News 13, WBTW.com
CONWAY, SC (WBTW) – Air Methods, an air medical services provider that has been at the center of a News13 investigation related to high out-of-pocket patient bills, says it will no longer maintain its LifeNet South Carolina 6 base in Conway.
The parent company says that reimbursement for services has not kept up with costs.
Doug Flanders, Director of Communications and Government Affairs for Air Methods, provided News13 with the following statement on Thursday:
“Air Methods, the leading air medical services provider, announced that after a thorough review and analysis of its operations, it will no longer maintain its LifeNet South Carolina 6 base in Conway.
Air Methods will continue to cover the service area with other Air Methods air medical aircraft, including North Carolina AirLife 2 in Lumberton, LifeNet South Carolina 2 in Camden, LifeNet South Carolina 3 in Orangeburg, as well as other air medical providers in the area.
The dispatch centers will not experience any interruption in service. The same dispatch number for LifeNet of 1-800-327-2611 and AirLife of 1-984-974-2944 will continue to be used for emergency air medical services request and the dispatch centers will coordinate the request. In addition, Air Methods is working with all employees on opportunities for other positions within Air Methods or their next career steps.
TAir Methods is dedicated to the delivery of emergency, lifesaving care to anyone who needs it, 24/7/365. Air Methods does not self-dispatch—we only go when we are called, and we transport every patient who needs our services, regardless of their ability to pay. In many cases, we are the only link between hospitals for patients who need more intensive care, which is a responsibility we take very seriously as we make these decisions.
Current Reimbursement Models are Not Sustainable
The cost of this around-the-clock readiness averages nearly $3 million per year for each air base, according to a cost study prepared for the Association of Air Medical Services (AAMS). Further, approximately 85% percent of costs are fixed costs associated with operating an air base, giving companies little leeway in reducing costs on their own.
However, reimbursement for services has not kept up with costs. Medicare, which covers air medical services in emergency cases only, established the current air medical service payment rates in 2002 based on an estimated 1998 cost pool. Today, the average Medicare per-transport reimbursement covers approximately half of the cost per transport, according to the AAMS study.
In South Carolina, nearly 80% of our transports are Medicaid, Medicare, other government, and self-pay/uninsured, which combined reimburses less than 40% of costs. Again, we don’t self-dispatch nor have any idea of insurance status until after we deliver our patient and finish our mission. Medicaid in South Carolina pays a little less than $3,000 per patient transport, with Medicare covering just over $5,000, and self-pay/uninsured paying just over $100.
Because of the high number of uninsured patients in South Carolina and the egregiously low payments by government payers, each South Carolina air ambulance patient with private health insurance has to cover the costs for the remaining balance left by these 80% of transports. This business environment is not sustainable and puts emergency transport access at risk, which is critical in a state like South Carolina which has seen 4 rural hospitals close in the last 6 years.
Fortunately, Air Methods is in-network with South Carolina Blue Cross Blue Shield as wells the national Humana health insurance plan and more than 25 other in-network commercial health plan agreements across the country. We will continue to aggressively pursue payer agreements across the country so that patients have access to discounted, out-of-pocket payment for qualified services, which varies depending on their plan’s benefits.
Additionally, our Air Methods’ Patient Advocacy Program has dedicated patient advocates who work with each patient to navigate the complexities of insurance reimbursement and to assist in obtaining payment for air ambulance services through the patient’s insurance coverage, including walking the patient through the insurer’s appeals and grievance process.
However, if the low government reimbursement continues, businesses will be deterred from providing this critical service that is needed. The best solution is to increase Medicaid reimbursement at the state level and the federal government to increase Medicare reimbursement for air emergency services which will ensure that the government doesn’t place this burden of debt on private businesses.”
In April, News13’s Julie Calhoun reported that Air Methods reached a deal with Blue Cross Blue Shield of South Carolina, so patients needing air medical service for health issues would only have to pay less than $50 out-of-pocket.
This came after a News13 special report in February, highlighting the sky-high air ambulance bills and one family’s heartbreak.
According to a study prepared for the Association of Air Medical Services, the cost per transport ranges from $4,000 to $20,000, with an average cost of $11,000.
This is an unregulated industry. Local representatives Kevin Hardee and Jeff Johnson are trying to change that.
Kevin Hardee said he’s been trying to change that for years, but the price of these flights fall under the 1978 Airline Deregulation Act, which created a free market in the airline industry and removed control over airfares and routes.
“Sit down with us and we will negotiate a rate that’s fair for everybody, and that will stop this. They wont sit down with us because they don’t have to, and can continue to charge you anything they want,” said Rep. Kevin Hardee.
Right now, lawmakers are trying to pass the Air Ambulance Affordability Act, which would require air ambulance companies to get a permit through the Department of Health and Environmental Control. It also brings the insurance companies to the table.
Congress currently has a committee studying the issue of costs.
Air Methods told us previously that price controls would ultimately cause every air ambulance service to leave the state.
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