| ▲ | gruez 5 hours ago |
| As much as I like articles that tries to use economics or finance to explain stuff, the "options" analogy is a bit hamfisted. The article starts off by noting about how ambulance is an "option" for a rescue, but even though the analogy might vaguely work, it's not really needed to answer the question. That can be answered far more simply: "medicare and insurance companies pay them too little, so they have to charge everyone else more". Or, from the article: >This meant that the payment structure and the cost structure were increasingly mismatched: and so ambulance services had to pay for their round-the-clock readiness by billing for individual rides. [...] >And notably, the fees that Medicare sets run far below cost. The average ambulance transport costs $2,673 to provide; Medicare pays only about $329 of that. A typical ambulance ride for a Medicare patient, in other words, loses theambulance service thousands of dollars. |
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| ▲ | jjk166 4 hours ago | parent | next [-] |
| > The average ambulance transport costs $2,673 to provide I think this ignores the 400 pound gorilla in the room. Why does an ambulance transport cost thousands for the operator? This is a short trip in an automobile, essentially a fancy uber ride. At first one might say that's flippant - obviously ambulances are specialized vehicles, and you have paramedics, and they need to get to locations quickly, and so forth, but let's consider those costs. A new, fully equipped ambulance is about $150k. Of course this is more than a regular car, but by a factor of 5, not 50. Let's be generous and presume the ambulance fully depreciates in 2 years. Typically an ems crew will be two paramedics. Average paramedic wage is about $23/hr. Again, not orders of magnitude more expensive. Then you have liability, both for the vehicle and for the medical treatment; that's about $12k per year. Throw in money for gas and wear and tear, which should be quite comparable to other automobiles, and it costs about $1600 to own and operate an ambulance for 24 hours. Now the other side of the equation is utilization. Taking the arbitrary example of Philadelphia Fire Department, they have 60 ambulances that handle on average 700 ems calls per day, and approximately 70% of ems calls lead to transport, so that's about 8 transports per ambulance per day. So distributing this all out, the actual cost to the ambulance operator, ignoring overhead, ought to be somewhere around $200. I'm sure there are some additional costs I haven't included in this back of the envelope calculation, and maybe some of the numbers I pulled off google are off a bit, this should be taken as a very rough estimate. But even if you significantly increase the cost, the medicare payment amount seems quite reasonable to cover the expenses with a healthy profit margin. Unless you want to claim that operating an ambulance is less than 10% of the cost of ambulance transport, and that the estimators with Medicare are absurdly out of touch with reality, whence cometh $2,673? |
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| ▲ | justonceokay 3 hours ago | parent | next [-] | | There’s the cost of supplies used during transport. Also the cost of maintaining potential supplies like blood even if they go unused. EMTs may make $23 but they are also getting benefits and have other overhead, making their real hourly cost probably closer to $50/hr minimum. There’s insurance, which I bet is out the wazoo expensive for ambulance. Ambulances have to be maintained and I would guess have much more regular service than your car at home. Ambulances have to be stored somewhere and secured-access parking isn’t cheap. Many ambulance rounds-trips can be well over an hour considering so many of us live far away from urban centers. Is it $2600? Probably not. But I think you are low-balling pretty significantly. Put another way, just getting a plumber to vibe to your house is gonna cost you $200 easy. It’s within reason that an ambulance ride might cost much more than that. | | |
| ▲ | Spooky23 an hour ago | parent | next [-] | | EMTs are like veterinarians. Lovely people who get ruthlessly exploited. Benefits are garbage unless you’re a unionized public employee. | | |
| ▲ | wombat-man an hour ago | parent [-] | | Yeah, every EMT I know was way underpaid for how crazy stressful it was. Especially considering how expensive the ride was | | |
| ▲ | jmcgough 36 minutes ago | parent [-] | | EMT now is often used as a stepping stone to a career with a liveable wage, like physician. |
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| ▲ | khuey 3 hours ago | parent | prev | next [-] | | I don't disagree with what you're saying but I want to point out that it's rather unusual for (American) ambulances to carry blood, and probably more of them should. https://www.redcross.org/about-us/news-and-events/news/10-wa... | | |
| ▲ | FireBeyond 2 hours ago | parent [-] | | Correct. The only ambulances that typically will stock blood are specialized NICU ambulances and HEMS (helicopter). Although more progressive agencies are looking more and more at part blood products. |
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| ▲ | michaelmrose 7 minutes ago | parent | prev | next [-] | | Most people live in urban environments. Approaching zero are over an hour. As with most people being in urban environments most ambulance rides are in urban environments and go to the nearest hospital meaning that most rides should be under 10 minutes. There is zero reason to compare cost of ambulance rides to a plumber and "vibe" on how much more expensive an ambulance ride instead of actually looking at the component costs. They aren't remotely related and one tells you nothing about the other. Both the actual analysis you responded to and this one are also missing the fact that the ambulance is already subsidized and that usage fees aren't actually paying for the ambulance which makes the fees charged more onerous yet. It might be instructive to look at what Canada charges non-residence as non-residents pay the unsubsidized rate of about $400-$600 Canadian. https://www.cma.ca/resources/healthcare-real/answers/healthc... | |
| ▲ | jasonjayr 3 hours ago | parent | prev [-] | | TIL getting an elevator tech to just come out to look at your building's elevator is about $1600. If it's an easy fix, that's all you need to pay. If it's not, it goes up significantly.... | | |
| ▲ | LanceH an hour ago | parent | next [-] | | He wouldn't be much of an elevator repairman if it didn't go up considerably. | |
| ▲ | cheesecakegood 2 hours ago | parent | prev | next [-] | | To be fair, if you pay the repairman, your elevator also goes up :) | |
| ▲ | MichaelZuo 2 hours ago | parent | prev [-] | | Don’t they need to sign something legally binding, the moment they adjust even one minor internal part? |
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| ▲ | Insanity 3 hours ago | parent | prev | next [-] | | +1. The base price for US healthcare is entirely removed from the cost of the service provided. And you can of course just look at other countries to figure out that the cost is much higher than it should be. | |
| ▲ | cogman10 3 hours ago | parent | prev | next [-] | | I think the main expense you are missing is medication and disposable equipment and insurance for the ambulance and medical malpractice. Otherwise, yeah, I suspect the other major cost is the "It's the mayor's brother's business" cost and the "private equity has figured out how to extract maximum value" cost. That said, there's no reason the patent should be charged anything. It should be entirely a tax burden of the citizens. It's crazy to make some decide between death and crippling debt. | |
| ▲ | socalgal2 an hour ago | parent | prev | next [-] | | You forgot the cost of insurance when you get sued by the passengers or when you get into an accident since you're racing down the road hoping people are paying attention and get out of the way. No idea what it costs but it's arguably more than an uber driver. 2x? 5x? There are a ton of other costs. You're not paying for one employee. You're paying for many since ambulances run 24/7. They are also driven hard which means they require more maintenance. The ambulance is also full of expensive equipment and supplies. My LLM of choice says it actually costs $1000-$2500 per ride to the company for operational costs on top of per-ride costs. You can probably ask one for a breakdown and see if it makes sense to you | | |
| ▲ | indoorfish an hour ago | parent [-] | | "My LLM of choice" is like when the news reporter says "confirmed by someone not authorized to speak publicly". It's not a meaningful report. | | |
| ▲ | failbuffer 27 minutes ago | parent [-] | | Your point about LLMs aside, I'd trust the inside source over whatever carefully baked misrepresentation the PR department doles out. |
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| ▲ | harmmonica 3 hours ago | parent | prev | next [-] | | Probably an obvious/dumb thing to say on HN, but I just want every medical service to have this exact type of breakdown. And then we can at least somewhat pierce the veil of health care costs. The thing I can't figure out is why this doesn't already exist, or, if it does, why it's not more widely known amongst laypeople. Everything from ambulance rides to MRI's to surgeries can be baselined and then we can talk about unique situations that can push that baseline price higher, but at least have a baseline. Seems like a good thing for an LLM actually if you could trust it. As to your specific $200 quote, which others have attempted to refine, it can't be a coincidence that you come up with that number and the Medicare number is $300+, which, if your $200 is even somewhat accurate, seems like a perfectly fair gross margin on what's being delivered. Imagine if the government actually reimburses for cost plus a decent profit margin! Unthinkable the gov could somehow be accurate in their reimbursements. Edit: spelling | |
| ▲ | somat 2 hours ago | parent | prev | next [-] | | It may also be telling to figure out why no startup is offering $400 ambulance rides and dominating on volume. | |
| ▲ | bandrami 15 minutes ago | parent | prev | next [-] | | We had to move my non-ambulatory[1] father from Mississippi to Virginia a couple of months ago. The vehicle probably didn't have all the staff and equipment of an ambulance but it did have an RN, a crash cart, and some other expensive crap that goes "ping". The cost was $3K for an 800 mile trip (slightly more because I included the "snacks and a DVD player" package). [1] Oh, holy crap, I just got why ambulances are called that | |
| ▲ | bombcar 2 hours ago | parent | prev | next [-] | | You can get an ambulance for only $150k? A transit van with a few options is already $75k. | |
| ▲ | tmnvix an hour ago | parent | prev | next [-] | | An interesting take on the relative differences of manufacturing (and purchasing) an ambulance in the US and China: https://www.youtube.com/watch?v=8JcCISp5S64 | |
| ▲ | FireBeyond 2 hours ago | parent | prev | next [-] | | > Typically an ems crew will be two paramedics. Average paramedic wage is about $23/hr. Paramedics and EMTs aren't the same thing. Private ambulance crews running "dual ALS (advanced life support, i.e. paramedics)" are _exceptionally rare_. Normal staffing is Paramedic and EMT, and most often there are crews that are dual EMT. Average EMT wage is actually about $18/hr (and in much of the south you can be looking at $15-16/hr). However where wages do go up, but not in a good way, is overtime. The agency I worked would happily schedule you for 36 or 48 hour _shifts_ and had no weekly hour limit beyond "You must take an 8 hour break after 60 hours of shift", I kid you not - and many people will regularly work 72-96 hour weeks. The big thing is that private EMS writes off a lot of bills and pushes the balance on everyone else. The holy grail for private EMS agencies is "inter facility -out- of a hospital", as oftentimes the hospital pays the ambulance bill and charges the patient. You also have to be careful looking at FD provided _transport_ as billing for this is often subsidized by property taxes. There are FDs who will charge for treatment and for transport, for transport only (not for treatment), or for neither (my FD did not charge - but there were also differing policies on when we transported, not by default, so you had people literally - and understandably - peeking out their window to see if it was a red FD ambulance/medic unit outside, or a white private ambulance). Even above and beyond that, there are a LOT of disposable costs you never recoup. Bedding, blankets, gloves, etc. > This is a short trip in an automobile, essentially a fancy uber ride. That is a little flippant, as you acknowledge... good way to offend any paramedic or EMT. I've delivered babies en route to a hospital, including breeches. CPR. Emergency airways. > A new, fully equipped ambulance is about $150k. Not any more. Thanks, private equity. You can easily be looking at $400K. And they are vehicles that are driven hard, and cold, and maintenance sucks as a result. No warm up times for engines. Private ambulance, it's common to see rigs with 300,000+ miles on them. > Then you have liability, both for the vehicle and for the medical treatment; that's about $12k per year. Not for the medical treatment, no. You can get insurance privately as a paramedic but those policies are generally excess/umbrella style or are specifically "occasional only". The last private agency I worked at with a dozen paramedics and 50+ EMTs had at least mid 6 digit insurance bill. > Throw in money for gas and wear and tear, which should be quite comparable to other automobiles For a vehicle that can weigh 10,000lb+, that gets started and stopped often 30 times a day, a lot of time driven "foot to the floor" with an attitude of "it's got to get where it needs to go"? No, although one of the first thing any halfway decent sized agency quickly learns to build out is its own full shop and multiple mechanics (my friend is the Head Mechanic at a local county fire agency and oversees 8 FT mechanics and an auto electrician). This jumped around a lot, I apologize, and I don't mean to shout you down, at all, but, lest you think I'm defending this state of affairs, I am not, in no way, shape or form. | |
| ▲ | Spooky23 an hour ago | parent | prev | next [-] | | Ambulance crews are almost never 2 paramedics. Most often they transport and do BLS only. If they are it’s because a local government is paying for that service. EMTs make minimum wage. The people who own ambulances typically have a little cartel like business in a region and print money. They refuse to sign insurance contracts so they are almost always out of network and will not accept direct insurance payments. When my wife had cancer, she ended up at a hospital that didn’t have the services she needed becuase the ER was full at the trauma center hospital. I was able to arrange a transfer, and paid $1800 for a drive that was approximately 12 city blocks. We had to do that to avoid a complication with hospital admission and coverage. The crew was cool and we did get to honk the siren. Air ambulance is worse. | | | |
| ▲ | 3 hours ago | parent | prev | next [-] | | [deleted] | |
| ▲ | 3 hours ago | parent | prev | next [-] | | [deleted] | |
| ▲ | mlsu 3 hours ago | parent | prev | next [-] | | Ah, but you forgot private equity, that's about $2473 of profit per ride that needs to be accounted for. This high cost is what we must pay to keep our economy dynamic and efficient. | | |
| ▲ | indoorfish 2 hours ago | parent [-] | | IKON passes don't grow on trees you know.. Someone has to rent out in Aspen. |
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| ▲ | tbrake 2 hours ago | parent | prev [-] | | > This is a short trip in an automobile, essentially a fancy uber ride. We need a regulatory body that can fine people for making analogies this bad | | |
| ▲ | delichon 2 hours ago | parent | next [-] | | > We need a regulatory body that can fine people for making analogies this bad We need a communal agreement to apply social opprobrium upon people who reflexively propose to solve trivial problems by imposing their will on other people. Tsk-tsk. | |
| ▲ | pasquinelli 2 hours ago | parent | prev [-] | | i mean their job is transporting people. |
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| ▲ | gerdesj 4 hours ago | parent | prev | next [-] |
| Given you find this is _normal_ for a six mile ambulance ride: "and $11,670 as a “base rate.”" What on earth would you consider normal for a helicopter ride from Exeter to London? That's roughly 150 miles as the crow flies. Pilot, co-pilot and a medic, minimum crew for say 1.5 hours. Each way, so 300 miles of fuel and aircraft lifetime and three hours of crew cost, not to mention ground crew etc. My dad got that on the firm when the shit hit the fan and he needed to be seen by specialists in the Royal Brompton and Royal Devon and Exeter decided that was his best shot at life. That was 15 years ago. Anyway, the OP's bill looked pretty normal until the 11,000 base rate nonsense. How can that possibly be justified? |
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| ▲ | gruez 4 hours ago | parent [-] | | > How can that possibly be justified? They can't make money on some customers (medicare/insurance), so they have to make up the difference however they can. In practice this means screwing over the people who have assets to seize. | | |
| ▲ | 37 minutes ago | parent | next [-] | | [deleted] | |
| ▲ | joe_the_user 2 hours ago | parent | prev [-] | | This thread is filled with strong arguments that ambulence operators do make money with medicare. But even more, it's completely false that the reason an ongoing, working business charges a huge price to some people is that some other people are taking money from them. A business charge people huge prices when it can. Businesses make as much money as they can. It is true that what health care providers charge individuals tends to be their "opening offer" to insurance companies so they do make this exact argument "we gotta make all our profits on you 'cause everyone else is denying us" but that doesn't make such arguments any more reasonable. |
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| ▲ | arjie 2 hours ago | parent | prev | next [-] |
| You’re right. The cost of the service not matching the direct cost is something we’re familiar with - that’s just fixed cost and entirely normal (happens with books, movies, etc). This just happens to be the case where you must transport people but most people are net losses. In this scenario, the only surviving companies would be those who charge the remainder sufficient enough that the blended population of clients causes a net pay-in. Everyone who doesn’t account for that will just go out of business. Being available constantly could be helped with a retainer, it’s true, but even with that we should expect that some patients pay a lot if they’re rarer than the loss-makers. |
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| ▲ | Spooky23 an hour ago | parent [-] | | That’s wrong. The poor people who don’t pay are Medicare and Medicaid patients, and both pay for medically necessary transportation. Those calls essentially cover the base business expenses. |
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| ▲ | Noumenon72 5 hours ago | parent | prev | next [-] |
| "Medicare pays too little" is based on the "fee for service" model; it only makes sense if you believe the group of people who actually use the ambulance should pay its full cost. The options model matters: if you model an ambulance ride as a roulette wheel, you only expect to pay if you get very unlucky. If you model it as an option, you expect to pay even if you never use it. The former doesn't imply "everyone else should have to pay for my bad luck"; the latter does. It's effective persuasion. |
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| ▲ | gruez 4 hours ago | parent [-] | | >The options model matters: if you model an ambulance ride as a roulette wheel, you only expect to pay if you get very unlucky. If you model it as an option, you expect to pay even if you never use it. There are plenty of services that have high fixed costs but low marginal costs, but we don't use the "options" framing. A movie costs tens to hundreds of millions to make, but otherwise costs very little to deliver. Their price are also fixed, rather than dynamically priced. Yet when a movie bombs, nobody is like "wow I guess they shouldn't have been selling an option for 2 hours of entertainment for $20!". It's a price problem, first and foremost, caused by insurance companies and medicare strongarming them. | | |
| ▲ | Noumenon72 4 hours ago | parent [-] | | I don't think you fully grasped the concept of an option, which is why it isn't illustrative for you; no one is purchasing the right to see a movie regardless of how much it turns out to cost to show. It's the movie maker that would love to buy an option that makes you promise to buy a ticket, even if the movie turns out bad. | | |
| ▲ | gruez 4 hours ago | parent [-] | | >I don't think you fully grasped the concept of an option, which is why it isn't illustrative for you I perfectly do know what an option is. It's just not relevant to the discussion, or at least not necessary. If you're selling a service that costs $2k of amortized costs to provide for $300, because that's all medicare/insurance companies are willing to pay, that's not a problem because you're offering options, it's an issue because you're charging too little. You're losing money because the numbers simply don't pencil out, not because you sold a bunch of options and sharp jane st traders cleaned you out. In any other situation where you're charging less than what it costs to provide, people just call it "bad business model", not "you're selling options" or whatever. |
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| ▲ | JumpCrisscross 3 hours ago | parent | prev [-] |
| > As much as I like articles that tries to use economics or finance to explain stuff, the "options" analogy is a bit hamfisted Idk, my takeaway is ambulances look like a solid market for a subscription model. Ideally, one that taxpayers pay for. But also, potentially, as a private one that you can pay e.g. $50/month to know you won't be billed $12,000 by idiots. |
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| ▲ | FireBeyond 2 hours ago | parent | next [-] | | One thing I'd like to point out, many of the Airlift companies, like Airlift Northwest, offer $60/year family insurance for Heli EMS. They'll bill your insurance and accept the insurer's payment as "Paid in full". They also tend to have reciprocal agreements with many other HEMS agencies. | |
| ▲ | mekael 2 hours ago | parent | prev [-] | | At the end of the day doesnt that just end up being universal healthcare but with more steps? |
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