A new ad hoc committee on the ambulance, medical and social service transportation industry will set the stage today for what could become a contentious battle over ambulance laws in the upcoming legislative session.

Republican Rep. Michelle Ugenti of Scottsdale is heading up the new group, which will review laws, policies and procedures of the ambulance industry and focus on the certificates of necessity that she says encourage monopolies and restrict competition.

The committee is scheduled to meet for the first time at 1:30 p.m. today. It will meet three or four times before the legislative session begins in January and will make recommendations for Ugenti’s legislation, she said.

Agenda items include discussing the impact of the ambulance certificates of necessity restrictions on competition, and whether modifying the certificate standards to allow more competition could provide a cost savings to the state, patients, and the payers for those services.

The committee will also discuss whether ambulance companies should be required to submit audited financial statements to the Arizona Department Health Services when requesting new rates or upon annual compliance reviews.

In the last legislative session, lawmakers took a crack at both the issue of certificates of necessity and ambulance companies’ audited financial statements, though the proposed legislation didn’t even get a committee hearing.

Ugenti said the certificates “really keep out competition” in the industry. She said a serious look at the process could result in new legislation and a better deal for Arizonans who need emergency medical transportation.

One of the most controversial requirements is that the Department of Health Services must consider whether issuing a certificate to more than one ambulance service within the same area is in the public’s interest.

That determination is based on, among other factors, the financial impact on current certificate holders.
“Right now, (obtaining a certificate) is a very complicated, time consuming, expensive process, one that arguably has benefited the incumbent (ambulance providers),” Ugenti said.

But Roy Ryals, president of the Arizona Ambulance Association and chief operating officer of Southwest Ambulance, said the current system of requiring ambulance providers to obtain certificates of necessity “has served Arizona extremely well” and lawmakers shouldn’t change it.

“It’s a very bad concept to start changing the (certificate of necessity) process under the guise of adding competition when really all it will do is detract service and push the rates up higher for people who need the service in the periphery area of the state,” said Ryals, who will serve on the committee.

He said the ambulance industry is heavily regulated for a reason: to ensure the public receives the best possible emergency transportation for the best price.

“As long as the existing providers are appropriately serving the public, the fewer providers you have, the more cost-effective it is,” he said.

The committee includes Ugenti, the directors of the Department of Health Services and the Arizona Healthcare Cost Containment System, representatives from an ambulance company and social-service transportation, a health insurance representative that contracts for ambulance services and a representative from a fire district that provides ambulance service.

The committee is scheduled to report its findings and recommendations by October 31 to the Speaker of the House of Representatives and the Secretary of State.