# How to Buy a NEMT Business in 2027: Due Diligence, Financing, and Change of Ownership

Canonical URL: https://nemtguide.com/guides/buy-a-nemt-business/ · Updated 2026-09-29

To buy a NEMT business, first confirm what will actually transfer, because Medicaid enrollment, broker agreements, and licenses rarely move on their own. Screen every owner and driver against the OIG exclusion list, review two years of claims, audits, and loss runs, and choose an asset or stock purchase. Then file each state and broker change of ownership before closing so rides never stop.

- You are buying trips that depend on approvals. Broker agreements, Medicaid enrollment, and licenses rarely move to a new owner on their own.
- MTM Health can reassign any trip, including standing rides, and requires a new agreement after a change of ownership.
- Screen every owner, manager, and driver against the OIG and SAM exclusion lists before you sign anything binding.
- A stock purchase brings the company's past overpayments with it. In Florida, the new owner also owes overpayments the state identified by the sale date.
- An SBA 7(a) loan for an initial acquisition needs at least 10 percent equity, a valuation that supports the price, and no seller earnout.

Buying an existing NEMT company can give you vans, trained drivers, and trips on day one. But most of those trips depend on approvals the seller holds: the state Medicaid enrollment, each broker agreement, and the operating license. This guide covers what really transfers, what to check before you sign, how SBA lenders look at the deal, and the change of ownership steps that keep rides running. For the other side of the table, see [how to sell a NEMT business](https://nemtguide.com/guides/how-to-sell-a-nemt-business/).

## What you are really buying

A NEMT company is a few assets you can hold and a set of approvals you cannot simply take over. Price the business on what you will actually keep.

| What the company has | Does it move to you? | What to check |
|---|---|---|
| Vans and equipment | Yes, by title in an asset purchase, or they stay in the company in a stock purchase | Liens, inspections, lift and ramp service records |
| Drivers and office staff | They can stay, but in an asset purchase your company becomes their new employer | Driver files, pay rates, I-9s |
| Broker agreements | Not automatically. MTM Health requires a new agreement after a change of ownership | The assignment and change of ownership sections of each agreement |
| Standing rides, such as dialysis | Not guaranteed. MTM can assign or reassign any trip, recurring trips included | Trip volume by broker for the last 12 months |
| Medicaid enrollment | Usually not in an asset purchase. It stays but must be updated in a stock purchase | Enrollment status and the next revalidation date |
| NPI | It belongs to the legal entity | The NPPES record |
| Licenses and permits | Not in some states. New Jersey mobility assistance vehicle licenses cannot be assigned | State and city license rules |
| Facility and private pay contracts | Only if the contract allows assignment or the other side consents | The assignment clause |

Broker revenue is the least certain part. MTM Health's standard agreement, in the January 1, 2023 version Pennsylvania posts, runs three years, lets either side end it on 30 days' written notice, and guarantees no minimum number of trips. It also says the provider has no right to transport any particular rider or to serve any particular facility. Health plans switch brokers too: Blue Cross and Blue Shield of Texas moves its Medicaid members from Modivcare to MTM Health on October 1, 2026, and recurring trips after that date go to MTM. A company with trips spread across several brokers, facilities, and private pay riders is safer to buy. See [NEMT payer mix](https://nemtguide.com/guides/nemt-payer-mix/).

## Why buy instead of starting from scratch

A purchase can shortcut the slow parts of starting: hiring and training drivers, buying and credentialing vans, and finding work while a [broker network is full](https://nemtguide.com/guides/broker-network-full/). It can also be one way into a market where new enrollment is paused. Federal rules let a state stop enrolling new providers of a high-risk type, in six-month periods (42 CFR 455.470). Minnesota has frozen enrollment of new NEMT providers in the seven-county Twin Cities metro since January 27, 2026, and on July 23, 2026 extended the freeze to January 27, 2027. See [Minnesota's metro enrollment freeze](https://nemtguide.com/news/minnesota-metro-nemt-enrollment-freeze/) and Medicaid enrollment moratoriums.

A stock purchase is the structure most likely to keep the existing enrollment, though some states still want a new application after a change of ownership. An asset purchase usually makes your company a new applicant, and a moratorium blocks new applicants. Ask the state in writing how it treats your deal before you sign.

Buying does not skip screening. Under federal rules, the state Medicaid agency:

- must get disclosures of every owner with 5 percent or more, officers, directors, and managing employees within 35 days after any change in ownership (42 CFR 455.104),
- must end the enrollment if a 5 percent owner does not give timely, accurate information or cooperate with screening (455.416),
- must deny or end enrollment when a 5 percent owner was convicted of a Medicare or Medicaid crime in the last 10 years, unless it documents why that is not in the program's interest (455.416),
- must require fingerprints from high-risk providers and their 5 percent owners within 30 days of a request (455.434), and site visits for moderate and high risk (455.432), and
- must screen a provider as high risk when it has an existing Medicaid overpayment, a payment suspension over a credible allegation of fraud, waste, or abuse, or an exclusion in the last 10 years (455.450).

That last rule matters to a buyer. A company carrying an unpaid overpayment faces the toughest screening at its next application or revalidation, and revalidation comes at least every 5 years (455.414). Illinois already requires fingerprint-based background checks for NEMT providers and makes them subject to on-site visits. See Medicaid provider risk levels and [Medicaid revalidation](https://nemtguide.com/guides/medicaid-revalidation/).

## Asset purchase or stock purchase

In an asset purchase, your own company buys the vans, phone number, name, and whatever contracts can move. In a stock purchase, or a purchase of LLC membership interests, you buy the company itself, with its enrollment, contracts, and history.

| | Asset purchase | Stock or membership purchase |
|---|---|---|
| What you get | The assets and contracts listed in the agreement | The whole company, including its past |
| Medicaid enrollment | Your company usually enrolls as a new provider. Illinois requires a new NPI and provider number from the purchase date | Usually stays, but new owners are disclosed within 35 days, and some states want a new application |
| Broker agreements | Need written consent or a new agreement | Still a change of ownership. MTM requires a new agreement |
| Past overpayments | Mostly stay with the seller, but Florida makes the new owner liable too for overpayments identified by the sale date | Come with the company |
| Employees | Your company is the new employer: complete new I-9s, or keep the seller's and accept liability for their errors | Same employer and the same I-9s |
| Taxes | Buyer and seller both file IRS Form 8594 with their returns | Different rules. Ask your CPA |
| SBA loan | Counts as a change of ownership when you buy substantially all the assets and continue the business | Counts as a change of ownership |

On Form 8594, vans are generally Class V assets. Licenses, permits, and a noncompete signed with the purchase are Class VI, and goodwill is Class VII. The split affects both sides' taxes, so agree on it in the purchase agreement.

Neither structure is safer in every case. An asset purchase leaves most old liabilities behind but restarts the approvals. A stock purchase keeps the approvals but hands you the company's past. Decide with a CPA and a health care attorney before you sign a letter of intent. If the company is a franchise, read the transfer terms first: Item 17 of the franchise disclosure document lists the franchisor's approval of a transfer, its conditions, and any right of first refusal. See [buying a NEMT franchise](https://nemtguide.com/guides/nemt-franchise/).

## Due diligence: what to check before you sign

Ask for documents only after a signed letter of intent and a confidentiality agreement. These are the items that decide whether a NEMT deal is worth doing.

| Document | What to look for |
|---|---|
| Formation papers and ownership list | Every owner with 5 percent or more, and every officer and manager, for screening |
| Exclusion checks | Current OIG, SAM, and state list results for the company, each owner and manager, and every driver |
| Medicaid enrollment approval and NPPES record | Legal name, tax ID, and addresses that match, and the revalidation date |
| Broker, health plan, and facility agreements | Assignment, change of ownership, and termination terms, plus the last year of scorecards |
| Two years of claims, remittances, and bank statements | Denials, recoupments, and deposits that match the books |
| Audit letters, overpayment notices, and payment holds | Every open matter, including preliminary audit reports |
| Trip logs and signatures | A sample checked against the claims paid for those trips |
| Driver files | Background checks, driving records, drug tests, training, and I-9s |
| Vehicle list with VINs | Titles, liens, inspections, and the broker's vehicle roster |
| Insurance policies and loss runs | Open claims, accident history, and any lapse in coverage |
| Licenses and permits | Which ones must be reissued in your name |

### Owners, managers, and drivers on exclusion lists

No federal health care program pays for items or services furnished, ordered, or prescribed by an excluded person, and anyone who hires someone on the OIG list may face civil money penalties. OIG tells health care entities to check the list routinely, for new hires and current staff. MTM's standard agreement bars using any driver or attendant on the OIG list or other government exclusion lists. Run every name, and have the seller warrant in the purchase agreement that none appears. See the [OIG exclusion list](https://nemtguide.com/glossary/oig-exclusion-list/) and [SAM exclusions](https://nemtguide.com/glossary/sam-exclusions/).

Check for terminations elsewhere too. A state must deny or end the enrollment of a provider that another state's Medicaid program or Medicare terminated and that is still in the federal termination database (455.416).

### Claims, audits, and overpayments

Read two years of remittances and every letter from the state, the broker, or an auditor. Florida's law counts any amount in a preliminary audit report issued before the sale as an outstanding overpayment, so ask for those drafts too.

Then test the claims. Pull a sample of paid trips and check each against its trip log, the rider's signature, and the driver's and van's credentials on that date. Colorado's HB26-1328, in effect since July 1, 2026, makes trips by noncredentialed drivers or in noncredentialed vehicles ineligible for payment, and MTM's Virginia handbook warns of lost payment for trips by drivers with expired documents. A trip that should not have been paid is an overpayment. Once an overpayment is identified, federal law gives 60 days to report and return it, and an overpayment kept past that deadline counts as an obligation under the False Claims Act (42 U.S.C. 1320a-7k(d)). In a stock purchase, that duty is your company's after closing. See the [60-day overpayment rule](https://nemtguide.com/guides/medicaid-overpayment-60-day-rule/) and [Medicaid recoupment](https://nemtguide.com/guides/medicaid-recoupment/).

### Broker agreements

In MTM's standard agreement, these sections decide what happens in a sale:

- A change of ownership, FEIN, or legal name requires a new agreement (section 2.C).
- Changes in ownership, officers, directors, or controlling interest must be reported to MTM right away (section 11.B).
- The provider cannot assign the agreement without MTM's written consent (section 12.A).
- A provider that assigns its right to payment, for example to a factoring company, must give MTM written notice 30 days before (section 12.C).
- After a termination notice, MTM withholds unpaid claims until it audits them, and it may offset penalties (section 14.E).

Other brokers use their own agreements. Ask each broker's provider relations team, in writing, whether your company must apply as a new provider and how long [broker credentialing](https://nemtguide.com/guides/nemt-broker-credentialing/) takes. Ask the seller for its [broker scorecards](https://nemtguide.com/guides/nemt-broker-scorecards/) as well. MTM's Virginia handbook says expired credentials can cut trip volume, trigger a performance improvement plan, or end in non-renewal.

### Drivers, vans, and insurance

**Drivers.** MTM's standard agreement asks for a criminal background check before hire and every year, a three-year driving record every year, drug and alcohol tests before hire, after an accident, and at random, and training certificates. MTM's Virginia roster adds PASS, HIPAA, defensive driving, first aid, and securement training dates. Check how drivers are paid too, since misclassified drivers stay the company's problem in a stock purchase. See the [driver file checklist](https://nemtguide.com/templates/nemt-driver-file-checklist/) and [whether NEMT drivers can be 1099](https://nemtguide.com/guides/nemt-drivers-1099-or-w2/).

**Vans.** Match every VIN to its title, lien payoff, inspection, and the broker's vehicle roster. CareOregon, for example, requires a safety inspection by an ASE-certified mechanic within the last year and yearly ADA compliance certification for wheelchair vehicles. See [buying a used wheelchair van](https://nemtguide.com/guides/used-wheelchair-van/).

**Insurance.** Ask for loss runs, the insurer's claims history, covering at least the same two years as the claims review, and every accident and incident report. A string of at-fault crashes can keep drivers off broker trips: MTM bars drivers convicted of two or more at-fault accidents with injury or damage in 36 months. MTM also ends its agreement immediately if insurance lapses, so in an asset purchase your own policy must be in force on the closing date. See [what to do after a NEMT vehicle accident](https://nemtguide.com/guides/nemt-vehicle-accident/).

### Licenses and rider privacy

Licenses can be stricter than Medicaid. New Jersey's rules for mobility assistance vehicle providers make licenses non-assignable and require notice to the Department of Health at least 30 calendar days before any ownership change. A change in controlling interest needs a new license application, no rides may run until the licenses are granted, and licenses become void if control changes first. An ownership change that leaves control where it is, or passes it to an existing owner, needs a $250 fee instead. See [NEMT license requirements](https://nemtguide.com/guides/nemt-license-requirements/).

Trip records hold rider health information. If the seller is a HIPAA covered entity, and your company is or will become one, the Privacy Rule counts due diligence for the sale as health care operations (45 CFR 164.501). The minimum necessary rule still applies, and MTM's agreement bars sharing member information without MTM's written consent. Work from totals and samples with names removed. See [HIPAA for NEMT](https://nemtguide.com/guides/hipaa-for-nemt/).

## How to pay for it: SBA 7(a) rules from October 1, 2026

Many buyers use an SBA 7(a) loan. SOP 50 10 8.1 applies to applications given an SBA loan number on or after October 1, 2026, and Appendix 15 sets the change of ownership rules.

| Rule | What SOP 50 10 8.1 requires |
|---|---|
| Equity for an initial acquisition (a buyer who is not already an owner) | At least 10 percent of total project costs. The lender cannot reduce it |
| Equity for an expansion | 10 percent, which the lender may reduce, when a company that has run at least two full fiscal years under its current owners buys another in the same four-digit NAICS industry group |
| Seller note | Counts as equity only on full standby, with no payments for the life of the loan, and covers no more than half the required equity |
| Business valuation | By an independent appraiser credentialed as ASA, CBA, ABV, CVA, or BCA, ordered by the lender. For a price of $350,000 or less, the lender may value it itself unless buyer and seller are closely related |
| Price above the valuation | Paid with your equity |
| Quality of earnings report | Required for initial acquisitions and expansions priced at $3 million or more. It tests customer concentration and whether contracts will continue after the sale |
| Debt service coverage | EBITDA at least 1.25 times all debt payments after the purchase for an initial acquisition, 1.15 times for an expansion |
| Earnouts | Seller earnouts are prohibited. Buyer rebates based on performance are allowed |
| The seller after closing | In an initial acquisition or an expansion, cannot stay as an officer, director, owner, or employee. May consult for up to 24 months in total |
| Loan term | Amortization of no more than 10 years when no real estate is included |
| Checks on the seller | The lender verifies the seller's financial statements against IRS tax transcripts and visits the business |
| Loan size | Up to $5,000,000 for a standard 7(a), $350,000 for a 7(a) Small loan, and $500,000 for SBA Express |
| Owners | Every owner and required guarantor must be a U.S. citizen or U.S. national living in the United States |

Here is how the two main tests work on a hypothetical deal. The price is $400,000, you add $60,000 of working capital, and closing costs are $20,000, so total project costs are $480,000.

**Equity needed = total project costs × 10% = $480,000 × 10% = $48,000**

A seller note on full standby can cover at most half, $24,000. The other $24,000 or more must be cash or another source SBA counts in full.

**Most debt the business can carry each year = EBITDA ÷ 1.25**

If the company earns $150,000 before interest, taxes, depreciation, and amortization, all loan payments after the purchase can total no more than $120,000 a year. The example numbers are made up; use the figures from the seller's verified books. For the rest of the loan rules, see [NEMT business loans](https://nemtguide.com/guides/nemt-business-loans/).

## Change of ownership rules by state

Federal rules set the floor everywhere: disclose new owners within 35 days (42 CFR 455.104), and, as a HIPAA covered provider, update the NPPES record within 30 days of any change (45 CFR 162.410). Where your state collects the federal application fee, it is $750 for applications submitted in 2026 (CMS notice, December 3, 2025). States add their own steps:

| State | When | What the buyer does |
|---|---|---|
| Florida | At least 60 days before the sale | The seller notifies AHCA and you submit a Medicaid enrollment application. AHCA will not approve you until outstanding overpayments are paid or on a written payment plan (2026 Florida Statutes, 409.907) |
| Texas | Within 30 calendar days after | Submit the enrollment application with a copy of the contract of sale that says who is liable for overpayments on earlier dates of service. You can bill dates of service from your enrollment's effective date, within 95 days after enrollment is complete and 365 days of the ride (TMPPM, September 2026) |
| Illinois | From the purchase date | Enroll in IMPACT with a new NPI and provider number, and replace prior approvals issued under the old number. HFS allows 90 days from enrollment to request revised approvals and 180 days from those approvals to submit claims (HFS handbook, March 11, 2024) |
| New York | Within 35 days (federal rule) | Report it in the Provider Services Portal with proof such as a bill of sale or stock purchase agreement, and pay the $750 application fee. A new application also needs a letter of support from Medical Answering Services (MAS), the state's broker (eMedNY, May 2026) |
| New Jersey | At least 30 days before | For a mobility assistance vehicle provider, apply for new licenses when controlling interest changes, and run no rides until they are granted (N.J.A.C. 8:40-2.3) |

In a state with an enrollment moratorium, ask the Medicaid agency in writing how it treats your deal before you sign. Our [state guides](https://nemtguide.com/states/) cover each state's enrollment office, and [how to become a Medicaid transportation provider](https://nemtguide.com/guides/how-to-become-a-medicaid-transportation-provider/) covers a new enrollment from start to finish.

## How to buy a NEMT business, step by step

1. **Decide what you want.** Pick the territory, the service levels (ambulatory, wheelchair, stretcher), and the payers you want to serve.
2. **Screen the seller early.** Search the company and its owners on the OIG and SAM lists, look up its NPI in the NPPES registry, and confirm its enrollment and licenses are active.
3. **Sign a confidentiality agreement,** then review summaries: revenue by payer, trips by broker, fleet, and staff.
4. **Sign a letter of intent with conditions.** Make the deal depend on broker consent or new agreements, Medicaid approval, licenses, financing, insurance, and clean exclusion checks.
5. **Do the due diligence** in the checklist above, with a CPA and a health care attorney.
6. **Choose the structure.** Asset or stock, and how the price splits across the Form 8594 classes.
7. **Line up the money.** An SBA lender orders its own valuation and verifies the seller's returns.
8. **File before closing.** Send the advance notices your state requires, such as Florida's 60 days and New Jersey's 30, submit your enrollment, start broker credentialing for your company, and bind your insurance for the closing date.
9. **Sign the purchase agreement.** Name who is liable for Medicaid overpayments on rides before the sale, as Texas requires, and have the seller warrant that no owner, manager, or driver is excluded or under investigation.
10. **Leave the seller's receivables with the seller.** State Medicaid programs pay only the provider that gave the ride, with narrow exceptions (42 CFR 447.10), so the seller bills its own dates of service and you bill yours. Settle any difference in the price.
11. **Close and report.** Disclose owners within 35 days, update NPPES within 30 days, notify each broker, transfer titles, and complete or adopt the I-9s. Both sides attach Form 8594 to their tax returns for the year of the sale.
12. **Keep the records.** Agree in writing who keeps the pre-closing trip records and for how long. MTM's standard agreement requires full records for 10 years.

For every report the state expects after closing, see [changes to report to Medicaid](https://nemtguide.com/guides/report-changes-to-medicaid/) and change of ownership.

## Red flags that should stop or reprice a deal

- **An excluded owner, manager, or driver.** Payment for their services is prohibited, and hiring them can bring civil money penalties.
- **An open audit, payment suspension, or unpaid overpayment.** Florida will not approve the buyer until overpayments are paid or on a plan, and an open overpayment moves the company to high-risk screening.
- **One broker or health plan behind most of the trips.** MTM's agreement can end on 30 days' notice and promises no minimum volume.
- **Trips run by drivers or in vans without current credentials.** Those payments can be taken back.
- **Books that do not match the tax returns.** SBA lenders check the seller's numbers against IRS transcripts.
- **An earnout with an SBA loan.** SBA prohibits seller earnouts, so agree on a fixed price instead.
- **A seller who offers to let you bill under their number.** Illinois warns that a new owner's claims under the prior owner's provider number can lead to recoupment and sanctions.
- **Gaps in insurance or a string of at-fault crashes.** Both can end broker work quickly.

## Frequently asked questions

### Do the seller's broker contracts transfer to me?

Not automatically. MTM Health's standard agreement, in the January 1, 2023 version Pennsylvania posts, requires a new agreement after a change of ownership, FEIN, or legal name, and bars assignment without MTM's written consent. It also lets MTM assign or reassign any trip, including recurring trips, at its sole discretion. Ask each broker in writing how it handles a new owner before you set a closing date.

### Am I responsible for the seller's Medicaid overpayments?

In a stock purchase, yes, because the company keeps its history. In an asset purchase it depends on the state and your contract. In Florida the buyer is liable for overpayments the agency identified on or before the sale date, including amounts in a preliminary audit report, and both sides are jointly liable if the 60-day notice is skipped. Texas requires a contract of sale that names who is liable.

### Can I buy a NEMT company to get around an enrollment freeze?

Rarely by buying assets. An asset purchase usually makes your company a new applicant, and a moratorium under 42 CFR 455.470 stops the enrollment of new providers. A stock purchase usually keeps the enrollment, but new owners must be disclosed within 35 days and screened, and 5 percent owners of high-risk providers give fingerprints within 30 days of a request (455.434). Ask the state in writing how it treats the change before you sign.

### How much do I need to put down with an SBA loan?

At least 10 percent of total project costs for an initial acquisition, where you are not already an owner, under SOP 50 10 8.1, effective October 1, 2026. The lender cannot reduce it. A seller note counts toward no more than half of that, and only if it is on full standby, with no payments for the life of the loan. If the price is above the business valuation, you cover the difference with equity.

### Can the seller stay on to help after I buy?

Yes, unless you use an SBA 7(a) loan for an initial acquisition or an expansion. In those deals the seller cannot remain an officer, director, owner, or employee, but the business may hire the seller as a consultant for up to 24 months in total. Put the handover plan, such as introductions to facilities and brokers, in the consulting agreement.

### Do I need a new NPI when I buy a NEMT company?

In an asset purchase your company bills under its own Type 2 NPI. Illinois treats a company's purchase of another transportation company as a buy-out: the buyer enrolls with a new NPI and provider number from the purchase date and cannot bill under the purchased company's NPI. Where a stock purchase keeps the company, it keeps its NPI, and a HIPAA covered provider reports any change to its NPPES record within 30 days (45 CFR 162.410).

### What should I check in the drivers' files?

Everything a broker would check. MTM Health's standard agreement asks for a criminal background check before hire and every year, a three-year driving record every year, pre-employment, post-accident, and random drug and alcohol tests, and training certificates. Screen every driver against the OIG exclusion list too, because no federal health care program pays for services furnished by an excluded person.

## Official resources

- [HHS OIG: Search the List of Excluded Individuals and Entities](https://oig.hhs.gov/exclusions/)
- [SAM.gov: Search exclusions](https://sam.gov/)
- [CMS: NPPES NPI Registry](https://npiregistry.cms.hhs.gov/)
- [eCFR: 42 CFR 455.104, Disclosure of ownership and control](https://www.ecfr.gov/current/title-42/section-455.104)
- [SBA: SOP 50 10, Lender and Development Company Loan Programs](https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs)
- [IRS: About Form 8594, Asset Acquisition Statement](https://www.irs.gov/forms-pubs/about-form-8594)
- [USCIS: Form I-9 rules after an acquisition](https://www.uscis.gov/i-9-central/form-i-9-resources/handbook-for-employers-m-274/80-rules-for-continuing-employment-and-other-special-rules)