Expiring subsidies for Medi-Cal patients threaten REACH and other air ambulance services

Air ambulance services that provide a critical lifeline to sick and injured people in remote areas of the North Coast are warning they could be forced to cut services sharply unless the Legislature replaces subsidies that are scheduled to expire at year’s end.

As many as one in four medical aircraft bases around California could be shuttered within 12 months if funding for Medi-Cal air transport patients is not included in the 2019-20 budget or extended through backup legislation pending in the state Senate, an industry representative warned last week.

The system cannot sustain itself without the subsides for Medi-Cal patients, who account for nearly 40% of the state’s medical air transports, said Christian Giller, president of the California Association of Air Medical Services. Currently, the transports are subsidized by a $4 fee assessed on most traffic tickets issued in California since 2010. The fee is set to expire at the end of the year, when, absent legislative action, the reimbursement rate will roll back to 1993 levels, minus a 10 percent reduction made in 2013, in the wake of the last recession.

North Bay legislators are scrambling to replace the funding in budget negotiations.

“We need this funding, and we need it now,” said Assemblyman Jim Wood, D-Healdsburg, who co-authored a contingency bill with state Sen. Bill Dodd, D-Napa, and lead author Tim Grayson, D-Concord, that would supply the funding if it’s not in provided in the budget.

Even with the subsidies, Medi-Cal reimbursements don’t cover the average $25,000 cost of a medical air transport, said Giller, who is also director of business development and government relations for REACH Air Medical Services, which was founded and headquartered in Sonoma County until the October 2017 firestorm, when its central offices were moved to Sacramento.

Thus the statewide system of about 70 emergency air ambulance aircraft will inevitably have to shrink, making medical air transports less available, Giller said.

“They’re very needed services and, unfortunately, there’s no other remedy for the government, for example, to come in and say, ‘OK, then we’ll stand up those bases when you lose them,’ “ Giller said. “So we’re going to do everything we can, but it’s going to be very challenging for the state of California.”

It’s still possible for the state Conference Committee on the Budget to put $16.9 million in next year’s general fund to help cover Medi-Cal air transports, as currently requested. But time is running out, and legislators already are behind schedule in their bid to get a spending plan to the governor in advance of next Saturday’s constitutional deadline.

As of Friday, the appropriation, requested for each of the next three years, was still not included in the proposed budget. Wood and five rural lawmakers have implored the budget committee chairs to reconsider the matter.

Supporters say air ambulance service is essential to the statewide emergency management system, both in terms of linking individual patients to critical care units, including specialty neonatal, burn, trauma and children’s centers, but also during large-scale emergencies.

During the Carr fire in Redding last year, for instance, medical aircraft were used to evacuate newborns and their mothers to UC Davis Medical Center in Sacramento. Air ambulances also transported injured firefighters and residents to regional burn centers, Giller said.

But day-to-day, air transport aircraft, both fixed wing and rotary blade, are more likely to be moving a patient from a basic, community hospital to a more specialized setting or picking up someone - say, an accident victim - in the field for speedy delivery to an emergency room, Giller said.

“We’ll do everything in our power not to close bases,” he said, “because we have them placed in all the rural areas, where they’re needed.”

Cuts in service would particularly hurt residents of remote areas on the North Coast and other scattered rural communities around California who depend on emergency aircraft to bridge the distance between home and urban centers with trauma or specialty care.

“We’ve got ground ambulance, but we rely on it (medical air ambulances) here on the coast, with one of the longest transports in California,” said Evan Dilks, operations manager of Gualala-based Coast Life Support District. “We have two hours to get to an ER, generally.”

Air transports are essentially airborne intensive care units, staffed and equipped to provide critical care level service to the most seriously ill or injured patients, Giller said. That’s particularly important to patients with traumatic injury, heart attack or stroke, where prompt attention can make the difference between life and death, emergency providers said.

“Air ambulance service is extremely critical,” said Theresa Gowan, operations manager for Medstar Ambulance of Mendocino County, which runs three ground ambulances serving inland Mendocino County, including the communities of Hopland, Ukiah, Willits, Covelo, Laytonville and Anderson Valley.

Ground ambulance providers in rural areas are commonly dispatched at the same time as medical aircraft and may hand off a patient in the field for faster delivery to high-level treatment facilities.

If they’re needed on the coast, where fog is common, they can’t always respond, which happens probably 30 percent of the time, said Dilks, with Coast Life Support, which serves an area stretching from Irish Beach on the Mendocino Coast to Fort Ross, and inland almost to Boonville and Lake Sonoma.

Even so, the district transports someone by helicopter about seven times a month, or 84 times a year on average, he said. Another 40 transports a year are made directly from walk-in traffic at the local urgent care clinic, he said.

“Airships are part of our operations on the coast,” Dilks said. “We’ve got tourism, so we’ve got traffic along Highway 1. We’ve got a two-lane highway in and out. So we’re going to use a helicopter on a higher percentage, due to that long transport.”

In addition, there is often only one ambulance staffed, sometimes two during daytime hours, and sending a patient to Santa Rosa by ground means losing that ambulance for six hours or so, he said. Using an aircraft means keeping that vehicle on the coast, and saving a life due to the faster arrival at a hospital, Dilk said.

“If we lose air ambulance service, it would be a real hardship,” Timber Cove Fire Chief Erich Lynn said.

REACH, a once-local company now merged with CALSTAR and other providers, controls about 30 air ambulances in California and runs about four trips a day in Sonoma County, with bases in Sonoma County, Napa, Lakeport, Ukiah and Willits, Giller said.

About 60 percent of its transports are hospital-to-hospital, while the remainder involve “scene flights,” where a patient has suffered a cardiac incident, stroke or an accident, Giller said.

Nearly 40 percent of patients are Medi-Cal recipients, many of them infants born with congenital problems or injured during birth, he said. Air ambulance providers serving children’s hospitals sometimes find that more than 70 percent of their patients are insured by Medi-Cal, according to state analysts.

But between Medi-Cal and Medicare recipients, “nearly half of the transports that we do every day we don’t cover the costs for it,” Giller said, “and that’s not just for REACH. That’s an industry norm.”

After years of unchanged Medi-Cal reimbursements rates, the state began to collect $4 from each moving violation ticket in 2010 to help reimburse Medi-Cal transports under the Emergency Medical Air Transportation Act, which was extended several times. Wood, whose district spanning from Santa Rosa to the Oregon border is largely rural and remote, co-authored the last extension, which was vetoed by Gov. Jerry Brown. Brown said he wanted Medi-Cal reimbursements to be part of the budget negotiations, not imposed with traffic citations, an argument others had raised, as well.

But a request earlier this year to include $25 to $30 million in the general fund got dropped during committee hearings with many other items, legislative staffers said.

Lawmakers like Wood are now asking for $16.9 million during each of the next three years. Barring that, they have introduced legislation already passed unanimously by the Assembly that would raise Medi-Cal air transport rates by about the same margin, as a percentage of Medicare levels.

“Ensuring air ambulance service is available to all Californians is absolutely critical,” Dodd said.