A committee chartered to find ways to stop ambulances from sending patients exorbitant bills is set to tell Congress that patients should pay no more than $100 or 10% of a bill, depending on which is less.

The recommendation, which still relies on the convoluted private insurance industry, comes as nearly half of all ambulance rides in the US result in a “surprise bill” of often hundreds of dollars.

“America has decided to use an insurance system to spread the risk among many,” said Patricia Kelmar, senior director of healthcare campaigns at US Pirg, a consumer advocacy group.

“But when it comes to ambulances, without a surprise billing protection, that risk isn’t spread – the person who needs the ambulance is paying a lot more than anyone else who has that insurance.”

Kelmar was the lone consumer spokesperson on the committee formally known as the Advisory Committee on Ground Ambulance and Patient Billing. Other committee members included emergency service providers, ambulance companies, insurance industry insiders and representatives of federal agencies.

The committee was chartered when the former president Donald Trump signed the No Surprises Act in 2020 – a bipartisan bill to stop patients from receiving “surprise bills”. Although the legislation stops an estimated 10m surprise bills a year from reaching patients, ground ambulances are conspicuously excluded.

Surprise bills are in effect a dispute between insurance companies and healthcare providers. When a person takes an ambulance that is not directly contracted with an insurance company, they can bill insurance any amount they please. The remainder of the bill is then the patient’s responsibility. Hence, surprise bills are often called “balance bills”. And they can cost thousands.

For instance, Theo is a Washington state infant who arrived earlier than expected and needed to be transferred between hospitals for specialized care. The hospital ordered the ambulance, and the family was grateful for the good care.

Then the family received a $7,000 bill.

Insurance paid only a small portion – $1,000. The family tried to negotiate with both the ambulance and insurance companies, but were rebuffed. Now, they are now on a 30-month payment plan. Theo will be nearly three years old by the time the balance is satisfied.

“The hospital arranged the transportation, we didn’t have a say,” the parents said, in a presentation by Pirg. “We are grateful for the care, but surprised that even though we have good insurance we owe so much because the ambulance was out-of-network.”

Part of the reason Congress has found it difficult to regulate ground ambulances is because there are so many parties to please. Ambulances were once considered a public good and were funded by the federal government. But in 1981, the Reagan administration transformed funding for emergency medical transportation into limited block grants which states could then spend as they wish.

With federal funding diminished and states facing varying political and budget pressures, localities closed some public facilities, contracted with private companies and both began to seek payment from health insurance companies.

Now, a hodge-podge of private and public entities provide emergency medical transport, and stick patients with surprise bills as much as half of the time, according to Pirg. Privately insured Americans paid an average of $129m in surprise ambulance bills between 2013 and 2017, according to an article examining the problem in the journal Health Affairs.

Private equity has also prospered. Two of the three largest ground and air ambulance companies are now owned by private equity, which in some places has resulted in aggressive billing and collections.

“There was no discussion of whether or not we were going to ban balance billing,” said Dr Ritu Sahni, an emergency medicine doctor and a committee member at a panel discussion on their findings. “Balance billing created a barrier to good healthcare. But it was the ‘yes and’ component – how do we ensure the safety and survival of our community by making sure the future of the EMS service was secure?”

The committee coalesced around a set of recommendations to Congress that continue to rely on private insurance. They said patients with private insurance should be covered when they call 911 or are transferred between hospitals, like Theo’s family. A patient should pay no more than the lesser of 10% of a bill or $100. And, insurance should pay ambulances in a timely manner.

Although the committee published its top-line findings, the full report will not be available until it is sent to Congress, which is expected in the coming weeks. Whether Congress will act on the recommendations is unclear. Eighteen states offer some kind of consumer protection from surprise ambulance bills.

“In many ways we’re locked into the system we have and we’re trying to solve for the system we have,” said Kelmar. “But it’s a really important public policy question to know: should we keep this system? Is this the way we want to pay for emergency transportation service? Do we want private equity running ambulance services in communities?”