Partnering with ambulance companies: taking the stretcher trips Medicare will not pay ambulance rates for

Ambulance services field scheduled requests every day for patients who do not need an ambulance, and Medicare will not pay them for those trips. A wheelchair or stretcher van company can take those patients, and the ambulance service gets back the patients who need treatment or monitoring en route. Done right, it is a plain referral relationship. Done wrong, it is a kickback arrangement between two companies that both bill Medicaid. NEMT vs ambulance explains where the medical line between the two falls. This guide covers the partnership itself: what changes hands, what cannot, and how to write it down. Ambulance services that run their own van division should read scheduling software for ambulance companies instead.

Why ambulance services shed van-level trips

Medicare covers a nonemergency ambulance trip only if “other means of transportation are contraindicated” for the patient, and the condition has to call for both the ambulance itself and the level of service on the claim (42 CFR 410.40(e)). When a patient on a regular schedule, such as a dialysis rider, can sit up in a wheelchair or lie on a stretcher without monitoring, the ambulance service is left with trips it cannot bill to Medicare at ambulance rates. Repeat trips also need a recent physician certification and fall under Medicare’s nationwide prior authorization model, which NEMT vs ambulance walks through.

The patient still has to get there. OIG’s 2003 compliance guidance for ambulance suppliers notes that Medicaid often covers wheelchair vans, cabs, and ambulettes that Medicare typically does not. That is the gap a van company fills.

What each side brings

A partnership works when each company sends the other the patients it should not be carrying:

• The ambulance service hears from the facilities. OIG’s guidance calls hospitals and nursing facilities key sources of nonemergency ambulance business, so van-level requests land on the ambulance dispatcher first.
• Your company has the right vehicle and price for a stable patient: a wheelchair van or stretcher van, a crew trained for transfers, and Medicaid enrollment, broker contracts, or private-pay booking.
• The return flow is just as real. Anyone who needs medical care or monitoring during the ride should go by ambulance, and your intake should pass those calls to the partner. NEMT vs ambulance lists what a van crew may not do.

Three ways the arrangement can work

Most partnerships take one of three shapes, and each carries a different level of risk:

1. A referral handoff. The ambulance dispatcher gives the caller your number or transfers the call, and you do the same in reverse. No money moves in either direction. This is the simplest form and the easiest to defend.
2. Overflow under the ambulance company’s account. The ambulance company books van-level trips for a facility it serves, you run them, and you invoice the ambulance company, which bills the facility or private payer. Put the terms in a written agreement with prices set in advance.
3. Shared services. One company pays the other for something real: after-hours call answering, dispatch, garage space, or a vehicle rental. Price each one at fair market value, and pay it whether or not any referrals follow.

For the second and third shapes, write the deal to fit a federal safe harbor. Paid services fall under the personal services safe harbor, and garage space and vehicle rentals under the space and equipment rental safe harbors (42 CFR 1001.952(b) to (d)). All three ask for a signed written agreement that covers everything exchanged, a term of at least one year, and pay set in advance at fair market value that ignores the volume or value of federal program referrals between you. Fitting a safe harbor is voluntary, but an arrangement outside one is judged on its facts.

Broker trips do not change hands

A Medicaid trip assigned by a broker belongs to the broker to assign, not to either partner. MTM’s standard transportation provider agreement, as posted by Pennsylvania’s Department of Human Services, says a provider “has no claim or right to transport any particular person or any claim or right to transport any person attending any particular health care services facility.” The same agreement bars subcontracting any services without MTM’s express written consent.

That rules out two common shortcuts. The ambulance partner cannot pass you a broker member’s trip because the member is on its list, and you cannot run your broker trips in the ambulance company’s vehicles to cover a busy day. When an ambulance partner hears from a Medicaid member who needs a van, the right handoff is to the member’s broker or plan. Check your own broker agreements, which may differ.

Where the kickback line sits for partners

The federal Anti-Kickback Statute makes it a felony to knowingly and willfully offer, pay, solicit, or receive anything of value in return for referrals of federal health care program business (42 U.S.C. 1320a-7b(b)). OIG’s ambulance guidance adds that courts have found a violation when any one purpose of a payment is to induce referrals. The penalties and the general rules on gifts, facility staff, and paid marketers are in the Anti-Kickback Statute and NEMT.

The guidance also notes that a company running ambulette or van service can itself be a source of referrals for other providers. In a partnership both companies refer patients, so the statute applies in both directions. Its rule of thumb is that every arrangement should be at fair market value in an arm’s-length deal, without regard to the volume or value of referrals, with written proof of how the price was set. In a partnership, these are the arrangements that fail that test:

• A fee for each patient the other company sends.
• Dispatch, phones, or office space provided free or below market to the company that refers to you.
• Overflow rates set above market for the partner that sends Medicaid riders your way.
• Any discount that grows or shrinks with the number of referrals.

Swapping: the joint offer to a nursing home

One version OIG has warned about is a package sold to a nursing home. Its nursing facility compliance guidance, published November 20, 2024, calls it “swapping.” The facility gets a low price on something it must pay for out of its Medicare Part A daily rate, and in return it sends the supplier other federal program business the supplier can bill directly, such as Part B services outside consolidated billing. OIG says no discount of any size brings swapping under the discount safe harbor, that it may violate the statute, and that ambulance providers are among the suppliers where it tends to show up. The warning signs it lists include selling below cost, charging the facility less than other buyers of similar size that send no federal program business, and discounts that come with an exclusive provider agreement.

A van partner can end up inside that package. Example: an ambulance service offers a nursing home cut-rate ambulance runs and wheelchair van rides on the trips the home pays for, run by its van partner, so long as the home sends it the Part B ambulance trips and the Medicaid van riders. Charge a facility for the rides it pays for what you would charge a comparable customer, and never lower the price in return for the facility’s Medicare or Medicaid referrals. Skilled nursing facility transportation explains which trips the facility pays for under consolidated billing.

State laws that reach private-pay referrals

Some states go further than the federal statute, which covers only federal program business. Florida’s patient brokering law, Fla. Stat. 817.505, bars anyone from paying or receiving anything to induce the referral of a patient to or from a health care provider, without limiting it to any payer. Its definition of provider includes anyone licensed by the Department of Health, which licenses Florida’s basic and advanced life support services under section 401.25, and anyone contracted with the state Medicaid agency to serve Medicaid recipients. Practices the federal statute allows are exempt. A violation is a third-degree felony with a $50,000 fine, rising to a second-degree felony and $100,000 at 10 to 19 patients and a first-degree felony and $500,000 at 20 or more.

In Florida, then, a referral fee for a private-pay stretcher patient can still be a crime. Check your state’s law with a health care lawyer before any money changes hands for a private-pay referral.

Putting the partnership in writing

A short written agreement protects both companies and shows a broker, an auditor, or a prosecutor what the relationship is. Cover these points:

1. The parties and the services each provides, including any paid services and their prices.
2. The screening questions both dispatch desks use to route a patient: bed-confined or able to sit, oxygen and who manages it, monitoring or IV needs, weight, stairs, and the destination.
3. How a referral passes, such as a warm phone transfer, and a plain statement that no fee or discount is paid for referrals.
4. Billing. Each company bills its own payers for the trips it runs.
5. Insurance. Each company insures its own vehicles and crews and provides a certificate on request.
6. Branding. Neither company presents the other’s vehicles or staff as its own. A van company may not look like an ambulance service; see used ambulance for NEMT for the markings that must come off.
7. Term and exit. At least one year if a paid service or rental relies on a safe harbor, with notice to end it.

Running referred trips in HealthRide

A referred patient becomes one more ride on the HealthRide board. Wheelchair, stretcher, and oxygen needs are matched, so the trip goes to a van equipped for that patient. Assign it in one motion, and the rider or the facility receives a text link showing when the driver will arrive. See the dispatch board.