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Air Methods Responds To ABC News Air Ambulance Investigation

Air Methods released the following statement in response to the ABC News report:

We appreciate ABC News in its willingness to address the issue of cost in its report of the emergency air medical transportation industry. While the topic is an important one, critical context was left out of the report about our financial investment and challenges that persist in the healthcare industry.

Each year, nearly half a million critically ill or seriously ill patients rely on emergency air medicine for lifesaving care.  As an industry, we provide access to more than 82 million people – one in four Americans – who otherwise would not have been able to reach a trauma center within an hour if not flown by helicopter. When transported, these patients are in such critical condition, we have to continue the care in the air.  We’re in essence a flying emergency room and we only respond when a physician or a first responder calls us. When every minute counts, emergency air medical transport and treatment is often not just the best choice for saving a life, it’s the only choice.

Like a fire station, our fleet and highly trained clinicians are always ready to deploy every moment of every day, whether there is an emergency or not. Yet, real-time deployment readiness requires enormous financial resources and ongoing investment. There is a very real cost that goes into providing access to lifesaving services twenty four hours a day, seven days a week, 365 days a year.

  • We have more than 300 air medical bases and each base costs, on average, $3 million to operate and maintain each year. 
  • The multi-million dollar aircraft, employing highly trained pilots, mechanics, flight nurses, flight paramedics and AirCom specialists, maintaining crew quarters, state-of-the-art equipment and administrative costs – these are all fixed costs, meaning we incur these costs just by staying ready at all times, whether we fly or not.

Aircraft, equipment, highly specialized staff—both clinical and aviation—and ongoing training are only part of the equation.

When we are asked to save a life, we deploy without regard to a patient’s ability to pay. That means we sometimes don’t receive payment for our services. And when we do, the payments we receive for Medicare or Medicaid patients don’t come close to covering the actual cost we incur for providing our service. This means we are essentially losing money on seven out of 10 transports due to extremely low government payments. 

At the heart of the issue is that health insurance isn’t doing what health insurance is supposed to do— protect its members. The core purpose of health insurance is to protect individuals from catastrophic events, yet private health plans continue to shrink their coverage, shifting toward high deductible, high out-of-pocket models and reducing coverage for their members. They don’t offer patients adequate protection—financially or medically.  No one wins in this scenario, except the insurance companies who choose to abandon their members by paying a minimal amount and walking away, leaving the hospital, Air Methods, and most importantly, their member and our patients to deal with the aftermath of their poor business practice.  In an ideal world, everyone pays their fair share, and if they did, the charge per transport would reduce significantly.  In today’s reality, many insurance companies are doing the bare minimum and expecting the rest of us, especially their members, to shoulder the burden.

Some have asked why we don’t include pricing on our release forms and the truth is because the number one focus of family and loved ones in these traumatic situations is on making clinical decisions so their loved ones survive. That’s their number one focus – and it’s our number one focus too.

The fact of the matter is our fractured healthcare system creates enormous barriers and makes lifesaving care more difficult and costly to deliver.  Every day, we are forced to operate within the system that exists and do our best to protect the people we serve. We face regulatory burdens not only from the FAA, but also from a variety of local and federal healthcare oversight bodies. We seek every efficiency and innovation to keep our costs down, but the nature of our service—and the complexities of the healthcare industry—dictate costs that are beyond our control. Our charges are similar to other for-profit and non-profit air medical providers.

We don’t like when our patients are put in these situations and we do everything we can to help them. We understand that every patient's individual and financial circumstances are unique, and our team is dedicated to partnering with every one of them as they navigate through the post-flight and critical care process. We have a long-established charity care process in place to allow us to reduce patient financial responsibility within our legal parameters, and our Patient Financial Counselors are here to help.  We believe that everyone deserves access to lifesaving care.

Visit our website to see the full transcript and video of Kim Downs, a parent to a former Air Methods patient, during her interview with ABC News.


Health Plan Member Satisfaction Climbs to Highest Levels Since ACA Implementation

Critical factors of health plan member satisfaction are highest in areas of the country that have more competition between different health plans according to the J.D. Power 2016 Member Health Plan StudySM .

On a nationwide basis, member satisfaction with their health plans improves nine index points in 2016, scoring a total of 688 on a 1,000-point scale. This follows a 10 point improvement in 2015. Member satisfaction with health plans reached a low point in 2014, following the introduction of the health insurance marketplace as part of the Affordable Care Act (ACA).

On a regional basis, the J.D. Power 2016 Member Health Plan Study found that member satisfaction in cost and information and communication is significantly lower in areas where one carrier holds a majority (more than 50%) of market share. Satisfaction is higher in competitive markets than in markets dominated by a single plan in cost (610 vs. 606, respectively); customer service (743 vs. 740); and information and communication (646 vs. 641).

“Competition among health plans is good for members in that it forces carriers to fight for market share, and the best way to do that is with satisfied customers,” said Greg Hoeg, vice president of U.S. insurance operations at J.D. Power. “In today’s health insurance markets, with increased legal restrictions on profitability, carriers are shifting toward member satisfaction.”

Hoeg noted that the one factor in which member satisfaction is higher in markets with less competition than in more competitive markets is provider choice within their plan (759 vs. 748, respectively). “Sometimes, having fewer, simpler plan choices makes it easier for the member,” said Hoeg. “Having dozens of plan options—such as deductibles and coverage levels—to choose from can be overwhelming.”

The Affordable Care Act (ACA) imposition of a minimum medical loss ratio has forced health insurers to compensate for slimmer margins by focusing on increasing their market share, often through mergers and acquisitions.

“Carriers are paying particular attention to cost management and economies of scale, and one way to do that is to combine with other carriers,” said Hoeg. “Competition is good for the market, but how that narrowing of the market will affect member satisfaction remains to be seen.”

The traditional plans like Blue Cross Blue Shield plans merging with other Blue plans, national deals like Aetna/Humana and Anthem/Cigna, and major market-driven acquisitions for UnitedHealthcare/Optum are all with an eye toward increased economies of scale and market power. Many have speculated that Anthem’s proposed acquisition of Cigna will harm competition and consumers by reducing the ability of other health insurers to compete with Blue plans. It appears that cost isn’t the only factor impacting member satisfaction, as satisfaction with information and communication and customer service is also significantly lower among members in less competitive markets.

Now in its 10th year, the study measures satisfaction among members of 135 health plans in 18 regions throughout the United States by examining six key factors: coverage and benefits; provider choice; information and communication; claims processing; cost; and customer service.

Overall member satisfaction averages 688 in the 2016 study, up from 679 in 2015 and 669 in 2014. The increase in satisfaction is driven by improved performance across all factors, most notably in coverage and benefits (+12 points); information and communication (+11); and customer service (+10).


  • Integrated Delivery Systems Dominate the Rankings: Health plans that utilize an integrated delivery system (IDS)—a network of healthcare and health insurance organizations presented to members as a single delivery organization—are poised for success as healthcare and health insurance become more focused on member satisfaction. Integrated plans have an average overall satisfaction score of 746, which is 63 points higher than that for non-integrated plans.
  • Premiums Declining: There is a slight decrease in the monthly premiums members pay. On average, the monthly premium for a family plan is $355 in 2016, down from $374 in 2015, while individual plan premiums are $207, down from $216.
  • Health Plans Evolve into ‘Wellness Partners’: Among the 20% of members who say they “strongly agree” that their health plan is a trusted partner in their health and wellness, satisfaction averages 837, which is 200 points higher than among the 7% who say they “strongly disagree.”

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Air Freight Makes Solid Start To 2016

Data for global air freight markets in January showing a rise in freight tonne kilometers (FTK) of 2.7% compared to January 2015. This continues the improving trend witnessed toward the end of 2015, and is the fastest pace since April of last year. The freight load factor (FLF) fell 1.8 percentage points, however, indicating that yields are likely to come under further pressure.

Total FTKs in January surpassed the previous all-time peak reached in February 2015. All regions except the smallest markets of Africa and Latin America expanded in January, but all regions reported declines in the FLF. Despite this good start, the underlying weak trade performance makes it unlikely that growth will accelerate significantly in the coming months.

“It is good news that volumes are growing, but yields and revenues are still under tremendous pressure. Air cargo plays a vital role in our globalized and fast-paced world in which trade is the foundation for long-term prosperity. Removing barriers to trade is a win-win. It will shore-up the foundations for stronger economies. And an improved business environment for air cargo will help facilitate much needed technology and process investments so that the industry will be an even stronger catalyst for growth and development. A third of the value of goods traded internationally are delivered by air. But the value of air cargo goes much deeper in the prosperity that it creates in supporting jobs and economic opportunity,” said Tony Tyler, IATA’s Director General and CEO.

Regional Analysis in Detail

African airlines’ FTKs declined by 1.4% in January compared to January 2015, and the FLF was 22.6%, down 4.8 percentage points, and the lowest of any region. The largest economies in the region, Nigeria and South Africa, are heavily dependent on energy industries and have been hit hard by the slump in global commodity prices.

Asia-Pacific carriers, which comprise almost 39% of all air freight, expanded by 1.3% year-over-year (although the international freight figure was a much lower 0.2%). The FLF fell 2.3 percentage points to 49.8%, still the highest of any region. Emerging Asia trade contracted in the second half of 2015 and in general trade to and from Asia-Pacific is weak.

European airlines’ demand grew by 2.5% in January but the FLF fell 1.5 percentage points, to 41.6%. Growth may have been flattered by the volatility and weakness seen a year ago. The growth trend for volumes looks weak for the months ahead, so there is a strong possibility that Europe could slip back into negative growth.

Latin American carriers continued the weak performance of recent months, declining by 3.6%. The FLF fell 2.7 percentage points, down to 32.9%. Brazil, the region’s largest economy, has struggled, particularly with the fall in the price of oil and other commodities.

Middle Eastern carriers resumed their strong growth trend, expanding 8.8% in January. The FLF was broadly stable, declining just 0.3 percentage points to 39.2%. The region’s airlines continue to enjoy strong growth, helped by large-scale network and fleet expansion.

North American airlines saw FTKs expand 2.5% in January compared to January 2015. The FLF was 34.6%, a fall of 1.4 percentage points. Following the spike in volumes due to last year’s West Coast ports strike, air freight from the US across the Pacific fell away. On the other hand trade with Europe, particularly imports, has increased.


AIG Announces Reinsurance Deal With Swiss Re

American International Group, Inc. (NYSE:AIG) announced that it has entered into a two-year reinsurance arrangement with Swiss Re, under which a share of AIG’s new and renewal U.S.

Casualty portfolio will be ceded to the reinsurer, consistent with the plans announced by AIG in its January 26, 2016 strategic update to investors.

The reinsurance arrangement is an important step in AIG’s strategy to improve its Commercial Insurance diversification and return on equity (ROE), and it highlights AIG’s focus on capital efficiency. This risk sharing agreement complements AIG’s leadership position as a premier provider of insurance products and services in the U.S. Casualty market.

“Swiss Re and AIG have had a strategic relationship for a number of years, and the trust and knowledge-sharing between the two companies facilitated this mutually attractive economic transaction,” said Rob Schimek, CEO of AIG Commercial. “We have been very clear about our desire to partner with our reinsurers to help achieve our strategic objectives, and this agreement with Swiss Re is an example of what is achievable with longstanding counterparties.”

Christian Mumenthaler, CEO Reinsurance Swiss Re, commented, "We are delighted to continue our long term partnership with AIG, providing solutions across their business. We know this portfolio, the leaders, and the underwriters very well and believe in AIG's plans. As a result, we are happy to accompany them on this journey by taking a significant position in this business. It's a transaction that allows both AIG and Swiss Re to improve their diversification."


$190 Trillion: Cost Of Insuring The World’s Population

The cost of insuring the world's population has been calculated at approximately $190 trillion, or roughly 2.5 times world GDP,1 according to Willis Towers Watson. The calculation, run on the Microsoft Azure cloud platform, involved an analysis of the insurance cost of providing each of the world's 7.3 billion people with a $100,000 whole life insurance policy and took under two hours.

"This was a fascinating exercise to test cloud computing and software technology to the limit and push the calculation boundaries for insurers," said Stephen Hollands, software-as-a-service and vGrid global product lead, Willis Towers Watson. "It demonstrates how industrialized risk modeling has become and how much processing power, speed and accuracy insurers have at their fingertips to price their products and manage risk and capital."

Willis Towers Watson, using Microsoft Azure Batch cloud service, ran the specialized insurance calculation with over 100,000 processing cores in approximately 90 minutes. According to the company, the calculation would have taken 19 years on a stand-alone computer with a single core. The entire exercise — including a one-off setup and configuration of the customized grid and model, in addition to running the model several times — took less than 24 hours and used data centers around the world, including Australia, Brazil, Europe, India, and Japan.

"What question is bigger for a life insurance company than figuring out the cost of insuring the entire world's population? Answering this complex question, in less than 24 hours, is a genuine technological triumph," said Jonathan Silverman, insurance industry solutions director at Microsoft Corp. "In addition, the use of just a single programming interface on Microsoft Azure to do it, regardless of the number of cores involved, shows how easy it has become to achieve a level of scalability that was until now possible only through complex coding and intense management input."

The calculation used RiskAgility FM, Willis Towers Watson's latest financial modeling tool, which is designed to run complex financial models and hyperscale-sized jobs for life insurers. It also used the company's new vGrid product, an infrastructure-as-a-service software tool that allows life insurers to run their models via an on-demand, cloud-based technology grid.

1.   With a standard deviation of roughly 15% of world GDP



Chase Templeton Scores Four With Wellbeing Health Insurance Acquisition

Private medical insurance consolidator Chase Templeton has completed its fourth acquisition of 2016 with the purchase of Manchester’s Wellbeing Health Insurance Ltd.

The deal has seen the Darwen, Lancashire, headquartered business acquire a book worth nearly £880,000 in annual premium income, of which 80 percent is generated by SME clients. 

Completion of this latest transaction follows last month’s acquisition of Leeds-based Independent Health Services and January’s purchases of Preston’s Health Equity Solutions and Caledonian Health Solutions of Kelso. 

Wellbeing was owned by Graham Harfleet who is relocating to Scotland after his wife and fellow director Elizabeth secured a new position with the Methodist Church.

 “Whilst not one of our bigger acquisitions, Wellbeing Health Insurance nonetheless brings another solid and valuable SME client book to the business,” commented Chase Templeton’s chief executive officer, Warren Dickson. “It’s a good buy which also precedes a trio of more substantial deals which are pipelined for completion between now and the end of May.” 

The acquisition maintains the momentum of the company’s aggressive buy and build strategy which was has seen Chase Templeton become the leading consolidator in the UK’s PMI sector. 

Since securing backing from Manchester finance house Palatine Private Equity, the company has completed over 60 deals, including high profile acquisition targets such as Atlas Consulting Group, Avanti Healthcare and Consilium Employee Benefits.

The company now manages policies worth over £150m and employs some 115 staff across its three UK sites.


WHO Outlines Ways To Prevent And Mitigate Childhood Hearing Loss World Hearing Day 2016

World Hearing Day is an annual advocacy event held on 3 March. It aims to raise awareness and promote ear and hearing care across the world. The theme for World Hearing Day 2016 is Childhood hearing loss.

Nearly 32 million children across the world live with disabling hearing loss. A new WHO report, "Childhood hearing loss: act now, here’s how", suggests that 60% of this can be prevented. It also highlights that if hearing loss is detected early enough, and if children receive the care they need, they can reach their full potential.

“A child who struggles to hear may also struggle to learn to speak, underachieve at school and end up socially isolated,” says Dr Etienne Krug, Director of the WHO Department for Management of Noncommunicable Diseases, Disability, Violence and Injury Prevention. “But this doesn’t have to happen. We have a range of tools to help prevent, detect and treat childhood hearing loss.”

Most childhood hearing loss can be prevented

There are many causes of childhood hearing loss. It is estimated that 40% is attributable to genetic causes; 31% to infections such as measles, mumps, rubella and meningitis; and 17% to complications at birth, including prematurity, low birth weight and neonatal jaundice. In addition, an estimated 4% results from expectant mothers and new-borns unknowingly using medicines that are harmful to hearing.

To prevent childhood hearing loss, immunizing children against diseases and regulating certain medicines and noise levels are vital.

Mitigating the impact of hearing loss

Early identification of those children with hearing loss helps to trigger the needed interventions, such as the provision of hearing devices and other communication therapies.

Hearing screening programmes for infants, and pre-school and school-based children, alongside hearing care training for health professionals, can dramatically improve the lives of children. Such programmes ensure that those in need of specialized care receive the interventions they need to be able to communicate, receive education and gain employment later in life.

Raising public awareness about ear and hearing care is another key strategy for reducing hearing loss and associated stigma around the use of hearing devices. Strengthening organizations of people with hearing loss and their families can contribute greatly to this effort.

The WHO report includes case studies from Cambodia, Canada, Thailand, Uganda, United Kingdom, Viet Nam and the United States which showcase the impact that programmes in these and other countries are having on the lives of children across the world. In settings where public health interventions, such as immunization programmes, are functioning optimally, much of childhood hearing loss is avoided. In others, early detection and treatment are key.

WHO collates data and information on hearing loss to demonstrate its prevalence, causes and impact as well as opportunities for prevention and management; assists countries to develop and implement strategies for hearing care that are integrated into the primary health-care system; and provides technical resources and guidance for planning, implementation and human resource development.


UN Secretary-General Appoints High-Level Commission On Health Employment And Economic Growth

By 2030, global demand for health care is projected to create more than 40 million new employment opportunities, mostly in upper-middle and high-income countries.

Conversely, low- and lower-middle-income countries are facing a potential deficit of 18 million health workers to achieve the Sustainable Development Goals. This will be exacerbated by the increasing trend of international migration of health workers. This mismatch poses a threat to the stability of health systems and global health security.

In December 2015, the United Nations General Assembly requested the Secretary-General to explore steps to meet the global shortfall of trained health workers, within the context of achieving Universal Health Coverage and the Sustainable Development Goals.

WHO welcomes the United Nations Secretary-General’s appointment of a High-Level Commission on Health Employment and Economic Growth, and looks forward to coordinating the Commission’s work together with the International Labour Organization and the Organisation for Economic Co-operation and Development.

The Commission will be chaired jointly by President Francois Hollande of France and President Jacob Zuma of South Africa, with WHO, ILO and OECD acting as co-vice chairs. It will start its work later this month and deliver its recommendations to the Secretary-General in September 2016.


HBF Keeps Health Insurance Premium Increases To A Minimum

HBF’s average premium increase for 2016 will be lower than the industry average for the fourth consecutive year.  

Federal Health Minister Sussan Ley today approved an average increase of 5.59% for all health funds. HBF’s average increase will is 4.94%. 

HBF Managing Director Rob Bransby said the fund had been determined to keep its premium increase low despite escalating health costs and increasing member claims. 

“As a not for profit fund our goal is simple - to keep premiums to the minimum we need to pay the claims we know our members will make in the year ahead. But doing this while health costs are climbing at the rate they are today is incredibly hard.” Mr Bransby said.
HBF’s forecasts show that claims will rise by an average of 6.4% per member in 2015/2016, and by a similar amount the following year. Hospital claims are expected to rise by over 7% per member in 2015 and 7.4% in 2016/17. 

Mr Bransby said HBF’s 2016 premium increase, which comes into effect on 1 April, had factored in promised reforms to address rising health costs.

“The Minister has said she is serious about addressing spiralling health costs, starting with the inflated prices health funds are currently obliged to pay for medical prostheses.”. 

“We’re taken her at her word and our premium increase assumes there will be significant savings in the prices we pay for prostheses in the future - savings we will pass on to our members,”
Mr Bransby said as a not-for-profit fund that had no obligations to shareholders or off-shore parent compaies HBF was free to prioritise the interests of its almost one million members.  

“This is another validation of our decision to remain as a not-for-profit fund.” Mr Bransby said.


HCF Releases Highest Hospital Claims Data Of 2015

Australia’s largest not-for-profit private health insurer, HCF, has released data detailing its highest hospital benefit payments made to members during 2015. According to the fund, most Australians would be unaware of the potential high costs associated with hospital admissions, noting there were 136 benefit payments made by HCF in the last year that exceeded $50,000 in value, and for which the member was only in hospital for one night or less.

HCF Managing Director, Shaun Larkin, said, “Despite the common view that health insurance doesn’t deliver as much value when you’re younger, our data clearly shows the benefit of health insurance for all age-groups, with high-cost claims coming from children and young families, singles, as well as the elderly.”

In the 12-month period ending 31 December 2015, HCF funded almost 31,000 hospital admissions for which the benefit paid exceeded $10,000 each. Total hospital benefit payments for these high-cost admissions came to $639 million for the year.

Notable high-cost hospital claims handled by HCF in 2015 included:

  • The highest individual claim paid was $312,000 for a 61-year old member who was treated for a heart condition and spent 90 days in a NSW private hospital;
  • Of HCF members aged 18-40 years, the highest individual claim was $110,000 for a 36-year old male in NSW who received treatment in a private hospital for psychiatric care;
  • $21,000 for an 11-year-old with acute appendicitis and peritonitis;
  • $18,000 for a 7-year-old requiring bladder surgery
  • For a new born baby, the highest claim was $129,000 for 154 days in a public hospital;
  • The highest payment for a public hospital was $147,000 for an episode of hospital care involving 211 days for a 78-year old male;
  • The most expensive single prostheses claim was $139,000 relating to spinal fusion. This correlates with a significant increase in people aged 40 to 49 years undergoing spinal fusion;
  • Of the 136 benefit payments made by HCF that exceeded $50,000 in value, and for which the member was only in hospital for one night or less, over 110 of these admissions were cardiac procedures involving an Automatic Implantable Cardioverter Defibrillator (AICD).

Explaining the reasons for such high-cost admissions, Larkin noted: “For many of these claims, the prostheses costs are a significant component. We welcome the recent announcement by the Federal Minister for Health, Sussan Ley, that a Working Group will be established to review and redesign the Australian Government Prostheses List to make it fairer for private healthcare patients.

“Currently, the cost of prostheses doesn’t stack up for members. For example, an implantable cardiac defibrillator costs Western Australia Health $19,000, while the current listed benefit on the Commonwealth Prostheses list is $52,000; that’s $33,000 more expensive. The proposed reforms have the potential to benefit members directly and we look forward to working with the Minister on them this year”.

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