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A Brief History of Air Ambulance Industry and Its Billing Practices


The air ambulance industry, contrary to popular belief, has a history that dates back several decades, but the civilian air ambulance industry only saw its first few entrants in the 1970s. Most of these medical flights were still owned and operated by hospitals. It was not until Medicare revised its reimbursement rates that the industry caught the attention of investors and the for-profit air ambulance industry was born. The arena was well set by the early 2000s, and over 500 medical flights were already in action. That was only the beginning. Over the next decade, the numbers had doubled.

The Billing Practices of Air Ambulance Industry

The history of the air ambulance industry cannot be discussed without addressing the elephant in the room and that is the surprise billing practice. The once-lucrative reimbursement rates did not change over time, but the cost of running a medical flight organization did. Of course, the for-profit organizations that dominated the air ambulance industry by now had to get around it if they were to survive. The result was surprise bills that made patients responsible for the payments. However, there was one catch. The bills were too high for the patients to handle. In fact, while medical flight services only make 1% of the insurance claims, they represent a whopping 8% of total Medicare spending.

Curtains on Surprise Billing

For the longest time, state administrators tried to regulate the cost of medical flight services; however, they were unsuccessful. The reason: the air ambulance industry was governed by a federal law that restricted state interference in the matter. However, things have changed today. The federal government has now sought to change the practice. The new law – slated to be passed in totality over the coming year – will end it. With the new law, it is hoped that the industry will continue to flourish while the patients will no longer have to worry about the cost.

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