Posted 3 years 334 days ago ago by jhadmin
I have just finished a day's contract flying and am now driving back home on a four-hour trip. I’m a little fatigued, but mostly just bored. I need new energy in the car. Fortunately, I have a phone interview scheduled to begin now with Don Wharton, REACH Air Medical Service’s director of business development. With both cruise control and phone speaker on, I start my phone's voice recorder and make the call. Wharton answers and his enthusiasm immediately comes flooding into my car—goodbye boredom!
I ask him, "In your own words, what's the Reach mission?" Without hesitation, Wharton replies, "Right across the ranks, it's our obsessive focus on safe and efficient transportation of our patients and always doing right by them in every situation. Depending on the situation, sometimes we substitute the word 'patient' with community, partner, or customer, but we are committed to the high-road process that produces the best result."
If you’re a pilot or medical crew member flying helicopter air ambulance (HAA), you need to know about Dr. John L. McDonald. As a pioneer in the California HAA community, he built a legacy of excellence and created a patient-focused culture.
After completing medical school and his residency, McDonald joined the U.S. Navy. There he was commissioned as an officer, and subsequently reassigned to serve the U.S. Marine Corps. Upon leaving the service in 1966, he set up a family medical practice across from Santa Rosa Memorial Hospital. Not only did the hospital not have an emergency department at that time, neither did the entire city of Santa Rosa. McDonald had changed that by 1971, establishing Santa Rosa’s first emergency department, and shortly thereafter its first paramedic program.
With an emergency medical system in place, another crowning achievement for McDonald occurred in 1987 when he introduced air ambulance operations to the community by founding REACH Air Medical Services. From then until his death in 2000, McDonald was the operator’s medical director.
Even the most populated state in the nation could not contain REACH. The HAA has grown over the last 29 years until it now has over 600 employees operating 33 bases spread over California, Oregon, Nevada, Montana, Wyoming, Colorado, and Texas.
Serving In New Ways
For as long as I have been in the industry, I seem to recall REACH always being on the leading edge of aeromedical services delivery. They were one of the first operators to introduce NVGs, as well as operate helicopters in the IFR environment. Still, they are not progressive just from an operational standpoint. One of their greatest strengths lies in uncovering and acting upon new business opportunities in the market. These opportunities have allowed them to break the mold of traditional hospital-based and community-based HAA delivery models:
Hospital-based is when a helicopter and crew operate from a specific hospital to: (a) serve that hospital’s community, (b) bring patients back to that hospital, and (c) be an aerial marketing tool for that hospital.
Community-based is when a helicopter, crew, and living quarters are strategically plopped down in a geographic area. Relationships are struck with potential users such as hospitals, fire departments, and ambulance companies to get a minimum number of flights per month. Air Evac Lifeteam has perfected this model since the ‘90s.
Always searching for new opportunities to expand services and serve communities, REACH has become adept at creating several hybrid care-delivery models. For example, they’ve formed two unique private-public partnerships, one with the City of Upland Fire Department in Southern California, and the other with the Viejas Band of Kumeyaay Indians east of San Diego.
In Upland, REACH provides the aircraft, pilots, and maintenance support, plus a portion of the air medical crew, while the city’s fire department provides flight medics from their ranks. "This arrangement allows us to take the trusted service delivery of a longstanding fire department within the community and blend that with our expertise in aircraft operations," says Wharton.
REACH’s arrangement with the Viejas tribe is similar, but there are unique components, such as allowing the tribe to decide how the aircraft and uniforms look and the levels of service provided. In the case of the Viejas operation, that service is not restricted to just the tribal lands’ catchment area, but it also is provided to the larger region to offer a greater good.
Outside of California, REACH is striking similarly structured deals. For example, Methodist Health Systems in San Antonio serves the entire southern Texas region. They use all REACH assets: aircraft, pilots, medical crew members, and maintenance support, but the entire operation is branded “Methodist.” There is also a similar REACH hospital partnership in Houston, but these types of models are still few and far between. Wharton explains, "At the end of the day, the common thread is that we look for unique opportunities to partner, to synergize, and then go out and ultimately perform our mission. We do what we are good at doing while leveraging the strengths of our partners, whether they be a fire department or a hospital."
Growth And Change Agents
Generally speaking, HAA is mirroring big health companies by consolidating through acquisitions and mergers. REACH is no exception to this trend, as it is owned by parent company Air Medical Group Holdings (AMGH), which is in turn owned by global investment firm KKR. Under the umbrella of AMGH are several sister companies in the HAA market: Med-Trans, Air Evac Lifeteam, Air Med International, and EagleMed.
There seem to be three predominant advantages propelling REACH’s growth. First, its acquisition in 2014 brought a host of benefits, including capital resources that allow REACH to aggressively pursue potential opportunities. Second, nearly all key personnel in the upper ranks of management come from the line and have flown HAA missions. This experience builds credibility and trust throughout the company. Last but not least, is expertise; the crews who make the helicopter missions happen are really good at what they do.
REACH AIR AND MEDICAL STRENGTHS
REACH nurses function under an advanced scope of practice, meaning they can perform some interventions typically reserved for physicians.
Clinical teams hold certifications in: basic life support, advanced cardiac life support, pediatric advanced life support, the Neonatal Resuscitation Program, and an approved trauma certification course.
Pilots have more than 2,000 hours of flight experience.
Aircraft safety features include IFR/GPS capabilities, Terrain Avoidance Warning System, and satellite flight tracking.
Night vision goggle trained and equipped
CAMTS accredited since 1998
Safety Management System Level II
REACH has transported well over 100,000 patients.
Changing HAA Business Model
The business model for HAA in the U.S. has several challenges. Constantly changing regulations can create uncertainty and financially burden companies in a sector that already has to contend with very high operational costs. Thus, the trend is for big HAA companies to keep expanding in order to maximize economies of scale to their advantage.
To provide some financial stability, the HAA companies under the AMGH umbrella utilize a membership program that is somewhat similar to that of the Automobile Association of America (AAA). REACH, Med-Trans, Air Evac Lifeteam, and EagleMed combine to create America’s largest air medical membership program—the AirMedCare network. The program serves approximately 2.5 million members who pay only $65 annually per household for medical air transport. Those who join have no out-of-pocket expenses when flown by the providers. The network operates from more than 250 air ambulance bases across 32 states.
This Just In …
Within days of interviewing Wharton for this feature, REACH announced another milestone—their merger with CALSTAR, one of the oldest and largest HAA providers in California. Founded in 1984, CALSTAR has approximately 225 employees, and 14 rotary- and fixed-wing aircraft flying from nine bases of operation.
The timing of the announcement could not have been better for this story, as it illustrates REACH’s obsessive desire to climb to new business heights by expanding the care it provides to communities. Here is the official announcement:
REACH, CALSTAR Announce Air Medical Services Merger
Bases in Northern, Central California Form Largest Statewide Network
REACH Air Medical Services and California Shock Trauma Air Rescue (CALSTAR), two of the preeminent air medical ambulance providers in Northern and Central California for three decades, are entering into an agreement that will place CALSTAR within the same corporate holding company as REACH.
In a joint announcement, Sean Russell, REACH president, and Lynn Malmstrom, CALSTAR CEO, said the air medical operation of CALSTAR will become a limited liability company (LLC) as part of the terms of the agreement, and will operate under the current CALSTAR brand as CALSTAR Air Medical Services LLC. The parties intend to better serve the community through their united efforts.
The new company will be one of the three firms under REACH Medical Holdings LLC, a holding corporation (the “Company”) which is part of Air Medical Group Holdings Inc. (AMGH), one of the largest air medical firms in the United States. Cal-Ore Life Flight, which merged with REACH in 2011, also is a part of the holding company.
CALSTAR Air Medical Services LLC will continue to operate with its own unique brand and flight nurse staffing model. REACH and CALSTAR officials foresee no base closures, with the goal being to focus on integration, support, and maintaining the services that have made both organizations successful. No other decisions have been made related to services.
Financial terms are not being disclosed at this time. The proceeds of this transaction will go to and fund a new not-for-profit foundation to benefit the public. The mission and activities of this new foundation are still to be determined and will be shared at a later date as they become available. “Our companies have been competitors for 30 years, built upon similar foundations of high quality services, patient care and loyalty to our communities, to our patients and to our members who rely upon us for safe, reliable air medical transport,” Russell said.
Malmstrom said a team comprised of staff from each company will be appointed to help guide the integration process. “We want to ensure that the resources of both programs are reviewed and utilized in a manner that is reflective of the best practices from our 30-year commitments to community and patient care, to industry-leading employee training and to the safe operations of one of the most modern rotor and fixed-wing fleets in air medical care.” CALSTAR’s current members will become members of the AirMedCare Network, extending their membership benefits with no out-of- pocket expenses related to transport across 32 states and more than 250 aircraft locations that are part of AMGH.