By Martin Espinoza
The Press Democrat
SONOMA COUNTY, Calif. — The public fire district that two and a half years ago became Sonoma County’s largest ambulance service provider is again asking county health officials for a significant rate increase that would primarily impact residents with private insurance.
The Sonoma County Fire District, which won the county contract in 2024, wants to split the increase into two smaller requests, a move that could sidestep an extensive audit of its operations and finances. Under that contract, which exclusively covers Santa Rosa, Rohnert Park, Cotati and Sebastopol extending out to the coast, such reviews are triggered by requests for rate increases larger than 10%.
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Overall, Sonoma County Fire District Chief Ron Busch said his agency is seeking a rate increase of 16.36%, according to a formal request letter dated July 2 . However, in the email conveying that letter to the county’s Health Services Director Nolan Sullivan, Busch spelled out a request for a bifurcated increase.
“SCFD would like to have a 9.9% increase approved ASAP,” Busch wrote in the July 3 email. “We would also like to have the remainder and a COLA January 1st of 2027.”
It is the district’s second attempt to secure a significant rate increase since taking over the county contract with its subcontractor Medic Ambulance. At that time the contract was worth about $30 million annually.
The district expects to generate about $40.2 million from the ambulance program in the current 2026-27 fiscal year, but expenses are projected to total $42.7 million, according to the rate increase request.
In March 2025, 15 months after it took over service, the district requested two increases totaling just under 25% that also would have rolled out in two stages starting with a 9.9% increase. Discussions between the county and district over that request appeared to stall, though officials were tight-lipped about why.
Months later, in September, the Board of Supervisors approved a 2.4% hike, a cost-of-living increase the contract facilitates annually based on the region’s consumer price index.
As with last year, district officials say the newly proposed rate hike is necessary to cover higher-than-expected labor costs, the financial burden of paying for its share of emergency dispatch and a negative change in “payor mix,” which is the share of private insurance, Medicare and Medicaid patients.
Sullivan, in an email, said the county is still evaluating the district’s request under the contract terms and will be making a recommendation to the Board of Supervisors. He said it was too early to say when that recommendation would come forward.
“Recognizing the potential impact any decision regarding a rate increase will have for our Sonoma County residents, as well as SCFD, we need to ensure we have gathered all relevant information to make an informed recommendation,” Sullivan said. “This cannot be rushed or given an arbitrary deadline. However, we are committed to completing the evaluation and recommendation as prudently and timely as possible.”
Privately insured patients to pay more
Last year, the district’s formal request came in the form of a three-page letter that specified the sought increase in the first sentence, followed by a chart of the direct impact on rates for patients.
The bulk of the district’s new request comes in a 16-page pitch listing numerous accomplishments, program innovations and stellar performance reviews. The exact increase being sought is not specified until page 11, at the end of a paragraph about payor mix. “Here is The Bottom Line Up Front,” reads the underlined lead-in.
The district said it is facing a projected 6% shortfall in revenue, which it said can only be made up for by a larger increase in transport rates due to its payor mix, which is mostly Medicare and Medi-Cal patients whose reimbursement rates are fixed. As a result, the district said, it must turn to a rate increase for patients with private insurance, who only make up 13.7% of calls.
“Let us not mix up the two numbers,” Busch said in the letter. “One is a matter of service economics. The other a product of National Healthcare policy and is beyond our control. Both are critical to the service we provide.”
Privately insured patients comprise 39%, or $13.7 million, of the district’s annual billing. Medicare, Medi-Cal and uninsured/self-pay patients respectively generate $9.2 million, $11.3 million and $1.2 million, according to district financial documents that accompanied the rate increase letter.
In that request, district officials highlighted steps taken to improve service, including more ambulances deployed on the street, creating a pipeline program for paramedics to become firefighters and reducing reliance on neighboring ambulance agencies to fill service gaps. The letter laid out these measures as improvements on service previously provided by ambulance grant American Medical Response, which held the contract for decades but lost it to the district in a rancorous competitive bidding process.
District touts report card
In support of its requested rate increase, the district described in its letter the findings of a “collaborative, comprehensive” two-year audit by the county to measure the district’s performance based on a set of compliance criteria outlined in the contract.
“At the end of the first year we’ve been given an informal ‘Progress Report’ with a score of ‘91.6, which in most places is an A,’” the letter states.
The letter does not mention the district’s ongoing negotiations over some of those criteria. A particular sticking point in those negotiations, which started in 2024, has been ambulance response times for certain calls.
“There is no update on negotiations at this time, but we are discussing getting back to formal negotiations and anticipate doing so soon,” said Sullivan, the health services chief, in an email.
The district listed several financial burdens that it has been carrying since it took over the contract from AMR in January 2024. One is the district’s obligation to the county’s fire and emergency medical dispatch center, which was restructured in the fall of that year, leaving the district responsible for a third of the center’s operational costs. Financial records show the district expects to pay $2.4 million to the center, known as Redcom, when it closes books on the fiscal year 2025-26 in the coming months.
The decision to restructure the dispatch center was unanimously approved by Redcom’s seven-member board, including a district representative, which Busch noted in the letter.
To cover initial costs in 2024, the district tapped into other funds it is now seeking to replenish.
“As with any new enterprise, the startup funds had to come from somewhere; in our case they came in the form of dollars paid by SCFD’s taxpayers into our enterprise fund,” the letter said, though it did not specify which tax revenue was used.
As a fire entity, the district serves a wide region stretching from the outskirts of Santa Rosa up to Windsor and out along the lower Russian River to the coast at Bodega Bay.
Unexpected costs
The biggest financial drag on its ambulance program, according to the district, is increased “unanticipated operating costs” resulting from a last-minute pay hike AMR granted its employees just before Sonoma County Fire District took over the ambulance contract.
The district was obligated to match the pay of the previous employer, under the terms of the contract.
“We have carried that unexpected cost for more than two years. We take pride in the wages and benefits we pay our employees. To maintain and enhance those packages we need to increase our transport revenue,” the district said.
AMR has previously pushed back on the district’s characterization that those raises were issued as a parting shot after losing the contract. A company representative has said those raises were no secret and were negotiated for its wider operating region, not just Sonoma County.
AMR also previously accused the fire district of significantly underbidding the contract only to turn around a year later and seek significantly higher rates. Fire district officials have rejected that claim.
Commitment to transparency
Busch provided The Press Democrat with the district’s request letter and supporting documents, which included financial statements and letters of support from neighboring agencies. He did not respond to multiple interview requests, including an email with questions in writing.
One of those questions sought an explanation for why the district’s wish for a bifurcated raise was left out of the formal request letter and whether the district was seeking to avoid a more rigorous examination of the ambulance program’s finances and operations.
In an interview last summer, Busch said the district was not wary of an audit. In the July 2 request letter, signed by Busch, the district touted its commitment to transparency.
“And, consistent with our role as a public provider of emergency services, we promised that our operations would be transparent and subject to outside review. We kept that promise,” Busch wrote.
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