The Fund supports networks of state health policy decision makers to help identify, inspire, and inform policy leaders.
The Milbank Memorial Fund supports two state leadership programs for legislative and executive branch state government officials committed to improving population health.
The Fund identifies and shares policy ideas and analysis to advance state health leadership, strong primary care, healthy aging, and sustainable health care costs.
Keep up with news and updates from the Milbank Memorial Fund. And read the latest blogs from our thought leaders, including Fund President Christopher F. Koller.
The Fund publishes The Milbank Quarterly, as well as reports, issues briefs, and case studies on topics important to health policy leaders.
The Milbank Memorial Fund is is a nonpartisan foundation focused on improving the health of communities and entire populations.
Original Scholarship Health Insurance
Erin C. Fuse Brown
Mark A. Hall
Back to The Milbank Quarterly
Context: Out‐of‐network air ambulance bills are a growing problem for consumers. Because most air ambulance transports are out‐of‐network and prices are rising, patients are at risk of receiving large unexpected bills. This article estimates the prevalence and magnitude of privately insured persons’ out‐of‐network air ambulance bills, describes the legal barriers to curtailing surprise air ambulance bills, and proposes policies to protect consumers from out‐of‐network air ambulance bills.
Methods: We used the Health Care Cost Institute’s 2014‐2017 data from three large national insurers to evaluate the share of air ambulance claims that are out‐of‐network and the prevalence and magnitude of potential surprise balance bills, focusing on rotary‐wing transports. We estimated the magnitude of potential balance bills for out‐of‐network air ambulance services by calculating the difference between the provider’s billed charges and the insurer’s out‐of‐network allowed amount, including the patient’s cost‐sharing. For in‐network air ambulance transports, we calculated the average charges and allowed amounts, both in absolute magnitude and as a multiple of the rate that Medicare pays for the same service.
Findings: We found that less than one‐quarter of air ambulance transports of commercially insured patients were in‐network. Two‐in‐five transports resulted in a potential balance bill, averaging $19,851. In the latter years of our data, in‐network rates for transports by independent (non‐hospital‐based) carriers averaged $20,822, or 369% of the Medicare rate for the same service.
Conclusions: Because the states’ efforts to curtail air ambulance balance billing have been preempted by the Airline Deregulation Act, a federal solution is needed. Owing to the failure of market forces to discipline either prices or supply, out‐of‐network air ambulance rates should be benchmarked to a multiple of Medicare rates or, alternatively, air ambulance services could be delivered and financed through an approach that combines competitive bidding and public utility regulation.
Keywords: air ambulances, out-of-network, surprise medical bills, balance billing.
Published June 2020 DOI: 10.1111/1468-0009.12464
Get the Latest from the Milbank Memorial Fund
The Milbank Quarterly’s multidisciplinary approach and commitment to applying the best empirical research to practical policymaking offers in-depth assessments of the social, economic, political, historical, legal, and ethical dimensions of health and health care policy.