March 22, 2024

By Hunter Hammond

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In fall 2020, an intubated COVID-19 patient was airlifted 20 miles between two hospitals. Weeks later, she got a $52,112 bill for the ride. In the final days of COVID’s debut year, the federal government enacted the No Surprises Act to ban surprises bills like this one, kicking off a battle with healthcare providers and insurers over who would foot the bill instead of patients.

In the years since, we’ve been following the battle closely to predict the hit to providers. Now, almost two years since the payment dispute resolution began, we are taking a look back at the data to see how the fight has shaken out so far and to predict what’s still ahead.

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Our analysis of CMS air ambulance data and insurer-reported rate data, accessed through Serif Health, shows that the No Surprises Act is leading to payments to air ambulance providers at or above actual rates reported by insurers.

See our full analysis of the data below, in which we compare No Surprises Act dispute resolution results with payer-reported in-network rates.  

Providers are winning 85% of disputes with insurers, and prevailing offers are above many in-network rates. We also found that insurers are making offers well below actual rates during the No Surprises Act dispute process. This is positive for air ambulance providers such as Global Medical Response, Air Methods, PHI Air Medical, and Apollo MedFlight. 

For patients with private insurance coverage, the No Surprises Act bars air ambulance companies from billing people more than they would pay if the service were considered “in-network” with their health insurers. For patients with public coverage, such as Medicare or Medicaid, the government sets payment rates at much lower levels than the companies charge. 

Insurer-reported qualified payment amounts (QPAs) are far lower than many insurer-reported in-network rates for key providers. Simultaneously, insurer offers are close to the QPA and thus also lower than reported in-network rates. 

Analysis of the data shows a wide difference between insurer and provider offers, with providers offering more than twice the amount proposed by payers. Over time and with enough iteration, we expect payers will raise their offers until they win more cases, at which point we expect providers to reduce their offers. Eventually, offer spread will compress, and an equilibrium rate will emerge. However, reaching equilibrium will require a more stable Independent Dispute Resolution (IDR) environment, more frequent data releases to facilitate price discovery, and an IDR portal more consistently open. 

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