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Air Methods Corp. hit with sixth lawsuit claiming price gouging

 

Date: November 08, 2016
Source: Business Den
Author:  Amy Dipierro

 

Centennial-based Air Methods Corp., the nation’s largest air ambulance company, was hit last week with the sixth lawsuit since 2015 alleging that it overcharges patients.

In a complaint filed Nov. 4, a Pennsylvania man injured in a car accident claims that publicly traded Air Methods Corp. billed him 400 percent more than what competitors would have charged for the same flight.

And, he says, Air Methods has exploited thousands of patients like him.

“Instead of charging patients a uniform, customary, and reasonable rate, Defendants charge outrageous prices that bear no reasonable relationship to the services rendered or what is customarily charged for the services,” said the complaint in U.S. district court, which also names a related company, Rocky Mountain Holdings, as a defendant.

Air Methods Corp. lately has wrestled in court with patients who refuse to pay steep bills, even as the company’s revenue has surged 64 percent in five years, to $1.09 billion in 2015, according to its most recent annual report.

Since April 2015, Air Methods has faced at leastsix putative class actions from patients, according to a tally of court cases mentioned in prior media reports and court records reviewed by BusinessDen. In a putative class action, a single plaintiff or group of plaintiffs claim to represent a class of people that has been injured and ask a judge to certify that status.

In the lawsuit filed in Colorado last week, Air Methods allegedly billed the plaintiff, Jeremy Scarlett, nearly $47,000 for a 30-mile flight to a Pennsylvania hospital. Scarlett claims he was also asked to sign a document transferring his right to insurance payouts to Air Methods and compelling him to pay the difference out of pocket.

Scarlett is being represented by attorneys Mitchell Baker in Denver, Jonathan Shub of Kohn Swift & Graf in Philadelphia, and Troy M. Frederick of Marcus & Mack in Indiana, Pennsylvania. Scarlett’s legal counsel did not respond to messages seeking comment.

In another proposed class action filed in October, an Alabama woman received a $52,000 invoice fromAir Methods after the operator transported her, unconscious, from the scene of a car accident. Her insurance reimbursed her for less than $9,500.

Bills in the air ambulance industry have skyrocketed in recent years.

The Colorado lawsuit claims that the average bill from Air Methods tripled from $13,198 in 2007 to $40,766 in 2014.

And a New York Times investigation found that air ambulance operators have raised their billing rates and expanded their fleets, even as insurers cut the share of ambulance charges they cover, leaving patients on the hook for the remaining bill.

Air Methods, which did not respond to messages seeking comment, has responded to past media reports by pointing out its costs to maintain its fleet and pay employees like pilots. It also blames private and public insurers for failing to cover patients’ bills and says it is “essentially losing money” on 70 percent of patients it transports, who cannot cover Air Methods’ costs.

The air ambulance service of Centura Health, Flight For Life Colorado, leases helicopters from Air Methods. Flight For Life Colorado helicopter pilots and mechanics are Air Methods employees.

The company is headquartered in 116,000 square feet of office and hangar space in Centennial Airport. As of the end of last year, it operated 467 aircraft.