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VCAD board continues looking at options
The beleaguered Vernon County Ambulance District took steps to ensure the outsourcing of accounts, payroll, and its toy drive, during a Nov. 3 special board meeting. Recently, the Internal Revenue Service filed a notice of federal tax lien against the VCAD in the amount of $213,158.26. Additionally, it came to the board's attention that they also owe approximately $44,000 in state taxes.
In light of these recent events, and with VCAD attorney Kendall Vickers present, the board talked in-depth about a tax anticipation loan. At the conclusion of the discussion the board voted unanimously to authorize board chair Mark Humphrey and VCAD director Leland Splitter to explore options for a tax anticipation loan to cover the unpaid taxes and other expenses.
"The tax anticipation loan is designed to get us some short-term cash flow to off-set some of the costs that we have," Humphrey told the Daily Mail after the meeting. "We've got some pretty major expenditures that we need to take care of very immediately."
Humphrey said the short-term loan would be waged against the VCAD property tax levy "that we would be able to collect and pay back by the end of January."
Humphrey said the much-needed operating capital would allow the Ambulance District to get "caught up and on an even plane."
"Until we can get the billing system back up so we can have our cash revenue rolling in, that would normally be rolling through the doors," Humphrey said.
After a closed session of the board Oct. 23, Board President Mark Humphrey announced that the employment of VCAD Director James McKenzie and staff member Tina Warner had been terminated effective immediately and that Leland Splitter, long time paramedic for the district, had been appointed as interim director.
"At this time we do not have the revenue stream rolling in from the billing side of it, due to the fact we have not been able to bill Medicare and Medicaid -- since we had some personnel changes," Humphrey said.
$44,000 in state taxes
Humphrey said at some point prior to the Tuesday meeting the board was informed of the approximately $44,000 in payroll taxes owed to the state of Missouri.
"We thought some payments had been made, but weren't exactly sure exactly what the extent of that was," Humphrey said. "The auditor was looking into that and trying to figure that out. We received the certified letter, I believe today was when it showed up (showing what was owed in state taxes)."
Humphrey said the board needs concrete figures to take to the lending institution.
"The big thing on paying off the IRS debt, and now the state debt that we have outstanding, is we have to have a good set numbers to be able to take the lending agency," he said. "And that's one of the things the auditor can do for us -- he can provide us with a better description of where we are financially and what our total liabilities are."
Humphrey said the board has instructed the staff to provide it with a list of total liabilities.
"So that we can formulate a complete budget that does reflect this debt that we have out there, so that we can take that to the lending agencies," he said.
Humphrey indicated that by going to the agency they would like to possibly procure a note with a five-year payoff related to both the IRS and state debt.
"We will still be charged the interest is my understanding," Humphrey said. "But we can possibly get rid of some of the penalties associated with that. And then pay that back to just a bank or lending institution as just a regular note."
Billing contract
During the meeting Vickers presented Humphrey with a billing contract negotiated with Specialized Billing and Collections Systems of Texas. Humphrey signed the contract, outsourcing VCAD's billing -- which was done in-house prior to the personnel changes.
"They're an outside firm," Humphrey said. "And really the only thing they handle is emergency medical service billing."
Humphrey discussed the contract in further detail.
"Any time that we transport a patient and there's billing associated with it -- all of those billing and trip charges will go through this company -- who will actually file those with insurance carriers. Whether it's a private carrier, or Medicare or Medicaid. Anything like that will be processed through this company, and then the fees associated with that will come to us. And then we pay 8 percent of whatever is collected, not what is billed. The 8 percent fee is paid to them for handling that."
Humphrey indicated a recent nation-wide change to the coding of billing, also promoted this move. According to Humphrey, roughly 12,000 new codes went into effect Oct. 1.
"The billing itself has become so much more complex than it was in recent years," he said. "I really think that in the long-run we can possibly see more revenue from outsourcing it than we can from (doing it in-house)."
Outsourcing of accounts payable
Looking to outsource its accounts payable, the board digested proposals from certified public accountant Carmen Owen, who works for James A. Novak, CPA, and Katie Pettibon, representing herself. Accounts payable is currently done in-house by the VCAD.
"We are exploring the aspects of moving it to an outside source," Humphrey said.
Humphrey said that whoever is selected will be responsible for more than just payroll.
"We would approve all of the expenditures for bills monthly, operating costs and things like that -- and then transfer that information to them in which they would print the checks and bring them back to us. We could sign them and send them out at that point," he said.
"So we would be approving the bills, then cutting the check for the money and getting them out the door. Along with, they would be able to do all the monthly accounting for us, so that they can give us the actual breakdown sheet and tell us exactly where we're at."
Humphrey said he expects the board to "move on that relatively quickly."
VCAD to outsource toy drive
"The board voted unanimously during its special meeting to outsource its annual toy drive fundraiser.
The amount of manpower and time, and space it takes up, we just feel that at this point in time it would be better for us to pass that to someone else," Humphrey said. "Or another organization that has the manpower and the time, and the space to do that.
"The proceeds that were made off the haunted house, we would pass that over to someone else. If we could get an organization to take that burden from us and get us back to kind of the basics of what we do here as far as emergency medical calls and patient transports."
Board ends relationship with Lisa Christie
Over the past couple years the VCAD had retained the services of Lisa Christie, a lobbyist from Jefferson City. Christie represents Burch & Associates. The board however, voted unanimously during the special meeting to cut ties with Christie.
"She kept us abreast of things related to EMS and maybe 911-dispatch," Humphrey said. "Things that would affect us directly. That was kind of a verbal contract that we had with her. At this point we're going to drop that for now."
Christie's VCAD fee was not made available during the meeting.
Late addition
It was noted during the meeting that more than $24,000 is owed in (Travelers) workers compensation, with a payoff due date of Dec. 1. The $24,000 was left off the VCAD vendors in accounts payable document distributed to the board prior to the meeting.
"I believe that is our workers comp and builders insurance," Humphrey said.
Humphrey indicated that this is one of the expenses to be rolled into the tax anticipation note.
New custodian of records
During the special meeting the board unanimously approved Denise Hopkins as its custodian of records. Hopkins, who works in the capacity of patient accounts with the VCAD, replaces Warner as custodian of records, effective immediately.