It's an open secret among Americans that calling
for an ambulance is a financial gamble.
According to one study, 71 percent of all
ambulance providers do not take the patient's
insurance. That same study found that 79 percent
of patients who took an ambulance could get a
surprise bill with an average total, around 450
dollars. And when nearly four in 10 Americans
would have to borrow money to cover a surprise
1000 dollar emergency, these surprise bills can
be a huge problem.
The Covid-19 pandemic has exposed wide inequities
throughout the American health care system and
like the rest of the health care industry.
Ambulance operators are feeling intense financial
pressure from the crisis.
So why are ambulance services so expensive in the
United States and what's being done to solve the
problem? There's a broad price range
for emergency medical services in the United
States. The U.S.
Government Accountability Office, or the GAO,
found that in 2010, the median cost per ground
ambulance transport was 429 dollars, ranging from
224 dollars to 2,204 dollars per transport.
And that price can vary a lot by state.
In 2016, the average price of an emergency ground
ambulance in Georgia was 824.
Twenty four dollars in New York.
It was 752 dollars, 930 dollars, in Texas and
557 dollars in Florida.
Even within the same state, the charges can vary
widely. Take Florida, for example, in Lake City,
Florida. The average charge for an emergency
ground transport with basic life support services
was 463 dollars in Tallahassee, two hours west of
Lake City, the average charge was more than 200
dollars higher at 680 dollars.
In Miami, the average charge was 630 dollars and
Tampa's average was 590 dollars.
A variety of factors contribute to this disparity
in price, including the type of ambulance used,
the medical services rendered, how far the
patient was transported, the state and city the
ride was taken and whether the ambulance service
was publicly or privately funded.
There are many types of organizational structures
when it comes to running an emergency medical
service. They could be privately run or funded by
the municipality and work in conjunction with
other entities such as the fire department.
They can also be a volunteer organization that's
funded through private donations and grants.
Art Cooke and David Sloan work at Westfield
Volunteer Rescue Squad in Westfield, New Jersey.
The rescue squad is funded completely by grants
and donations from residents and businesses in
the town, so there's no out-of-pocket charge at
the point of use.
We're lucky that we live in a very generous and
affluent community, so we don't generally have
difficulty raising the funds.
Because all of the rescue squads, dispatchers and
EMT are volunteers, the organization can operate
without high staffing costs.
As with any labor-intensive of organization, your
highest cost is going to be payroll.
Supporting a non-profit ambulance provider through
donations can be tough for less affluent areas,
as well as dense urban areas with high call
volumes.
If a less affluent town were not able to meet the
fund requirements for that individual rescue squad
to be able to supply their ambulances, or if
they have a problem getting volunteers to be able
to operate that system, each town, we would look
for an alternative to be able to ride the
ambulance service.
More often than not, that either becomes
contracting with a private ambulance service,
which is a cost or hiring E.M.S.
personnel under the auspices of air, police, or
fire department.
Many patients who get surprise ambulance bills can
trace them back to forfor-profit profit
companies.
My name is Karan Chhabra.
I'm a resident in the Department of Surgery at
Brigham and Women's Hospital.
Surprise medical bills happen when you get
medical care from somebody who you were unable to
choose and that person or that provider doesn't
take your insurance. So in those situations, if
they don't participate in your insurance plan,
they can charge you whatever they want to be
paid. Dr. Chhabra and his colleagues recently
released a study that evaluated insurance claims
from a large national insurance plan focusing on
the years between 2013 and 2017.
The data couldn't tell them how many patients
actually received surprise bills.
Just how many could have if the ambulance
provider decided to bill them for what the
insurance company didn't pay.
They found the average patient could be charged
450 dollars per ground ambulance ride after the
average insurance payout.
Contrast that to the potential surprise bill for
an air ambulance, which came in at a staggering
$21,700fifty-five dollars per ride.
Ground ambulances usually get the focus when it
comes to surprise billing, even though they cost
less than air ambulances.
That's likely because ground ambulance rides are
55 times more common than air ambulances.
Chhabra's analysis found that potential surprise
bills for ground ambulances over the four year
period he studied would add up to more
out-of-pocket costs overall than air ambulances.
Despite being less common, air ambulance billings
are trending upward.
Chhabra's study notes that potential out of
pocket air ambulance fees are catching up with a
15 percent annual increase in potential surprise
billings for air ambulances between 2013 and
2017. Betsy Imholz is an attorney who used to
work on health-care issues at Consumer Reports, a
nonprofit consumer advocacy and research
organization.
One of the arguments about why there is more air
transport these days for medical reasons is that
rural hospitals are closing.
But we found, in fact, that there's a lot in
metropolitan areas.
Some would say the traffic has gotten bad and so
we need to even transport people locally in a
highly concentrated, populated areas.
So whatever reasons, there's a lot of work going
on all over and all kinds of areas.
Imholz says one reason for this spike could be the
air ambulance industry shifting more toward a
for-profit model.
Between 2012 and 2017, more than 100 new
helicopter bases were added, some of those in
areas where there already were services.
So they are duplicating services, not responding
to higher demand.
When air ambulances first started to be used in
New Jersey, they were run by the state police and
didn't charge for their services.
Now there are also competing private air
ambulance services that are generally affiliated
with hospitals.
And in a normal functioning market, this would
work if there were more suppliers present in the
market than prices should go down.
But the problem is that people in medical
emergencies don't get to choose their ambulance
provider. The ambulance providers dispatch by
nine nine one one operator.
And since they don't have to declare insurance by
law, they can charge you whatever they want.
So there is no price competition.
There's no pressure driving down prices.
In some cases, there's been an argument over
whether patients' medical issues were urgent
enough to warrant the use of air transport.
Some of the consumers that we interviewed felt
that they had been unnecessarily transported by
helicopter when they really didn't need to be.
It was an urgent situation, but they felt that by
the time the copter landed and picked them up and
got them to the hospital, they could have even
more quickly gotten there by ground transport.
So it's very hard for consumers to know was it
really necessary or not?
And often that's a fight with insurance
companies. Was it medically necessary?
A big problem outside emergency medical services
are expensive to operate.
The amount of revenue that's generated from even
the most efficient ambulance systems is limited
by the fact that if you want that ambulance in
your community to be available for you when you
need it, that means they can only really be doing
ambulance calls about half the time at best.
But not much data is available about how much
ambulance services cost to operate.
Asbel Montes is the senior vice president of
strategic initiatives for Acadian Ambulance
Service, as well as the chairman of the Payment
Reform Committee for the American Ambulance
Association.
We are one of the last industries to do any type
of cost data collection or what most people refer
to as cost reporting, and that is something that
we have advocated for as an industry.
We do not have a mechanism like hospitals and any
others that are actually having to do cost
reports to validate the Medicare payment system,
that is not we do not have that data yet.
The GAO and the nonpartisan Medicare Payment
Advisory Commission, or MedPAC, do collect some
data regarding reimbursement rates for E.M.S.
providers. But those within the industry say the
reports do not accurately estimate costs of
service. The lack of comprehensive data also
leaves some consumer advocates, such as Imholz,
concerned.
The question is what is the real cost of providing
this service? And are people price gouging?
Are some of these companies price gouging?
Because of the private equity control of many of
these companies? We really don't have the data on
what it really costs.
How much is profit?
How much is surplus?
How much are unnecessary rides?
They're just building up more and more supply
than they really need to.
So there's a lot of information lacking s
till.in-network
Many private insurance companies consider most
E.M.S. providers out of network.
This means the two entities do not have a
predetermined agreement about how much the
service costs.
The way reimbursement set up right now, it's often
more profitable to these ambulance companies to
avoid contracting with the insurance companies.
It's more profitable to stay out-of-network.
So why would they bother, you know, writing a
contract?
The American Ambulance Association does not
believe the concept of in-network or
out-of-network should apply to emergency medical
services.
There's really no such thing as an out of network
911 provider. You might be the city of - and I'm
just going to throw out a name here - the city of
Houston, who provides their own E.M.S.
services. If you as a citizen do not have a
choice in who, your 911 provider that is set by
the mayor of that city and the city council
saying we, the City of Houston is the one that
provides 911 services.
How is that out of network?
So the issue there that we've got going on is the
insurance company is denying it wrong, saying the
city of Houston does not want to be in our
network. And so they're out of network.
No, the issue is you don't like the rate that the
City of Houston is charging.
In addition to private insurers not paying the
entire cost of the bill, government-funded
insurance plans such as Medicare and Medicaid
don't cover the entire cost of the service
either. A report conducted by the Moran company
contracted by the American Ambulance Association
concluded that E.M.S.
providers lost money from Medicare and Medicaid
rides.
That did conclude that we were being reimbursed
below costs for Medicare and then Medicaid,
remember, actually reimburses less than Medicare
does.
We often hear that. That there's cost-shifting,
that much more has to be charged as private pay
or even uninsured people, because the
reimbursements either from insurers, Medicare or
Medicaid are insufficient.
And we haven't really found the evidence for that
to be valid.
So how much should ambulances cost patients out of
pocket?
The main reason we have out-of-pocket costs for
any health care is that we don't use health care
willy nilly and without some rationale.
So we want to discourage things like calling an
ambulance for a routine stomachache.
So the out-of-pocket costs for anything should be
just enough to discourage people from overusing
ambulance services. But not so high that they
discourage appropriate use or they make people go
broke.
And the problem is, as you balance this out so
that the patients don't get hit with a three
thousand dollar bill.
But at the same time, you want to also have some
controls over utilization.
So while you don't want bills that are going to
bankrupt people, you do want bills, preferably
some kind of payment at the point of service,
which discourages people from utilizing an
ambulance when they don't really need one.
There are some countries that do maintain low
out-of-pocket costs for ambulance services.
Take Australia, for example.
Ambulance fees do vary in Australia from no
out-of-pocket costs to more than 1000 Australian
dollars in certain regions.
In some of the Australian states and territories
where there are no out-of-pocket costs, many
residents call for ambulances without actually
having an emergency.
Because this puts a strain on the system Australia
runs a public education campaign urging people
not to call an ambulance if it isn't an
emergency.
Triple zero ambulance emergency.
I think I've sprained my wrist I've had a cold
for three days now last year.
Ambulance Tasmania received too many trivial
triple zero colds that could take us away from
real emergencies.
Save triple zero for saving lives.
Rational people behave in rational ways.
If you're poor and you can either have to call an
Uber and pay for the Uber at the point service or
you call the ambulance not to pay at all, people
call the ambulance because that's perfectly
rational.
Despite there being agreement on both sides of the
aisle that this is an issue, it's been difficult
to make progress on legislation.
It's been a completely bipartisan issue.
There's been proposals that have been agreed upon
by both Democrats and Republicans in both the
Senate and the House. Remarkably, the Congress
and the president agreed on this as well.
Congress has taken some steps toward collecting
more cost data for the industry in order to
better understand reimbursement rates.
The Bipartisan Budget Act of 2018 did actually
mandate a cost data collection provision to start
this calendar year for the ambulance industry
over a four year period.
They will basically mandate every ambulance
provider and supplier that bills the Medicaid
program will have to, at a minimum of one time
report their data.
And they will do an analysis all on this system
from all of the rates that we get paid based upon
the different organizational types to understand
where are we being paid inappropriately.
The legislation authorizes what is known as
extended payments for ambulance services.
These are Medicare add ons that increase the
payments depending on the area the providers are
servicing.
Basically, Congress this time said we want data
from your industry. You keep telling guys based
upon the GAO reports, the MedPAC reports that we
are underfunded and our you're reimbursing it
under cost. Well, in order for us to give any
more money in here, we'll extend these for five
years. But we're going to mandate cost data
collection.
Some states have also been working to pass laws to
fill the holes of federal regulations, but they
can be met with legal challenges.
There are many states that have tried to intervene
to protect consumers on this.
Several of them, at least.
But generally, the industry comes right in and
takes them to court and challenges the law.
Under the CARES Act, one of the coronavirus relief
packages any provider, they got federal funding
through the relief package is actually banned for
balance billing anyone with suspected
coronavirus.
You can't help but think about our big health care
system in the middle of this pandemic kind of
crisis. And people are recognizing the importance
of having available, affordable, quality services
for us and certainly in the emergency context, as
we rethink the health care system, I hope that as
a nation, we will just really think hard about
whether we want to leave emergency services on a
catch as catch can basis with unbridled for
-profit companies without any great regulation, or
whether we really want to think this through
carefully and have a system that ensures that
every American can get the care they need without
going bankrupt.