NEMT accounts receivable: aging reports, follow-up, and write-off rules
Your NEMT accounts receivable is what brokers, state Medicaid, health plans, facilities, and private riders still owe you for trips already driven. Control it with an aging report split by payer, days sales outstanding measured against each payer's own terms, a weekly follow-up block that clears problem claims before their filing limits expire, and a written policy for writing balances off.
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Receivables are profit that has not turned into cash yet, and in NEMT they come with expiration dates. A typical operator is owed money by a broker or two, the state or a health plan, a few facilities, and some private riders, and each of them runs a separate claim deadline and a separate pay cycle. The tools that keep that money moving are simple: an aging report split by payer, a days sales outstanding figure for each payer, a fixed weekly follow-up block, and clear rules for the balances you will never collect.
What goes on the receivables list
Count every completed one-way leg that has not been paid in full. That is a longer list than “claims sent.”
- Not billed yet. Legs that were driven but never made it onto a claim or invoice. They are the easiest money to lose, because their filing deadline started on the day of the ride.
- Billed and waiting. Claims and invoices with the payer, including ones rejected before processing that you have not resent.
- Paid wrong. Denials you can still correct, lines paid below your contracted rate, and recoupments that a payer will take out of a future deposit. Carry a recoupment as a negative line until it clears.
- Owed by facilities and riders. Open and past-due invoices and card balances.
Track each leg rather than the round trip. In MTM’s standard agreement, a single trip means one leg, from the pickup point to the drop-off point, so a round trip with one unpaid leg is still half open. See trip leg.
Which date to age from
Filing limits count from the ride, while payment terms count from the bill, so each type of receivable ages from a different date.
| Receivable | Age it from | Why |
|---|---|---|
| State Medicaid claim | Date of service | The federal ceiling is 12 months after the ride, and many states set much shorter limits |
| Broker trip | Date of service | MTM’s standard agreement cuts off claims after 90 days, and WellTrans’s Indiana agreement asks for them inside 60 |
| Health plan claim | Date of service | Your contract with the plan sets the filing limit |
| Facility invoice | Invoice date | Terms such as net 30 start when you invoice |
| Private-pay balance | Invoice or ride date | Your booking terms decide |
Keep a second date on every claim: the day you sent it. Payment promises count from receipt, so the billed date is what tells you a payment is overdue. The federal payment standard in 42 CFR 447.45 counts from the agency’s date stamp, and MTM’s 30 days start at online submission.
An aging report, read row by row
An aging report sorts what you are owed into age buckets, with one row per payer. Here is an example for a hypothetical fleet. The payers and amounts are invented.
| Payer | 0 to 30 days | 31 to 60 | 61 to 90 | 91 to 120 | Over 120 | Total |
|---|---|---|---|---|---|---|
| Broker (60-day submission limit) | $13,900 | $1,450 | $380 | $0 | $0 | $15,730 |
| State Medicaid (90-day limit) | $5,700 | $1,900 | $610 | $0 | $0 | $8,210 |
| Medicaid health plan | $2,300 | $1,500 | $900 | $450 | $0 | $5,150 |
| Hospital, net 30 | $3,300 | $3,300 | $1,100 | $0 | $0 | $7,700 |
| Private-pay riders | $650 | $240 | $0 | $0 | $180 | $1,070 |
| Total | $25,850 | $8,390 | $2,990 | $450 | $180 | $37,860 |
The totals say little on their own. Each row has to be read against that payer’s rules:
| Row | What it signals | This week’s move |
|---|---|---|
| Broker, $380 in the 61 to 90 column | Trips older than the 60-day submission limit | If they were never billed, expect to lose them. If they were billed in time, pull the claim numbers and ask why they are unpaid. |
| State Medicaid, $610 in the 61 to 90 column | Inside a 90-day limit with little room left | Bill or correct it now |
| Health plan, $450 in the 91 to 120 column | Old enough to be near many plan limits | Look up the filing limit in the plan contract, then get a status on each claim |
| Hospital, $4,400 over 30 days | Everything past net 30 is overdue, and $1,100 is more than a month late | Call the hospital’s accounts payable office |
| Private pay, $180 over 120 days | A balance that ordinary reminders have not moved | Send your final notice, then apply your write-off policy |
Days sales outstanding by payer
Days sales outstanding, or DSO, measures how many days of billing are still waiting to be collected:
DSO = amount owed ÷ (amount billed in the period ÷ days in the period)
With 90 days of billing behind the example above:
| Payer | Billed in the last 90 days | Owed now | DSO | Rough expectation from the payer’s terms |
|---|---|---|---|---|
| Broker | $45,000 | $15,730 | 31 days | Mid 30s: weekly billing plus 30 days to pay |
| State Medicaid | $18,000 | $8,210 | 41 days | Depends on the state’s payment cycle |
| Health plan | $7,200 | $5,150 | 64 days | Your contract’s payment schedule |
| Hospital | $9,900 | $7,700 | 70 days | 40s: monthly invoicing plus net 30 |
| Private pay | $3,600 | $1,070 | 27 days | Near zero when a card is charged at the ride |
| All payers | $83,700 | $37,860 | 41 days |
The company-wide 41 days looks healthy, but the payer rows show two problems: the health plan and the hospital are each about a month behind their terms, while the broker is on time. Private pay would fall close to zero if riders’ cards were taken at booking.
The expected figures come from the payers themselves. MTM’s standard agreement sets 30 days from online submission for properly submitted, undisputed invoices. In Indiana, Verida pays a clean fee-for-service claim in 14 days if it is in by Wednesday. Facilities pay on whatever terms your agreement sets. Recalculate every month and watch the direction. A payer whose DSO climbs in consecutive months has a specific cause worth finding, whether that is a rate change, a portal problem, or a missing document. NEMT KPIs covers the other numbers worth a monthly look.
Filing limits by payer
A receivable is only worth something while the payer can still accept the claim. Most NEMT payers allow far less time than the federal maximum.
| Payer | Last day to file | If you miss it |
|---|---|---|
| State Medicaid, federal outer limit | One year after the ride (42 CFR 447.45(d)(1)) | The state generally cannot pay. Among the exceptions: after a timely Medicare claim, the state may pay within 6 months of the Medicare decision. |
| New York Medicaid, transportation | 90 days after the ride | Late claims need a documented, acceptable reason for the delay (billing guidelines, version 2026-02) |
| MTM, standard agreement | 90 days after the ride, unless MTM’s client requires another limit | The claim is not eligible for payment, and the provider waives it |
| WellTrans, Indiana | 60 days after the ride | Past day 90, WellTrans disallows the invoice entirely. When Medicare is the primary payer, the deadlines run from Medicare’s denial date. |
| Facilities and private pay | Your agreement | Collect under your terms and state law |
Two habits protect you here. Keep proof of the date every claim went out, since a timely submission is the strongest argument on appeal. And resend a rejected claim right away, because the filing clock keeps running while it sits. See timely filing limits.
A follow-up rhythm: daily, weekly, monthly
Receivables stay current when follow-up happens on a schedule, not when cash gets tight. Give one person the job.
Every day
- Bill yesterday’s completed legs, with the trip record complete.
- Post deposits and payment statements as they arrive.
Every week, in one two-hour block
- Compare driven legs with billed legs. Anything driven but missing from a claim goes out the same day.
- Look for claims that never entered processing. Check each payer’s portal or acknowledgment report. A claim rejected at the door generally does not appear on the remittance, so the silence can be mistaken for a slow payer.
- Tie payments to deposits. Mark each line on the remittance or broker statement as paid, paid short, denied, or held. Then confirm the statement total matches the bank deposit, and trace any gap to an offset or recoupment. NEMT remittance advice explains each part of a remittance.
- Work denials by deadline, closest first. Correct and resend your own errors. Appeal the payer’s errors with the trip record attached. MTM’s agreement includes an appeal route for denials, and WellTrans will reconsider a claim it returned for missing information once you supply the missing details. See appealing a denied NEMT claim and corrected NEMT claims.
- Call about overdue payments. Once a payer’s cycle has passed, look up the claim status before resending, so you do not trigger a duplicate denial. Call with claim numbers ready. Late broker payments covers escalation.
- Move facility and private balances along. One workable ladder: a reminder on the due date, a call to accounts payable at 15 days late, a call to the person who signed the agreement at 30 days, and a final written notice at 60 days. Charge late fees only if your agreement provides for them.
Every month
- Recalculate DSO for each payer and compare it with last month.
- List every claim within 30 days of its filing deadline and assign each one.
- Review the month’s write-offs together, looking for a repeat cause.
NEMT trip reconciliation goes line by line through matching trips to payments.
Reading short payments
Each cut on a remittance is labeled twice. A two-letter group code assigns the amount to someone: CO (contractual obligation), OA (other adjustment), PI (payor initiated reduction), or PR (patient responsibility). A reason code explains why. Five that transportation providers see often:
| Code | X12 description, shortened | Common cause in NEMT | Next move |
|---|---|---|---|
| 45 | Charge exceeds the fee schedule or contracted fee | Your billed rate is above the payer’s rate | Post it as a contractual adjustment |
| 16 | Information missing, or a submission or billing error | A missing or invalid field, such as the authorization or trip number | Fix the claim using the remark code and resend |
| 18 | Exact duplicate claim or service | A resend while the first claim was still open | Find the first claim and follow that one |
| 29 | Filing time limit expired | The claim arrived after the payer’s deadline | Appeal if your submission records show an on-time filing |
| B7 | Provider not certified or eligible for the service on that date | A credentialing or enrollment gap on the ride date | Check the provider’s and driver’s status for that date |
X12 keeps the complete, current code list. The claim adjustment reason codes entry and the guide to NEMT claim denials cover the codes transportation providers run into most.
When a balance will not be collected
Unpaid amounts are not all the same kind of loss. Book them separately so both the accounting and the fixes stay accurate.
| Type | What it is | How to handle it |
|---|---|---|
| Contractual adjustment | Your charge minus the payer’s contracted rate | Post it with the payment. It is not a loss. |
| Administrative write-off | A trip lost to an internal miss, such as a late claim or a missing credential | Write it off and fix the step that failed |
| Bad debt | A facility or private balance still unpaid after your full collection steps | Write it off under your policy and decide whether to keep serving the account |
Three rules limit what you can do next:
- Medicaid riders are generally off limits. 42 CFR 447.15 makes the agency’s payment, together with any cost sharing the plan charges, the full price of a covered ride. MTM’s standard agreement goes further: its members may never be billed, even when the money never comes from MTM or its client. WellTrans carves out one case, and only where the law permits it: payment was denied because the rider never went to the medical visit the trip was for.
- Overpayments go back. A Medicare or Medicaid overpayment generally has to be reported and repaid within 60 days of discovery, with the reason explained in writing. Past that deadline, the retained money becomes a debt the False Claims Act reaches. Brokers recover their own overpayments too, and MTM’s agreement lets it offset them against future payments. See the 60-day overpayment rule.
- Tax treatment follows your accounting method. IRS Topic 453 says that to deduct a bad debt, you generally must have already included the amount in income. A cash-basis company generally cannot deduct unpaid fees it never reported. A business bad debt is deducted in the year it becomes partly or totally worthless. Your tax preparer can confirm the treatment for your company.
Put the write-off policy in writing: who may approve a write-off, the dollar amount that needs the owner’s sign-off, and what each entry records (trip, payer, amount, reason code, and date). When a month’s entries share one driver, one payer, or one missing document, the fix is obvious.
Where software helps
HealthRide marks every invoice as outstanding, paid, or past due, sets its due date from that payer’s terms, and keeps a past-due list of exactly who to call. Checks, cards, and broker payments are all recorded in one list and matched to trips and invoices. For any date range, the payer summary report shows what you billed and what is still unpaid for each payer. See invoicing and reports.
Frequently asked questions
- Which days sales outstanding number should a NEMT company aim for?
- There is no single benchmark, because payers pay on different cycles. Compare each payer's figure with its own terms. A broker that pays 30 days after submission, billed weekly, should sit in the mid 30s. A facility on net 30 that you invoice once a month should sit in the 40s. A payer running well past its expected figure has claims stuck somewhere.
- Which date should a NEMT receivable be aged from?
- Age Medicaid, health plan, and broker claims from the date of service, because filing limits count from the ride: federal rules cap state Medicaid at 12 months, and MTM's standard agreement allows 90 days. Age facility and private invoices from the invoice date, since payment terms such as net 30 start there. Record the billing date too, since payment deadlines start on the day a claim reaches the payer.
- How long should I wait before chasing an unpaid NEMT claim?
- Until the payer's own promise runs out, then act. Under MTM's standard agreement, a properly submitted invoice that nobody disputes is due 30 days after you enter it online. WellTrans pays Indiana providers in two runs a month, at most 30 days after submission. For a clean Indiana fee-for-service claim that reaches Verida by Wednesday, the promise is 14 days. Check the claim's status before sending anything again, so a resend is not denied as a duplicate.
- Is a contractual adjustment the same as a write-off?
- No. A contractual adjustment is the normal difference between what you charged and the rate the payer pays under your agreement. Remittances usually mark it with group code CO and reason code 45. Post it when the payment arrives. A write-off is money you expected to collect and will not, such as a claim that missed its filing limit.
- A payer paid the same trip twice. Now what?
- Send it back. Federal law makes a provider or supplier that received a Medicare or Medicaid overpayment report and repay it, with a written reason, generally no later than 60 days after spotting it. Keeping it longer exposes you to the False Claims Act. Brokers can also recover overpayments from later payments, as MTM's agreement allows.
- Who should approve a write-off in a small NEMT company?
- Set it in writing before you need it. Let the billing lead approve small administrative write-offs, and require the owner's sign-off above a dollar amount you choose. Each entry should record the trip, payer, amount, reason code, date, and approver. Reviewing the month's entries together shows whether one driver, one payer, or one missing document keeps costing you money.
