Agenda - 10-20-2009 - 6f - Laserfiche WebLink

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Comparison of In-House vs. Outsourcing of EMS Billing and Collections Costs on an Annual Basis In-House Outsourcin Personnel Costs (including indirect/ administrative overhead $103,398 $ 68,340 O erational Costs $21,172 $ 5,400 Contract Costs $ 0 $121,500 Total Costs $124,570 $195,240 Additional Revenue Collections Antici ated c2) ($0) ($150,000) Total Net Count Costs $124,570 $ 45,240 ~'~ The annual contract cost of $121,500 represents 6.75% of net collections currently budgeted at $1,800,000 for FY 2009-10. (2~ The additional annual revenue collections anticipated of $150,000 represents additional delinquent collections staff estimates it will collect due to freeing up current staff to work on those collections which would otherwise remain unpaid. Staff recommends the Board approve a one year trial contract with EMS Management & Consultants, Inc., beginning January 1, 2010, for the initial billing and insurance filing. During the year, Revenue Department staff with closely monitor the success of collections as well as any impacts on customer service. FINANCIAL IMPACT: The annual contract cost with EMS Management and Consultants, Inc. of $121,500 is based on a charge rate of 6.75% of net collections, currently budgeted at $1,800,000 for Fiscal Year 2009-10. By outsourcing this billing and collections operation, staff estimates that the annual net County costs for this operation will decrease from $124,570 to $45,240. Due to current staff being redirected to work on delinquent collections instead of billings and collections, the total net savings to the County that the department will realize from outsourcing is estimated at approximately $30,000 annually. This is based on the contract cost of $121,500 and the anticipated additional revenue of $150,000 from delinquent collections. RECOMMENDATION(S): The Manager recommends that the Board: • Approve the one-year contract with EMS Management & Consultant, Inc. and authorize the Chair to sign after final review and approval by staff and the County Attorney; and • Amend the Fiscal Year 2009-10 budget to receive an anticipated additional $75,000 from delinquent collections for the six-month period of January-June 2010.