Air ambulance bills could crush your most vulnerable clients

Sometime in the next year, an air ambulance service could save your client’s life.

An out-of-network air ambulance service could also saddle clients who lack the right kind of medical evacuation benefits with the mother of all out-of-pocket health care services bills.

The Chicago-based Blue Cross and Blue Shield Association says many fully insured patients in North Dakota, a state that looked into the issue, ended up with high out-of-pocket costs even though the patients’ plans paid an average of $17,000 per air ambulance transport.

State insurance regulators talked about the air ambulance services balance billing problem this summer in San Diego, at a meeting of the Kansas City, Missouri-based National Association of Insurance Commissioners.

Critics and defenders of the services gave their perspectives on the conflict in meeting presentation slidedecks.

Now the staff of the NAIC’s Health Insurance and Managed Care Committee has given its version of what the regulators heard in draft meeting minutes.

For highlights from the staff’s account, read on:

Critics say a federal law encourages abuse

Jeff Frazier of Sentinel Air Medical Alliance, a web-based air ambulance services cost control organization, told regulators that service costs have skyrocketed partly because providers have flooded the market.

Because too many providers are serving too many patients, the average level of fixed costs per provider is too high, Frazier said.

Another, major problem is that the federal Airline Deregulation Act of 1978 blocks states from doing anything to regulate air ambulance services costs, Frazier said.

Defenders say the services’ fixed costs are enormous

Mike Allen of Denver-based Air Methods Corp., a large air medical service provider, told regulators the number of U.S. providers is growing, and must grow, because so many rural hospitals are shutting down.

Transporting a patient with a traumatic injury to a trauma center within an hour is often a matter of life or death, and 85 million Americans now live so far from a trauma center that the only way they can possibly reach a trauma center within an hour is by using air medical transport, Allen said.

Any air ambulance services provider will have high fixed costs, because it must be prepared to respond to a service call at a moment’s notice, 24 hours a day, 7 days a week.

Costs for private-pay patients are high partly because government health programs cover about 70 percent of the patients served, and those government programs cover less than half of the cost of moving the patients, Allen said.

To bring down private air ambulance services charges, Congress needs to increase what Medicare pays for air ambulance services, Allen said.