Privatizing Emergency Medical Service

How Cities Can Cut Costs and Save Lives

Executive Summary

Paramedic service is generally the legal responsibility of local governments. Some meet this responsibility by directly operating the service, usually as part of their fire department. Others contract with private ambulance companies, while still others use a mixed system. Recent controversies have raged over which type of provider “should” provide this life-saving service.

This guide argues that the key factor is not, per se, the identity of the provider but the design of the emergency medical service (EMS) system. A number of U.S. jurisdictions have adopted a “high performance model” which ensures excellent response time performance, avoids errors (such as sending the wrong type of unit), and generally costs significantly less than systems of traditional design.

The existing high-performance paramedic systems involve a public-private partnership in which the fire department provides “first-responder” capability, while a competitively selected private firm provides paramedic-equipped ambulances which respond to every medical call, treat the patient, and (if necessary) provide transport to a medical facility. Higher productivity (due to better matching resources on duty to calls for service) and economies of scale lead to significantly lower costs when paramedic service is organized in this manner.

Of the 200 U.S. cities of 100,000 or more population, 56 currently use private paramedics to treat and transport. Another 44 use a mixed public-private system, and the remaining 100 use an allgovernment (fire department or “third-service”) or hospital-based system. By switching to a highperformance model, most of the 144 cities in the latter two groups could achieve significant cost savings and improved EMS performance.

This guide explains how these improvement arise, and offers guidelines on how to implement the sophisticated contractual arrangements needed to obtain high-performance paramedic service.