More states are adding protections against big ambulance bills

The big picture: Patients in an emergency can hardly shop around for an ambulance covered by insurance. More than half of ambulance rides are out of network, putting patients on the hook for surprise bills that typically cost hundreds of dollars.

• Congress carved out ground ambulances from its surprise billing legislation that prevents patients from paying more than the in-network cost for care unwittingly received out of network.
• At the time, it was seen as too challenging to figure out regulation for this unique corner of the health care system, and lawmakers ordered further study.

Driving the news: Washington state last week became the 16th state to pass consumer protections for ambulance bills, and Indiana's governor signed a similar bill earlier this month.

• Just two states had some protections for ambulance bills in the 1990s, but momentum has grown since passage of the No Surprises Act.
• Four states passed ambulance billing laws in 2023, and more are looking to take up legislation.

How it works: State laws cap patient costs for out-of-network ambulance rides at what the patient would pay if it was covered by insurance, and health plans are on the hook for the rest.

• Some state laws, like the new one in Washington that takes effect next year, peg health plan charges to local or Medicare rates.
• Other states, like Delaware and Maine, settle payments through an arbitration system, similar to the federal surprise billing law.
• Colorado only bans surprise bills at privately run ambulances, which accounted for about 30% of emergency rides nationwide in 2020, per KFF. Meanwhile, Maryland only covers those provided by fire departments and other public agencies.

The ambulance industry has largely been on board with how states are approaching these laws, Tristan North, a lobbyist for the American Ambulance Association, told Axios.

• But insurers have raised concerns that some states are setting benchmark rates far above what Medicare pays, said a spokesperson for insurance trade group AHIP.

Yes, but: The state laws are ultimately limited, because most employer-sponsored health plans — a huge chunk of the private market — fall under federal regulation.

• "It's good to know that Washington has this new law now, but we're hoping to see it go one step further to the federal level," said Christy Shum, who received a bill for about $7,000 when her infant son was transferred from one hospital to another last year.
• Shum's employer-sponsored insurance initially covered only about $1,000 for the out-of-network ride, but the charges were eventually wiped without much explanation, Shum said.

What's next: A commission created by the No Surprises Act to study ground ambulances will soon formally submit recommendations to lawmakers, which will include a $100 cap on patient costs and linking insurer payments to locally regulated rates when possible.

• President Biden recently called for extending surprise billing protections to ground ambulances, but there's little expectation that lawmakers will take up legislation this year.
• This Congress has struggled to pass modest bipartisan payment changes, and some of the biggest champions of the No Surprises Act are no longer in office.

The bottom line: "We really need to build the groundswell of support — more than we already have, apparently — to see Congress address it," said Patricia Kelmar, a director at Public Interest Research Group and member of the federal ambulance billing advisory committee.