STAR Flight sees higher payouts since August fee increase went into effect
Tracy Velek and her late husband were living in Rockne, an unincorporated community in Bastrop County, in 2014 when he suffered a heart attack and first responders decided to airlift him to an Austin hospital.
Doctors were unable to save him, and weeks later, a bill for about $25,000 arrived in the mail. Velek’s insurance covered $17,000 of it, but the remainder was left for her to pay out of pocket. At the time, Velek said, that was more than she could afford. She never paid the bill.
“I hate to say it, (but) I was at the point where there wasn’t a lot of income for me to even consider paying,” Velek said. “You wonder how much is justified and how much is padding the bill.”
In keeping with a national trend among air ambulance companies, fees have only gone up since then. Travis County’s STAR Flight helicopter program for medical transportation and other emergencies tripled its fees in August.
Officials told the Travis County Commissioners Court during a briefing Tuesday that they’d already started to see returns from the fee increase: The aver-
age payment from private insurance companies per month has tended to double since August, and offi- cials expect those numbers to continue to rise as billed payments trickle in.
STAR Flight’s average payment from private insurance was about $12,656 in August 2017, when fees rose, compared with about $9,962 in that month in the previous year. By the end of the year, the average payment was about $32,000, compared with about $6,289 in Decem- ber 2016.
The average payment figures do not include billed services that have not yet been paid, meaning reve- nue will continue to rise as time goes on, officials said. Payment can generally take from nine to 19 months, offi- cials said.
Early 2018 figures seem to support that assumption: From January 2017 to January 2018, the average payment in that month rose from about $9,500 to about $27,520, about a 190 percent increase.
Program director Casey Ping said the fee increase was meant to shift STAR Flight’s cost burden from taxpayers to users of the service, usually covered by private or other insurance. The program had a budget of about $7 million in fiscal 2017 but only brought in about $2 million in revenue.
But private insurance doesn’t always cover air ambulance service, and patients and their families, like Velek, who generally don’t have a say over whether to use the service, can be stuck with sky-high bills, industry experts say.
“Not only are health insur- ers paying huge sums to the air transportation industry, consumers are stuck with secondary surprise medical bills because the service is often out of network,” said Jamie Dudensing, CEO of the Texas Association of Health Plans. “This is yet another situation where consumers are completely powerless, and the financial stakes are very high.”
Under STAR Flight’s new fee schedule, the base rate for service is $15,500 for resi- dents and nonresidents alike and $200 per mile, up from the previous rates of $4,500 for county residents and $9,500 for non-Travis County residents and $165 per mile. Individuals pay deductibles and copays according to their insurance plans.
Officials said in August that the county’s rates were much lower than the average for Central Texas of about $16,000. They also updated the process by which unin- sured or underinsured residents can seek bill relief for financial hardship and wrote a policy for evaluating that hardship.
The policy sets out payment plan options for those at least 300 percent above the federal poverty level and allows requests for other remedies, such as fee waiv- ers, from those with less than 301 percent of the federal poverty level.
Ping said the county did not direct any patients or responsible parties to a collections service in 2017.
In fiscal 2016, STAR Flight carried 530 patients, and in fiscal 2017, it carried 447 patients, officials said. Ping said Tuesday that 2018 numbers appear to be pointing up.
The program has seen an overall increase in revenue since August. Though Ping did not have numbers available Tuesday, he said the primary driver has been private insurance payouts, as he expected.
Commissioners in August also gave the county execu- tive of emergency services, Josh Davies, the ability to adjust the fees 8 percent up or down at his discretion, with the stipulation that he annually briefs the Commissioners Court on how rate adjustments are working.
The emergency services staff said Tuesday it plans to raise fees again this August by about 1.1 percent to keep up with inflation. The increase was calculated using a formula from the Centers for Medicare and Medicaid Services, officials said.
Even with the increase, staffers said Tuesday that Travis County still will be below the average air ambulance rate in Central Texas. The base cost of medical tr a nsport will i ncrease from $15,500 to $15,670.50 and from $200 per mile to $202.20 per mile.
Commissioners voted in September to sell the county’s old chopper fleet and spend $34 million on three new helicopters. Officials have said the new aircraft are going to be faster and travel longer distances, allowing for more transports and, they hope, more revenue.
“Ideally, we would increase it (fees) more than 1.1 percent,” Davies said. “In 19 months from now, once we see what our actual collections are from the change that took place in the summer, then we might be in a different position.”
Separately, commissioners on Tuesday also voted 3-2, with Commissioners Gerald Daugherty and Margaret Gómez against, to direct staffers to study the Green Line commuter rail between downtown Austin and Manor and possible funding sources.