to the SB-198 Health and Safety_ Regulations. We will have to locate a building and pay si~ificant cost for remodeling, moving computers and cabling, etc. The anticipated increased cost under "Government regulations" include on going Blood Bom Pathogens compliance and the up coming OSHA Confined Space Regulations. While the exact impact is difficult to project at this time, we do believe this additional regulation will have a direct negative effect on our efforts to maintain cost control. CITY OF BAKERSFIELD 1992 COST ANALYSIS COST CENTER INCREASE Employee Related; Medical Insurance 22% Worker's Comp Coverage 8% Paramedic Training 21% Wage & Benefit Package 11% Computer Driven Dispatching System' $100,000.00 annual · Increased Government Regulations $20,000.00 annual ReduCtion in COunty Reimbursement $35,000.00 annual Leagal Fees 18% ~ CITY OF BAKERSFIELD 1993 COST PROJECTIONS COST CENTER INCREASE Employee Related; Medical Insurance 20% Worker's Comp Coverage 4% Paramedic Training 10% Wage & Benefit Package 11 °A Computer Driven Dispatching System $100,000.00 annual Additional equipment enhancements $50,000.00 Blood Bom Pathogen Regulations $10,000.00 Reduction in County Reimbursement $40,000..00 Legal Fees 40% Relocate Main Office $100,000.00 Paramedic EqUipment Upgrades $65,000.00 EmergencY Equipment Purchase Price 18% MEDICARE Mail Address: Medicare, P.O. Box 797, Turlock, CA 95381-0797 July 16, 1992 Golden Empire Ambulance Attn: Peter W. Brandon 801 18th Street Bakersfield, CA 93301 Any Inquiry Refer To: 289218153490 Provider.Number: ZZZ90597Z Dear Mr. Brandon: This is in response to your recent request regarding an equity adjustment. We have adjusted the provider's 1992 Medicare Customary Charges as shown below: PROCEDURE CODE ADJUSTED 1992 CUSTOMARY MEDICARE ALLOWED AMOUNT A0010 $ 439.50 $ 212.6~ A0020 17.30 10.96 A0060 23.80 11.52 IIC A0070 44.50 43.19 A0220 547.50 438.48 A0221 17.30 10.96 A0222 547.50 164.98 Y0002 , 78.80 50.42 A0150 ~ .439.50 183.23 These updates are retroactive effective January 01, 1992. Any claims which you feel should be reconsidered based on the information above should be resubmitted with the EOMB directly to Medicare Beneficiary Services, Chico, CA 95976. You may resubmit your claims on or after July 29~, 1992. CITY COUNCIL- BUDGET AND FIN~~ COMMrlq3~ IIALI./M~'IB~~ SERVICE COST SUMMARY INFORMATION F.Y. 1991 - 1992 · Employee Retirement - Benefit Plan (-!- 86%) Increases occurred due to employer contributions (100 %) associated plan administrator costs (+ 13 %) and increased employee participation of 13%. · F~mployee Education - Relations (+ 32%) Mandated training required by Federal (OSHA) and Local EMS Agencies i.e. do not resuscitate, emergency medical disPatch, HAZ MAT training, spinal immobilization, air ambulance protocols, sudden in~ant death syndrome, interosse°us infusions; bloodborne pathogen, and emergency Vehicle operator training. Paramedic Annual Re-certification requires each paramedic receive 65 continuing education credits. [Currently employed 45 full-time Paramedics). Patient service requests continually require increased advanced cardiac life support treatment interventions, requiring upgraded provider/instructor certification for paramedic personnel; (53 % of paramedic staff'mg ACLS certified). Due to the increased number of newly certified paramedics F.Y. 1990-1991 (38)vs. 1991-1992 (49) + 30 % four field paramedic trainers were designated, and additionally compensated; In order to provide the necessary required training to certified personnel updated training videos, CPR and ACLS training mannequins 'and cardiac defibrillator simulator were purchased. Employee recognition awards for continued years of service, patient public commendation for outstanding service, and community volunteering; The Company is fortunate to enjoy small employee turnover 10 percent annually and long term employee service 40 percent five years or longer;, · Vehicle Insurance ( + 12 %) The normal and customary annual increases occurred in addition to three (3) 1992 fully equipped paramedic ambulance vehicles. Company loss history is excellent and the accompanying increase are not reflective of history; [11 General Insurance (+ 40%) The normal and customary annual increases occurred in addition property values, medical equipment, supplies, and technology (data processing) were enhanced, resulting in higher premiums; · Group Health Insurance (+ 21%) The normal and customary annual increases occurred in addition six employee eligible participants were enrolled. The Company presently pays 100% of premimns for employee after six months employment and after five years employment 100% of family dependant coverage. · Workers Compensation lnq~rance (+ 18%) The annual increase for aH employee work categories was 6.7 %. Overall salaries and wages increased 33 Pen:eat. · Legal & Professiohal (+ 73%) Due to the withholding of payment of Federal Medicare billings during the Spring. of 1992 for medical review, legal remedies were necessary and subsequently successful in collecting outstanding payments of $750,000.00; this process is on-going as the Federal Government pursues mechanisms which curtail health care costs. The State of' California proposed to eliminate Non-emergency Medical Transportation from the State Budget resulting in necessity of legal intervention to protect this most important reimbursement; Due to the ever increasing problem of non-compensated health care patients, a number of legal proceedings were necessary to pursue payment from individual patients; · Ambulance Vehicles + 4 %) The purchase of a new fully equipped paramedic ambulance in 1992, resulted in a 4 percent increase from 1991. Due to the need to provide a larger patient care area on each paramedic unit, larger vehicles must now be purchased resulting in increased costs per unit. · Vehicle License (+ 29%) Ambulance vehicle permits and licenses required by the County of Kern increase 50% while the State of California implemented normal annual license and tax increases for vehicle operation and fuel. In addition, increased sales tax occurred on the purchase of new ambulance vehicles. · Medical Supplies (+ 11%) The major individual cost increase was necessitated due to all local hospitals adopting cost containment policies and controls which impaired the abilities of ambulance personnel t° secure replacement of medical supplies; The Kern County EMS Agency mandated and implemented new regulations and policies on OSHA for new medication and equipment; i.e. infectious personal protective equipment, medication, interosseous needles, spinal immobilization equipment, oxygen nebulizers and pediatric medications; cost: $7,686.55. Due to the increase of operational paramedic units and certified personnel additional medical equipment and supply purchases were necessary; · Employce Snlaries (+ 33%) Employee salaries increase due to mandatory training requirements and certifications. In addition a 30% (11 paramedics) increase in paramedic personnel occurred which resulted in the Company achieving full paramedic coverage on ALL "911" call requests. For the first time since 1975' (the 'first year of paramedic service for the City of Bakersfield). A revision of policies regarding employee sick leave, vacation, holiday, and personal- bereavement resulted in modest salary increases. AH additional mandated training requirements must be conducted on employee off- duty time, resulting in premium compensation (time and half). AH Communications Personnel have been certified as Emergency Medical Dispatchers in order to qualify for new local dispatching policies. Overall, NO new employees were hired in the ambulance division, however, eleven employees were upgraded to paramedic certification, a 30 percent increase. Due to the 'increased level of incoming "911" calls .to the Communication Center, 4 new communications employees were hired. [~] · PayroU Taxes Payroll taxes increases are derived from individual payroll increases (+ 33%) and are tabulated from normal and customary governmental payroll taxes; · Telephone (+ 28%) Because of the number of patients who are routinely withholding payment for services, increased telephone efforts became necessary resulting in prime time per- minute charges along with increased long-distance calling to ln~rance Companies responsible, and transient patient collections. Due to a change in radio repeater to insure improved communications additional radio-telephone charges have been incurred. · Utilities (+ 22%) The normal and customary annual utility Company increases have occurred. Utility monitoring devices have been installed in all applicable ambulance stations in an effort to reduce utility costs. · Accounting-Financial Plannine (+26%) With the constant requirement of operating a small business as cost effective as possible, professional accounting fees increase as a result of need of additional expertise for cost accounting, budgeting, purchasing and enhance fiscal managements; · Office Expenses (+ 18%) Due to increasing billing - medical documentation requirements by private insurance companies, Federal Medicare and the State MEDI-CAL Program, additional costs are incurred for stationary supplies i.e. paper, billing forms, data ribbons, typewriters, pens, pencils; NOTE:. Vehicle Maintenance and Fuel Cost~ Because of the utilization of Diesel Powered Ford Ambulance Units, an aggressive preventative maintenance program and the replacement of older non-cost effective units, vehicle maintenance and fuel costs have declined slightly during the past year. [4] Respectfully submitted H.A.S. - Feblnlary 3, 1993 G RAN D TOTAL ., COST CENTERS . 11% 1991 1 992 COST CENTER INCREASES EMPLOYEE RETIREMENT 85.8% n/a -11.8% -17.9% 1988 1 989 1 990 1991 1 992 COST CENTER INCREASES EMPLOYEE EDUCATION/RELATIONS 8.2% ................................................. : ........................ . ....... ..8..... .]... ~ ................... 48.2% -44.4% 1988 1989 1 990 1991 1 992 COST CENTER INCREASES .FUEL 1 988 1 989 1990 1 991 1992 COST CENTER INCREASES VEHICLE INSURANCE 12.3% 25.8% 71.4% -8.7% 1 988 1989 1 990 1991 1 992 COST CEN.TER INCREASES GENERAL INSURANCE -32.1% ..-.1~..8% ................................................................................................................................................ -53.5% 1'988 1 989 1 990 1 991 1992 ~ COST CEN-TER INCREASES GROUP INSURANCE 20.6% 107.8% -6.1% -40.5% 1988 1 989 1 990 1 991 1 992 COST CENTER-INCREASES VVORKERS COMPENSATION 18.4% 3~.6% -~-6.9% 16.2% 1988 1989 1990 1991 1992 COST CENTER INCREASES LEGAL AND PROFESSIONAL 73.1% 11.1% 5.5% -10.4% 1988 1 989 1990 1991 1 992 COST CENTE NCREASES : VEHICLE ENSE ,, 29.4% 38.2% 89.5% -15.1% 1988 1989 1 990 1 991 1 992 COST CENTER INCREASES MAINTENANCE/REPAIR VEHICLES -16.5% -7.2% 1988 1989 1990 1991 1992 COST CENTER INCREASES MEDICAL SUPPLIES 427.7% 11.4% -27.2% -34.3% 1988 1989 1990 1 991 1 992 .. COST CENTER INCREASES SALARIES 9.5% 10.9% 7.9% 6.9% · 1988 1989 1 990 1 991 1 992 COST'CENTER INCREASES. .. PAYROLL TAXES . 11.9% ~ ~:...~iii · 1988 1989 1990 1991 1 992 COST CENTER INCREASES TELEPHONE' -2.2% 28.3% -12.6% 1 988 1 989 1 990 1991 1992 COST CENTER INCREASES UTILITIES 22.2% _,-'/ ~4.~ ...................................................................... · ' , ~ ~ -4.0% 1988 1989 1990 1991 1992 COST CENTER INCREASES ACCOUNTING FINANCIAL PLANNING 18.9% 4.7% 44.0% 0.0% 1988 1989 1990 1991 1992 COST CENTER INCREASES OFFICE EXPENS 24.3% 41.0% .................................................................................................................................................. 18.4% -4O.5% 1988 1989 1990 1991 '1992