What do you think is the average reimbursement rate offered by Medicare for air ambulance services? Well, you will be surprised but it is just $6,500, while the median cost itself is about $10,200. In essence, the medical flight service providers get paid about 30% of what they bill. Also, such insurance holders account for about 70% of the population. This puts immense pressure on the air ambulance industry to cover the amount. Guess who bears the brunt of it all? It’s the private insurance holders. The medical flight service providers try to push this cost burden by charging steep amounts to private insurers.
How Do Private Insurers Respond to Air Ambulance Bills?
The private insurance holders are known to cover air ambulance bills to a huge extent, in most cases even when the bills are high, they cover up to 80%. If you’re asking what happens to the remaining 20%, the answer is surprise billing – a practice that has been quite prevalent in recent times. The patient himself becomes responsible to cover this amount. The excuse given is that the air ambulance service provider is out of the insurance network. For the patients, this becomes a huge problem as in emergencies they simply are not in a position to choose an in-network medical flight or even ask about the prices.
Market Saturation and Regulations – The Real Causes
The number of players in the air ambulance market has risen dramatically in the past few years. This has translated into each organization getting a smaller piece of the patient pie. This compels them to charge higher to each patient who avails the service. What facilitates this is the regulation that does not allow states to interfere in the billing practices of air ambulance companies. The ability to charge the price that they desire is also the reason why most medical flight organizations are not willing to join insurance networks.