Red Wing City Council Workshop on EMS Operational and Financial Updates – September 28, 2026

The Red Wing City Council met in workshop on Monday, September 28, 2026, from 5:00 p.m. to 6:06 p.m. in City Hall Council Chambers. Council President Janie Farrar called the meeting to order; all council members were present, with Vicki Jo Lambert arriving at 5:01 p.m. Also present were Mayor Gary Iocco, City Council Administrator Chris Heineman, Fire Chief Mike Warner, Finance Director Marshall Hallock, Assistant Finance Director Tony Schultz, City Attorney's Office representative Zach Cronin, and EMSMC billing specialist Becky Mork. The workshop's sole agenda item was an operational and financial update on Red Wing's ambulance and EMS services, including billing, reimbursement, interfacility transfers, township funding, and long-term sustainability.

Discussion Items

• Chief Warner presented the EMS mission, Minnesota statutory requirements, and the service area, explaining that the city operates within its primary service area and also responds outside city limits in townships.
• Becky Mork reviewed the billing and reimbursement process, including EMSMC's billing work and the PWW compliance/advisory partnership, plus 2025 data. The city billed over $10 million on the ambulance fund but received $2.5 million in cash, for a 62.9% collection rate. Average cash per trip was about $964; 911 transports averaged about $758 per trip and interfacility transports just under $1,300 per trip.
• Mork said roughly 75% of the payer mix is Medicare/Medicaid, which pays regulated rates well below billed charges and cannot be balance-billed. She also noted that Medicaid changes taking effect in 2027 could reduce Medicaid enrollment by an estimated 10%.
• Chief Warner said the annual cost difference between advanced life support (paramedic) and basic life support (EMT) is about $51,000. Downgrading to BLS would likely reduce collections, not improve finances. If the city stopped operating an ambulance, it would still respond to 911 calls with fire apparatus but could no longer recover transport revenue, shifting more costs to the general fund.
• The chief used an epinephrine pen example to illustrate reimbursement shortfalls: a $650 pen would only be reimbursed at about $430–$450 on the roughly 75% of calls covered by Medicare/Medicaid.
• Chief Warner discussed interfacility transfers, which generate about $1.5 million in cash annually. He said the city has limited transfers to roughly 60 miles to avoid tying up ambulances and crews.
• Finance Director Hallock and Assistant Finance Director Schultz explained the ambulance fund deficit. General fund operating transfers were $250,000 in 2023, $300,000 in 2024, $500,000 in 2025, and $750,000 in 2026. The preliminary 2027 budget proposes $750,000 plus a $3.2 million one-time transfer to address the accumulated deficit. Staff said unsubsidized losses had accumulated since 2017 and totaled about $4.5 million over ten years; the 2025 cash loss was around $973,000.
• Chief Warner reviewed the current fund allocation of 48% general fund and 52% ambulance fund, and raised a 75/25 allocation as a starting point for discussion.
• The chief cited a state methodology putting Red Wing's per-response EMS operating cost at about $1,147.01 versus a statewide average of $705.38, attributing the gap partly to the 262-square-mile service area and diesel fuel costs.
• Chief Warner reviewed township outreach: the city requested roughly $32 per capita from townships, and two townships are considering $20 per capita, but none have committed. Townships that do not pay would still receive service. Mayor Iocco noted townships vote on budgets in March.
• Attorney Zach Cronin updated the council on the default judgment against former billing provider Expert Billing LLC. The judgment is final, has been docketed in Minnesota and South Dakota, and no payment or response has been received. He recommended a future closed session to discuss litigation strategy.
• Chief Warner said a community risk assessment and standards of coverage draft will be presented in the coming weeks or months.

Council Positions and Questions

• Council President Farrar asked who sets interfacility rates. Billing specialist Mork responded that rates are influenced by Medicare/Medicaid releases and by comparisons with other agencies, with final approval through the city/chief.
• Council Member Snyder asked whether both an ambulance and fire truck respond to every 911 call. Chief Warner said the ambulance responds to the call; fire apparatus is used for severe calls or when extra paramedics are needed.
• Council Member Kliewer asked whether any townships had committed to contributing. Chief Warner said none had committed; two were considering it.
• Council Member Lambert confirmed that the operating transfers were coming from the general fund, and Finance Director Hallock agreed.
• Council Member Goggin asked about the yearly deficit. Finance staff explained the deficit growth and the impact of Medicare/Medicaid reimbursement changes.
• Council Member Norton expressed support for funding EMS through the general fund as a community service, comparing it to law enforcement, but she was concerned about losing leverage for state subsidies. Chief Warner replied that the city could still apply for grants as long as it tracks operating costs and receivables.
• Council President Farrar requested additional discussion about transfers coming from reserve funds.

Key Outcomes

• No formal votes or decisions were made at the workshop; it was an informational session.
• Follow-up items identified include continuing township funding discussions, performing a cost analysis of resident versus non-resident rates, considering future fund allocation options, scheduling a closed session on the billing-provider litigation, and presenting the community risk assessment at a future meeting.
• Chief Warner indicated he expects to bring a treatment-in-place grant to a future council meeting for approval.
• The workshop adjourned at 6:06 p.m., with the regular city council meeting scheduled for 6:30 p.m.