There have been a lot of developments when it comes to the air ambulance industry in recent times. The most predominant of these changes has been the attempt by the Federal Government of the United States to bring down the surprise billing practices. While the attempt is sure to help the patients, enabling them to use air ambulance services without the worry of payments, there are several issues that will bother the industry in the coming days. With insurance coverage being felt inadequate, the margins of the industry are going to dwindle down drastically. How can the industry adapt? This is the question we try to answer.
Air Ambulance Companies Need the Right Perspective
Most of the air ambulance services in the United States are funded by private equity and the organizations are obviously for-profit. A drastic dip in revenues can mean that a lot of the players will start looking at an exit strategy. However, this can impact the nation adversely as it directly affects the coverage, especially for rural America where healthcare infrastructure is less than adequate. This inadequacy necessitates air ambulance services during emergencies. If air ambulance companies shut down, it could be a fatal problem for this population.
The Need to Work Cohesively by Industry Players
It is time that the major players in the air ambulance industry look at cutting down the costs. One effective way of achieving this is a collaboration between companies. This will necessitate fewer resources as they can be shared. Consequently, the cost burden will be significantly reduced. It is also a time to look at acquiring smaller players who were anyway reeling under competitive pressure. Also, lesser competition means that each player will have a greater piece of the market pie. Profits will, therefore, remain optimum as the economy of scale will kick in.
The United States has one of the largest air ambulance industries in the entire world. This is in spite of the fact that it is not the most densely populated country in the world. It is, therefore, natural that one wonders why this is so. There are several reasons behind it. One of the prime reasons is the potential for revenue. However, there is another important aspect to it, which is not often considered. The United States is a country that has a huge rural population. It is without quick access to appropriate medical facilities and air ambulance services are a necessity.
Air Ambulance Services Close the Distance Gap
Although the United States is not a densely populated country, it is one of the largest when it comes to the landmass. This means that the population in the country is spread thinly across a large geographical area. Moreover, the cities are very thickly populated, which means the population in the rural areas is thinly distributed. This fact acts as a disincentive for any major medical corporation to have a facility in the areas as the number of potential revenue-generating subjects is very not that great.
Air Ambulance Industry is a Profitable One
Closing the gap created by the lack of medical facilities in the rural areas is the air ambulance industry. Most of the time, the only way a patient can get quick access to advanced medical care is through air ambulance services. This fact increases the customer base of the industry. With most of these organizations being funded by private equity, obviously, a lot of investment has gone into the sector. The result has been a huge increase in the number of air ambulance services that rule the country’s skies. With the surprise billing practices slated to come to a close soon, the general public will soon reap the true benefits of having several air ambulance companies at their disposal.
According to one research medical flight services run by for-profit organizations had seen, on average, 7 to 8 crashes a year between 1998 and 2012. Of these mishaps, the biggest contributors were those organizations that ran the most medical flights. This raised serious concerns about the safety norms followed by the industry and several studies and investigations were performed simultaneously to make the skies safer for the crew and the patients. The result was some startling revelations. It was seen that the crew was pressured to make as many flights as possible in a day to maintain the profitability of the organizations that they worked for.
What Were the Medical Flight Services Doing?
It was seen that medical flight services were taking orders for new rescue missions even during an ongoing mission. This caused unnecessary operational chaos and instilled a sense of urgency among the crew members. Moreover, it was seen that ground ambulance paramedics were being hired by medical flight services too. This was causing a conflict of interest, wherein the possibility of the paramedics contacting their favored service providers was high. It was also found that some so-called rescues were actually unnecessary as they did not provide any advantage over the ground transportation.
New Safety Laws were Passed
The medical flight industry was subjected to intense scrutiny. Certain safeguards such as maximum permissible hours of work for crew members and laws concerning visibility were put in place. The aging aircrafts had to be replaced by new and safer ones. Upgrades with respect to technology were also made compulsory in certain areas. Better weather reporting and aids for in-flight decision-making were put in place. It can be stated, with confidence, today, that medical flight services are safer and more efficient. The industry and the patients that it serves have benefitted immensely from these developments.
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.