UMPC's MedEvac Closes 3 Out-of-State Bases

STAT MedEvac, the air ambulance provider controlled by University of Pittsburgh Medical Center, has quietly shuttered two out-of-state bases -- and soon will do the same at a third on the Pennsylvania-New York border.

In the months before STAT placed its longtime CEO on leave to investigate his business practices, it stealthily pulled out of western New York after less than a year. It also withdrew from a base in Ohio, where critics claim STAT pays kickbacks to shore up business.

Public documents and interviews in communities where STAT operated suggest STAT extended the business into far-flung rural markets that failed to deliver anticipated profits.

In February, STAT placed James Bothwell, its chief executive, on paid leave while it studied unspecified concerns about how he ran the company. Bothwell, of Jefferson Hills, resigned a month later from the $262,293-a-year job.

Bothwell said in a brief telephone interview that he did not know why he was being investigated.

"It's a great organization, great people," he said. "That's all I have to say."

In November, medical providers in North Dansville, N.Y., learned that STAT's helicopter was gone for good -- seven months after it set up for business.

In December, STAT told its ground ambulance partner in New Philadelphia, Ohio, that it would exit the market before Christmas.

And Robert Packer Hospital in the north-central Pennsylvania community of Sayre is looking for a new provider of helicopter service after STAT departs this month.

Critics say STAT executives seem to think they can gain market share simply by showing up.

"What we have found with STAT is, they will just plunk a ship down and see how it does," said Charlene Mancuso, administrator of Metro LifeFlight, based in Cleveland. "If it doesn't do what they think it should, they remove it -- after they've told a community that they are going to serve them."

STAT spokesman John Chamberlin said STAT operates within the law and with patient care as its guiding principle. He described its withdrawal from the three communities as business decisions.

"There has been no change to this strategy," he said.

Sprawling growth

STAT's first base opened in 1984 at Mercy Hospital in Pittsburgh's Uptown section. At the time, the air ambulance market belonged to then 5-year-old LifeFlight, of Allegheny General Hospital in the North Side. AGH operates one chopper each from Pittsburgh, Indiana and Butler counties, and two in Westmoreland County.

Today, STAT operates 20 EMS helicopters from 16 bases in central and western Pennsylvania; Youngstown, Ohio; and Hagerstown, Md. Its "STAT Comm" toll-free number dispatches STAT and LifeFlight choppers -- a system that chafes AGH, but was approved by the state Health Department.

STAT provides choppers branded with hospital logos for Cleveland Clinic, Children's National Medical Center in Washington and Johns Hopkins Hospital's Lifeline in Baltimore.

The nonprofit Center For Emergency Medicine, whose board UPMC controls, runs STAT. West Penn and Altoona hospitals hold small stakes on the board. UPMC referred questions to Chamberlin.

The Center's tax filings show revenue jumped 15 percent, to $60.5 million, in fiscal year 2006. But helicopter flights cost thousands of dollars, and expenses consumed most of that income. STAT has relied on UPMC loans -- $24.4 million as of last summer -- to keep growing.

Kickback allegations

In Ohio, STAT was dogged by allegations of violating federal anti-kickback rules by paying $500 "reimbursements" to some ground medical responders.

Many first responders, often volunteer fire departments, say they need the reimbursements, because only the entity transporting a patient can bill insurers for the service. Skeptics worry that cash-poor responders might call a company offering money, even if its aircraft isn't the closest.