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The Ypsilanti Fire Department hopes to generate as much as $36,000 a year in revenue after City Council approved the ability to bill for services.
An ordinance approved unanimously on second reading by City Council Tuesday allows the department to bill for costs rendered during emergency calls, unless the call is a structure fire.
The costs the department hopes to recoup from the new policy include salaries, wages, overtime wages, fringe benefits, equipment used and supplies lost or expended during the response as well as cleaning and securing a site to its pre-existing condition.
Specific costs, which Fire Chief Jon Ichesco said will be billed to insurance companies, will be announced later when City Council adopts the fee schedule to coincide with the new ordinance.
Ichesco said he has contacted several billing companies, which would collect from insurance companies if selected. He said all are paid on based on a percent of revenue generated. He said the policy will be directed at vehicle crash responses, hazardous material clean-up, open or brush fires and vehicle extrication.
Huron Valley Ambulance, which operates ambulances in the area, does not perform vehicle extrication, Ichesco said. He said the policy is not in effect to charge people who can’t afford it, and a billing policy adopted by City Council will dictate to the selected billing company what scenarios will cause a bill to be issued.
City staff said Saline, Madison Heights, Pittsfield Township and Chelsea all have similar cost recovery programs.
Ichesco said he hopes to have a collection company, billing policy and fee schedule adopted by the end of the year.
The first reading of the ordinance was performed by City Council in May. Shortly after its approval, councilmembers received a letter from the Insurance Institute of Michigan, a lobbying firm representing 90 insurance companies in the state.
The letter said, “The majority of insurance companies operating in Michigan do not provide coverage to their policyholders for police/fire response to auto crashes.
“It is understandable that local governments are seeking alternative funding sources due to the current budget constraints,” the letter said. “However, if municipalities begin charging for emergency response and the market demands that insurance companies provide coverage, they will have to charge an appropriate premium which will result in higher insurance premiums for your residents.”
Ichesco said the second reading had been delayed due to this information. He said both he and the city attorney’s office investigated the matter and the policy would be able to stand.
Assistant City Attorney Karl Barr said one community highlighted in the letter from the insurance lobby, Kentwood, had to toss its ordinance because it automatically billed $1,000 for every response. He said the cost was high and the policy in Ypsilanti would only bill for “over and above normal services.”
Councilmember Brian Robb, D-Ward 3, said he contacted his insurance company and was told he would not be covered under his policy. He said the city may end up tossing this policy as well.
“I don’t really have high hopes for this,” Robb said.
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