Title
Resolution authorizing the City Manager or designee to execute a Consulting Services Agreement with Digitech Computer LLC for ambulance billing and revenue cycle management services for an initial term of five (5) years, with the option to extend the agreement for up to three (3) additional two-year terms, for compensation equal to 3.75 percent of collected revenue.
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WHEREAS, the South San Francisco Fire Department provides Advanced Life Support (ALS) and Basic Life Support (BLS) ambulance transport services, processing approximately 4,300 ambulance transports annually; and
WHEREAS, ambulance billing and revenue cycle management services are essential to ensuring timely reimbursement from Medicare, Medi-Cal, commercial insurers, and private payors while maintaining compliance with applicable federal and state laws and regulations; and
WHEREAS, as the City's existing ambulance billing agreement approached expiration, the Fire Department determined that conducting a competitive Request for Proposals (RFP) was in the City's best interest to evaluate current market capabilities, technological advancements, pricing, customer service, and opportunities to improve revenue cycle management; and
WHEREAS, following an initial review of the written proposals by Fire Department staff, three finalists were selected for interview, and were evaluated using the criteria established in the RFP, including experience and qualifications, technical approach and methodology, compliance and reporting capabilities, customer service approach, cost competitiveness, and references; and
WHEREAS, staff concluded that Digitech Computer LLC demonstrated superior technical capabilities in automated claims processing, insurance identification, denial management, reporting and analytics, and revenue cycle management, and that these capabilities provide the greatest opportunity to improve compliant revenue recovery and long-term financial performance, and staff entered into negotiations with Digitech Computer LLC; and
WHEREAS, those negotiations resulted in substantial enhancements to the City's benefit, including a reduction of the proposed contingency fee from 4.25 percent to 3.75 percent of collected revenue, the addition of a unilateral City option to terminate the agreement during months 15 through 18 if performance expectations are not met, retention of Digitech's comprehensive reporting, analytics, compliance support, and revenue cycle management platform, associated staff training, and a clearly defined strategy to improve insurance identification, reduce denials, and maximize compliant reimbursement; and
WHEREAS, the proposed agreement provides for compensation equal to 3.75 percent of collected ambulance revenue, representing the lowest contingency rate the City has achieved for these services despite significant inflationary pressures over the past two decades, for an initial five-year term with three optional two-year extensions, for a maximum potential term of eleven years; and
WHEREAS, funding for ambulance billing and revenue cycle management services is included within the Fire Department operating budget and no additional appropriation is required.
THEREFORE, BE IT RESOLVED, that the City Council of the City of South San Francisco hereby approves the Consulting Services Agreement with Digitech Computer LLC for ambulance billing and revenue cycle management services, attached hereto and incorporated herein as Exhibit A.
BE IT FURTHER RESOLVED that the City Council hereby authorizes the City Manager or designee to execute the Consulting Services Agreement on behalf of the City of South San Francisco in substantially the form as Exhibit A, subject to Digitech Computer LLC executing the agreement and providing necessary documents.
BE IT FURTHER RESOLVED that the City Council hereby authorizes the City Manager or designee to execute any related documents, or take any necessary actions, to carry out the intent of this resolution, subject to approval as to form by the City Attorney.
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