Stopping surprise ambulance bills a tough policy puzzle

Figuring out how to protect Americans from surprise, expensive out-of-network emergency ambulance bills is a complicated task, new research from The Ohio State University shows.

A study examining a New York law aimed at preventing these unexpected, often unavoidable bills found that ground ambulance providers raised their prices in response, a move likely to hit health consumers’ bank accounts through elevated insurance premiums, said lead author Wendy Xu of Ohio State’s College of Public Health. The study appears today in the journal Health Services Research.

In 2022, the U.S. instituted broad consumer protections for expensive out-of-network bills under the “No Surprises Act.” It covers a variety of care in situations when patients cannot choose an in-network provider, including air ambulances, but does not protect patients and their families from pricy ground ambulance bills.

“Balance bills” – costs passed on to consumers because their health plans won’t cover them – can be devastating to those with limited resources, and the problem is made worse when they come after emergency services, where a patient’s choice is limited or nonexistent, Xu said.

“People often need these ambulances for life-threatening emergencies, and patients and their families aren’t in a position to choose which ambulance will be sent based on their insurance coverage,” said Xu, a professor of health services management and policy. “If the closest ambulance saves your life but is out of network, you might find that you’re being asked to pay the whole bill even if you have insurance.”

With no federal protections, some states have attempted to institute their own laws. Xu and her colleagues examined ground ambulance prices in New York leading up to and following that state’s 2015 legislative effort to curtail surprise ambulance bills. In New York, patients are insulated from balance bills from out-of-network ground ambulance providers during a medical emergency, but the law requires insurance to pay providers the “usual, customary and reasonable rates,” which are based on charges.

Using national claims data, Xu focused on New York and compared billing there with states without such policies. Providers of ground ambulance services in New York responded to the law there by increasing their prices – to the tune of a 13% increase overall, the research team found.

“The logical next step would be that higher prices for these services will drive up health care premiums for employers and those who are covered by their plans,” Xu said.

A federal committee formed in 2023 to examine the issue developed recommendations to stop surprise ground ambulance billing, but no federal action has been taken to date.

“This issue isn’t going anywhere and, in fact, it’s getting bigger and bigger,” Xu said. “This is prompting more states to pass their own laws, but our research suggests that those approaches may not lower health care costs in the long run and may, in fact, be inflationary.”

“Policymakers should be aware that payment rules based on charges will drive up prices, and costs are going to be transferred to patients in another way – those are the unintended consequences,” she said. “It’s a complicated and complex landscape for ground ambulance services, with some run by government and others run by private entities, and it proves very difficult to regulate.”

Other study authors from Ohio State include Yiting Li, senior research consulting statistician in the College of Public Health, and Sheldon M. Retchin of the College of Medicine.

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CONTACT: Wendy Xu, Xu.1636@osu.edu

Written by Misti Crane, Crane.11@osu.edu; 614-292-3739