EMSA trustees approve reforms
BY ZIVA BRANSTETTER World Enterprise Editor
Thursday, February 28, 2013
2/28/13 at 7:40 AM
Complete coverage of EMSA’s financial practices: Find all the stories in Enterprise Editor Ziva Branstetter’s investigation into Tulsa’s ambulance provider.
STROUD - EMSA's board voted Wednesday to stop making charitable donations, require employees to disclose possible conflicts of interest and end a practice of making tax-free purchases for its private contractor.
The votes were among actions taken in response to a critical state audit, sparked by a Tulsa World investigation that began in October 2011.
EMSA CEO Steve Williamson apologized to the board for "scrutiny" that has been focused on the agency over its spending practices, some of which the audit called "unwarranted and extravagant."
"I know I owe an apology to the board for some actions that could be construed as outside the scope of the public trust," Williamson said.
He later noted that the agency operates "arguably one of the finest clinical systems in the United States."
"Organizations can always get better ... Systemically this system isn't broken. It certainly isn't corrupted as someone once said."
The Emergency Medical Services Authority is a government agency that oversees a contractor providing medical care to more than 1.1 million people in Tulsa, Oklahoma City and some surrounding cities. Residents in most of those cities pay a fee on their utility bills designed to cover out-of-pocket expenses for emergency transports.
Questioned costs in the audit included $905 for two spa treatments, $35,190 for floral arrangements, $23,875 for employee fitness classes taught by the wife of an EMSA employee and more than $4,000 each for two catered employee retirement parties. The audit also was critical of EMSA's $15,000 donation to First Tee of Oklahoma City, a youth golf charity.
In addition to questioning EMSA's spending, the audit notes that wording in some EMSA materials to customers could be misleading and makes suggestions for improvements in the agency's billing practices. It recommends that procedures used to identify patient addresses be improved and that outreach efforts to patients be enhanced.
Before EMSA changed its financial statements last year, its bills failed to inform patients about the utility program. The old bills stated "due from patient" and "due upon receipt," possibly leading patients to pay bills they did not owe.
In a response to the audit discussed at the board meeting, EMSA notes that the audit "found no systemic erroneous patient billing."
"However all parties agree that the system of using utility addresses for TotalCare membership is inherently difficult," the agency's response states. "Management is currently working with the city of Tulsa's utility department, along with the MRO (management review) office, to determine different ways this task can be accomplished."
EMSA has taken numerous steps to improve the agency's billing process, including indicating on bills whether customers are members of the utility fee program. The agency has also worked with the city of Tulsa to improve its process of gathering accurate address data and is working on a way to uniquely identify patients in the system, Williamson said.
EMSA is overseen by an 11-member board of trustees, eight of which are appointed by city officials in Tulsa and Oklahoma City. The board normally meets virtually, with trustees in Tulsa and Oklahoma City discussing agenda items via video conference.
Wednesday's meeting was held in Stroud at the suggestion of trustees who wanted to meet in person.
Agenda items included two executive sessions - one to discuss legal issues raised by the state audit and one to discuss "personnel issues relating to the President and CEO." Trustees returned to a public session of the board and took no votes following those discussions.
Ron Schwartz, president of Paramedics Plus, also responded to the audit, defending the company and its employees. The private company based in Texas provides paramedics for EMSA.
Schwartz said he has been reluctant to speak out because he assumed the company's side would not be fairly represented in the media. He said implications in the audit and in news articles of an "inappropriate relationship" between EMSA and Paramedics Plus were not fair.
Schwartz said the company has done nothing illegal and has an "independent financial review done each year" to ensure compliance with all laws and requirements.
"The employees have been frustrated by this; the employees have been scared by this," he said of the controversy.
The audit was critical of $7.1 million in purchases made by EMSA on behalf of Paramedics Plus, including a "gambling-themed event" and "a frozen drink machine." The money was deducted from EMSA's payments to the company but auditors questioned the appropriateness of the arrangement, which allowed the company to avoid paying taxes on the purchases.
The company also provided a $25,000 "sponsorship" to defray some of Williamson's travel expenses as head of an ambulance industry association. Williamson said he disclosed the payment to officials in Oklahoma City but acknowledged that no records exist to show he told EMSA board members.
Trustees approved a policy change Wednesday that requires all employees to fill out a form annually that discloses all possible conflicts of interest.
Since 1998, Paramedics Plus has held a contract with EMSA to provide paramedics who staff EMSA ambulances. EMSA employees provide services such as contract oversight, accounting and customer billing. The current five-year contract is valued at approximately $150 million and expires this year. EMSA's board is seeking proposals for a new contract.
Under the current contract with EMSA, signed in 2008, Paramedics Plus is required to "supply, at the contractor's own cost, all fuel, oil, and routine maintenance" for the ambulances. State taxes add 16 cents per gallon of fuel, a cost EMSA does not have to pay.
A legal opinion by EMSA attorney Jim Orbison states that because the fuel is used by EMSA for a public purpose, it is appropriate for EMSA to pass along its tax exemption. The opinion states that all but 3 percent of the purchases made by EMSA for the company would have been exempt from sales tax and were not inappropriate.
The opinion recommended that the authority discontinue the practice of making donations to charities.
"It may not be consistent with the trust purposes and therefore inappropriate," the opinion states.
The board voted unanimously to approve a motion by trustee Phil Lakin to end the purchasing practice which Schwartz said has existed between EMSA and its contractor for 35 years. The board also voted to approve Lakin's motion to end the practice of donating money to charities and voted to form two committees to carry out oversight duties recommended by the audit.
Lakin joined the board eight months ago.
Trustees will receive monthly reports of all financial transactions by the agency and discuss additional policy changes in committee that should be considered by the full board.
Dr. Charles Foulks, a new board member attending his first trustee meeting, said despite administrative challenges the agency is going through, "I can assure you that this service is the best that you can find in the country."
"I would hope that our compatriots in the Fourth Estate would make it clear that none of this has any effect" on medical care provided by EMSA, he said.
Original Print Headline: Trustees approve reforms for EMSA
Ziva Branstetter 918-581-8306
Steve Williamson: He apologized to the EMSA board for problems that have come to light, while also praising the service EMSA provides
Board member Ed Shadid questions EMSA CEO Steve Williamson (not pictured) during an EMSA board meeting on Wednesday in Stroud. At left is board member Phil Lakin. MIKE SIMONS/Tulsa World