X-Message-Number: 1205
From:	Ralph Merkle <>
Subject: Suspension cost containment
Date:	Fri, 18 Sep 1992 10:48:06 PDT

Keith Henson in article #1192 wrote:
>The recent east-coast suspension of a member who was signed up for 
>about a week before we went on standby is certainly a sharp lesson. 
>All the bills are not yet in on that one, but those to date for the 
>standby/transport phase totaled a little over 21k.  That is *7 times* 
>the allocated amount in the suspension funding.  I roughly averaged 
>the standby/transport fraction of cost for the last half dozen 
>suspensions (all except one were in California) and the amount 
>allocated is reasonably close to the actual cost. 


My cryonic suspension agreement reads:

"5.  Suspension Fund minimums provide $2,000.00 for location, recovery,
stabilization, and transport of the Patient's human remains.  If funds
in excess of $2,000.00 must be expended for these purposes, and if the
Patient has only the minimum Suspension Funding, the Patient may not
be suspended.  Provision of adequate funds for location, recovery,
and transport of the Patient's human remains is the sole responsibility
of the Patient."

(My agreement is no longer the current one being used by Alcor, so
the language might have changed).

Obviously, we cannot lose in excess of $20,000 on a transport very
often.  We must adopt measures to insure that such losses are infrequent.
The obvious method is to charge for actual costs.  Particularly when it
is clear in advance that the expense of transport will significantly
exceed the amount budgeted, Alcor should seek prior agreement that
the patient (or some responsible party) would pay the actual costs
(or at least something approximating actual costs).

It is also clear that the amount of the financial loss actually computed
by Alcor is in fact only a fraction of the actual financial loss incurred
(e.g., volunteer time is considered "free.") Even a policy of full payment
by the patient for the costs of the transport would still represent a
significant underpayment (how frequently can volunteers provide "free"
service before they become exhausted?)

A second alternative is a general increase in suspension minimums.  This
has the disadvantage that it fails to provide appropriate incentives for
cost reduction.  In particular, costs will be substantially reduced if
patients move to the Los Angeles area (or, in the future, where ever the
suspension team is located) prior to the suspension.  In the absence of
some charge to the patient that reflects the financial reality of the
actual costs involved, this incentive would be greatly reduced.

It is also clear that we must move aggresively to increase our capabilities
in any geographical area where there are many suspension members.  The long
term solution is clearly to provide high quality suspension services at
a reasonable cost to all our members.  Today the costs vary rather
dramatically depending on circumstances.  This is likely to continue for
the foreseeable future for a substantial percentage of Alcor members.

We need to develop mechanisms for coping with this problem.

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