Non-Emergency Medical Transportation/Medicaid Transportation

Non-Emergency Medical Transportation

Medicaid, the publicly funded health care insurance program for low-income populations, is jointly funded by states and the federal government. Medicaid programs operate under an agreement between a state and the federal government. States must will abide by federal rules and may claim federal matching funds for its program activities. The state plan sets out groups of individuals to be covered, services to be provided, methodologies for providers to be reimbursed, and the administrative activities that are underway in the state. For example, in some states, eligible individuals may be those whose income level is at or below 100% of the federal poverty level; in other states, it may be 200% of the poverty level. 

One in five Americans receive health care coverage through Medicaid, our nation’s health insurance program for low-income individuals. As explained in a CTAA white paper, the vast majority of the more than 70 million Americans covered lack access to other affordable insurance, and face complex and/or costly health care needs.


The Medicaid NEMT benefit explained

Non-emergency medical transportation (NEMT) technically refers to any medically related transportation service apart from those provided in an emergency situation. Those transportation services assist individuals in accessing medically necessary services, such as primary health care, post-hospitalization appointments, and recurring treatments and therapies. In this broad context, NEMT services are provided through veterans’ health care programs, the Indian Health Service programs, federally qualified health centers, Medicare Advantage and other Medicare programs, and even through private insurance programs.

However, NEMT is also commonly used to describe the transportation benefit provided for Medicaid recipients. Federal Medicaid regulations require that states ensure transportation to and from health care providers for beneficiaries who have no other means of accessing services. It is important to note that many state Medicaid agencies view NEMT as a medical service whereas many public transportation and human services transportation providers think of NEMT as a transportation service. In addition, states can choose from two types of federal reimbursement for NEMT: either as a medical service expense, reimbursed at the state’s regular federal matching rate for medical services (50-74.6 percent in FY 2017) or as an administrative expense (capped at 50 percent). The latter option gives states greater flexibility in the delivery of NEMT services and eliminates the freedom of choice of provider requirement, allowing for contracts with a single provider and alternative types of payment, like vouchers for NEMT clients.

States use a variety of different delivery models and payment structures to implement the NEMT benefit, which are detailed in a 2018 report by the Transportation Research Board (TRB).  In addition, it is important to note the role that NEMT services play as a key component in the coordinated public transportation model that allows public and community transportation systems to thrive – read a report detailing this interdependency here.

As described in the 2018 TRB report, each state has broad discretion to determine who is eligible for NEMT. In most states, qualified means eligible to receive medical services through the Medicaid program and eligible for NEMT. In general, NEMT will be covered by Medicaid if the following conditions for medical necessity are met: 1) the beneficiary is eligible for a medical assistance program (Medicaid), 2) the medical service for which the trip is needed is a Medicaid-covered service,  3) the beneficiary has no other means of getting to and from the covered medical service, 4) the NEMT trip is authorized in advance by the appropriate agency or broker, 5) the NEMT trip is to the nearest qualified medical provider as authorized by Medicaid, and 6) the NEMT trip is the lowest cost available transportation mode that is both accessible for the client and appropriate for the client’s medical condition and personal capabilities. 

How states contract for NEMT services

There are many different models under which states provide NEMT; the most common are described below:

  • NEMT is included in state’s contracts with managed care organizations for broad medical services, who in turn contract with transportation brokers
  • NEMT is provided through contracts with multiple brokers, each of whom is responsible for one or more regions in the state; these brokers then subcontract with public and private transportation providers to provide the actual service
  • NEMT is provided through a contract with a single statewide broker, who then subcontracts with public and private transportation providers to provide the actual service
  • NEMT is provided through a contract with transportation providers in each county or for multiple counties

It is common for brokers, whether state, regional, or county based, to be paid a fixed per-person rate for enrolled Medicaid recipient rather than being reimbursed on a trip-by-trip basis. In most states, this fixed rate is calculated as a per-member-per-month (PMPM) rate. So, for example, if a state had 100,000 enrolled Medicaid members, each month the broker would receive the agreed-upon per-person rate multiplied by 100,000, and in return agree to provide all eligible trips, regardless if the cost of those trips exceeded or was less than PMPM reimbursement. 

NEMT contract revenue and public transportation

In many communities (particularly in rural America), transit providers use the contract revenues gained from providing Medicaid NEMT services as local match dollars to receive federal transit funding. In other words, these communities cannot access their allocated federal transit investment without continued Medicaid NEMT contract service support. 

The coordinated approach to community mobility — one fully supported by recent presidential administrations going back more than 20 years — allows Medicaid to benefit from community-based mobility at a fraction of actual costs. These trips often actually save Medicaid funding by reducing appointment no-shows, hospital readmissions, and streamlining patient discharge. With key health care challenges like diabetes and opioid treatment and recovery at the forefront of public health officials’ agenda, removing Medicaid NEMT from the coordinated transportation model would be counter-productive.

For further investigation . . .

Economic Benefit of “Modern” Nonemergency Medical Transportation That Utilizes Digital Transportation Networks

This study used the National Academies’ NEMT cost-effectiveness model to perform a baseline cost savings analysis for provision of NEMT for transportation-disadvantaged Medicaid beneficiaries. The results found that total annual net savings for traditional NEMT in Medicaid was approximately $4 billion.

Non-Emergency Medical Transportation and Health Care Visits Among Chronically Ill Urban and Rural Medicaid Beneficiaries

Inaccessibility to health care services due to lack of transportation affects the most vulnerable segments of the society. The effect of Medicaid-provided nonemergency medical transportation (NEMT) in Oklahoma on health care visits for the management of chronic illnesses is examined.

Transportation Brokerage Services and Medicaid Beneficiaries’ Access to Care

The objective of this study was to examine the effect of capitated transportation brokerage services on Medicaid beneficiaries’ access to care and expenditures. For asthmatic children, transportation brokerage services increased nonemergency transportation expenditures and the likelihood of using any services; reductions in monthly expenditures more than offsetting the increased transportation costs.

Additional resources

Needham Community Council Rides to Health Care

Needham Community Council – Needham, MA
In 2017, the Needham Community Council began supplementing its volunteer driver medical transportation program with trips provided through the ridehailing company, Lyft. Lyft rides were funded through the Needham Community Council operating budget and a donation from Beth Israel Deaconess Hospital – Needham.

Read More »

Engaging Older Adults in Mobility Management

Brookline Council on Aging – Brookline, MA
Transportation Resources Information Planning and Partnership for Seniors (TRIPPS) is an initiative of the Brookline Council on Aging. TRIPPS launched in 2015 with initial funding through a grant from the Massachusetts Department of Transportation using federal 5310 funding. We provide information, resources, and support to older adults in Brookline who are looking for transportation options. Our focus has been on older adults who are either not driving or are transitioning from driving to other modes. About 70 percent of our older adults who we work with do not own a vehicle.

Read More »


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