Alaska Air Ambulances at Risk

By Jared Sherman, Alaska Executive Director, Guardian Flight 

Alaskans are at risk of losing air ambulances because the cost of providing care is outpacing the payments received from government programs like Medicare and Medicaid as well as private insurance programs. When Medicare and Medicaid payments are combined with other government programs and the number of uninsured patients is factored into the equation, more than 7 in 10 patient transports receive no or below cost reimbursements. Insurers that once agreed to pay more to cover the low reimbursements from government programs so their beneficiaries would have access to critical services are refusing to continue this practice. This often results in a surprise bill for the patient.

Living in a frontier state with far flung communities comes with a unique set of benefits and challenges. Together, these forge Alaskans into a hearty, self-sufficient family that can solve most problems that arise. Yet, every so often there are issues, like health crises that push us to our limits. When a health emergency arises and in the most critical moments, we must rely on air medical services to help. Each year, thousands of Alaskans are flown from villages to cities that have the facilities to treat the most seriously ill and gravely injured. In some instances, the flights are handled as part of training missions by the Coast Guard or other government entities, but in most cases, private air medical services are the ones who save lives. 

Air medical services help Alaska’s remote towns, supporting the local clinics and health aids, serving as mobile emergency rooms, transporting patients to the critical care they need faster than ground services ever could. In remote locations like Alaska, air ambulance services are often the only way Alaskans (both those in metro areas and in the bush) can receive specialty or emergency treatment in a timely manner.

According to a recent YouGov Survey of American adults, 90% consider air ambulances a critical service in healthcare, with 95% agreeing that these services help save lives.

However, if legislation currently being discussed in Congress is enacted as written, health insurers will have unprecedented power to determine how much they will pay for air medical services, regardless of the actual cost. This will put significant economic pressure on providers and may cause a cascading effect that will force the closure of air medical bases all across the country, including Alaska. 

The discrepancy between insufficient reimbursement rates and actual costs is made worse by the billing process following an emergency transport for patients with private insurance. Nationally, insurers deny more than 50% of initial claims for air ambulance services in one form or another. As providers and insurers work out a resolution, patients with surprise bills are caught in a terrifying and exasperating financial limbo, unsure of their ultimate responsibility.

To address surprise billing, some policymakers propose tying reimbursement rates to “a median in-network rate”, but with many insurers currently refusing to negotiate rates with air ambulances, there are often no fair rates to benchmark a median rate against.

Today, 85 million Americans in rural areas rely on air ambulance services to access a Level I or Level II trauma center within 60 minutes. Because the entire state of Alaska does not have a Level I trauma center (the closest is in Seattle), Alaskans have entirely different needs and requirements for air medical services. It is imperative our elected officials recognize the solutions being discussed may have serious, unintended consequences for the families of Alaska. Surprise billing needs to be addressed, but we need to be sure efforts to solve problems in the Lower 48 do not put Alaskans further from the medical care they need.