Medical airlifts: Life, death and bankruptcy? 7 ON YOUR SIDE investigates
THE SKY HIGH COST OF AN AIR AMBULANCE
It was the trip of a lifetime last winter — snowmobiling in Yellowstone National Park.
“It was probably about five minutes into this tour when I got caught in a drift and went down a ravine,” said Rachel Podnos, a 28-year-old financial planner from D.C.
Podnos and her father, who was riding on the back, hit a tree. Podnos’ helmet flew off. Both were knocked unconscious. Her injuries were possibly life-threatening.
“My lip was hanging off, all my teeth were gone. They were afraid I’d broken my neck.”
The National Park Police called an air ambulance, run by a private company. Had the chopper belonged to a law enforcement agency and funded by taxpayer dollars, Podnos would’ve paid nothing. Her mother, who is a physician, signed the release form, never dreaming her daughter’s 95-mile ride in the sky would land her with a sky-high bill: $54,999.
At first, Podnos’ health insurance would only cover $6,000. Consumers across the country are increasingly facing this devastating debt.
One Manassas man had a medical emergency and needed to see a specialist in D.C. to save his life. He flew 28 miles to George Washington University Hospital and was charged $46,000 for his airlift. (That’s the commercial airline equivalent of 100 round trips to Paris, France.)
“You can’t tell me it costs that much to fly from Manassas to GW. It’s a real scandal that’s out there,” said Elisabeth Schuler, president of Patient Navigator in Northern Virginia. “People don't realize they're being hosed.”
The problem, as she sees it, is that insurers underpay, air ambulance companies overcharge, and patients are stuck with the bill.
“You are very vulnerable, you have no say in the matter, and you have to fly out," said Schuler.
In Podnos’ case, the grand total for her medical care cost $260,000.
“I had my jaw wired shut for five weeks, I lost part of my lip, and I had a bunch of other things that went on,” said Podnos. “But none of it was as much pain as this helicopter ordeal. Especially because it’s been ten months and the end is seemingly nowhere in sight.”
Month after month, Podnos said Air Methods sent her aggressive letters with bold print warning they would report her bad debt.
7 On Your Side confirmed with Maryland Insurance Commissioner Al Redmer that air ambulance companies can charge whatever they want.
Technically, states are powerless to help consumers because of the Airline Deregulation Act of 1978, designed to encourage commercial flights and reduce fares. Redmer said some members of Congress are looking into whether the law needs to be updated. In the meantime, Redmer brokered a deal among hospitals, insurers, and the General Assembly.
“Now in Maryland, these air ambulance companies have contracts with insurance companies where they will accept full reimbursement as payment,” said Redmer.
In the end, Podnos hired a patient advocate, Richard Pugach of Health Navigaid, which cost her $2,000, but the fee paid for itself when she received more than $15,000 in insurance reimbursements. After 7 On Your Side reached out to the D.C. Insurance Commissioner, a representative from that office encouraged Podnos to file a complaint (to file in your jurisdiction, see below).
Looking back, Podnos is grateful Air Methods was there in those mountains, she just wishes she had known about the billing avalanche afterward.
AIR AMBULANCE COMPANY RESPONSE TO 7 ON YOUR SIDE
7OYS QUESTION 1: Could you please explain Air Methods’ pricing? In an ABC report, the company rep said most flights should cost around $12k. So what would make a 21-mile flight cost $50k?
AIR METHODS’ RESPONSE: This hypothetical figure could be achieved if Medicare, Medicaid, private insurance providers and the uninsured all paid their fair share.
7OYS QUESTION 2: What needs to happen so that patients are charged what the typical ride costs?
AIR METHODS’ RESPONSE: The solutions are twofold: First, the drastically low reimbursements from the Centers for Medicare and Medicaid Services must be fixed and, second insurance companies must be willing to negotiate and start to reimburse for air medical transport services at a reasonable rate. Air Methods strongly supports the proposed federal legislation that would resolve the Medicare reimbursement shortfall by updating reimbursement rates. A recent study conducted in Montana showed that for only a $1.70 more per month in insurance premiums, emergency air medical transportation can be reimbursed in full without burdening patients with huge bills.
7OYS QUESTION 3: Did Air Methods change anything about its billing and collection practices since the March 2016 ABC report ran?
AIR METHODS’ RESPONSE: Our mission is first and foremost to preserve emergency air medical service for all communities around the country. We continue to work with patients one-on-one and family-by-family to help them get what they deserve from their insurance company and determine what they can reasonably pay. These practices have remained the same.
Our patient financial counselors are in place with the sole function to advocate on our patients’ behalf and exhaust every avenue to get coverage from their insurance carrier. Our team understands that every patient’s individual and financial circumstances are unique, and we are dedicated to partnering with every one of them as they navigate through the post-flight and critical care process. In addition, we have a long-established charity care process in place to allow us to reduce patient financial responsibility within our legal parameters, and our Patient Financial Counselors are here to help.
PODNOS’ COMMENT: Yes, they do have a patient financial counselor that patients can call. I spoke with one regularly while my appeals were pending, as he told me that I needed to check in with them every two weeks or risk being sent to collections. This was the case even with them knowing that my internal appeal with CareFirst was pending. They also sent regularly scheduled threatening letters (you have some of them).
7OYS QUESTION 4: Why doesn’t Air Methods publish information about its pricing?
AIR METHODS’ RESPONSE: The number one focus of family and loved ones in traumatic situations is on making clinical decisions so their loved ones survive. It’s our number one focus, too: when we are asked to save a life we deploy without regard for a patient’s ability to pay, which is why we do not include pricing on our release forms. We’re in essence a flying emergency room and we only respond when a physician or a first responder calls us. Like other emergency service providers we have Consent to Treat forms that are standard in the industry and we are mindful that rates are not reflective of the costs to the patient, taking into account Medicare, Medicaid, reimbursement from insurance and other factors. When every minute counts, emergency air medical transport and treatment is often not just the best choice for saving a life, it’s the only choice.
7OYS QUESTION 5: What advice do you have for consumers about how to stave off or manage an emergency bill totaling more than $50,000?
AIR METHODS’ RESPONSE: Our message to patients is: Let us be your advocate. We are honored to provide our air medical services to you and to be a part of your emergency care. We know the last thing you want to think about during recovery is healthcare insurance and medical bills. Our Patient Financial Counselors are here to help, so our patients can focus on healing.
We don’t like when our patients are put in these situations and we do everything we can to help them. We understand that every patient’s individual and financial circumstances are unique, and our team is dedicated to partnering with every one of our patients as they navigate through the post-flight and critical care process by working directly with their healthcare insurance provider, offering patients a special consideration application to allow us to reduce patient financial responsibility within our legal parameters, and providing Patient Financial Counselors to work directly with patients and their families. We believe that everyone deserves access to lifesaving care.
PODNOS’ COMMENT: Here is how they acted as my "advocate": They sent a boilerplate appeal to CareFirst BCBS company asking for full payment of the bill after CareFirst initially only paid them around $6k. Their only argument was essentially that they deserved to be paid the entire $54,999 because that is how much they charged.
My billing advocate told me that they sent the exact same appeal boilerplate in for one of his other clients. It was only after I hired a billing advocate and did my own separate appeal that we were able to get another payment out of CareFirst BCBS. Air Methods was of course more than happy to take this additional payment. After that, they got right back to sending me threatening letters and demanding that I pay the $38k balance of the bill.
Eventually, they did offer to "work with me" on the $38k balance of my bill. The offer I got from them was to pay them $20,957 over 60 months, or some lower amount in a lump sum to settle my case---a $12k lump sum was thrown out as an example of an amount that might be acceptable to them.
About two weeks after the above conversation with Air Methods, I got another call from them and the representative told me that they had received an additional $29k payment from CareFirst BCBS and that my balance was now down to $9040. Obviously, I was thrilled because at this point, they had been paid around $46K by my health insurance for my 1 hour flight and because two weeks earlier, they told me that my account could be closed out with a $12k lump sum payment. Seeing as they had just received over twice that amount from CareFirst, I assumed that my case was closed.
But no--they informed me that they still expected me to pay the $9040 balance. I brought up the fact that they offered to settle for $20,957 over 60 months or a much lower lump sum two weeks before. The representative explained that Air Methods' policy is to always make the patient pay some balance of the bill, if there is any balance, no matter how much has been paid by health insurance. I couldn't believe it.
The following day, the same representative called me back and said that the call about the $29k payment was a mistake, and that no additional payment was received, and that I still owed them $38K.
Then, around two weeks after that, the representative called me and said that my bill had been "adjusted" by $29K because of a single case agreement with my health insurer and that my balance was again $9040.
I think my experience speaks for itself.
MORE PATIENTS’ STORIES
Within 24 hours of word spreading that 7 On Your Side was investigating the cost of air ambulance rides, we received several phone messages, emails, and direct messages on social media from other patients who had similar stories. The bills ranged from $31,000 to 49,000. Here’s a sampling:
From Susan Fisher Wheeler: "This too has happened to me! On June 13, 2015 I fell off of a ladder and was unresponsive. I had to be taken by helicopter to the nearest head trauma hospital which was Inova in Fairfax. I received a bill for $30,767 for a 7 minute ride. I have really good insurance that is supposed to cover situations like this at 100%. What people don't know is that there isn't any helicopter medical transport company that has contracts with any insurance company. My insurance company at the time kept telling me that they paid the allowable amount and my argument to them was how is that when you don't have a contract with the helicopter company. I too had Guardian Nurses as an advocate which worked countless hours trying to help me. I have had to hire an attorney and I am still dealing with this today. I can't even begin to tell you how much unnecessary stress this has caused my family and I. The helicopter company is now threating to take legal action against me. Something needs to be done to these insurance companies because they seem to have the upper hand."
From Russell Wodiska: "I heard that this evening you are doing a story on medical airlifts I am currently facing a $42,000 bill as a result of a hiking accident last year. I feel my story is both compelling while at the same time being deeply upsetting. Because I have insurance, I am currently in the external appeals process through the Maryland Insurance Commission. For what it is worth, I have spent considerable time researching the issue and trying to understand how this occurred. Outside of an amendment to the FAA re-authorization by the Senators from North Dakota (which did not receive even a vote), Congress has truly failed its citizens. If you are looking for another voice or perspective, I am happy to help as I think this issue needs as much public attention as possible. Regardless of whether you contact me, thank you for bring this issue to the public's attention. Right now the consumer is caught in the middle of bad actors on both sides."
From Paul Marshall, Jr.: "I’m glad to see you’re doing a story tonight at 6pm on Air Ambulance Father Paul Marshall was a 32 year D.O.D employee of The Pentagon and March 13th 2015 he went in to have 3 stints inserted and everything went well until the surgeon gave my dad xxxxxx which is FDA approved after suffering from a stroke due my father who lived in Woodbridge VA was rushed by Ambulance to Sentara Wellness center and then flown to Fairfax trauma center at the request of the lead neurologist in the ER who stated that my father was going to die if he didn’t get transported ASAP and an ambulance ride would kill him.
The ER prepped my dad and the Air ambulance people came in they were very nice and polite and my mom asked was this covered by his insurance and she was told oh yea don’t worry Ma’am it is well yea only a portion of it was the * min total flight time cost us 39,000 and the insurance company covered all but 6000.00 which we resubmitted and then question if it was really necessary that he been flown and the insurance company even questioned the family to make sure it wasn’t something we requested and then checked with the ER neurologist to make sure it was at his request and my mother fought with the helicopter company for 11 months and they sent her to collections and then filled court papers to have her sued. The insurance company claimed the helicopter company over charged for the service and the helicopter company said who is your insurance company and how can they tell us what to charge and so I wrote 7 on your side...
I’m so glad you’re helping someone I just wish it could of been my Mother. It was heart breaking to see what she went through and to know I couldn’t do anything or get anyone to listen or help her."
THE INSURANCE COMMISSIONERS’ RESPONSES
Click here to file a complaint: http://insurance.maryland.gov/Consumer/Pages/FileAComplaint.aspx
From Commissioner Al Redmer:
"Commissioner Al Redmer, Jr. has been very concerned with balance billing from air ambulance companies. Minutes matters after an accident, heart attack, stroke or other major medical emergency, and air ambulances quickly provide transport for a patient to a medical facility. While most health insurance policies provide some coverage for this service, coverage gaps can leave patients struggling to pay large bills. The health benefit plan usually pays based on an allowed amount that is much less than the billed charge. The difference between the allowed amount and the billed charge is called “balance billing.”
Unfortunately, we do not have any regulatory authority over air ambulance services. Currently, to develop a regulatory solution would lead the State into a violation of the Federal Airline Deregulations Act of 1978, which contains a preemption clause that expressly prohibits a state from enacting or enforcing any statute or regulations “related to a price, route, or service of an air carrier.” This is a problem around the country and North Dakota took the first step to address it by enacting legislation. However, North Dakota’s law was immediately challenged by the air ambulance companies in federal court as being preempted. We, along with other states, are closely monitoring the case and awaiting the outcome. We also have contacted the Maryland congressional members asking them to address this at the federal level.
To better understand how the citizens of Maryland have been impacted by the air ambulance balance billing, we held a public hearing regarding this issue in September 2015. We invited the public, employers across the state, hospitals, insurance carriers, air ambulance companies as well as all elected officials in the state to attend. This provided a forum for us to listen, ask questions and gather information regarding this problem .
As a result of the hearing, we discovered while some hospitals owned their own fleet of air ambulance and others had negotiated with certain helicopter cos. not to balance bill, others had not and their patients being transported were being balance billed. Commissioner Redmer encouraged the hospitals, air ambulance companies and carriers throughout the state to engage in meaningful discussion regarding the current payments for these types of services. Some of the air ambulance carriers and hospitals and carriers have come to an agreement for certain in-state air ambulance transport. For example, CareFirst and two of the large air ambulance companies agreed to accept CareFirst’s allowed amount and not to balance bill patients beginning in early spring 2016. Other hospitals have reviewed their protocol for the use of air ambulance transportation and have instituted changes to make the instances of balance billing less frequent. While this resolved many of the complaints that we have received, the issue still continues for MD residents who receive air ambulance transportation outside of the state or with certain air ambulance companies.
As you know, Maryland has an excellent Medivac program, but that is only available in accidents and similar incidents. The majority of the complaints that we see are hospital-to-hospital medical transportation, which involved the private air ambulance companies. Additionally, employers such as municipalities who self-fund their health insurance coverage determine the benefits and coverages for their employees. It is important that such employers are aware of this potential loophole in their coverage."
Click here to file a complaint: http://www.scc.virginia.gov/boi/complaint.aspx. Simply click on the "File a Complaint" link and select the Property & Casualty or Life & Health complaint form.
The actual life & health complaint form: http://www.scc.virginia.gov/boi/complaint.aspx#A7.
From Commissioner Jackie Cunningham:
"Thank you for your inquiry regarding the high cost of air ambulance services. This is an issue that the Bureau of Insurance is following closely, as is the National Association of Insurance Commissioners (NAIC). Many state insurance departments, including Virginia, have received complaints from individuals who have received services from air ambulance companies that are not affiliated with a hospital or carrier network. In many cases, the bills for the services of these air ambulance companies are very high.
The Airline Deregulation Act of 1978 prohibits state regulation of air carriers, which includes air ambulances. States have no regulatory authority to establish standards for network participation, reimbursement and balance billing, or transparency. Federal legislation would be necessary to give states the authority to address this issue. You may want to contact a Congressional representative for information concerning any efforts at the federal level in this regard. We are not aware of any Virginia-specific legislation, or plans for legislation, addressing this issue at this time.
There is further information about this topic on the NAIC website at: www.naic.org.
Patients who receive high air ambulance bills should try to resolve the issue with the air ambulance company or their insurer first. If that is unsuccessful, we encourage them to file a written complaint with the Bureau of Insurance. They can file a complaint online by going to https://www.scc.virginia.gov/boi/complaint.aspx#A7 or they can call us toll-free at 1-877-310-6560 or email us at firstname.lastname@example.org. In some cases, an individual may be able to appeal an insurer’s air ambulance service coverage decision through the Bureau’s Ombudsman’s Office or External Appeals process. Where practicable, we would encourage patients or their representatives to find out if the air ambulance service is part of their insurer’s network of providers and request a written estimate of the patient’s payment responsibility before agreeing to use the service."
Click here to file a complaint: http://disb.dc.gov/service/file-complaint-or-report-fraud
From DC Insurance Commissioner Stephen Taylor:
"We are aware of the insurance issues related to air ambulance services provided to consumers at their most vulnerable state, and the financial hardships caused to consumers when such services are provided by out-of-network providers. The Department is considering legislation that will address this and similar issues related to out-of-network providers."
RESPONSE FROM INSURANCE INDUSTRY
From America’s Health Insurance Plans (AHIP):
"Health care can be confusing and complicated, and that’s especially true when it comes to paying for health care services. For air ambulance services, insurers have increased reimbursement rates in relative proportion to providers’ rates. Typically, health plans pay for air ambulance services using a base fee plus mileage at a per-mile rate. Reimbursement rates vary among individual plans, with commercial insurers typically reimbursing at a higher rate than other payer types, such as Medicare and Medicaid.
Health plans contract with a wide range of care providers to ensure access to quality affordable care. However, many air ambulance providers are increasingly moving away from contracting with plans. By not participating in plan networks, air ambulance providers can charge any amount. These amounts can even be several hundred or thousand times greater than Medicare rates approved by CMS. The financial consequences on consumers and patients can be profound.
That’s why we recommend that states consider legislation requiring open and honest price disclosure for air ambulances that explicitly details the costs to patients. Transparent disclosure informs and educates consumers about their costs, and helps hospitals know where costs are being incurred. The FAA already requires air carriers to disclose ticketing fees and fuel surcharges – so consumers deserve to know what price they may have to pay."
CAMPAIGN TO SAVE MEDICAL HELICOPTER SERVICE
From Amanda Thayer, SOAR (Save Our Air Medical Resources) Campaign Spokesperson:
"Communities need and deserve reliable access to emergency air medical services—a critical element of healthcare services that can mean the difference between life and death, and make huge differences in the quality of life a patient has following a severe trauma. There is no question that something must be done to fix the underlying problems that result in balance-billing.
But real-time deployment readiness, including being available on a 24-7-365 basis, and providing a high-level of care comes with significant costs. The unfortunate reality right now is that the reimbursement rates currently provided by government insurance (Medicare and Medicaid) and by some private insurance companies are drastically below the true costs of providing air medical services for patients. In fact, 70% of air medical transports are under-reimbursed. In some states, Medicaid reimburses for these transports as low as $200, which is less than half of the price of fuel alone for the average transport. If an air medical transport company is reimbursed substantially below cost for seven out of every 10 transports, it means that the remaining transports are essentially paying for the whole system.
The solutions are twofold: First, policymakers must address the government insurance reimbursement shortfalls (for example, there is proposed federal legislation that would go a long way by resolving the Medicare reimbursement problem). Second, insurance companies must be willing to negotiate and start to reimburse for air medical transport services at a reasonable rate. We need long-term, meaningful solutions that are rooted in putting the patient first, that recognize the value of life-saving care that is emergency air medical service, and that ensure that these services remain accessible to all communities, no matter what their zip code is."