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HomeMy WebLinkAboutItem 09f - Change Order to increase Wittman Enterprises Purchase Order STAFF REPORT ADMINISTRATIVE SERVICES DEPARTMENT DATE: March 3, 2026 TO: Honorable Mayor and City Council FROM: Henry Chen, Administrative Services Director SUBJECT: CHANGE ORDER TO INCREASE THE PURCHASE ORDER WITH WITTMAN ENTERPRISES, LLC FOR AMBULANCE BILLING AND COLLECTION SERVICES IN THE AMOUNT OF $88,000 CEQA: Not a Project Recommendation: Approve SUMMARY On June 5, 2018, the City Council approved a purchase order with Wittman Enterprises, LLC (“Wittman”), for billing and collection services for the City of Arcadia’s emergency medical transport services, in an amount not to exceed $83,400 ($66,000 collection fee plus $17,400 for electronic Patient Care Report [“ePCR”] license) annually, based on estimated annual collections of $1.55 million. The agreement between Arcadia and Wittman calls for Wittman to receive a 4.25% fee on the amounts they collect. Due to higher transport volumes, the collections in the current fiscal year have increased to an estimated $3.5 million. The original Purchase Order amount is not sufficient to cover the extra fee on their increased collections. As a result, an increase in the Purchase Order to cover the increased collection fees is requested. It is recommended the City Council approve an $88,000 increase to the Purchase Order with Wittman for the ambulance billing and collection services for the remainder of Fiscal Year 2025-26. These costs will be offset by additional revenues received in the billings for ambulance care. Change Order for Wittman PO March 3, 2026 Page 2 of 3 DISCUSSION Annually, the Arcadia Fire Department receives over 6,000 incident calls, with 70% of calls requiring rescue and emergency medical service. Ambulance charges, also called Emergency Medical Services (“EMS”) fees, are the single largest revenue source for the Fire Department. The revenues collected for these purposes depend primarily on the quantity of transported patients by the Fire Department and the type of emergency medical services rendered to each patient. The Fire Department only bills for EMS calls that involve medical transport. The original Purchase Order amount of $83,400 in FY 2018-19 was determined by prior years’ total call volume, billable EMS transports, and projected revenue of $1.55 million. The collection fees remitted to Wittman are a flat rate of 4.25% of net collections, which equates to $66,000 in fees. The City also reimburses Wittman for their continued payment of the City’s annual ePCR licensing and storage fees to Digital EMS Solutions. At the time of the contract award, the total ePCR fees totaled $17,400 annually. Due to an increase in overall transport volume as well as the addition of a basic life support ambulance program, the collection fees the City is required to pay to Wittman have increased beyond the original amount the contract was approved for. For FY 2025-26, projected revenue should total $3.5 million with an estimated 3,500 billable EMS transports. Under these projections, the 4.25% collection fee to Wittman will also increase to $148,800. The current annual ePCR licensing and storage fee is $22,600. The table below summarizes the increase in fees from FY 2018-19 compared to FY 2025-26: FY 2018-19 FY 2025-26 Increase Ambulance Collections 1,550,000$ 3,500,000$ 1,950,000$ Collection Fee @ 4.25%66,000$ 148,800$ 82,800$ ePCR License Fee 17,400$ 22,600$ 5,200$ Total Fees:83,400$ 171,400$ 88,000$ The original Purchase Order amount is not sufficient to cover the collection fee to Wittman for the increased collections. An increase of $88,000 to the Purchase Order Change Order for Wittman PO March 3, 2026 Page 3 of 3 will cover the additional collection fees and is requested for the remainder of FY 2025-26. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), and it is deemed to have no impact on the environment. Thus, this matter is exempt from CEQA. FISCAL IMPACT In FY 2025-26, it is estimated that Wittman will collect $3.5 million in billing receipts, resulting in a collection fee of $171,400. The current Purchase Order for $83,400 needs to be increased by $88,000 to cover the remaining estimated collection fees. The payments to Wittman are recorded as an offset to revenues, so no additional appropriation is required. RECOMMENDATION It is recommended the City Council determine this action does not constitute a project under the California Environmental Quality Act (“CEQA”); and approve a Change Order to increase the Purchase Order with Wittman Enterprises, LLC for ambulance billing and collection services in the amount of $88,000.