Mark Huber is an aviation industry veteran who has worked in the flight training, aircraft sales, aircraft component, and airport development businesses. He has flight time in more than 50 different and diverse aircraft, including helicopters, aerobatic aircraft, vintage warbirds, jet fighters, business jets and turboprops, and transport-category aircraft. He has jumped out of several of these—on purpose—with a parachute. His defense and aviation journalism has been published in a variety of national and international periodicals.

Contributor

Mark Huber

A group of industry stakeholders interviewed for a new study released by the Government Accountability Office (GAO) cast doubt on the ability of increased Medicare reimbursements to solve the ills of the U.S. air ambulance industry. The industry has long called for higher Medicare reimbursements to mitigate “balanced billing” and other practices seen driving the high costs of air medical transports, whose average median costs climbed to $30,000 from $15,000 between 2010 and 2014, according to the GAO.

 


The average Medicare reimbursement was just $6,502 in 2014, which the industry has long claimed is substantially below actual costs. The nation's largest air ambulance provider, Air Methods, raised its average price per transport to $49,800 in 2016 from $13,000 in 2007—an increase of 283 percent.&nbsp;By last year, the nation's three largest independent air ambulance providers all had average transport costs in excess of $40,000 and the GAO noted that, collectively, they were rapidly increasing market share. The agency noted, “The three large independent providers reported operating 692 air ambulance helicopters in 2015 and 763 in 2016—an increase from 66 to 73 percent of all helicopters in the industry.”

 


However, raising the Medicare reimbursement rate might actually exacerbate the industry's overcapacity/underutilization/high-cost problem. The GAO reported, “Some of these stakeholders noted that increasing Medicare rates could encourage further growth in the industry, which could reduce the average number of transports per helicopter, putting pressure on providers to raise prices charged—thereby exacerbating the problem. Further, industry growth may be an indication that Medicare rates are not too low. We have previously reported that when rates are set too low, access to appropriate care for patients covered by Medicare may be adversely affected. However, the growth in the number of air ambulance helicopters indicates that providers are still deciding to provide service under existing Medicare rates.”

 


The number of Medicare patients as a percentage of overall patient transports is climbing, the number of air medical helicopters went up by more than 10 percent, from 900 to 1,020, between 2010 and 2014, but the number of transports per 1,000 Medicare patients was flat and down slightly among the privately insured. Industry stakeholders attributed this to two trends, the GAO said. “Representatives from three providers stated that there is an issue with overcapacity or oversaturation in the industry and that the helicopters being added to the industry are in areas with existing coverage and not serving additional demand, thereby reducing the average number of transports per helicopter rather than improving access to patients previously not covered by the service. On the other hand, representatives from four other providers told us that the decline in transports per helicopter is attributable to helicopters increasingly being located in rural areas where there is greater need, but less population density, leading to fewer transports per helicopter.”&nbsp;

News and issues regarding all manner of civil and military rotorcraft and their powerplants, including helicopters, tilt rotors and unmanned air vehicles.

More Medicare May Not Solve Air Ambulance Woes

Increasing rates could reduce the number of transports per helicopter, having the unintended consequence of further increasing prices.

2024 Corporate Aviation Leadership Summit

Charlotte Bailey

News and information on safety procedures and concerns.

News and issues relating to the aerospace industry that are related to the science, engineering and business of flight in space involving civil, industrial and military applications, and similar topics related to flight in the atmosphere of the Earth that are not covered more directly by other AINonline subject channels. In other words, both astronautical and aeronautical subjects, except for those aeronautical topics that are specifically covered elsewhere on this website.

Fire and disaster management agency to use aircraft in aerial reconnaissance role

Japan Orders Its First H160 for Emergency Response

Flights with two scaled technology demonstrators will inform potential future iterations 

Singaporean eVTOL Conducts Test Campaign In Germany 

Matt Thurber

New developments and products in avionics, specifically about aircraft electronics in the cockpit.

News and issues relating to business, corporate and private aviation, primarily regarding turbine-engine-powered airplanes and helicopters. Subjects include aircraft, engines, maintenance, operations, personnel, acquisitions, accidents, safety, security, and training.

Lightweight white-phosphor NVG have a 94-degree field of view

FAA Approves TSO for ASU Panoramic Night-vision Goggles

Hanneke Weitering

Proposed rule addresses pilot awareness of control limits

FAA Floats Special Conditions for Skyryse Fly-by-wire R66

Charles Alcock

News about bills, laws, regulations and other governmental decisions affecting aviation and aerospace. Topics include FAA re-authorizations, taxes on fuel and aviation activities, environmental legislation, ICAO decisions, governmental mediation of labor conflicts and World Trade Organization disputes and decisions.

European Helicopter Association and Vertical Aviation International extended their alliance 

Vertical Lift Groups Extend Trade Show Partnership

Essential news and analysis on the defense aerospace business. Your trusted source for new and ongoing programs and requirements in military aircraft (manned and unmanned), engines, avionics, weapons and associated systems, including ground-based air defense.

More In Rotorcraft

Japan Orders Its First H160 for Emergency Response

Fire and disaster management agency to use aircraft in aerial reconnaissance role

Singaporean eVTOL Conducts Test Campaign In Germany

Flights with two scaled technology demonstrators will inform potential future iterations

FAA Approves TSO for ASU Panoramic Night-vision Goggles

Lightweight white-phosphor NVG have a 94-degree field of view

FAA Floats Special Conditions for Skyryse Fly-by-wire R66

Proposed rule addresses pilot awareness of control limits

Vertical Lift Groups Extend Trade Show Partnership

European Helicopter Association and Vertical Aviation International extended their alliance

Sikorsky Is Upgrading the Black Hawk Helicopter for Evolving Military Needs

Armed forces will be able to outfit Black Hawks with new armament and equipment.

Sikorsky’s S-97 Raider Points to a New Level of Performance for Future Helicopters

Originally developed for the U.S. military, X2 technology is in search of a new customer.

Bell 505 Makes Asia-Pacific Debut with Aichi Police

Joins fleet of longtime operator of Bell 206s and 412s

AIN Products

SUBSCRIPTIONS

RESOURCES

ABOUT AIN