Recently a woman aboard a cruise ship called Norwegian Escape fell seriously ill. It went on to the extent that an air ambulance had to be called out. Lucky for her, the coast guard was reachable and quickly responded to the emergency by evacuating her. However, not all are as fortunate as this woman to find help when it is needed most while cruising through a fun vacation in high seas.
Often, while in international waters, with different national borders in place, the logistical problem can turn out to be a nightmare. The cost too can be quite high as evacuation is rather tough and involves huge distances. Insurance coverage is therefore of paramount importance.
Ask About Air Ambulance Coverage Beforehand
Not all travel insurance policies will cover air ambulance evacuation and you might have to shell out a huge amount for this purpose. There have been instances where people have even turned to crowd funding to pay air ambulance bills. The wisest thing, therefore, is to opt for a travel insurance that has comprehensive medical flight evacuation coverage. Moreover, you would not want to be treated in a foreign country if the treatment duration is long. Getting back to your home country among your loved ones would be among your top priorities.
Your Options without an Air Ambulance Coverage
If you have deep pockets, of course, there is absolutely nothing to worry but if you do not, it can be a problem. Minor ailments like broken bones, fever, and food poisoning is cared for onboard the cruise as each one hosts medical professionals. However, if the health condition is severe, the ship simply has to wait for the nearest port and admit you there. It would then leave with the remaining passengers once you are assured appropriate medical care. Sounds a little scary? That’s precisely the reason you need comprehensive air ambulance coverage.
There’s a lot happening in the air medical transport industry currently. With the state lawmakers and the feds trying hard to end surprise air medical billing practices, there is a high degree of lobbying that is taking place both by insurance and air medical transport industry. There is a huge amount of blame game going on. Both parties are trying to pin the blame on each other. Often, you’ll find articles that highlight high bills that patients are compelled to foot and on the other hand, articles that detail the plight of the air ambulance industry and the rising costs it is grappling with.
What is a Surprise Air Medical Transport Bill?
In order to understand what surprise air medical transport bill is, we should adopt an industry agnostic perspective. The problem is not just with the air ambulance industry, it is rampant throughout the medical world. In the United States, unlike other parts of the world, insurance is a matter of network coverage. If a provider is not covered by the insurance company, it is likely that the reimbursement is going to be rejected. This compels the patients to foot the bill all by themselves. This phenomenon, where a person is compelled to pay a medical bill, in spite of having medical insurance, is known as surprise bill. This is what the polity of the nation is currently trying to eliminate.
Why is Tough to Eliminate Surprise Billing?
There are several facets to this. Some air ambulance companies, in the absence of fair reimbursement by insurance industry, simply do not want to come in network. The question arises, “Why?” The answer is obvious – this move paves the way for balance billing where the patient becomes responsible to foot that cost which is not covered by the insurance provider. Then who is to blame? Well, both insurance and air ambulance industries: the insurance industry because it refuses to reimburse a fair amount and the air medical transport industry because it refuses to come within insurance networks. It’s a Catch-22 situation.
Well this might not come to you as a surprise because you might have witnessed this yourself. According to one survey conducted by Kaiser Family Foundation, about 40% of US citizens have revealed that their families have received a medical bill despite being covered by medical insurance. This is a growing problem for the country as insurance companies are seen restricting the number of providers in their networks. Of course, out of network providers are not covered by insurance companies. In this context, the question arises, is it the same logic behind huge medical flight bills that people across the country are witnessing?
Medical Flight Bills and Insurance Network
A majority of industry experts believe medical flight service providers willingly stay out of insurance networks. The reason is simple, they lose the freedom to charge what they feel is fair for their services. It is also felt that there is a huge disparity between what the medical flight industry believes is a fair payout and what the insurance industry pays. The middle ground, it seems, is something that has not been achieved so far. The issue has not gone unnoticed by the lawmakers. However, the opinion is divided as to who is responsible for the huge bills.
Efforts by Lawmakers to Bring Down the Bills
Several attempts have been made to limit the amount that can be charged for medical flight services. From trying to ban balance billing to compelling air ambulance companies to come under insurance networks, several innovative efforts have failed. The reason behind this is the Airline Deregulation Act of 1978. Designed to create a competitive environment to keep the price of this essential service down, it precludes the state governments from intervening in the matters of air ambulances. Only the Federal Government is authorized to make changes.
Air ambulance services play a critical part in providing medical care on time for stroke victims. The Centers for Disease Control estimates that about 795 thousand people suffer strokes every year in the United States of America. Up to 140 thousand of these people die of stroke. Approximately 610 thousand people have never experienced stroke before. To put these numbers into perspective, one person has a stroke every 40 seconds on average in the country. All these people need air ambulance services to receive care on time. If not, they are at risk of suffering disability for the rest of their life.
Air Ambulance Services are Time Critical in Stroke
It is said that the chances of survival and complete recovery improve drastically if the patient receives care within the first three hours of the stroke. Air ambulance services play a major role in ensuring that this. The fact that rural doctors are moving towards urban areas and the reality that rural hospitals are closing at a rapid rate makes air ambulance services for such regions critical and life-saving. These patients are in need of high-level care facilities equipped to handle this medical condition.
The Economics of Stroke
In the US, cost of stroke treatment is approximately USD 34 billion annually. This includes the cost of care, medicines and loss of work revenue due to medical absence. Despite this, insurances only cover about 30 to 40% of the cost related to air ambulance services. Why? Because the reimbursement rates have not been revised for over 20 years, which puts a lot of financial strain on air ambulance services. The result – medical flight service providers are closing at a rapid rate, especially in rural America. If something is not done about this by the congress, it could turn out to be a grave situation for the people in the near future.
Perhaps the biggest problem that people who avail medical air transportation services face is unexpected costs that run into thousands of dollars, even when they are covered by their health insurance policies. Now, a new bill has been passed by the state of Virginia that seeks to end this uncertainty. The bill is called ‘Air Medical Transportation; Informed Decision’. The bill was introduced by Jeremy S. McPike and it went into effect on March 1, 2019. It was passed by the House and Senate of Virginia with zero votes against it recently. Here, we discuss what this bill will mean for the common citizens.
What is Virginia Medical Air Transportation Bill All About?
The bill mandates that hospitals establish processes, which necessitate giving an electronic or written notice to the patients or their authorized representatives. The notice should contain the cost implications of availing medical air transportation services. It should also contain the alternative options including emergency ground ambulance options. If the medical air transportation is out of network of the patient’s health insurance, this fact too must be made apparent. Even if the medical air transportation is covered only in part, it has to be brought to the attention of the patient or his/her authorized representative.
What will the New Bill will do for the Patients?
Patients in Virginia will now have the power to choose whether they want to avail medical air transportation services. Further, it will let them know the cost implications beforehand so that they do not get any nasty surprises in the form of huge bills later on. It is a good attempt by the state to bring about transparency in billing.
It is hoped that the medical insurance companies and the medical air transportation industry will ultimately come to an understanding with regards to costs, facilitated by this bill.
It is a short question that demands an elaborate answer. As the rural hospitals close at a rapid rate, air ambulances are playing a vital role in bringing patients quick access to emergency rooms. It is believed that, currently, a quarter of the population in the United States of America do not have access to medical care within an hour. It is air ambulances that fill this gap. A report reveals that 80 rural hospitals have closed in the past decade and over 700 rural hospitals, it is believed, will be closed in the next 10 years. Air ambulances are turning out to be critical services.
Time is a Factor that Air Ambulances Manage Well
A Federal rule says that air ambulances can traverse between state borders without having to worry about state regulations. This allows for seamless travel across borders without any regulatory hassles. If the states are allowed to regulate the air ambulance industry, it might so happen that traversing these now-free state borders could become lengthy or challenging to say the least.
A statistic says that over 30% of air ambulances cross borders annually. The state laws, if different from each other, might make flying the skies tricky, prompting the air ambulances to fly to another state because the regulations are less tedious. A report by American Stroke Association says that brain juries not getting treatment in time can result in fatality or poor recovery. That alone should be an argument enough in favor of Federal regulation.
It’s All About Reimbursements
The reimbursements rates by insurance companies have remained unchanged for over two decades. This puts a lot of financial stress on air ambulance service industry. Unable to get adequate cost coverage, organizations are compelled to go to the patients. Most disheartening is the fact that the patients who pay for this service are insurance holders but without adequate coverage.
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.
Imagine heading a business where customers only pay you 30% of the time in full and the remaining 70% only pay you 50% of the cost. How would your business survive? This is precisely the situation of most air ambulance companies in the United States of America say industry experts. What adds insult to the injury is the fact that there is a outcry about the charges both in national media as well as people, not to mention the politicians who are trying to pin all the blame on air ambulance companies. Most players in the industry say that air ambulance business is getting harder by the day to run.
Air Ambulance Companies Asked to Do More
Rural hospitals in the US are closing down at a rapid rate. More and more rural patients are veering towards the services extended by air ambulance companies. However, the fact remains that air ambulance services are expensive and the costs are not being reimbursed by health insurance providers citing several reasons. While the most common is the ‘lack of medical necessity’ others simply have a small ceiling of reimbursements that have not been revised for a very long time.
Most of the Air Ambulance Costs are Fixed
Costs of running a medical base is, on an average, about USD 3 million a year. This amount accounts for about 85% of the costs and are fixed. These include maintenance of the aircraft, hangar, support staff, crew and the like. Then there are write-downs that are either forced upon the air ambulance companies or the ones that they undertake themselves on humanitarian grounds. All this adds up to a huge amount. Plus, there are always the running costs such as fuel which is also quite expensive. Industry experts feel that the demand for the services provided by air ambulance companies is going to increase considering that the population is aging, and that something needs to be done on a war footing to make the reimbursements commiserate with the services provided.
We have been citing the reluctance of insurance companies to revise their payment charts, in keeping with the time and also several air ambulance companies that simply refuse to budge down when it comes to the pricing.
This time around, Missouri Insurance Department has come up with a report that reveals, on an average, people of Missouri are paying about USD 20,000 for an air ambulance services. Of course, this is a whopping price for a common person, not just in the state but anywhere in the world. The report further said that close to USD 26 million was billed by air ambulance companies in the year 2017. Of this, 12.4 million is what people had to bear, taking into consideration deductibles and co-pays.
Does the Report Vilify Air Ambulance Companies?
This was a question that air ambulance industry advocates would raise without a doubt and not for any frivolous reasons. Balance Billing, which forces patients to pay the amount when insurance companies refuse to clear the air ambulance bills, had no mention in the report. The reason stated for this was ‘insufficient data’. One could even say that the lack of this data, sort of makes the report a little lopsided.
High Fixed Cost was Cited by Air Ambulance Companies
One aspect that should be appreciated about the air ambulance companies is that they have not shied away from saying the amounts charged to the patients are pretty steep. They have also expressed their helplessness in containing this, as the fixed costs of maintaining a medical flight is very high. However, what goes against the favor of some air ambulance companies is the fact that they are unwilling to come in the network of insurance providers.
As we have always stated, the air ambulance industry and the insurance industry need to come together to find a middle path, so that the common person does not have to bear the burden of huge bills.
One of the most basic criteria for insurances approving and covering costs of medical flights is establishing that there was actually a medical necessity for availing the service. However, understanding what constitutes a ‘medical necessity’ is important. Of course, we have discussed, in our earlier guides, that the decision to summon air ambulances can only be taken by the treating medical professionals in the hospital or at the site of accidents. Let’s dive into this topic a little deep here.
Medical Flights and their Advantage Over Ground Ambulances
It must be established or deemed important to leverage the advantage that medical flights have over ground ambulances. The instability that comes with transporting a patient via ground ambulance and the need for rapid medical transportation could be the two reasons to avail medical flight services. Further, the condition of the patient should be such that he or she could suffer serious medical consequences or even face death if an air ambulance is not used.
Accessibility of the Destination
An air ambulance can become a ‘medical necessity’ if the destination is located in a region that is remote or completely inaccessible to other forms of transportation. The ground approach to the destination could be such that it poses a serious threat to the patient owing to the terrain.
Time Taken to Reach the Nearest Treating Facility
There are times when a delay as small as 30 minutes to an hour can mean the difference between life and death. The ground ambulances may be available in such scenarios but the time that they take to reach the treating facility could be a deterrent and the advantage of quick transportation that comes with medical flights could be the advantage. Of course, the severity of the illness or the disease condition would be the primary factor behind this decision.