Taken for a ride: Your medical emergency could end in bankruptcy

Larry Barker

Former New Mexico Insurance Superintendent Chris Krahling calls an obscure insurance practice, “Cold. Unethical. Wrong.”

We buy health insurance for protection from unforeseen medical emergencies. That’s the way it’s supposed to work. However, a four-month News 13 investigation has uncovered a cruel and heartless tactic that’s leaving some families on the brink of bankruptcy.

Melvin and Tricia Banister know the issue first hand. While working on a piece of machinery in Carlsbad last year, Melvin fell and fractured his hip.

“It’s the worst pain I’ve ever had in my life,” Melvin Banister said. “Anytime they moved me I would just start screaming and hollering because it hurt so bad.”

Melvin required emergency surgery. However, the Carlsbad hospital where he was being treated did not have an on-call orthopedic surgeon.

“The E.R. doctor said that he needed to be airlifted out,” Tricia Banister said. “I said, ‘Can I take him by car?’ And she said no. And I said, ‘By ambulance?’ And she said no, he needs to be airlifted.”

Melvin was flown by air ambulance 160 miles to a hospital in Lubbock. He underwent surgery the next day and made a full recovery. However, the Carlsbad retiree would soon learn this ordeal was just beginning. It was triggered by an invoice that came in the mail a few weeks after Melvin’s accident: a $64,999 bill for that 75-minute medical helicopter transport.

“I thought it was a crazy amount. That’s just ridiculously high, and I thought the insurance would pay for it,” Tricia Banister said.

The Banisters submitted the bill to their insurance company, Blue Cross Blue Shield, for payment. However, BCBS rejected the claim, sticking the Banisters with the $64,999 obligation.

In an appeal, Melvin’s doctors in Carlsbad and Lubbock asked BCBS to reconsider. The doctors said Melvin needed an air ambulance because of his severe pain and need for emergency surgery.

But just because your doctor said you need a medical airlift doesn’t mean the insurance company will pay for it. In this case, Blue Cross Blue Shield refused to pay the Banister’s helicopter bill because, in the insurance company’s opinion, an air ambulance was “not medically necessary.”  

It’s all right there in the BCBS Benefit Book, “…Because a health care Provider prescribes, orders, recommends, or approves a service does not make it Medically Necessary… BCBSNM will determine Medical Necessity based on (stated) criteria.”

According to a staff attorney in the New Mexico Insurance Superintendent’s Office, Blue Cross Blue Shield is the only New Mexico insurance carrier with language in its benefit booklets giving the insurance company authority to deny coverage based on ‘medical necessity.’

“It just really chaps me that with the premiums we paid, and they come up and say it’s not medically necessary,” Melvin Banister said. “They’re not there. They’re not in the emergency room. They’re not the ones that see you there in pain and…they’re basically second-guessing the doctors.”

Former New Mexico Insurance Superintendent Chris Krahling reviewed the Banister file. Krahling is critical of Blue Cross Blue Shield for denying to pay Melvin Banister’s air ambulance bill. 

“The one and only person in the whole world that has the authority to determine what is medically necessary in an emergency room situation is the attending physician,” Krahling said. “The insurance company doesn’t have any authority to override the decision of the attending physician.”

“It is not right. It’s not correct. It’s not fair,” said John Franchini, New Mexico’s current Insurance Superintendent. “My message to the insurance companies is quit deciding what is medically necessary. Let the doctors and the hospitals decide what is medically necessary.”

Melvin Banister is not the only victim.

“It’s devastating. I mean you end up losing sleep at night because you’re wondering how in the heck am I going to be able to pay this bill,” said Southeast New Mexico cotton grower Travis Ludwig.

Last summer while burning weeds at his Anthony, New Mexico farm, Travis suffered first and second degree burns over 7 percent of his body. 

“I was in a lot of pain,” Ludwig said. “We went to the closest hospital … on the west side of El Paso. The surgeon stated that I needed to go to a burn unit.”

The nearest Burn Unit to El Paso is 300 miles.

“They put me on (an air ambulance) plane and transported me…to Lubbock, Texas,” Ludwig said. “I was thinking this is probably going to be a very expensive situation. But I didn’t think I had any sort of worry given the fact that I had insurance.”

Little did Travis Ludwig know that one year later his insurance company, Molina Healthcare, would flat out refuse to pay the air ambulance bill leaving Travis with a $65,000 debt.

“I was flabbergasted. I just was completely floored,” Ludwig said.

On appeal, Molina Healthcare reconsidered and agreed to pay a small portion of the air ambulance bill. However, Travis Ludwig was stuck with paying the balance, $55,243, out of his pocket. “

It’s so exorbitant, it’s so unreasonable and unconscionable. How can anybody pay that? Nobody,” Ludwig said.

A spokesperson for Molina Healthcare said the insurance company could not discuss its handling of the Ludwig claim.

What’s going on here? Well, if you thought health insurance covers big-ticket expenses like an air ambulance, think again. In fact, in New Mexico, if you have a medical emergency and need to be transported by air, you could be stuck with the bill, and it might set you back as much as $60,000-$70,000.

“It’s a huge issue in the state of New Mexico. It’s at a crisis level,” said Insurance Superintendent John Franchini. Franchini calls air ambulance billing practices outrageous.

“The bills are not justified. They’re highway robbery. They are charging excessive amounts of money,” Franchini said.

However, Air Methods, one of the largest air ambulance companies in the country, said it is not gouging consumers. Air Methods executive Doug Flanders said it costs the medical airlift firm millions of dollars to run a 24/7 New Mexico operation staffed by teams of medical and flight professionals.

“We are basically a flying ICU,” Doug Flanders said. “We can do things that you can’t do by ground, and we can get there quicker, thus making sure that these patients have a greater degree of success from a health care recovery.”

Flanders said Air Methods loses money on 80 percent of its New Mexico transports which are primarily Medicaid, Medicare or uninsured patients. In order to stay in business, he said the unreimbursed costs are shifted to private insurance companies.

“We have to then work with the health insurance company to try to get as much reimbursement on behalf of that patient,” Flanders said. “We work very hard to try to do that on a regular basis. Sometimes we’re successful. Other times we’re not.”

In Melvin Banister’s case, the air ambulance didn’t actually cost $65,000. His bill was inflated to make up for all the other transports that weren’t paid. When Melvin’s insurance company refused to pay the bill, then Banister was on the hook for the full amount.

“When we pick (a patient) up we’re hoping that the insurance is going to be able to cover their medical emergencies. If you’re looking at, why do you have insurance? It’s for medical emergencies,” Doug Flanders said.

“We’ve seen an increase of 336 percent over the last four years where the insurance company will receive the claim and then say, ‘this was not medically necessary, the doctor who deemed this medically necessary was incorrect,’ and they would deny the claim,” Flanders said. 

“What that means to the patient is then they are now stuck in the middle because the insurance company has said ‘sorry, but the care you received is not medically necessary, so therefore, you now have to pick up the bill,'” Flanders said. 

A spokesperson for Blue Cross Blue Shield of New Mexico said some ‘out of market’ air ambulance bills are unreasonably high. BCBSNM said it is in negotiations with Air Methods to arrive at a negotiated rate so that policyholders are not stuck with huge bills.

Despite the excessive charges and insurance company fine print, you can fight back. Melvin Banister and Travis Ludwig challenged their air ambulance bills and appealed their cases to New Mexico’s Insurance Superintendent. Ultimately, Banister and Ludwig won their cases and got their air ambulance charges reversed.

“A lot of people just give up and pay it,” Melvin Banister said. “I’ve made up my mind that I wouldn’t just give up and pay it. I was going to fight them to the bitter end,” the retired Carlsbad businessman said.

Travis Ludwig wonders, which was worse, the accident or the bill?  “I would say they were pretty neck and neck because it only took me a month to get over the physical pain, but the mental anguish created many a sleepless night for me.”

Statement from Blue Cross and Blue Shield of New Mexico

As it relates to air ambulance companies, noncontracted rates are generally much higher when compared to Commercial contracted rates and Medicaid and Medicare rates.

As an example, a noncontracted air ambulance company liftoff rate can be $30,000 or higher. When mileage rates of $250 per mile for noncontracted air ambulance companies are added to the liftoff rate, we have seen total charges up to $65,000 for relatively short flights.

That is compared to liftoff rates for Medicaid and Medicare that range from about $1,800 to $4,000. When mileage rates ranging from $7 to $35 per mile are added in, total charges for a similar flight would more likely be in the range of $6,500.

Contracted air ambulance companies include San Juan Regional Medical Center AirCare, CSI Aviation Inc., Med Flight Air Ambulance, University of New Mexico Hospital’s Lifeguard Air Emergency Services, Critical Air Response Enterprises, PHI Air Medical, and Southwest Med. Evac. Inc.

List of air ambulance cases in the office of the New Mexico Superintendent of Insurance as of August 2018

TH New Mexico Health Connections NMHC
Air Ambulance Provider: Mercy Air Service

Grievant TH filed a complaint against NMHC. TH is being balance billed for $37,579.77. NMHC paid Mercy Air Service $15,920.45. Total bill for the services provided by Mercy Air Service is $53,500.22. Grievant was transported from Pahrump, Nevada to University Medical Center, Las Vegas, NV for treatment of a gunshot wound to the right knee (traumatic injury).

YS New Mexico Health Connections
Air Ambulance Provider: PHI Air Medical

YS was transported by ground to the Presbyterian Emergency Room in Socorro where she was diagnosed with a brain aneurysm and then air lifted to UNMH, Albuquerque due to the severity of the bleeding in the brain. YS remained in Neuro ICU for thirteen days.

Dr. TB ordered the air transport and YS was transported 76 miles. YS filed a complaint against NMHC. YS is being balance billed $30,526.56. NMHC paid PHI Air Medical $16,559.44. Total bill for the services provided by PHI Air Medical $47,186.00.

CM New Mexico Health Connections
Air Ambulance Provider: Rocky Mountain Holdings, LLC

CM filed a complaint against NMHC. CM is being balance billed $48,017.28. NMHC paid Rocky Mountain Holdings, LLC $16,981.72. Total bill for the services provided by Rocky Mountain Holdings, LLC $64,999.00. CM was transported from Gerald Champion Medical Center, Alamogordo, NM to Sierra Providence Medical Center, El Paso, TX. CM experienced a syncopal episode (fainting or passing out) on 12/2/17 and again on 12/3/17. CM was transported on 12/04/17 (via personal vehicle) to the ER and was admitted to the ICU. CM underwent a cardiac catheterization. During the cardiac catheterization the grievant went into v-fib (ventricular fibrillation). CM was transferred by air to Sierra Medical Center because an Electrophysiologist was not available at Gerald Champion Medical Center.

Dr. L was the referring physician and states CM’s condition was time critical requiring rapid air transportation in order to minimize morbidity/mortality. The specialized care, treatment and diagnostics was not available at the referring facility. CM was transported 88 miles.  

JG Blue Cross and Blue Shield of NM
Air Ambulance Provider: Sunrise Air Ambulance

This appeal was for two fixed wing air ambulance transports. In May, JG was transported due to altered mental status after being found unresponsive at home. In June, JG was reported to have epilepticus with seizures for two hours or more and needed large doses of benzodiazepines. Dr. H ordered air transport from Silver City to the Tucson AZ Medical Center for neurology specialty services, as the specialty services were unavailable at the sending facility. JG was transported 166 miles.

Total Bill: $82,645.00

As of September 11, 2018, a Post Service Internal Review of Adverse Determination approved the reprocessing of these claims.

TL Molina
Air Ambulance Provider: Rocky Mountain Holdings, LLC

The total initial bill is $64,999.00. Molina is paying $8,755.86 and the grievant has a co- insurance responsibility of $2,188.96, with an unpaid balance of $54,054.18. TL was transported by ground ambulance from The Hospitals of Providence Transmountain Campus to El Paso International Airport El Paso, TX, then transported by air to Lubbock Preston Smith International Airport Lubbock, TX, then transported by ground to University Medical Center (UMC) of Lubbock: TL was transported from El Paso due to 1st degree burns to his cheek and 2nd degree burns to right hand and upper leg. Airtime is 70 minutes and ground is 360 minutes. Molina stated that they reached out to their UM Department to review the claim submission.

PA New Mexico Health Connections
Air Ambulance Provider: Rocky Mountain Holdings, LLC

PA transported by air from Roswell, NM to Albuquerque, NM for treatment of a wrist fracture (Subdural hernatoma-HCC); comminuted intra-articular minimally displaced fracture involving the distal radius, with accompanying fracture fragment of the ulnar styloid. There were degenerative changes at the base of the thumb. The amount of the total bill is $64,999.00. NMHC paid $20,113.63 and the unpaid balance is $44,785.37.  

Air Ambulance Provider: PHI Air Medical, LLC

KS was seen in the ER and had obstructed right pyelonephritis associated with right ureteral stone, along with ESBL bacteremia and Nephrolithiasis. Dr. B ordered air transport from Gallup, NM to UNMH in Albuquerque, NM. The total balance of the bill is $62,363.05, Discounts, reductions and payments applied $1,593.05, and the amount not covered $60,770.00.

CV Molina
Air Ambulance Provider: Rocky Mountain Holdings, LLC

CV transported by air from Carlsbad Medical Center, NM to University Medical Center, Lubbock, TX. CV experienced an acute myocardial infarction (heart attack). He had a cath study that showed three-vessel disease. An Intraaortic balloon pump was inserted in Carlsbad, NM and CV was transferred to Lubbock, TX for a coronary artery bypass graft. The cardiologist ordered the air transport because CV needed medical attention that she could not provide. The total amount of bill is $124,857.25. Molina paid $39,237.84 to Rocky Mountain, and the unpaid balance is $85,612.75.

TS New Mexico Health Connections
Air Ambulance Provider: Rocky Mountain Holdings, LLC

TS transported by air from Gila Regional Hospital, Silver City, NM to Las Palmas, El Paso. TS experienced a stroke and air transport was ordered. Total bill for air transport services is $64,999. NMHC paid provider $18,700.46. Unpaid balance of bill: $46,298.54

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