March 16, 2016
Debts from medical bills cripple thousands of Americans financially but what may surprise many is the cost of a flight to the hospital.
After a helicopter ride to the hospital, patients are left with bills for tens of thousands of dollars. Bills can reach up to $50,000 sometimes costing more than a hospital stay. Insurance policies many times won't cover that cost.
The largest air ambulance company in the country admitted it doubled its prices in the last five years.
ABC 6 Investigators, in collaboration with affiliates across the country, learned federal law protects air ambulance companies. The companies are considered air carriers.
States are prevented from regulating the prices, routes and services, said Sandy Ahn, an expert at Georgetown University with the Center on Health Insurance Reforms.
"For the consumer, they're left out in the cold," she said. "If they... ever have an emergency where they have to take an air ambulance, they may be left with a huge bill and no recourse."
A LACK OF TRANSPARENCY
There's no transparency in how companies bill patients. The average bill for an air ambulance is $34,000.
"You don't know how they got to those prices," Ahn said.
Some companies admit they engage in balanced billing practices -- charging higher rates for patients who carry insurance from private companies. They say patients with Medicare and Medicaid plans pay them significantly less.
Company officials say it's to recoup costs, but the country's largest air ambulance company, Air Methods, made $108 million profit last year transporting over a 100,000 patients.
"Well, we have to," said Paul Webster, vice president of Payer Strategy for Air Methods Corporation.
He said seven out of 10 flights transport Medicare patients.
"Look if everybody paid their fair share, you know what the charge for this service would be? Twelve thousand dollars. That's the reality that we operate at," he said.
Air Methods is pushing for legislation to go after insurance companies and increase payouts from Medicaid and Medicare.
The prices for patients continue to go up.
Revenue for the company in 2015 was more than a billion dollars.
"Well we made a lot of investments into safety and -- technology that goes into these aircrafts," Webster said. "We've also seen a shift from, you know, private insurance into Medicare over that time period. Well I think it's necessary to have doubled the price."
The CEO of the company, Aaron Todd, made $4.7 million in 2014. His salary jumped over 300 percent from the previous year.
"You know, he has a big responsibility. You know, we have 4,500 employees in our organization. And he's been -- I mean, I think he's been fairly compensated," Webster said.
AGGRESSIVE BILLING TACTICS
Air Methods has a reputation for being one of the most aggressive companies when it come to going after patients to collect money.
Liens are placed against homes, records show.
Patients are asked to sign forms saying they will take full responsibility for all charges before they take flight. The costs are not disclosed at the time.
"We've heard stories of a lot of, kind of aggressive tactics: calling consumers, threatening -- them about their credit -- really, kind of, unscrupulous actions -- scaring consumers about what will happen if they don't pay," Ahn said.
Frank Sliwoski, who lives just outside of Cleveland, developed an infection in one of his legs two years ago.
"I work in an auto shop, an auto dealer. I bump my legs all the time cuts and bruises are part of the deal," he said.
He went to a rural hospital for care. As a precaution, doctors decided to transfer him to a larger hospital with advanced medical care.
His helicopter bill from Air Methods came in at $30,000 -- less than what Sliwoski makes in a year. His insurance received the claim and opted not to pay saying that doctors did not need to fly him to a neighboring hospital.
He's now on the receiving end of those collection tactics.
"If I would have known about this when I was laying there, I would have put my foot down," he said. "'Hey, I can't do it man, I can't afford this.'"
Sliwoski wishes he could pay the bill. Collectors hound him now.
"I look, I see the number I think I know who it is, I don't even want to talk to them. I just want this to go away," he said.
SEARCHING FOR RESOLUTION
Sliwoski filed a complaint with the Ohio Attorney General's Office as well as the Ohio Department of Insurance. He hasn't been able to reach a resolution with the company. He's fearful he will be taken to court.
"If I had the money, I'd just pay the thing," he said.
The Ohio Division of Insurance is not actively pursuing this issue of lack of regulation or helping customers navigate what to do to deal with air ambulance companies.
It regulates insurance companies that provide coverage -- not the helicopter companies or hospitals.
That hasn't stopped Maryland Insurance Commissioner Al Redmer from trying to help people. He held forums after recognizing how many people are affected in his state.
"There were some very sad real life stories," he said.
In talking with insurance companies, he said carriers say the rates are not fair and reasonable. Air Methods claims it is negotiating with insurance carriers.
"So, you know, we continue to push and prod," he said.
Redmer has studied the rising prices that have been passed on to patients.
"They can send a bill for almost any amount they want. And if you look at the statistics -- their pricing has increased dramatically -- over the last number of years. So you have to look at -- is there price gouging going on?"
Until the industry can be regulated at a federal level, Redmer is encouraging hospitals to find companies that will negotiate the price in hopes of providing a better community service for patients.
A NEED FOR REGULATION
There's a nonprofit air ambulance company, Careflite, based in Texas that operates with much lower expenses.
"I'm certainly not opposed to the free enterprise system, that's how America's economy works. But this is healthcare, so you're talking about people's lives and wellbeing," said James Swartz, CEO of CareFlite.
Swartz was shown a bill for a 55 mile helicopter ride from Air Methods resulting in $47,000 in charges. His company would have completed the same ride for $11,000 less.
Careflite, which has been in existence since 1979, tries to operate in the most efficient and inexpensive way, he said.
"[Patients are] not asking for a lawsuit. They're asking you to help save their life," Swartz said.
For companies to charge less, it will likely require regulation.
"I think Congress needs to step in. There needs to be some kind of federal protection for ... consumers that are really stuck in an emergency situation," Ahn said.
For Sliwoski, he's left with a bill that grows each day with more interest. He regrets the helicopter ride.
"I'm just Joe Schmoe working stiff 30 grand's a hell of a lot of money for me," he said
He's left to pay the price.