Occasionally, I have a story that I'd really like to cover, but it affects a client, so I keep quiet. For example, I haven't written about the extraordinary monopoly in Arizona's ambulance industry because I've been working on the issue on behalf of a company that would like to provide competitive ambulance services.
The story is so compelling that I knew it would come out eventually anyway. Now it has. Tempe has now realized that the market is controlled by one company and has decided there's no need to conduct an RFP. It's an amazing story. Here's the Republic's version.
Only one company is competing for Tempe’s lucrative contract for ambulance services to support the Fire Department. The Tempe City Council chose to allow only Professional Medical Transport to compete for the contract because city officials believe that the state’s approval last year of Rural/Metro Corp.’s purchase of that company effectively ended competitiveness in the market.
Then a strange thing happened...Rural Metro bought all the other companies. Then they hired a team of the best lobbyists in the state in order to prevent the law from being changed. Frankly, it's a brilliant move.
This session, I worked with a client that wants to break into the inter-facility transfer market. Inter-facility transfers are scheduled transports of stable patients who aren't able to ride in cabs, private cars or stretcher vans. They are by definition, non-emergency transfers, but they still require an ambulance. And that ambulance has to be licensed as an "ambulance". The problem is that it is statutorily impossible to break into the market...which like I said, was fine until Rural Metro bought the other companies.
Our bill to open up the market to competition didn't even get a hearing. Then we managed to get a study committee amendment on a bill...but that was stripped off immediately. Eventually Speaker Tobin created an Ad Hoc study committee to look at the issue this summer.
That's going to be fun. Folks who support the closed market argue that the artificial monopoly in inter-facility transfer helps keep 9-11 emergency rates lower. We point out that this is clearly wrong because the market was competitive just a few years ago. Not to mention that in Phoenix, the fire department handles the emergency calls and Rural Metro only handles inter-facility transfer. There's obviously no cross subsidy that's paid from Rural Metro to the Phoenix Fire Department.
Opponents like to characterize efforts to eliminate the monopoly as "deregulation" That' not true either because all of the quality regulations that DHS enforces would still apply to new entrants...just like they all applied to the other market participants before Rural Metro bought them.
The only statutory change that proponents are seeking is to eliminate the requirement that prevents competing companies from obtaining a license. So far, making that change has been impossible...and even setting up a study of that change has been extremely difficult.
Maybe the Legislature will act after more cities like Tempe cancel their RFPs because they realize that there's only one alternative.