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Medical Flights – The Market-Driving Factors

It is believed that the medical flights will be in great demand for most part of the next two decades and will grow at a rate of 9.3%. In the past year, the industry grew to US$ 4,524.7 million. Those are some robust numbers and not the kind we commonly see in the prevailing economy. What are the driving factors behind these trends? It is certainly not the affordability of the people as evident by the growing concerns surrounding the balance bills that never fail to make the headlines. It is the medical need that is driving the air ambulance industry. Here are some sharp insights.

Medical Flights and Diabetes

Perhaps the most common lifestyle disease that prevails today is diabetes. While there is nothing that cries emergency about diabetes, it is a cause for more serious ailments. People with diabetes are known to eventually develop serious heart and kidney conditions, which give rise to life-threatening emergencies. This is where medical flights come into picture. With the US fighting obesity and diabetes (as a consequence), the market is set on an upswing. In fact, currently, there are about 463 million diabetics in the country, and it is projected to reach 700 million in the next 25 years.

Medical Flights and Drug-Related Emergencies

The illicit drug menace has bothered the country for long. Today, it is believed drugs are among the biggest killers when it comes to people under the age of 50. A lot of times, these give rise to serious and unexpected medical emergencies ranging from overdose to motor vehicle accidents. Medical flights are the only recourse in most cases.

Medical Flights and Rural Hospitals

It is a known fact that rural hospitals have been closing down at a rapid rate in the country, and the trend has been up since a decade now. Medical flights are the only way out for the residents of such areas.

In a way, the market for medical flights is a reflection of how healthy the society is.

Air Ambulance Industry Landscape and Attempts at Regulating It

The air ambulance industry has been in the headlines for quite some time now. Most recently, however, it was because the state of Wyoming was attempting to regulate it. The hurdle was (and is) a federal regulation that prohibits state governments from interfering in the affairs of air ambulance industry. However, the attempts were rejected by CMS. Wyoming had proposed that the states must be allowed a say in the matters of air ambulance industry. It had done so to keep the cost of medical flight services at bay as they have been getting steeply expensive recently.

Does this Mean the Air Ambulance Industry has Won?

The answer is “yes.” At least for now, the air ambulance industry seems to have won. The CMS verdict favors the medical flight service providers. They will not be subjected to any state control and will be free to fly across state borders and also charge the consumers what they feel is the right amount.

The industry had feared that if they are forced to come under insurance networks, they will then have to conform to the reimbursement rates that are set by the insurance organizations. This was especially worrying since the rates have not been revised in over a decade. Moreover, since bidding system to offer services for a particular state would have come into picture, there were high chances that some insurance companies would have gone out of business.

What does it Mean for Consumers?

Consumers will now have access to a wide range of air ambulance companies. This means they will be able to avail specialized medical flights during emergencies. Since the profitability will remain unchanged, the air ambulance industry would find it financially encouraging extending their reach to remotest parts of the country. There, however, is one drawback. Since insurance companies have not still revised their reimbursement rates, the consumers are at risk of high out-of-pocket expenses.

Medical Flight Services and Insurance Companies seem to be Coming Around

A recent survey has shown that medical flight services are now more open to insurance network participation. In fact, the numbers have gone up by a healthy 20%. It has also been seen that the medical flight services and insurance companies are holding intense discussions and negotiations surrounding in-network arrangements.

The reason behind this change has been the huge increase in consumer demand and also to steer clear of the negative publicity that both the industries have been subject to in recent times. The efforts by the state governments to regulate air ambulance pricing and also getting insurance companies onboard with their cost-controlling measures have seen a lot of backlash recently.

The Medical Flight Services and their Cost Compulsions

The refusal of the insurance companies to take cognizance of the fact that maintaining medical flight services is an expensive affair – some say – was the cause of all the misunderstanding. Air ambulance companies usually spend a fortune to remain on standby for emergencies. The cost, of course, is then transferred to their services. When insurance companies refuse to foot these costs, the burden unfortunately is transferred to the patients who avail the service. This is a practice that is popular as ‘balance billing’.

How In-Network Coverage Helps

Customers are able to enjoy discounted and ‘fair’ out-of-pocket expenses to cover medical flight services when in-network coverage becomes a reality. In an ideal world, all air ambulance services providers must be in-network. However, the onus of it does not lie only on these emergency service providers. The insurance organizations too must be willing to reimburse a fair amount. Otherwise, it simply does not make business sense for medical flight services to join any network.

The good news, however, seems to be that both these industries are coming around and finding common grounds to work together.

Community Air Ambulance Funding – Does it Work?

When it comes to communities funding air ambulance services, United Kingdom leads the way, and there is no doubt about it. It is the involvement of the locals that makes it happen. People are known to undertake several community efforts, no matter how small, to keep the medical flights funded. From marathons to selling cookies, people contribute in their own way through innovative fund-raising efforts. The question that such undertakings raise is this: does this method work across the board? The answer to this simple question, however, is quite complex and the success is dependent on several factors. Let’s take a look at some of them.

The Absence of Significant Private Air Ambulance Companies

In a country like the United States, there are several private players who do an exemplary job to provide air ambulance coverage. They span a wide network of rural areas with zero compromise on quality of transport. The problem, however, is the price that they charge. In the absence of adequate insurance coverage, they can turn out to be a huge challenge to pay off. Of course, there is the issue of network coverage and surprise billing that has got the country concerned lately. This is the prime factor that is pushing people to look at alternate means of funding air ambulance services.

Community Funding is Not Always Successful

The estimated cost of keeping air ambulance services floating runs over a million dollars. Even the most successful charitable medical flight services do not rely solely on community funding to satisfy this need. Governments and corporate organizations play an active role in their funding. Moreover, prominent personalities are known to raise awareness and extend support to raise awareness about the services. In the United States, however, such an ecosystem is completely missing. Unless there is a concerted effort to get it in, such efforts are bound to fail.

New Air Ambulance Billing Draft taking a Neutral Path?

There has been much anticipation surrounding the new air ambulance bill that aims at curtailing surprise billing practices. However, experts opine that the draft leaves much to be desired for both parties – the payers and the air ambulance service providers.  The feeling is that the lawmakers have tried to take a middle ground so as to not displease the air ambulance industry or the medical insurance industry.

From the insurance industry point of view, the fact that it suggests an in-network rate even for those medical flight service providers that are out of network seems like a big win. The provision is something that payers have wanted all along.

From the air ambulance industry point of view, the draft allows for arbitration if there is a dispute with regards to the billing. However, since this comes in the backdrop of a set rate, the industry is not too happy about it.

How is the Air Ambulance and the Wider Healthcare Industry taking it?

The American Hospitals Association has strongly opposed the draft. Their reasoning is that it harms the rural hospitals by limiting the access that patients currently have. The association went as far as saying it is a ‘windfall’ for the insurers ‘at the expense of’ community hospitals. American Association of Medical Colleges too has opposed the draft.

America’s Health Insurance Plans has displayed its dissatisfaction surrounding the provision for arbitration.

More about Arbitration

When it comes to air ambulance companies, arbitration will only be possible for amounts over $25,000. The industry is also expected to provide two years’ worth of data pertaining to costs. This data would be provided to US Transportation Secretary as well as HHS.

The air ambulance industry has been vocal in raising the concerns surrounding patient safety as well as closure of medical bases. They also pointed out that the current insurance payouts by Medicare and Medicaid do not cover even 40% of the costs.

Air Ambulance Industry and the Airline Deregulation Act

The air ambulance industry has often cited the Airline Deregulation Act whenever questions have been raised against its billing practices. It is obvious that most people are curious about this act that precludes the states from interfering in the matters of the medical flight industry.

The law was originally passed in the year 1978 with the intent of keeping the prices of commercial flights low and to promote a healthy capitalistic competition. Prior to that, the commercial airline industry was seeing a lot of monopolistic moves and the prices were quite high. The Act was quite successful and the primary reason why we see highly competitive prices in the commercial airline market even today.

How did it Affect Air Ambulance Industry?

The credit goes to the air ambulance industry that has successfully argued they too are in the business of commercial flights and, therefore, the states cannot interfere in the matters of their pricing. However, like all industries, there are bad players in the air ambulance industry too. They have leveraged this act to charge incredibly high amounts to the customers. The issue has now catapulted to the extent that it has caught national attention. Some experts believe that strong lobbying of the industry is even influencing federal decision makers.

The Argument against the Air Ambulance Industry

Many believe that air ambulance industry must not be treated as commercial airlines. Instead, medical flights must be treated as public health utilities. Part of the argument is also that the congress – while formulating the act – would not have imagined that the air ambulance industry would interpret it the way it has been at this point. Also, the main intent was to keep the prices competitive and not soaring as is the case today. The air ambulance industry too, on the other hand, has a valid point. It points fingers at the insurance industry, which is known to deny out-of-network coverage.

Coordinating Air Ambulance Evacuation

Air ambulance evacuations can throw situations at crew members that they are not always prepared for. It is simply the nature of the job. It is impossible to imagine all kinds of situations one might encounter. It is therefore necessary to have a coordination mechanism in place where help can be sought with minimum wastage of time. The coordination could be between ground ambulances, treating or receiving facilities and even cross-nation institutions. At times, it becomes necessary to coordinate between legal teams when the evacuation involves getting a patient from overseas locations. It is vital that one chooses an air ambulance company that is well experienced, in the interest of fluidity in evacuation.

International Air Ambulance Repatriations are Especially Hard

Rules and legislations differ from country to country. You never know what bureaucratic red tape is flung at the crew without forewarning. In cases like these, it is vital that the air ambulance company has a lawyer handy. You would need someone who is well versed in local laws as well as international ones. Failure to procure help in time can lead to legal troubles and unnecessary delay which can prove to be detrimental t the health of the patient.

Coordination with Ground and Hospital Crews

The ground crew does not always belong to the same organization as the air ambulance. Also, the crew usually has to deal with a different ground ambulance organization with each evacuation. Many times, it is their first time dealing with a ground ambulance crew and their organizational rules might be different. The medical fight crew needs to understand their functioning well in advance for smooth transition.

The same goes with the hospital teams too. It is therefore advisable to establish common grounds in advance. It is because of situations like these that most well-organized medical flight companies employ a separate team to take care of these eventualities.

Air Ambulance Transport Industry – Is ADA of 1978 Serving Its Purpose?

The Airline Deregulation Act of 1978 has found mention far too many times recently. Every attempt by insurance commissioners and insurance industry has been successfully countered by the air ambulance transport industry, thanks to this act. At the outset, the act itself seems arbitrary considering it takes away the power to control prices by the democratically elected state governments. Then why was this bill introduced in the first place? This is the question that comes to mind often. It was originally passed so that competition can be encouraged. However, it is questionable whether this intent is still being served in the current industry context as prices are simply shooting up. In an ideal competitive world, the prices must be well controlled.

FAA Reauthorization Act of 2018

It must be noted that only the Federal Government can make changes to the existing ADA of 1978. Considering the growing voices against the act, the government enacted FAA Reauthorization 2018. While some were hopeful that it will make drastic changes to the exiting act, it was not to be. The new act limited itself to making provisions to appoint an advisory committee to take a closer look at the air ambulance transport industry and the financial burden on the patients. It has no powers to implement any changes and is limited to offering advice only.

Balance Billing and Air Ambulance Transport Industry

Balance billing continues to be a problem. The healthcare insurance industry, it looks like, refuses to change its reimbursement model for the air ambulance transport industry. It has remained unchanged for over two decades now. On the other hand, medical flight companies are refusing to conform to the prevailing reimbursement rates and adamant against going under insurance networks. The result: balance bills that are not covered by insurance are being thrust upon the patients and they are being compelled to foot bills that amount to thousands of dollars. A solution does not seem at sight, at least at this juncture.

The Interiors of a Modern Medical Flight

Of course, it all begins with the aircraft model that a medical flight company purchases. Each aircraft is different in some way or the other. However, once the purchase is made, there are certain aspects that one must consider to ensure that the medical flight is fit and convenient enough to provide the healthcare that is expected of it. Here, we discuss a few of those in some detail.

The Floor of the Medical Flight

The floor is a very critical part of the medical flight. It must be such that the in-flight as well as maintenance crew must be able to clean it efficiently and quickly. The emergencies that come a medical flight’s way can involve a lot of blood and other elements, which need to be cleaned out as quickly as possible to maintain hygiene. This might necessitate floor drains and the design must be such that modifications like these can be easily made. Also, the floor can see a lot of heavy equipment which is often moved with little care for the floor itself, so the floor must be sturdy enough to take such abuse.

Important Considerations that Must be Kept in Mind

Today, it is necessary that an aircraft has modern connection facilities such as USBs. Customization is another factor. Depending on the situation, the crew must be able to quickly put in cabins, add/remove seats and/or stretchers. Proper mounts for medical devices must already be in place. While all such facilities bring in a high level of convenience, safety remains the primary concern. For this reason, all the modifications must be certified by a competent agency.

Care must be taken to make use of the space available to the maximum. For instance, the stretcher must be able to double up as a bed that can be immobilized on the flight. Plus, the space beneath the stretcher could be used for storage by building custom cabinets. It is obvious that a one-size-fits-all approach generally does not work; however, a creative approach to the medical flight interiors can go a long way to make it comfortable and efficient.

Are Some Medical Flight Companies Acting Unfairly? How do You Find Out?

Let’s understand the scenario with a hypothetical situation – a patient has suffered a serious injury and is in Carthage, Missouri. It is felt that the most appropriate facility to treat the patient is in Joplin, which is just about 12 miles from where he is. A medical flight is summoned, in spite of the ground ambulance being ready to take the patient. The medical flight takes about an hour to reach the patient and another 15 minutes to reach the treating facility. A week elapses, just when the patient is thanking his stars that he was lucky to receive the treatment on time, he is slapped with a balance bill of $25,000. The insurance company has covered $20,000 of the total $45,000 bill. The once happy patient is now contemplating mortgaging his house to pay off the balance bill.

The Argument Against Medical Flight Company

The insurance company argues that the ground ambulance was readily available and the destination was just 12 miles away, which would have taken the ground ambulance about half an hour to reach. Yet, a medical flight was called in, even though it took an hour for it to simply reach the patient. The insurance company feels there was no need for the medical flight service in the first place and refuses to cover the bill in full. In the outset, the argument seems right but only until what the medical flight company has to say.

Looking at the Situation from the Medical Flight Company’s Angle

Medical flight companies do not and cannot choose to take a call whether they want to fly a patient. They are summoned by the hospital and the medical necessity is decided by the treating physician. Come to think of it, the treating physicians usually have a sound logic behind suggesting an air ambulance service. The ground ambulance might not be best suited, owing to the patient’s condition.

What needs to be done in contradictions like these is following a middle ground and for this, there needs to be a mechanism in place where things are sorted out between medical flight and air ambulance companies. Until that happens, the patient will continue to suffer.