By Pam Zubeck
A rocky couple of months after being chosen to negotiate an emergency ambulance contract with Colorado Springs ended on Oct. 11 when the city announced it had scrapped talks with Falck Rocky Mountain.
The city now will try to hammer out a new five-year contract, with five one-year options, with American Medical Response of Greenwood Village, the incumbent provider, the city announced.
The announcement comes after a failed protest by AMR of the city’s choice of Falck and a string of headlines regarding Falck’s performance and troubles elsewhere.
City spokesperson Jamie Fabos said in a statement that the city and Falck “mutually agreed” to end negotiations and that Falck was a “professional and well-managed company.”
Fabos also noted the city expects to arrive at an agreement for ambulance service that will “improve the EMS transport system in Colorado Springs for the benefit of its residents.”
The city has complained in the past that AMR relies too heavily on the Colorado Springs Fire Department to meet response times. It’s also upped the amount sought from the contractor to compensate the city for firefighters’ time and supplies, from $1.17 million in the current contract to $1.4 million in the latest request for proposals.
AMR’s vice president of operations Scott Lenn said via email, “We appreciate the opportunity and look forward to sitting down to discuss the EMS system in Colorado Springs.”
Falck Rocky Mountain said in an email the company found the city wanted a contract “considerably different” from Falck’s proposals, which would “require Falck to make service delivery commitments that we believe are significantly at risk of not being sustainable.”
“We are not willing to make unsustainable commitments, and we believe the City would agree that it would be irresponsible to do so,” Falck Rocky Mountain CEO David Patterson said.
After Falck was chosen as the preferred provider, issues came to light about the company.
• The Danish Competition Council accused Falck of unfair competitive practices, which led to a settlement this year. In it, Falck acknowledged its actions, agreed to pay the equivalent of $22.4 million to a competitor as compensation after it went bankrupt, and vowed not to repeat the actions it took that led to the council’s action.
Falck’s President and CEO Jakob Riis said in a statement, “Falck acted in a way that was unacceptable and which we will never repeat. We have accepted the ruling by the authorities. We have worked to create a joint solution for both large and small creditors. We are happy that we have reached a settlement and will now pay the parties’ losses.”
• Falck initially said it planned to hire AMR personnel to service the Colorado Springs contract, but AMR then said it planned to keep most of its workers busy with other contracts in the region. That meant Falck might have had a hard time hiring, because the nation is experiencing a shortage of emergency medical technicians and paramedics.
• Falck’s performance under a contract with Alameda County Health Care Services Agency, San Leandro, Calif., came under scrutiny, leading the agency to write a letter on Sept. 23 to Falck. Though an Alameda County official said in early September there had been “a successful transition” to Falck from Paramedics Plus and that “all partners worked well together during the transition,” the letter advised Falck of a $372,500 penalty being imposed. The penalty stems from Falck’s alleged failure to meet response time expectations. Alameda County asked Falck to submit a corrective action plan by Oct. 8.
Patterson said in an email the Alameda County contract represents a transition from a provider that wasn’t complying with response times and was “severely understaffed.” Falck hired 66 EMTs and paramedics after July 1, which with other changes would help the company show “significant improvement” in compliance.
• Falck also became embroiled in litigation over the alleged misuse of intellectual property of management consultant Scott Griffith Collaborative Solutions LLC (SGC), Westlake, Texas. The firm filed a federal lawsuit on Sept. 26 in the Northern District of California against Falck NorCal, its subsidiary Care Ambulance Service and Falck USA. The suit accuses Falck of copyright and trademark infringement and unfair competition under federal and California laws for allegedly using its management materials in bids submitted in California.
Falck filed a lawsuit against SGC the same day in federal court in Texas, claiming breach of contract, business disparagement, libel and interference. Falck contends SGC gave permission to its subsidiary, Care Ambulance, to use its materials in a 2016 agreement and later claimed it hadn’t given permission. Falck accused SGC of circulating a demand letter among media, which broadcast the letter, with one using a headline, “Falck Ambulance, the city’s choice for a 5-year contract, accused of lying in a proposal in California.”
Falck also accuses SGC of making statements “maliciously and with an intentional disregard of their accuracy, and in complete disregard of what is actually provided for in the Agreement and written consents.”
As for AMR’s record, it has faced criticism locally for failing to meet response times without the help of firefighters. It also racked up more than $1 million in fines in Georgia last year due to slow response times.
AMR’s Lenn says that contract issue was resolved.
“In the EMS industry, there may be disagreements over response time penalties due to causes that are out of the provider’s control such as weather, traffic accidents or system problems,” he said.
AMR has served the region for some 40 years either as AMR or a previous iteration of the company and was the first to directly contract with the city, starting in 2014. When the city rebid the contract last year and chose Priority Ambulance, AMR protested, and the city eventually ended that effort and solicited a new round of bids. After Falck was chosen, AMR again protested, on Aug. 23. The city rejected that protest.