December 15, 2000
CO-OP Helps Communities Afford Ambulance Services
By Susan Huppert
UW-RF News Bureau
Communities in a five-state area are benefiting from an innovative group buying program that allows them to purchase supplies and equipment for ambulance services at volume discounts.
The program, known as the North Central EMS Cooperative (NCEMSC) began as a collaborative effort between UW-River Falls and three ambulance services: Gold Cross, a Mayo Medical Systems affiliate and nonprofit service; HealthEast St. Paul, a for-profit service; and Willmar Ambulance Service, a municipal service of Rice Memorial Hospital in Willmar, Minn.
The group formed the cooperative in 1997, in anticipation of reduced coverage by Medicare for ambulance services. The cooperative helped them lower operating costs to compensate for the cutback by allowing them to purchase ambulances, medical supplies, office equipment and other products at volume discounts.
The co-op accepts members from North Dakota, South Dakota, Iowa, Minnesota and Wisconsin, and is open to organizations that provide emergency medical services, regardless of size or structure. Currently, it has 90 members, and other areas of the country are showing interest in replicating the program.
Funding for NCEMSC came from a grant to UW-RF in 1994 from the W. K. Kellogg Foundation to be used for the Cooperative Development Initiative, a project aimed at testing the cooperative model in multi-community, non-agricultural sectors.
In 1998, the incorporators of NCEMSC applied for assistance through the CDI, and the program was selected as one of CDI╣s eight model projects. UW-RF staff members David Trechter and Linda Jacobson served as consultants. Trechter, who was the director of CDI, and Jacobson, who was associate director, helped the group develop a strategic plan, write a business plan, launch a membership campaign and strategy, and develop marketing materials, then provided ongoing support and guidance.
Savings to communities through co-op buying have been substantial, according to Jacobson.
"Within eight months, coop members purchased more than 40 ambulances, with savings of $6,000 to $25,000 per ambulance," she said. "This totaled more than $250,000 in savings from ambulance purchases alone." Detroit Lakes Hospital, one co-op member, saved $11,000 when it purchased software upgrades.
Savings on medical products are projected at 10-60 percent. Gasoline and cell phones will be offered at volume discounts in the near future.
The cooperative is open to anyone in emergency services in the 5-state area, with an annual membership fee of $75. Additional information on the cooperative is available online at http://www.ncemsc.org, or by calling NCEMSC in St. Cloud, Minn., at 320/240-9617 or 888/603-4426.
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