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‘Unnecessary rescues’ soar in Nepal on profits from insurance payouts
LUKLA, Nepal, June 28, 2018 (BSS/AFP) – Tourists hiking in Nepal’s
Himalayan mountains are being pressured into costly helicopter evacuations at
the first sight of trouble by guides linked to powerful brokers who are
making a fortune on “unnecessary rescues”, industry insiders say.
Dodgy operators are scamming tens of thousands of dollars from insurance
companies by making multiple claims for a single chopper ride or pushing
trekkers to accept airlifts for minor illnesses, an investigation by AFP has
revealed.
In other cases, trekking guides, promised commission if they get tourists
to return by chopper, are offering helicopter rides to tired hikers as a
quick way home, but billing them as rescues to insurance companies.
The practice is so rampant helicopter pilots are reporting “rescuing”
tourists who appear in perfectly fine health.
“It’s a racket that’s tantamount to fraud, and it’s happening on a large
scale throughout Nepal,” said Jonathan Bancroft of UK-based Traveller Assist,
which carries out medical evacuations in Nepal on behalf of global travel
insurance companies.
Trekking outfits stand to make more in kickbacks from evacuating a hiker
by helicopter than the cost of the trek itself, contributing to an alarming
rise in rescues from Nepal’s biggest tourist attraction: the fabled
Himalayas.
Traveller Assist said 2017 was the most expensive year on record for travel
insurance companies covering tourists in Nepal due to a startling number of
helicopter rescues — though this year is on track to beat it.
There is no centralised dispatch centre for helicopter flights in Nepal
making it difficult to know precisely how many evacuations are carried out.
But over the past six years the skies of the Everest region have turned
into a helicopter highway, with a six-fold increase in the number of choppers
in the air, each logging over 1,000 flying hours per year, according to
industry data.
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“We used to see maybe one helicopter in two or three days. Now we are
seeing 10 or so in a day,” said Thanishwar Bhandari, who works as a small
clinic in the Everest region.
Meanwhile, one foreign pilot, who requested anonymity, said he rescued
trekkers on a near daily basis in April and May this year, peak trekking
season.
“I think I took three people the whole season who appeared genuinely ill,”
he told AFP.
– ‘Told to lie’ –
Australian trekker Jessica Reeves was urged by her guide to be evacuated by
helicopter from near Everest base camp in October 2017 when she complained of
a common cold.
“He kept telling me to get a helicopter,” Reeves told AFP. “They said if I
keep going it would be really risky so it was better to leave now instead of
risking it.”
Reeves said nine or 10 hikers in her group ended up returning to Kathmandu
on three helicopters but were instructed to say they were alone on the flight
back.
She alleged the company, Himalayan Social Journey, billed each of the
tourists’ insurance providers for the whole flight — pocketing around
$35,000 in the process.
“They told us all to lie to the insurance company and say there was only
one person on the helicopter when there were three or four of us on each,”
she said. Reeves’ insurance claim was in any case rejected because her policy
had expired.
The company owner, Ram Sapkota, denied that the insurance companies were
each billed for the full flight.
“(They) claimed insurance on a sharing basis and we received money from
(the) insurance,” he said, dismissing allegations as “fake”.
Sapkota blamed the rise in helicopter rescues from the Himalayas on lazy
hikers and hypochondriacs.
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“When one client gets sick, then the group they say, ‘I feel unsafe and
just want to go’,” he said.
Extensive interviews by AFP with players at every stage of the commission
chain reveals that guides, trekking operators, lodge owners and charter
companies are acting as brokers, playing helicopter companies off against
each other to secure a cut of the rescue fees.
One manager of a Kathmandu-based helicopter company said they paid $500 to
brokers for each rescue flight.
“If we don’t pay the commission, we can’t get the business,” the manager
told AFP on condition of anonymity.
– ‘Safety net’ –
The trekking industry in Nepal took a hit following a devastating
earthquake in 2015.
But tourists are now returning: from March to May 2014, more than 20,000
foreigners visited the Sagarmatha National Park, home to Mount Everest,
according to government figures.
Meanwhile, there are an estimated 2,000 trekking companies promising to
whisk them off into the mountains, many of them operating from scruffy,
cramped offices in the dusty backstreets of Kathmandu.
The cost of the 14-day trek to Everest base camp varies wildly between the
outfits, but many offer the tour for less than $1,000, below cost price
according to multiple industry sources.
Guides working for the low-cost agencies are being told to make up the
shortfall by getting trekkers rescued by helicopter: one guide told AFP on
condition of anonymity that he was given a quota for the number of trekkers
he should have “rescued”.
“The industry thrives on these unnecessary rescues,” added Suraj Paudyal,
who coordinates helicopter rescues for Mediciti Hospital in Kathmandu.
For doctors working in the high-altitude Everest region, the increased
availability of helicopters does provide reassurance that critical patients
can be airlifted from remote locations to better-equipped hospitals below.
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“It is nice, as a doctor, to have the safety net of a helicopter,” said
British doctor Helen Randfield, who manned a small clinic that caters to the
influx of trekkers who arrive with the good weather of spring and autumn.
But the decision as to who gets evacuations ends up in the hands of the
guides, not the medical professionals.
“Trekkers or their guides are deciding themselves whether they need a
rescue,” said Sonia Mariano, an American doctor who worked at the same clinic
last year.
The majority of rescues are happening without prior approval of insurance
companies — 80 percent according to Alpine Rescue, which carries out
evacuations for the International Assistance Group, an alliance of global
insurers — leaving the system open to exploitation.
– Conflict of interest –
Some hospitals back in Kathmandu also have a stake in the rescue business.
Company registration documents reviewed by AFP show that many large trekking
outfits have financial ties to hospitals and helicopter providers, creating a
conflict of interest.
Ram Sapkota of Himalayan Social Journey said his guides received a
commission from some hospitals if they take a tourist there, saying he
allowed it because his company needed to “maintain relations” with medical
providers.
He also bought a 10 percent stake in helicopter firm Altitude Air last
year, he told AFP.
A German trekker hiking in the Everest region in April told AFP that a
broker offered him a return helicopter flight to Kathmandu — with the cost
billed to his insurance provider.
“He said he knew a doctor who would sign it off as a rescue,” the tourist
said, requesting anonymity.
The majority of rescues in the Himalayas are related to “acute mountain
sickness” caused by low oxygen levels at high altitude. The symptoms are
vague — headaches, nausea, loss of appetite — and the only treatment is to
descend.
But once the patient is at lower altitudes the symptoms disappear, making
it impossible to tell if the evacuation was medically necessary.
“By the time (the trekkers) come down, they are fine,” said Dr Prativa
Pandey, medical director of respected Kathmandu-based travel clinic Ciwec.
She added that doctors cannot be made responsible for cleaning up the murky
business: “You (as a doctor) have to give the benefit of doubt to the
patient,” she said.
International insurance companies are beginning to wise up to the rampant
fraud.
Multiple insurance companies linked to one major UK-based underwriter are
considering no longer offering travel insurance for Nepal, an industry source
said, requesting anonymity as the firms did not want to alarm customers.
Nepal’s tourism ministry launched an investigation into alleged insurance
fraud in early June after receiving complaints from multiple sources, joint
secretary Ghanashyam Upadhyaya told AFP.
“The investigation might take (another) month. When we began our work we
did not realise the magnitude of the problem,” Upadhyaya said.
Upadhyaya would not confirm the details of the ongoing investigation, but
local media reported that 500 trekking and helicopter companies are being
probed, including Sapkota’s Himalayan Social Journey. Sapkota said he had not
been contacted by the ministry and again denied any wrongdoing.
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