AIRM
While it has yet to break out of the downtrend, the trading range has narrowed. The stock is between support at 7.80 and resistance at 8.17. A break of one of these levels forecasts the new trend. The 10 day MA has crossed over the 200 day MA perhaps with the 50 day MA following. Additionally, I see an inverse head and shoulders pattern.
(Mags, Ray, what do you guys see?)
The reason for the downtrend has been primarily earnings related as well as bad debt. AIRM cited severe weather and insurance reimbursement issues as the culprits for the earnings problems and the company has been cash flow positive.
Additionally pressure on the shares was due to the Federal Aviation Administration investigation ealier this year of the industry's rapid growth and unacceptable number of accidents. Major publications including the NY Times and the Wall Street Journal provided coverage and opinion. Copies of these articles are below.
AIRM is the largest player in this niche. There's reason for optimism that the company may benefit from the growth in their industry. They report that insurance reimbursement has improved and it is natural to expect less weather related problems in the near future than they've experienced in the past year. One insider has been buying, biz.yahoo.com
AIRM has picked up analyst coverage from C.E. Unterberg Towbin.
The roster of mutual funds with a stake in AIRM features a who's who of small cap funds
Holder Shares % Out Value* Reported
Fidelity Small Cap Stock Fund 798,751 7.26 $6,102,457 31-Oct-04
Heartland Value Fund 400,000 3.64 $2,580,000 30-Sep-04
Munder Micro-Cap Equity Fund 350,000 3.18 $2,257,500 30-Sep-04
Perritt Microcap Opportunities Fund 264,000 2.4 $2,270,400 31-Dec-04
DFA U.S. Small Cap Value Series 190,894 1.74 $1,613,054 31-Aug-04
Bridgeway Fds Inc-Ultra Small Company Market Fd 120,655 1.1 $877,161 30-Nov-04
AIRM has reported better profit margins than their competitors and is selling at lower P/S and forward PE ratios.
Heres the articles:
-------------------------------------------------------------
Air Ambulances Are Under Fire
Critics Say Emergency Medical Helicopters
Are Overused and Offer Few Benefits to Patients
By KEVIN HELLIKER and VANESSA FUHRMANS
Staff Reporters of THE WALL STREET JOURNAL
March 3, 2005; Page D1
For weeks now, federal regulators have been investigating the safety record of the air-ambulance industry, which has experienced four deadly crashes this year.
But an increasing body of evidence suggests there is a larger question to be asked about emergency-medical air transports: Do they benefit most patients?
The conventional wisdom is that air ambulances save the lives of patients who are too critically ill to withstand a slower ride in a ground ambulance. Yet some observers of the industry say medical air transports actually save very few lives -- while costing as much as 10 times more than ground ambulances. A number of published studies including research at Stanford University and the University of Texas, show that the flights often transport minimally injured patients when ground transport frequently could get them to a hospital faster, and with less risk to others.
"In 20 years of experience in urban critical-care helicopter transport, I can count on the fingers of one hand the number of times I thought flying a patient to the hospital made a significant difference in outcome compared to lights and siren," says David Crippen, an associate professor of critical care and emergency medicine at University of Pittsburgh Medical Center.
IN THE AIR
Some research on medical air transports:
• A 2002 paper showed a 24% reduction in mortality for seriously injured patients, but nearly 60% of patients actually had lesser injuries.
• A 1995 study of potential organ donors flown by transport found that an estimated 27 out of 28 would have arrived faster by ground ambulance.
Inspired by images of helicopters evacuating wounded soldiers in Vietnam, the air-ambulance industry took root in the 1970s and has grown steadily ever since. The industry fleet has nearly doubled since 1997, and patient transports are rising an estimated 5% a year, according to Tom Judge, president of the Association of Air Medical Services, a trade group.
The current probe of this year's fatal crashes, begun in January, comes as the industry has drawn increasing scrutiny over not just safety, but also efficacy and possible overuse. Also in January, the journal Prehospital Emergency Care published an abstract reporting that a study of 37,500 helicopter-transported patients determined that two of three had only minor injuries. One of four had injuries too minor to require hospital admission. "The evidence says too many patients are being flown, and yet they keep flying more," says Bryan Bledsoe, a physician who co-authored the Prehospital Emergency Care abstract.
Among other recent research critical of air-transport use, Stanford University trauma surgeon Clayton Shatney conducted a study of 947 patients flown to Santa Clara Valley Medical Center and concluded that helicopter service potentially saved the lives of only nine of them -- while potentially serving as detriment to five who could have arrived faster by ground. Travel by helicopter often is slower in urban situations, in part because of a lack of places to land. "In multicasualty situations, it has not been uncommon that ground ambulances arrive before an airship with patients from the same event," says the Stanford study, published in 2002 in the Journal of Trauma, Injury, Infection and Critical Care.
Critics say air ambulances are overused and offer few benefits to patients
To be sure, there are situations where there is little debate that medical air transport has clear benefits, such as in rural areas where patients must travel long distances quickly. Some smaller hospitals that fly patients to bigger facilities say they must err on the side of caution with a patient they aren't equipped to handle themselves. And there is research that shows a value for patients. A 2002 study, conducted by an air medical service in Boston compared patients flown with patients driven and showed a 24% survival benefit among the most seriously injured who were flown. "That's an enormous benefit," says Mr. Judge of the Association of Air Medical Services.
The cost of air ambulances varies -- generally from $5,000 to $10,000 a trip, and sometimes as much as $25,000, according to industry experts. That is typically five to 10 times as much as ground ambulance. But ground transportation also can be not just less expensive, but faster: A 1995 study of air transport of potential organ donors in Houston, conducted by trauma surgeon Christine Cocanour, found that 27 of 28 would have arrived faster by ground ambulance.
Air-transport industry leaders, including Stephen Thomas, a physician and associate medical director of Boston MedFlight, an emergency medical air-transport service, attribute the high rate of minimally injured patients to the difficulty of conducting accurate injury assessments at the scene of accidents -- especially considering that such calls often are made not by physicians but by paramedics and even police.
But the majority of air transports occur not from accident scenes but from hospitals, according to the Association of Air Medical Services and others. Frequently, doctors at a smaller hospital assess and stabilize patients before dispatching them to larger medical centers.
Insurance companies -- which often must pay for the costly transport -- say they are reluctant to second-guess the decisions of these doctors, who may view air transport as the least-risky choice for both the patient's health and the hospital's liability.
Consider the decision on Jan. 11 to fly Ryan Memering out of Memorial Hospital of Carbon County in Rawlins, Wyo. Mr. Memering had two fractured vertebrae and a deep gash inside his mouth from a car accident. Doctors at Carbon County made the decision to fly him to a larger trauma center in Casper, 120 miles away.
Hospital officials in Rawlins say that ordering the air transport was a clear-cut decision: Though the 45-bed rural hospital has a small intensive-care unit, it lacks full-time specialists for higher-level acute or trauma care. "Any time you have something out of their scope of practice, that's a liability for anyone. Do you want to take that risk?" asks Candace Hofmann, the hospital's ambulance director.
The plane dispatched to retrieve Mr. Memering attempted to land in the dark at Rawlins Municipal Airport. It crashed three miles away, killing three of four crew members on board. Not until the next day did Mr. Memering get flown to the Casper hospital, where doctors performed no surgery and released him in four days. "The staff there said Rawlins had panicked basically," says Serena Memering, the patient's wife. Her husband, she says, "feels guilty that three people died because of this. In my opinion, it was a waste of lives."
The Rawlins crash represented the third fatal accident of an air ambulance during the first two weeks of 2005, prompting federal regulators to open a probe.
Safety experts say the industry's crash record is less a threat to patients than to crew members, who if they worked 20 hours a week for 20 years would face a 40% chance of being involved in a fatal crash, according to Johns Hopkins University epidemiologist Susan Baker, a professor in the Johns Hopkins Bloomberg School of Public Health who has studied the industry. Possible outcomes of the federal probe include a requirement that pilots wear night-vision goggles. The four fatal crashes so far this year of air ambulances have killed six crew members and one patient.
Patients can end up paying for helicopter transport that wasn't medically necessary. After 9-year-old Tyler Herman fell and broke his jaw in the wilds of Arizona, doctors at a community hospital decided the boy should fly to Phoenix to undergo plastic surgery for a gash on his face. During the flight he was well enough to sit up and remark on the scenery. Upon arriving in Phoenix, he waited nearly 20 hours to undergo surgery. "We could have driven him there in four hours," says Sharon Herman, the boy's mother. Her insurance didn't cover air transport, leaving the Hermans with a bill for $25,000.
On its own, the air ambulance doesn't appear to be a huge money maker. Earnings at the industry's largest player, Air Methods Corp., climbed to $5.1 million from $3.4 million during the five years ended in 2003. But a 2003 Journal of Trauma study conducted by the University of Michigan Health System, which runs a flight service, found that flown-in patients had better insurance and generated significant "downstream revenue" because the patients developed a relationship with the hospital and often returned years later.>
--------------------------------------------------------------
<Fatal Crashes Provoke Debate On Safety of Sky Ambulances
By BARRY MEIER; STEPHANIE SAUL CONTRIBUTED REPORTING FOR THIS ARTICLE. (NYT) 1903 words
Late Edition - Final , Section A , Page 1 , Column 2
ABSTRACT - Spike in accidents, some fatal, puts spotlight on little-regulated and fast-growing medical helicopter industry; number of such sky ambulances has doubled in last decade, to estimated 700, as generous federal reimbursements and changes in payment methods attract more operators, including publicly traded corporations; emergency medical helicopters do save lives, by speeding patients to hospitals far faster than ground ambulance could and by reaching remote areas; but industry's rapid, competitive growth may be exacting toll; federal regulators and some doctors worry that pool of skilled helicopter pilots has become drained and that some of those flying are making poor decisions; also, some companies are flying older helicopters that lack instruments needed to help pilots navigate safely; 21 of 27 fatal medical helicopter accidents between 1998 and 2004 were at night and often in bad weather; National Transportation Safety Board is studying matter and will issue its recommmendations to Federal Aviation Adm; photo (M) >
-------------------------------------------------------------
Saturday, March 05, 2005
Air Ambulance Thoughts for Blaine County
I am planning to make my home in Blaine County, Idaho in the coming years. The county has one hospital, St. Luke's, which is supported by Wood River Fire & Rescue , Hailey Fire Department, Ketchum Fire & Rescue, and the Sun Valley Fire Department. (really forward-thinking on the part of the Wood River / Sawtooth Region EMS), there's been great progress in rationalizing the services provided.
For most serious trauma and some serious illness, patients in Blaine County are placed in an air ambulance (usually this service) and taken to an urban center. Now they are offering memberships...should I buy one? Hmmn. Doctor Sivertson is probably the fellow to ask.
What made me start thinking about this is these articles at A Chance to Cut is a Chance to Cure: Send the Whirlys I and Send the Whirlys II
(Text of NYT article follows):
Crashes Start Debate on Safety of Sky Ambulances
By BARRY MEIER--Published: February 28, 2005
On a mild afternoon last week, emergency workers raced up to Jana Austin's rural Arkansas home to ask if a medical helicopter could land on her property to transport a victim of a car crash to a nearby hospital. Ms. Austin, a nursing student, said she readily agreed. But moments after the helicopter took off, she and her 4-year-old daughter stood stunned, watching as the helicopter began to spin, slowly at first, then faster, until it twirled out of control into a nearby pasture. The patient died, and the three crew members were seriously hurt.
The accident, whose cause is under investigation, was hardly isolated. In January, a medical helicopter plunged into the Potomac River in Washington, killing the pilot and a paramedic. In less than two months this year, four people have died in four accidents. Last year was a particularly deadly one for flight crews and patients, with 18 people killed in 11 accidents, the highest number of deaths in a year in more than a decade, according to federal regulators and an industry group.
The spike is putting a spotlight on a little-regulated and fast-growing sector of health care: the medical helicopter industry. There are an estimated 700 medical helicopters operating nationally, about twice the number flying a decade ago.
Medical helicopters were once nearly all affiliated with hospitals. But more generous federal reimbursements and changes in payment methods have attracted more operators, including publicly traded corporations and smaller concerns that in some cases set up outposts and market their services to rural emergency units and even homeowners.
Emergency medical helicopters do save lives, by speeding some patients to hospitals far faster than a ground ambulance could and by reaching remote areas. But the industry's rapid, competitive growth may also be exacting a toll. Federal regulators and some doctors worry that the pool of skilled helicopter pilots has become drained and that some of those flying are making poor decisions. In addition, some companies are flying older helicopters that lack the instruments needed to help pilots navigate safely. Of the 27 fatal medical helicopter accidents that occurred between 1998 and 2004, 21 were at night and often in bad weather, according to federal statistics.
"You need to raise the bar and say this is where the bar is," said Dr. Scott Zietlow, the medical director for the helicopter program at the Mayo Clinic. "If you can't get over it, you can't fly."
Last month, the Federal Aviation Administration, after a meeting with helicopter operators, proposed steps to improve flight safety. They included helping pilots assess risks and providing them with up-to-date electronic equipment.
Separately, the National Transportation Safety Board has been examining medical helicopter safety and plans to issue recommendations to the Federal Aviation Administration, a safety board official said.
Initial reviews by the aviation agency and the safety board indicate that pilot error was to blame in many of the recent accidents. A report in 1988 by the board, which came after a string of accidents in the preceding years, found that medical helicopters were crashing at a rate three times higher than that of other helicopters. At that time, the safety board made a number of recommendations adopted by the aviation agency, including better pilot training, particularly for flying in bad weather.
Executives of medical helicopter companies and trade groups said they were greatly concerned by the rising accident numbers but added that the figures might simply reflect the fact that more helicopters were flying, rather than an increase in the accident rate.
The executives said they could not be sure a trend existed because the industry had been operating without a system to track its total flight hours, a standard measure for assessing air deaths.
Under pressure from regulators, company officials say they hope to have such a database in place by late spring, and several asserted that they were not pressuring pilots to take on dangerous missions.
"We are seeing the number of accidents creeping up, and we need to be able to understand what the factors are," said Tom Judge, executive director of Lifeflight of Maine, owned by two health care systems there.
The growing concerns about medical helicopter safety are unfolding alongside a long-running debate over whether many such flights are medically necessary. The cost of a medical airlift typically ranges from $5,000 to $8,000, five or more times that of a traditional ambulance. Private health plans and some public ones, like Medicare, cover air services, at least in part.
There are about 350,000 medical helicopter flights annually, with about 30 percent involving calls to accidents or other emergencies, according to the Association of Air Medical Services, a trade group in Alexandria, Va. Most other flights involve the transfer of patients between hospitals.
As recently as a decade ago, medical helicopters were generally operated directly by hospitals and emergency service units or run under arrangements with aviation companies, including publicly traded ones like the Air Methods Corporation and Petroleum Helicopters Inc., which provided the helicopters and pilots.
But industry officials said the business began to change in the late 1990's when the federal government required hospitals to charge separately for ambulance services, including airborne ones, rather than bundling such costs in bills paid by all patients. In addition, Medicare, in adopting a national fee schedule, increased reimbursement rates for air ambulance flights in some regions.
As a result, many hospitals decided to abandon their helicopter operations, and for-profit companies saw an opportunity.
Mr. Judge, the Lifeflight of Maine official, said some studies suggested that 20 percent of patients transported by air might have died from injuries or illnesses had they not been flown.
But Dr. Bryan E. Bledsoe, a former emergency room doctor who lives in Midlothian, Tex., a suburb of Dallas, said 14 medical helicopters operated within a 75-mile radius of his home. "The problem is that there is not that much of a need," said Dr. Bledsoe, a critic of the air-ambulance industry.
Another significant area of industry growth involves companies that are not connected to hospitals but instead set up helicopter bases in rural areas and then market their services to local hospitals, emergency officials and, at times, homeowners.
For example, Air Evac Lifeteam, which started 20 years ago with a single base in West Plains, Mo., now has 43 sites in 10 central states. For $50 a household, homeowners receive a company membership guaranteeing that Air Evac Lifeteam will not seek additional payment from them beyond what an insurer will pay. Over 150,000 households are signed up, Air Evac executives said.
The splintering in the way the industry operates has led to a hodgepodge of standards. For example, the Mayo Clinic, which gets its craft and crews from an aviation company, requires pilots to have 5,000 hours of experience and uses only twin-engine helicopters. Air Evac requires pilots to have 1,500 hours of flight time before hiring them and uses older single-engine craft.
"There is a wide variation in self-imposed standards," said Mr. Judge, who is also president of the industry's trade group.
The Arkansas accident a week ago involved an Air Evac Lifeteam helicopter that had just been refurbished after spending 20 years ferrying workers and supplies to oil rigs. Colin Collins, the company's president, says that it uses only Bell model 206 helicopters like the one that crashed in Arkansas because they have an excellent safety record and are relatively simple to maintain.
Local emergency officials said that the Arkansas car-crash victim, Robert Arneson, 71 of Harlingen, Tex., had a gash on his forehead but was stable and alert when taken by ambulance to a field for helicopter transfer.
It was about 20 air miles, or a seven-minute flight, from the crash site, a trip that would have taken about 45 minutes by ground. But because emergency workers had to locate a landing site, nearly an hour elapsed, officials said, after the first emergency call and before the helicopter took off.
Mr. Collins said he expected the National Transportation Safety Board to release its preliminary findings as early as tomorrow.
In the last 12 months, Air Evac Lifeteam has had two fatal crashes. Other companies have also had troubles. In January, Air Methods, the industry's biggest operator, had two fatal crashes, including the one in Washington. Both operators said those incidents involved their first deaths in many years.
Even company executives acknowledge that the industry's rapid growth may be outpacing the pool of experienced pilots.
Mr. Collins said most of his pilots a decade ago were Vietnam veterans, but the majority have retired, and fliers coming out of the military now are not interested in helicopters.
While company executives said pilots were not being pushed to fly, industry critics and federal regulators are concerned about whether pilots are making the right judgments or have the right information and equipment to base them on.
Last summer, emergency officials in South Carolina summoned a helicopter to transport a woman found seriously injured beside a highway. But the first helicopter, which was based in Columbia, S.C., about 50 miles southeast of the accident, aborted its mission four minutes after takeoff with the pilot citing fog and deteriorating weather conditions.
The next two helicopter crews contacted also refused to fly, citing the weather. Officials called a fourth helicopter, in Spartanburg, S.C., which agreed to fly, arriving about an hour after the accident. The helicopter, which was owned by the Med-Trans Corporation, picked up the victim and crashed shortly after takeoff in a nearby national forest. All four people aboard were killed.
The South Carolina crash remains under investigation by the National Transportation Safety Board, and Jeffrey B. Guzzetti, its deputy director for flight safety operations, said the agency was reviewing the pilot's decision to fly.
Reid Vogel, a spokesman for MedTrans, based in Bismarck, N.D., said the company could not comment on the accident because of the federal investigation. But Mr. Vogel said the company's flight team had thoroughly checked the weather that day.
In last month's notice, the Federal Aviation Administration, citing the industry's rapid growth and an "unacceptable" number of accidents, suggested that operators increase the use of technical aids like radar altimeters, night-vision goggles and terrain awareness warning systems, among other things.
In addition, it recommended that companies emphasize a "safety culture" and also improve systems that will give pilots better information about changing weather conditions while they are in flight.
Company officials said they were working with regulators to find solutions.
"I think there is a lot of concern within the industry in terms of what it would require in terms of retrofitting helicopters," said Dr. Zietlow of the Mayo Clinic. "The anxiety is that this can't happen with the medical industry overnight."
Stephanie Saul contributed reporting for this article.
lizditz.typepad.com |
