June 03—Fearful of sky-high bills, some Missourians have turned to air ambulance memberships to shield themselves from charges their insurer may not cover after an emergency.
In exchange for a fee, air ambulance memberships promise no additional out-of-pocket expenses after a patient is airlifted.
But one Alabama woman who purchased a membership alleges a local air ambulance company attempted to collect additional funds even after her health insurer paid a portion of the bill.
"She purchased coverage that is worthless," according to a federal lawsuit filed in Springfield, Mo.
For some rural Missourians who live hours from a level one trauma center, memberships offer peace of mind.
"Down here we understand that if we have a medical condition that's not a sniffle, we're going to Cape (Girardeau) or St. Louis," said Poplar Bluff Fire Chief Ralph Stucker.
The issue is so ingrained in rural Missouri that it's common to see motorists sporting a sticker on their car as a way to notify emergency crews which air ambulance company they should call for pickup in the event of a serious wreck, according to Stucker.
And for some Missouri employers, paying for employee memberships has become part of the traditional employee benefit package. In Poplar Bluff, the city picks up the roughly $12,500 tab each year to cover its 250 employees, according to City Manager Mark Massingham.
The memberships are frequently advertised in rural areas, and the industry taps established organizations to help market them.
For example, Missouri Farm Bureau's 126,000 members get a discounted rate if they choose to buy an Air Evac membership, and the bureau helps to market that information.
Farming is still a fairly dangerous profession and the memberships offer peace of mind, said Eric Volmer, director of field services for the bureau.
"When you're working in a rural setting and working on a farm ... you could be hours away from a hospital," Volmer said of a potential farming accident.
But there are some risks. In some instances, the membership does not cover a competing air carrier. In that case, the membership does nothing to protect the consumer from a potential balance bill, a billing practice that can have significant financial consequences for patients.
The Post-Dispatch has reported on numerous households stuck with bills ranging from $27,000 to $51,000 after a family member was airlifted to a hospital. The problem stems from a lack of in-network air ambulance providers.
This out-of-network issue allows for balance billing, which can occur when two providers have not agreed to in-network pricing terms, and a provider can send the remainder of a bill, or the balance, to the patient even after insurance has paid a portion.
It's not uncommon for air ambulances to be out-of-network. The state's two largest insurance companies—Anthem Blue Cross Blue Shield and UnitedHealth—do not have any in-network air ambulances through direct contracts.
So, many turn to air ambulance memberships to protect themselves from being stuck with a significant bill.
"I think the fact that people feel the need to buy into air ambulance membership plans is a symptom that ordinary health insurance coverage is breaking down. Insurance is supposed to protect us from just this sort of financial exposure—unpredictable, unavoidable, and high-cost events," said Erin C. Fuse Brown, a health law expert at Georgia State University.
For Doris Pratt, an air ambulance membership was "worthless," according to a lawsuit the Alabama woman filed in April 2017 against Air Evac Lifeteam and its affiliate Air Evac EMS.
She alleges O'Fallon, Mo.-based Air Evac was in breach of contract when it tried to collect additional funds from her following a serious car accident that required her to be airlifted in Alabama in December 2009. Her mother died in the accident.
The air ambulance bill totaled about $18,250. Pratt's health insurer paid slightly more than $8,000, leaving a balance of about $10,000, according to Air Evac bills, which were included as exhibits in the lawsuit.
The lawsuit alleges Air Evac continues to bill Pratt for the remaining balance.
Air Evac believes it's entitled to money she was paid from an auto-insurance policy following a separate lawsuit regarding the accident.
Her lawyers disagree.
But the marketing materials Pratt was sent seem to conflict with the language of the contract, according to exhibits in the lawsuit.
"Whatever your medical benefits provider pays will always be considered payment in full for your flight," according to a marketing letter that was sent to Pratt in Alabama, which is included as an exhibit in the lawsuit.
While the marketing material sent to Pratt emphasizes medical benefits, an employee explained in an email to Pratt's representatives that "Air Evac reserves the right to bill any and all applicable insurance. This includes but is not limited to Health, Auto, Homeowner, Worker Compensation," according to the email, which is an exhibit contained in the lawsuit.
As the case has played out in federal court, Judge M. Douglas Harpool said he was stunned by the broad terms of the contract, according to a transcript of a hearing on Nov. 8.
"Well, I'm struggling with your broad interpretation of this contract," Harpool said. "And if nothing else, strongly encourage your client to have it rewritten because this is pretty vague. It doesn't mean you're going to lose this case, but I was stunned at how vague and hard to understand this contract was, and I did insurance defense work..."
In a statement, Air Evac President Seth Myers said, "Our members never have out-of-pocket costs (such as a balance bill) for a transport by us. The benefit of a membership is that we will accept as full payment any insurance or benefits available to a member that covers our emergency transport services, including automobile insurance that covers these services."
According to the deposition of an Air Evac employee, there is a lien on the proceeds, or money, Pratt received from her car insurance.
However, Air Evac said a lien was never filed against Pratt. Instead, "a notice of claim / demand for payment was sent to Alpha Insurance, which had issued an automobile insurance policy and was being sued by Ms. Pratt, there was not a lien filed against Pratt."
Consumer advocates were appalled by the details of Pratt's case.
"This is a shocking example of how oppressive this industry can be for consumers," said Betsy Imholz, director of special projects for Consumers Union, the advocacy division of Consumer Reports.
Sen. Claire McCaskill, D-Mo., has been working on the air ambulance issue and she has drafted legislation that would allow states to regulate the medical costs of air ambulances.
McCaskill said when it comes to the memberships it's important that consumers are getting what they pay for.
"The most important thing is to make sure there's consumer protections for either individuals that are buying memberships or for municipalities or counties that are buying memberships, so that there isn't some kind of fine print that when you actually need to utilize the service, somehow it's not covered," she said.