Key provisions of separate health care bills in the House and Senate designed to protect patients from “surprise” medical bills could financially cripple the air ambulance industry and lead to the closure of up to 80 percent of the air ambulance bases in the U.S., according to the Association of Air Medical Services (AAMS).
Last week, AAMS sent out an urgent update to its members alerting them to the potential dangers of the bills. While specifics of the three bills (two in the House and one in the Senate ) differ, in general they are designed to protect patients from “balanced billing,” the practice of holding patients liable for charges either denied by insurers or the difference between what medical providers charge and medical insurers pay. This includes “out-of-network” charges. While none of the bills is likely to pass outright this year, AAMS fears that key provisions could be grafted onto last-minute, late-night amendments to the federal budget bill likely to pass both houses of Congress later this week.
“There’s no pathway for this [legislation] to the floor. What [members of Congress] have been trying to do is to attach the bills to a larger year-end budget appropriations package,” Christopher Eastlee, AAMS vice president for government relations, told AIN. On their own, the bills were widely opposed by key members of the health care lobby including the American Hospital Association and physician groups, he said. “The bills are not just bad for air medical services, they are bad for health care. This is not an open and deliberative process. It is a very dangerous time.”
AAMS warned that the bills were crafted without supporting data and would likely trigger widespread closures of air medical bases that would disproportionately harm Americans in rural areas. AAMS notes that more than 57 air medical bases in the U.S. already have closed this year, a figure Eastlee said was “absolutely unprecedented,” creating 51 communities “without any air medical services at all” compared to a year ago.
“None of these base closures are due to lack of volume or demand,” Eastlee said. “All of them are due to a poor payer mix cause by a significant rise in the number of Medicare and Medicaid patients.” Medicaid reimbursements can be as low as 28 percent of cost, Eastlee said. “We just can’t survive” merely transporting Medicare and Medicaid patients at current reimbursement rates, he said.
Eastlee said the industry is continuing its efforts to persuade Congress to increase reimbursement rates for federally insured patients, but that the current legislation presents the more immediate threat. Even if the objectionable provisions are not enacted this year, they could resurface in 2020, he warned.
AAMS said the environment for air medical is already difficult, with health insurers initially denying claims for air medical services “more than 40 percent of the time.” It said the proposed legislation would “cripple the market” by destroying incentives for insurers to enter into in-network agreements with air ambulance providers; reduce in-network insurance payments to providers; and allow for regional rate-setting in violation of the Airline Deregulation Act.
The association said the likely outcome of adopting relevant provisions of the legislation would be to drive “in-network” rates to parity with Medicare rates, which are already 40 percent below “the cost of providing the service.”
Eastlee already cited a “continuing ratcheting down” of payments by medical insurers to providers. “This is a very serious, highly complex issue. AAMS fully supports getting patients out of the middle,” he said and noted that, while stories of patients receiving large bills for air medical transport were highly publicized, state studies showed this simply was not the case for the majority.
“In Wyoming, 90 percent of the patients who were transported received no bill at all and the average payment for the other percent was something like $250. There is no windfall in balanced billing patients. We are simply trying to get them involved so we can negotiate with the insurance companies. We are forbidden by law to negotiate with the insurance company without the patient’s involvement.”
AAMS would like the government to mandate the collection of air medical industry data to create an accurate and transparent cost picture to share with Congress and insurers. Eastlee noted that industry in-network agreements with insurers have grown from two percent to 40 percent in recent years and is continuing to grow. “But these negotiations can take years,” he said.