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Consumer and Health Groups: Senate H.E.L.P. Legislation Could Limit Access to Air Medical Service for Rural Americans

WASHINGTON, D.C. -- In a letter to the Senate Committee on Health, Education, Labor, and Pensions (HELP), seven consumer, health and air medical organizations expressed concern over the bill’s unintended threat to access to air medical service in rural America. Specifically, the groups cited Section 105 of the Lower Health Care Costs Act, and noted that 32 air medical bases have already closed since the beginning of 2019. The letter urges the committee to instead address one of the root causes of cost-shifting to the private sector by updating the Medicare reimbursement rate for air medical services and having insurers cover these critical services.

Full text of the groups’ letter to the Senate HELP Committee is below.

July 16, 2019

Dear Chairman Alexander and Ranking Member Murray,

We applaud your work to address the problem of balance billing in the context of air medical transportation. This is a matter of great concern because today, approximately 85 million Americans, or 1 in 4, can only reach a Level 1 or Level 2 trauma center within an hour if they are flown by an air medical helicopter. In addition, 22 percent of rural hospitals have shuttered since 1990 and many more are on the brink of closure. Emergency care is becoming increasingly scarce, and thus air medical services are increasingly essential.

Ninety percent of emergency air medical transports treat patients experiencing a stroke, a cardiac event, or a traumatic injury. Air medical services are clearly needed and indeed, are often the only option for patients to get access to life-saving care quickly.

In this vein, we are concerned that Section 105 of the recently introduced Lower Health Care Costs Act, while undoubtedly well-intentioned, could inadvertently limit access to air medical services for millions of Americans, especially those living in rural areas. We recommend that Congress instead address the underlying problem by updating the Medicare reimbursement rate, which has not been changed in two decades.

More than 70 percent of patients transported by air ambulance have Medicare, Medicaid, another form of government insurance, or are uninsured. When government programs reimburse far below the cost of service, those costs are shifted, and balance bills increase for people with insurance. The balance billing problem must be addressed in a way that is fair to all parties – patients, providers, taxpayers who support federal health care programs, and insurance companies – and access to emergency air medical services must be protected for the 85 million Americans who, as noted above, currently can only reach a Level 1 or Level 2 trauma center within an hour if they are flown by an air medical helicopter.

There is an urgency to our concerns. Since January of this year, 32 air medical bases have closed. We urge you to look at the variety of factors affecting air ambulance service costs and reimbursement policies and take action to ensure that Congress adopts thoughtful, fair and comprehensive reimbursement and coverage rules. We thank you for your attention to this important issue.

Sincerely,                                                                                                  

National Consumers League

Brain Injury Association of America

Consumer Action

Consumer Health Coalition

International Association of Flight and Critical Care Paramedics (IAFCCP)

Association of Air Medical Services (AAMS)

Save Our Air Medical Resources (SOAR) Campaign

cc: Members of the Senate HELP Committee 

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Wyoming State Report: Air Ambulance Balance Billing Stories Don’t Match The Facts

Policymakers Should Collect Data and Get to the Root Cause of Surprise Billing

WASHINGTON, D.C. – A recent state of Wyoming’s Department of Public Health report shows that most air medical transport patients pay little or nothing for these emergency services, dispelling inaccuracies and misperceptions about balance billing within the industry.

The May report analyzed balance billing by emergency air medical providers and provided policy proposals to take patients out of the middle. The report found that the average out-of-pocket payment for emergency air ambulance transports by patients with private insurance is $300, with approximately 90 percent of those patients paying nothing. According to the report, of the 10 percent who do pay something for their transport, the median amount paid is $700. This aligns with research conducted by Xcenda which found that the average cost paid out-of-pocket by patients is $600.

“Thirty percent of all emergency air medical transports are for patients with private insurance and balance bills occur when a patient’s private insurer refuses to pay for the life-saving service,” said SOAR spokeswoman Carter Johnson. “The State of Wyoming’s report demonstrates that anecdotal stories about large balance bills don’t measure up to the data.”

Americans think insurers should pay for emergency air transport. A survey by the American College of Emergency Physicians found that 81 percent of Americans believe their insurance companies should pay for surprise medical bills and more than half – 54 percent - of survey respondents said they received a surprise bill because their insurance did not cover the medical treatment they received.

“If policy makers want solutions to this issue, they must first look at real data and address the root cause – chronic under-reimbursement by government payers and denials by private insurers,” continued Johnson. “Seventy percent of emergency air medical flights are covered by Medicare, Medicaid or are for patients with no insurance. Medicare only reimburses 59 percent of the cost of transport and Medicaid on average only reimburses 34 percent. This has led to immense financial challenges for the industry, as evidenced by the 32 air bases that have closed across the country since the start of this year.”

Private insurers also deny reimbursement for these services. Approximately half of all air medical claims are denied by insurance companies, either on the basis of network status or medical necessity. This despite the fact that 100 percent of emergency transports are ordered by an EMT or attending physician based on medical necessity.

“The legislative remedies to balance billing currently under consideration in Congress, while perhaps well intentioned, are misguided. But there is a better way. Congress already passed legislation last year calling for the U.S. Department of Transportation to collect cost data from the industry and develop recommendations for protecting patients from balance billing. This process must be allowed to move forward, before harmful legislation can be passed that puts these services at risk. By working together to address private insurer and government payer reimbursement, we can take patients out of the middle and protect access to the care they need in an emergency.”

SOAR Statement on Chairman Alexander’s Remarks About Air Medical

The following statement was released today by Carter Johnson, spokesperson for the Save Our Air Medical Resources (SOAR) Campaign, in response to Chairman Lamar Alexander’s remarks pertaining to air medical during today’s legislative hearing on S. 1895 in the Senate Health, Education, Labor & Pensions Committee.

“This proposal is dangerous, unworkable, and puts patient lives at risk. 85 million Americans live in rural areas where it takes more than an hour to get to a Level I or Level II trauma center by ground. Air medical transport is the lifeline that delivers patients to the health care facility they need in emergency situations. This bill, which puts insurance companies ahead of patients and by letting insurance companies decide what they want to pay for this service, will decimate essential air medical services and leave patients without access to the care they need in an emergency.

“The concept behind benchmarking is simply unworkable when applied to air medical transportation because in most places, there is no meaningful median network rate. Some insurance providers have refused to allow any emergency air medical providers to go in-network, and others have only one in-network emergency air medical provider. Further, it is completely inaccurate to say that 70% of air medical transports are out of network — in fact, 70% of air medical patients are either uninsured or covered by Medicare, Medicaid or other Government insurance. Only 30% of air medical patients have private insurance coverage, and if one applies the GAO’s questionable estimate that 69% of this smaller group is transported by providers that are out-of-network, this represents about 1 in 5 air medical transports overall.

“These and other facts should raise concerns among policymakers about the notion of benchmarking. If 69% of the small group of patients who have private insurance are transported by air medical providers that are outside of their insurance network, isn’t it obvious that the data necessary for benchmarking are missing? How could appropriate rates be set without factoring hard data on rural vs. suburban transports, provider type (hospital system v. community v. standalone provider), type of transport, patient outcome, and patient claim experience, to name a few crucial considerations? This is policymaking in the dark with a blindfold.

“If this proposal becomes law and insurance companies are allowed to reimburse air medical providers at either an illusory median network rate or the minimum allowable rate, insurance companies will default to the minimum allowable rate, which is not based on negotiated market data or actual market conditions. The result will be that insurance companies will increase their profits, air bases will close, and millions of Americans will lose access to the care they need when they need it most.

“There is a better way. The government should get the data it needs before approving this dangerous and impractical proposal.  Last year, Congress directed the U.S. Department of Transportation to collect data from the air medical industry and develop recommendations for protecting patients from balance billing, improving disclosure and informing consumers of insurance options. We support this process and want it to work so that patients are taken out of the middle and get the care they need.”

ADDITIONAL KEY FACTS ABOUT AIR MEDICAL

  • 90% of all emergency air transports are for cardiac, stroke, or other trauma conditions. The remaining 10% encompass specialty pediatric care, burns, neonatal, high-risk obstetrics, neurological, and other conditions.

  • 100% of emergency air transports are ordered by an EMT or attending physician based on medical necessity.

  • 100% of emergency patients are transported without regard to insurance status or ability to pay.

  • 20% of Americans, or 85 million, live in areas where it takes more than one hour to get to Level I or II trauma center.

  • More than 70% of patients transported are covered by Medicare, Medicaid, other government insurance, or have no insurance at all. The Government Accountability Office estimates that about 20% of all air medical transports, or 1 in 5, are of patients who have insurance but are transported by an out-of-network air medical provider.

  • Medicare drastically under-reimburses for the cost of an emergency air medical transport, covering only 59% of the cost (in 2015 dollars). The average Medicaid reimbursement is even worse, covering only 34% of the cost.

SOAR Statement on Provisions of Lower Health Care Costs Act

“Recently proposed legislation by the U.S. Senate Committee on Health, Education, Labor and Pensions (HELP) would destroy access to life-saving emergency air medical service for millions of Americans, especially those in rural areas.

The Lower Health Care Costs Act includes a provision – Section 105 - that hurts patients, cuts air medical providers out at the knees, removes vital care from rural America—and only benefits health insurance companies. The language would allow insurers to continue paying ever lower rates while continuing to question the emergency medical decisions of doctors and first responders.  It would also leave no recourse against some insurers who refuse to negotiate in-network agreements with air ambulance providers. The unintended consequences of Section 105 will decimate the air medical safety net in rural America so that the cardiac, stroke and trauma patients air medical crew members care for 24 hours a day, 365 days a year, will have no chance to receive definitive care in an adequate amount of time. 

This public policy gives the insurance industry all of the cards and could lead to the elimination of emergency air medical services at a time when large swaths of the country and millions of Americans are losing hospitals and other health care facilities. We urge members of Congress to reject this ill-conceived legislation.”

SOAR Statement on the House Hearing regarding “No More Surprises: Protecting Patients from Surprise Medical Bills”

“The Save Our Air Medical Resources (SOAR) Campaign supports efforts to protect patients from balance bills and ensure access to life-saving emergency air medical care. We urge Congress to get to the root of the problem by fixing Medicare’s chronic under-reimbursement for air medical services, and we call on insurance companies to do right by their patients and consistently cover this emergency service.

“Last year, Congress took a step in the right direction when it directed the U.S. Department of Transportation to collect data from the air medical industry and develop recommendations for improving disclosure, informing consumers of insurance options, and protecting patients from balance billing. We support this work and want it to succeed. Adding a new billing requirement to separate the health care and transportation aspects of an emergency air medical transport would be a step backward, however. Not only is such a separation impossible due to the nature of the service, it would do nothing to protect patients from balance bills or lower costs.  

“We applaud the Subcommittee for taking up this issue and look forward to working with it to preserve access to emergency air medical services and protect patients from balance bills.”

SOAR Statement on the House Hearing regarding “Examining Surprise Billing: Protecting Patients from Financial Pain”

The SOAR Campaign thanks Chairwoman Frederica Wilson (FL-24) and all the members of the Committee for calling today’s hearing to explore strategies on the important issue of surprise billing.  This is a welcome first step toward finding real solutions to take patients out of the middle.

Largely missing from today’s discussion was the role that private insurers play in surprise billing. For example, narrow networks and medical necessity are routine ways in which insurers deny coverage of patient claims in order to increase profits. Recent media coverage has shown that Health Care Services Corporation, which runs Blue Cross Blue Shield plans in five states, spent only 63 percent of premiums on actual medical costs. Insurer Centene was recently fined $1.5 million because their networks provided inadequate access to providers. These practices by private insurers leave patients at risk from surprise bills.

Emergency air medical providers never want to see a patient receive a bill they did not expect or cannot afford. Air ambulances are called by first responders or medical professionals to transport patients to the closest, most appropriate healthcare facility in an emergency. Air ambulances never self-dispatch: they go when they are called, regardless of the patient’s ability to pay or their network status. Yet some private insurers leave patients with large bills because they refuse to negotiate. As a result, air ambulance providers have patient advocates who work with the patient to navigate the insurance appeals process and, in many cases, provide the patient with a discount on their bill. But insurance denials beg the question - if patients can’t rely on private insurance in an emergency, what is insurance for?

To take patients out of the middle, private insurers must negotiate a fair reimbursement to bring air medical providers in-network, which air ambulance providers want to do. This can be accomplished for a small increase in premium as shown by a Montana legislative study which found that for only $1.70 a month more in premium costs, air ambulance services would be covered.  A similar study in Kentucky estimated that the increase would be between $0.92 and $3.69 per person per month.

Beyond that, however, Congress must pass legislation that would require the collection of data from the air medical industry so that Medicare reimbursement rates can be updated to reflect the actual cost of care. Seventy percent of patients flown by air are covered by Medicare, Medicaid or have no insurance, and rates haven’t been updated in almost 20 years. This is unsustainable.

The SOAR Campaign appreciates the Committee’s attention to this issue. Working together on solutions that address the root of the problem will protect patient access to these life-saving services.

SOAR Statement on 2019 GAO Report

The Government Accountability (GAO) report issued Wednesday (3/21) confirms what the SOAR Campaign has been saying for some time – that the majority of patients covered by private insurance (two-thirds according to the GAO data) are out-of-network and therefore at financial risk of receiving a balance bill. Air medical providers are committed to going in network – and aggressively work to do so – but some private insurers refuse to even negotiate.

Even though the GAO found that only one in five Americans flown by air medical have private insurance and the number of large balance bills they receive is quite small, air ambulance providers never want to see a patient with a bill they didn’t’ expect or can’t afford. That’s why they have patient advocates who work side-by-side with the patient to navigate the insurance appeals process and, in many cases, discount the final bill.

The report also found that 60 percent of new air bases are in rural areas, where hospitals, and specialty services like maternity and emergency care, are closing at alarming rates. In those areas, air medical is filling the gap by transporting patients to the nearest, most appropriate health care facility. This is critical for patient outcomes in an emergency.

The solution to balance bills is twofold.

First, Congress must pass legislation that would require the collection of data for the air medical industry so that Medicare reimbursement rates can be updated to reflect the actual cost of care. Because 70 percent of patients flown by air are covered by Medicare, Medicaid or have no insurance, and rates haven’t been updated in almost 20 years, this is an important step toward preserving access to these life-saving services.

Second, private insurers must do right by patients by going in-network with air medical providers. The fact is emergency air medical transport can be covered by private insurance for a small increase in premium. A Montana legislative study found that for only $1.70 a month more in premium, air ambulance services would be covered.  A similar study in Kentucky estimated that the increase would be between $0.92 and $3.69 per person per month.

We are grateful that the GAO has focused its attention on the role that private insurers play, and we look forward to working with members of Congress and private insurers to find solutions that get to the root of the problem, to take patients out of the middle.