NEMT Subcontractor Work in 2027: How to Run Trips Under Another Provider

An established company with more trips than vans is a tempting first customer for a new NEMT business. Running its overflow can keep your van busy while your own enrollment works its way through. Done without the payer’s blessing, it can also mean trips nobody pays for, an insurance claim nobody covers, and a broker that drops both companies.

Can you run trips under another NEMT provider?

In this arrangement one company, the prime, holds the contract with a broker, health plan, or facility. Your company drives some of the prime’s trips, and the prime pays you out of what the payer pays it. Brokers use the word subcontractor more loosely: MTM Health’s Virginia handbook (approved August 10, 2026) addresses every provider in its network as a subcontracted transportation provider, and Kentucky’s sign-up page for broker networks is titled “Subcontract Non-Emergency Medical Transportation Provider.” This page is about the level below that network, where your company works for one of its members.

Whether the arrangement is allowed is written in the prime’s payer contract. Here is what published agreements and manuals said as of September 2026:

Program	Rule on handing trips to another company	Document date
New York Medicaid	Forbidden. Providers are personally and directly responsible for transporting enrollees, and that duty may not be assigned, delegated, or subcontracted.	Policy manual effective August 25, 2023
MTM Health standard agreement	Only with MTM’s express written consent, for any service and any person or business (section 12.A). A driver is an individual the provider itself retains or employs (section 1.E).	January 1, 2023 version posted by Pennsylvania
WellTrans, Indiana	Only with WellTrans’s express written consent, which it may withhold in its sole discretion. An unauthorized assignment is void. Drivers and vehicles must be registered with and pre-approved by WellTrans, or the trip is not paid.	Revised October 16, 2025
Modivcare, Kansas	No subletting, subcontracting, or arranging transportation from any third party, and only vehicles the provider owns or leases.	Manual updated May 2022, linked from Modivcare’s Kansas page
CareOregon brokerages, Oregon	A provider that cannot run a trip sends it back to the brokerage for reassignment and may not change assigned rides without authorization.	Manual version 1.3, February 2024

New York once let an enrolled company subcontract trips to another enrolled company, or lease its vehicles, for a short time after a breakdown or similar emergency. It no longer allows either, because such arrangements can slip past the safety and financial controls the Medicaid program relies on. Today a New York provider that runs short of vehicles calls the broker, and the broker finds a different company.

Vehicle ownership rules shut the same door from another side. New York requires ambulance, ambulette, and taxi providers to own their vehicles or lease them in the provider’s own name from a manufacturer or licensed dealer, and to register, insure, and maintain them. A provider may not use a vehicle registered to, insured by, or maintained by someone else, and violators can be disenrolled. So a plan to “run your van under my contract” can break the rules even if the trip itself never changes hands.

Trips that a hospital, nursing home, or rider pays for directly are governed by that customer’s contract. Before you drive one, get a copy of the clause in the prime’s facility agreement that permits another company to do the work. See NEMT facility contracts.

What the prime provider stays liable for

A prime that hands you a trip keeps every promise it made about that trip. The principle starts at the top. Under 42 CFR 438.230, a Medicaid health plan keeps ultimate responsibility for its state contract even when it subcontracts, and government auditors can inspect its subcontractors and their contractors for 10 years after the contract period ends. Broker agreements then place the same weight on each provider in the network.

Duty the prime keeps	Where the agreements put it
Running what it accepted	MTM treats accepted trips as equal in priority to the provider’s other work and requires a backup plan for each one (section 2.P). A provider leaving MTM must still run its assigned trips through the 30-day notice period (section 14.B).
Using only approved drivers and vans	MTM may withhold pay for trips run by uncredentialed drivers or in uncredentialed vehicles, and can charge liquidated damages (sections 2.N and 6.B). WellTrans charges $100 per driver per day, capped at $2,500 a month per occurrence, and $100 per vehicle per day for a vehicle it has not registered or that is missing from the provider’s insurance.
Screening everyone who works its trips	WellTrans providers promise that no employee or subcontractor on its trips has a Medicaid or Medicare fraud conviction, a program termination, or an exclusion. Louisiana’s Medicaid manual (July 14, 2025) bars anyone who employs or contracts with an excluded person from claiming Medicaid payment for that person’s services.
Answering for injuries	Each MTM provider takes on the defense of MTM and its client, and covers their losses, for claims tied to its work, including claims from people it engaged (section 10.A), and insurance minimums do not cap that promise (section 9.C). WellTrans’s indemnity covers services provided by the provider or at its direction.
Paying the workers	MTM holds the provider responsible for paying each employee and contractor on the work (section 2.KK).
Keeping records	MTM wants complete records for 10 years (section 2.S). WellTrans wants them for the contract term plus 10 years, with copies produced on three days’ notice.
Protecting member details	MTM forbids giving member information to any person or business without its written consent, beyond internal use (section 21.B).
Absorbing penalties	MTM may pass along any amount its client charges it because of the provider, and may withhold liquidated damages from payments (sections 7.A and 7.B).

MTM’s Virginia handbook shows the stakes. Putting a driver, attendant, or vehicle on a trip without ever credentialing them in MTM’s system is a top-level violation there: 3 points, an immediate suspension of at least 5 days, and possible permanent removal of that driver or vehicle.

A careful prime therefore treats your company like its own staff. Expect it to ask for every credential, a certificate listing it as additional insured, and trip records by a fixed day. The NEMT liability guide covers what happens when a claim arrives.

Four ways a new company can cover another provider’s overflow

Providers turn trips back for ordinary reasons: a van in the shop, a driver out sick, a stretcher request on a day with no crew. What matters is the route those trips take to you.

Route	Your contract is with	What the broker must approve	Best for
Drive for the other provider	That provider	You, as its driver	Owners still forming their company
Subcontract with consent	The prime	Your company, drivers, and vans, in writing	A prime with steady overflow, under a broker that allows it
Facility or private-pay overflow	The prime	Nothing, because no broker is involved	Work the facility contract lets the prime pass on
Your own network contract	The broker	Your company, as a provider	Getting turned-back trips offered to you directly

Drive for the other provider first

Joining another company as its driver is the simplest legal way in. MTM’s agreement counts an individual the provider directly retains or employs as its driver (section 1.E). The provider keeps a file on each driver, owner-drivers included: license, criminal background check at hire and yearly, a three-year driving record pulled yearly, drug and alcohol results, and training certificates (section 5.C). You learn manifests, signatures, and claims from the inside while your own company is enrolled. If you would drive as a contractor rather than an employee, read can NEMT drivers be 1099 contractors.

Subcontract with written consent

If the prime’s agreement allows consent, the prime requests it from the broker. Keep a copy that names your company before your van moves. The broker will still want to approve your drivers, vans, and insurance as it would for any provider. See NEMT broker credentialing.

Take facility and private-pay overflow

Work that a facility or rider pays for is outside the broker’s rules, so the facility contract is the only permission you need. Keep this deal separate from Medicaid work, and never pay the prime for sending Medicaid riders your way. The anti-kickback guide explains why that kind of referral payment is a risk.

Join the network and take turned-back trips directly

When a network provider cannot run a trip, the broker usually takes it back. New York tells a short-handed provider to alert the broker so it can find another company. CareOregon’s manual has providers return trips for reassignment, and lists vehicle capacity and driver schedule limits among the acceptable reasons. The broker then offers the trip to another company in its network, and that company can be yours.

Getting in can take a while. As of September 2026, MTM Health’s Rhode Island page estimates 8 to 12 months on its waitlist for new providers, and Kentucky requires new network companies to keep at least three approved drivers and three working vehicles. For what to do while you wait, see when a broker network is full and starting with one van.

What subcontract work pays

Money moves in one direction: payer to prime, prime to you. MTM’s agreement has its providers look only to MTM for payment and never bill a member, even if MTM or its client fails to pay (section 6.C). As a subcontractor, the prime is the only company you can collect from.

A worked example makes the trade-off clear. As of September 2026, MTM Health posts its Rhode Island Schedule A (effective July 1, 2023) as its current rates. A curb-to-curb wheelchair trip in business hours, picked up within 40 miles of where the provider keeps its vans, pays $28.50 for the first 5 miles plus $2.50 for each mile beyond them. The trip length and the prime’s share below are example numbers.

Example: one 12-mile wheelchair trip	Amount
Base rate, first 5 miles	$28.50
7 additional miles × $2.50	$17.50
MTM pays the prime	$46.00
Prime’s example share, 20%	$9.20
Paid to you	$36.80

Across 10 such trips in a day, the example share comes to $92 that your own contract would have paid you. Add the chance that the prime pays late or not at all, and overflow work makes more sense as a stepping stone than as a business plan.

The prime’s deadlines become yours:

• MTM pays properly submitted, uncontested invoices within 30 days of electronic submission, and will not pay a claim submitted more than 90 days after the date of service (section 6.A).
• WellTrans requires invoices with completed trip logs within 60 days, rejects any after 90 days, and pays twice a month within 30 days of submission. It can hold payments while its own client owes it money, and it deducts a trip a facility reports as not attended unless the provider responds in writing within 30 days.

Late trip logs from you can push the prime past its deadline, and then neither company is paid.

Terms to settle before the first trip

Get the arrangement signed by both companies before any rider gets in your van. The subcontractor agreement checklist has the full list. These terms carry the most weight:

Area	Terms to settle
Permission	A copy of the broker’s written consent, naming your company and service area
The work	Counties, service levels, trip types, hours, and how trips are offered, accepted, and handed back
Money	The rate (a set price per trip, a price per mile, or a cut of the payer’s rate), who keeps after-hours, wait time, and no-show pay where the payer pays it, and a payment date counted from when you deliver trip records
Paperwork	What each trip record must show (pickup and drop-off times, rider signatures, mileage, and proof of any no-show), the format, and the due date
Denials	Which denials, recoupments, and penalties you absorb, limited to those your own service caused
Insurance	Limits that match the payer’s contract, the prime and the payer as additional insureds, and advance notice of any cancellation. MTM’s standard agreement sets general liability at $500,000 per occurrence and auto at a $500,000 combined single limit, while MTM’s Rhode Island network wants $1,500,000 on each as of September 2026. See NEMT insurance requirements.
Claims	Each company defends and pays for claims its own work causes
Incidents	The payer’s reporting clocks, passed down. WellTrans expects a phone call within 3 hours of any accident or incident that injures someone, and a written report within 24 hours of any accident or incident.
Privacy	A HIPAA business associate agreement, covered below
Ending it	Notice periods, standing orders, and final payment. MTM may end its agreement at once if its own client contract ends (section 14.D), and a subcontract under it ends the same moment in practice.
Your independence	You hire, pay, train, and insure your own drivers

Sharing rider information under HIPAA

Every manifest carries protected health information: who the rider is, where they live, where they are going, and what help they need. HIPAA follows that information from company to company. Modivcare’s 2025 compliance training lays out the chain: Modivcare is a business associate of the health plans and state agencies it serves, and its transportation providers count as its subcontractors. A company one step further down becomes a business associate too, because HIPAA covers any subcontractor that creates, receives, maintains, or transmits protected health information for a business associate (45 CFR 160.103).

Before sending you any trip details, the prime must get satisfactory written assurances that you will safeguard them (45 CFR 164.502(e)). The contract that documents those assurances has required contents under 45 CFR 164.504(e)(2):

Your promise in the agreement	What it looks like day to day
Limit use to what the agreement allows or the law requires	Rider details go to the driver running the trip, not to anyone else
Safeguard electronic records under the Security Rule	Locked phones, separate logins, secure file transfer
Report unapproved uses and breaches	A lost manifest or a misdirected text gets reported to the prime
Bind anyone you hire to handle it to the same terms	A billing service you hire signs one too
Open your records to HHS if asked	Keep your policies and logs where you can produce them
Give back or destroy rider information after the work ends, if feasible	Wipe old manifests from drivers’ phones

The prime’s own contract may be tighter than the federal rule. WellTrans’s subcontractor business associate agreement gives one business day to report a security incident. MTM’s confidentiality clause means the prime needs MTM’s written consent before it shares member details with your company. See HIPAA for NEMT providers.

Step by step: set up subcontract work the right way

1. Read the prime’s payer agreement. Find the sections on assignment, subcontracting, drivers, and vehicles.
2. Get consent in writing. The prime asks the broker, and you keep a copy.
3. Check enrollment. Federal rules require states to screen, enroll, and revalidate all network providers of Medicaid health plans (42 CFR 438.602(b)). Ask the broker whether your company needs its own Medicaid enrollment for this work.
4. Credential every driver and van with the broker before they carry anyone.
5. Screen your people. Federal law requires states to make sure every NEMT provider and driver they pay is not excluded from federal health programs or on the OIG exclusion list, that every driver holds a valid driver’s license, and that each provider has a process to address state drug law violations and to disclose each driver’s driving history to the state (SMD 23-006, September 28, 2023). Keep the results in each driver file.
6. Insure to the payer’s limits, with the prime and the payer named on your certificates.
7. Sign the subcontract and the business associate agreement before any rider information arrives.
8. Build a records routine that gets trip logs to the prime well before its billing deadline.
9. Track how much of your revenue comes from the prime, and keep applying for your own contracts. See working with multiple NEMT brokers.