Judge Dismisses Air Ambulance Attempt to Block Florida Reimbursement Law

By | October 15, 2021

Florida officials are applauding a federal court’s decision to dismiss an air ambulance company’s challenge to a 2020 law that limits insurance reimbursements for pricey helicopter and fixed-wing medical transports.

David Altmaier

“The successful dismissal of this lawsuit will ensure consumers are protected from extraordinary out-of-pocket expenses at a time when they need help most,” Insurance Commissioner David Altmaier said in a statement.

U.S. District Judge Allen Winsor this week agreed with Altmaier’s motion to dismiss the lawsuit that was brought a year ago by Air Methods, a major air ambulance provider. Air Methods had asked the court to block Altmaier’s enforcement of House Bill 747, now state law, which requires “reasonable reimbursement” of air ambulance flights and bans balance billing to patients. It’s an issue that has churned through state and federal courts across the country for the past decade.

Air Methods filed the suit last fall, shortly after Gov. Ron DeSantis signed HB 747 into law. The company argued that federal law preempts state laws and that the federal Airline Deregulation Act of 1978 governs interstate air transportation prices. Three federal appeal courts and a number of state courts have agreed with that argument in similar cases, leaving state regulators, insurers and patients frustrated over air ambulance bills that can top $50,000 for one emergency transport.

The judge in this case sidestepped the federal preemption question but held that Air Methods had no standing to bring suit. As of yet, the firm has not been subject to reimbursement restrictions and has not been injured. Furthermore, the judge said, Altmaier’s Office of Insurance Regulation (OIR) does not enforce the new law.

An air company’s grievance would be with an insurance company that did not pay the full amount of the bill, Winsor wrote.

Altmaier’s case was argued by two Florida assistant attorneys general. In their response to Air Method’s complaint, William Stafford and Elizabeth Teegen wrote that the section of the new law that Air Methods (AMC) sought relief from “is self-executing and applies only to private contractual arrangements between air ambulance services and those they transport. OIR has no authority to enforce it, and so an order against the commissioner will make it no easier for AMC to bill individuals for any portion of its air ambulance charges that the insurers do not cover.”

Williamson

“We’re very excited to see the judge’s ruling,” said Rep. Jayer Williamson, R-Pace, the chief sponsor of the 2020 legislation. “We tried hard to come up with language in the bill that would pass the courts.”

The Florida law is somewhat unique in the country and was crafted after months of research and work with the Florida Association of Health Plans. It requires insurers to base reimbursement on the actual cost of the service, but to also consider the average cost of those air services in a region, including the cost of helicopters operated by county sheriffs.

Air Methods has said that its aircraft are exceedingly expensive to maintain and that highly trained crews must be on-call at all times. HB 747 keeps reimbursement too low, jeopardizing service to rural parts of Florida, the firm said. It asked the court for an injunction to halt enforcement of the law, almost before the law was enacted.

But the state argued that Altmaier’s office, while overseeing most insurance matters, does not have a dog in this fight. Air Methods cannot trace its injuries or redress them with the OIR. The assistant attorneys general offered this scenario: Say Air Methods sends a bill for $50,000 to the insurance company after a medical flight. The insurer pays only $20,000, and the air ambulance company bills the patient for the remainder.

“Suppose that the insured, believing this violates (the new law), informs OIR,” the state wrote in its motion to dismiss. “OIR would not, and could not, bring an enforcement action under these circumstances.”

The court agreed.

“In sum, Air Methods has not alleged facts to show traceability or redressability,” Judge Winsor wrote.

Attorneys for Air Methods and for the Florida Attorney General’s office could not be reached for comment Friday.

Williamson said the law does not affect workers’ compensation insurance reimbursement or fee schedules, which has been a subject of litigation in other states, including Texas. “But that’s something we can look at in the future.”

Topics Legislation Florida

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