Urgent – New Medicaid Rules Effective Immediately Make Sweeping Changes Regarding Ownership, Subcontracting and Recordkeeping for Transportation Services

The most recent New York State Medicaid Update altered the landscape for the provision of transportation services under the New York State Medicaid program.  All transportation service providers, including ambulance, ambulette, and taxi/livery service providers, and providers who contract for transportation services are urged to immediately review their structures, contracts, and other arrangements for compliance purposes.

Medicaid now requires all transportation service providers to own the vehicles outright or be personally responsible for the vehicles pursuant to a vehicle lease agreement with a motor vehicle manufacturer or with a licensed vehicle dealership.

Medicaid also announced that effective immediately, transportation service providers may not assign, delegate or subcontract out their transportation service responsibilities. This prohibition applies even when the transportation provider does not have enough vehicles to meet the need for services and in the event of emergencies including mechanical breakdowns.  Instead, the Medicaid transportation provider must alert the appropriate Medicaid transportation manager of the problem as soon as possible.

Medicaid also introduced new documentation requirements effective immediately for ambulette and taxi/livery service providers, including maintaining the name and signature of the driver providing the transportation attesting that the referenced trip was completed, the vehicle’s license plate number, the driver’s license number, and pickup and drop-off times and locations for each trip.  Effective July 1, 2016, Medicaid claims for taxi/livery services must include the vehicle license plate number and the driver’s license number.

Providers deemed in violation of the new rules are subject to penalties, up to and including termination from the Medicaid program.

The new guidelines were issued unexpectedly. We have spoken with the Department of Health, which has indicated that they may issue additional regulations and guidance regarding the new transportation rules.

A copy of the Medicaid Update can be found here:

If you are a transportation service provider, a party to a transportation service arrangement reimbursable under Medicaid, or otherwise need assistance regarding compliance with the new Medicaid transportation provider rules, please contact the GW attorney with whom you regularly work.