Can you charge Medicaid patients for transportation? Payment in full, copays, and non-covered trips

On a trip Medicaid covers, the program’s payment is the whole fare. You may collect a copay only when your state’s plan sets one, and you may sell a Medicaid member a ride only when Medicaid does not cover that ride and the member agrees to pay before it happens. Everything else, from a “small fee for the wheelchair” to billing a rider for a trip the broker left unpaid, puts your enrollment at risk.

The Medicaid rate is payment in full

Federal rules limit Medicaid participation to providers who accept, as payment in full, what the agency pays plus any deductible, coinsurance, or copayment the plan requires the member to pay (42 CFR 447.15). There is no room for a balance bill on top.

The penalty for ignoring that is criminal. Knowingly and willfully charging money “at a rate in excess of the rates established by the State” for a state plan service is a felony, with fines up to $100,000, prison up to 10 years, or both (42 U.S.C. 1320a-7b(d)). For members of a Medicaid managed care organization, the limit is the rate its contract allows.

Broker and plan trips carry the same protection. Every Medicaid managed care plan, including a transportation plan, must make sure members are not held liable for covered services when the state or the plan fails to pay the provider, or for more than they would owe if the plan had covered the service directly (42 CFR 438.106). Broker contracts spell it out. MTM’s standard provider agreement, as posted by Pennsylvania’s human services department, says the provider “will look solely to MTM for payment” and may not bill a member even if MTM or its client does not pay, apart from a copayment or fee MTM or its client authorizes.

Some states go further in writing. New York’s transportation policy manual says Medicaid members never pay a copay for NEMT, and drivers and transportation providers never ask a member for payment.

Copays: when a state can charge one

A copay on NEMT exists only if the state chose one, and only within federal limits. CMS’s 2023 transportation guide says cost sharing is allowed for NEMT only when the state covers it as an optional medical service, it must be nominal, and it is not allowed at all when the state claims NEMT as an administrative activity (SMD 23-006). Check which way your state covers it before you collect anything.

Where a copay is allowed, 42 CFR 447.52 and 447.56 cap it:

• Amount. For members at or below 100 percent of the federal poverty level, the rule’s table sets $4 for outpatient services, raised each year since October 1, 2015 by the medical care component of the CPI. Higher income groups can be charged a percentage of what the agency pays. A copay can never equal or exceed the payment for the service.
• One charge per service. The state may not stack more than one type of cost sharing on a service.
• Exempt members. No cost sharing for children under 18 in the core children’s groups, children in foster care, pregnant women for pregnancy-related services, people in an institution who pay their income toward their care, hospice patients, American Indians who have received care from an Indian health care provider, and members covered through the breast and cervical cancer group.
• Exempt services. Emergency services, family planning, preventive care for children, and pregnancy-related services.
• Family cap. All premiums and cost sharing for a Medicaid household cannot exceed 5 percent of family income, counted monthly or quarterly.

States must publish who owes cost sharing, how much, and what happens if a member does not pay, and give that schedule to participating providers (42 CFR 447.57). That schedule, not habit, decides whether you collect anything.

State practice varies widely:

• Florida lists transportation among services subject to copayments in section 409.9081 of its statutes, and its NET coverage policy sets the copayment at $1.00 per trip unless the member is exempt or the member’s managed care plan waives it. The statute’s exempt list includes members under 21 and members enrolled in a Medicaid prepaid health plan or HMO.
• New York charges no NEMT copay at all.
• Indiana suspended all copays on April 1, 2020. Under House Enrolled Act 1513 (2023), most programs did not bring them back when the pause ended on July 1, 2024. Package C, the children’s health insurance program, did: its $10 transportation copay applies to emergency trips and to physician-requested nonemergency ambulance transfers between facilities.

A change is coming for some adults. Starting October 1, 2028, Public Law 119-21 requires states to charge cost sharing above $0 on some services for expansion adults with income above the poverty line, with a ceiling of $35 per item or service and held within the same 5 percent family limit. Each state picks the services. The law shields primary care, mental health care, and substance use treatment, among others, from the charge.

Collecting a copay without breaking the rules

The copay belongs to the member, not to you, and the rules on collecting it are strict.

Turning a rider away over an unpaid copay takes three things at once: a state that allows it, a member whose family earns more than the federal poverty line, and a member outside the exempt groups (42 CFR 447.52(e)). For everyone else, the state plan must bar providers from denying service for inability to pay. The debt does not disappear, though: a member’s inability to pay does not erase the liability. You may also reduce or waive the copay case by case.

Waiving it costs you the copay. The agency must cut its payment to the provider by the member’s cost sharing amount whether you collected it or not (42 CFR 447.56(c)), and Florida’s copayment statute says the same: a provider need not collect, but the state still deducts the copay from what it pays.

Trips Medicaid does not cover

A ride Medicaid will not pay for is not a Medicaid service, so payment in full does not apply to it. North Dakota’s manual lists noncovered NEMT services, including:

• transportation to a noncovered medical or dental service
• trips to a hospital or other site ordered by a court or law enforcement
• charges for luggage, stair carry, or airport, bus, and train terminal services
• trips to noncovered places such as a grocery store, health club, or school
• parking fees

North Dakota also makes the member responsible for transportation charges when the member is evicted for breaking a hotel’s or transportation provider’s policy, because the state will deny that claim.

Charging privately still takes care. Indiana’s rules are the clearest statement of what a state expects. A provider may bill a member for a noncovered service only when the service has been determined noncovered, the member understands before the service that it is not covered and that they are responsible for the charge, and the file shows the member chose the service voluntarily. A waiver form is optional, but if you use one it must name the specific service, be signed before the service, and avoid conditional wording that makes the member pay only if the program turns the claim down. Indiana warns that a signed waiver does not stop the state from investigating what it says.

The same logic covers a rider who turns out not to be eligible on the trip date. Indiana lets you bill the member if you tell them they are not eligible and they agree in writing to pay. Check coverage before the ride; our guide on NEMT eligibility verification covers how. A one-page private-pay rider agreement records the price and the rider’s consent before pickup.

Upgrades, extras, and top-ups

The risky middle ground is a Medicaid trip with something extra added. A rider wants a solo ride when the broker authorized a shared one, or a family wants a sedan instead of the van the program approved, and offers to “pay the difference.”

Indiana’s rule explains why that rarely works. An add-on can be billed to the member separately only when it has its own procedure code. When no separate code exists, the whole service is either covered or noncovered, and Indiana’s example is eyeglass frames: the program cannot be billed for basic frames while the member pays for the upgrade. Applied to rides, a top-up on a covered trip can look like a charge above the state’s rate, which is the felony described above. If the rider wants a trip the program will not authorize, price the entire trip as a private pay ride and bill Medicaid nothing for it.

No-show fees and Medicare riders

Two other charges come up often.

• No-shows. CMS’s 2023 guide says no one, state or provider, may bill a member for a missed ride. North Dakota allows it only when the same written or posted policy applies to every rider, Medicaid or not. The Medicaid no-show billing guide has the details.
• Qualified Medicare Beneficiaries. A QMB member has no legal liability to pay a provider for Medicare cost sharing on a Medicare-covered service (42 U.S.C. 1396a(n)(3)). For NEMT companies that bill Medicare for ambulance trips, that rules out collecting the coinsurance from the rider. A QMB-only rider who books a wheelchair van ride is a different case: Indiana, for one, lists QMB-only among benefit plans with no NEMT coverage, so that ride is private pay. The qualified Medicare beneficiary entry explains both.

When coverage turns up after the rider paid

A rider who pays out of pocket while waiting on a Medicaid decision may later be approved back to the date of the trip. In that case CMS expects the state to pay for covered services in the retroactive period, rides included, and warns that you may have to hand back what the member or family paid before you submit the claim. Indiana’s modules spell out the order: once you learn of the retroactive eligibility, return right away what the member paid for covered services in that period, then bill the program. A claim filed more than 180 days after the trip but within a year of the eligibility award carries the note “Retroactive eligibility. Please waive timely filing.” See retroactive Medicaid eligibility.

Keep every private payment tied to its trip so the refund and the claim can be matched in minutes. Verification surveys can ask members directly whether they paid anything out of pocket, as our guide to explanation of Medicaid benefits letters shows.

Before you take money from a Medicaid rider

Run through these checks every time:

1. Confirm whether the trip is covered. If it is, the Medicaid or broker payment is the whole fare.
2. Look up the state’s published cost sharing schedule. If it sets no copay for this trip, collect nothing.
3. Check for an exemption. Children, pregnant members, institutional residents, hospice patients, and American Indians served by Indian health providers usually owe nothing.
4. For a trip Medicaid does not cover, get the rider’s written agreement before the ride, naming this trip and this price.
5. Give a receipt that names the trip and the amount.
6. File the payment with its trip so a refund is easy to find if coverage arrives later.

Collecting what you are allowed to collect

Private trips and allowed copays are easier to handle when they sit next to the Medicaid work instead of in a separate notebook. In HealthRide, the person paying can use a pay link or a stored card, run through a secure card processor, and checks and cash are recorded against the trip they cover. Every payment and refund lands in one ledger. See payments.