A Wyoming Department of Health plan that would have radically reimagined the state’s air ambulance service has been rejected by the Centers for Medicare and Medicaid Services.

“Using the Medicaid administrative structure to provide services to other individuals in the state as a mechanism to avoid the application of federal aviation law is a clear departure from the core, historical mission of the Medicaid program to provide health coverage to the Medicaid eligible population,” Calder Lynch, acting deputy administrator and director for CMS, wrote in a Jan. 3 letter to the Department of Health.

The plan, submitted in the form of a 1115 waiver to CMS last October, required CMS approval in order to be implemented, which means it is more or less dead in the water at this point, according to Sean McCallister, CEO of Johnson County Healthcare Center. Still, there is a chance that it could come back for consideration down the line.

“My sense is that the state could likely come back and apply again, but it also seems like CMS was pretty point-blank in their refusal of this particular plan,” McCallister said. “So if they do bring this proposal back, they are going to have to change their approach a bit.”

Under the proposed plan, the state would have bid out air ambulance services for the first time, letting the competitive market bring the prices down, according to the Department of Health’s policy coordinator Franz Fuchs. It would have also narrowly expanded Medicaid to cover the entire state for air ambulance services while giving Wyoming control over the number of air ambulance bases around the state.

Under the plan, the state could hire either one company for the entire state or multiple companies based on region or capabilities (helicopter vs. airplane), Fuchs said.

The DOH’s plan was an attempt to lower the costs of air ambulance services for Wyoming residents, according to Fuchs. During the summer of 2019, Fuchs claimed the costs for a flight often exceeded $36,000 due to the air ambulance services’ high upfront costs and low patient volume.

While the air ambulance companies bill patients directly, McCallister said, it was likely that the $36,000 estimate from the Department of Health was accurate.

"From my experience, the $36,000 per flight number that the Department of Health is putting out there is pretty realistic," McCallister told the Bulletin in July 2019. "And we are not the only state with air ambulances that charge those kinds of rates. When I was working in Alaska, those costs were between $50,000 and $80,000."

With the Department of Health plan rejected by CMS, it’s back to square one in finding ways to reduce air ambulance costs, McCallister said. As of now, there is no clear way to achieve that goal.

“Running an air ambulance is very expensive considering all of the equipment and staff and training involved,” McCallister said. “And it’s not just here – there aren’t any exceptions in the country. So maybe the government does need to get involved in some way. Maybe they could work directly with companies to reduce the cost.

It is as important as ever that patients have access to affordable care. But I’m not sure there’s any clear way forward on how to do that right now.”

Stephen Dow covers a variety of beats for the Buffalo Bulletin including the Johnson County Commissioners and JCSD #1. Stephen is a Billings native who joined the Bulletin in 2016.

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