The Danger of NEMT's Broker System: It's Time to Eliminate the Middle-Man
With a growing emphasis on the Social Determinants of Health (SDOH) as crucial factors in the health status of individuals, it has become more clear than ever how important reliable Non-Emergency Medical Transportation (NEMT) is to successful patient outcomes. According to the American Hospital Association (AHA), every year 3.6 million patients in the United States are unable to receive the medical care they need due to issues surrounding transportation. The average no-show rate for medical appointments NOW HOVERS JUST UNDER 20%[1], creating inefficiencies in an industry already bogged down by excess administration and bureaucracy. In fact, these missed appointments add up to a $150 BILLION PRICE TAG ANNUALLY[2], without making any tangible improvements to a patient’s health.
Transportation to and from medical appointments is, without a doubt, an integral part of a patient’s journey to wellness. Yet the current non-emergency medical transport (NEMT) system is bogged down by inefficiencies, fraud, and mismanagement. Many of these problems lie as a result of brokers, the dominant model of NEMT in the United States today.
Brokers are typically given a capitated payment (a set amount paid per patient annually) by CMS, and are then responsible for managing the delivery of NEMT. Brokers pass off ride requests to their local network of providers, and in turn pay the transportation providers a cut of what they receive from CMS and other insurance providers. Brokers track transportation provider credentialing and act as the middle-man between transportation providers and ride requests. In reality, this system does far more harm than good. Brokers are not only becoming irrelevant in the NEMT industry, but their lack of oversight often negatively affects patient care.
The brokerage model is problematic for a number of reasons. As brokers often monopolize an entire region or state, and are paid in a lump-sum, they don’t maintain any incentive to provide a high standard of care. Regardless of the amount of work they perform or their network’s service quality, they get paid the same amount. Without any incentive to provide quality patient care, patient well-being can cease to be a priority. And it does.
Regardless of the amount of work they perform or their network’s service quality, [brokers] get paid the same amount. Without any incentive to provide quality patient care, patient well-being can cease to be a priority. And it does.
Reports from a couple of the largest brokers in the United States cite patients being stranded when MEDICAL TRANSPORTATION FAILED TO SHOW UP[3], DROPPED OFF AT THE WRONG ADDRESSES[4], or lEAVING CHILDREN AND HANDICAPPED PATIENTS UNSECURED IN THE VEHICLE[5]. One patient in South Carolina, Welsey Clemons, almost died due to Logisticare not showing up to transport him to the hospital. Clemons relied on oxygen tanks to breathe, and FINISHED HIS LAST TANK WHILE WAITING FOR HIS RIDE TO THE HOSPITAL, WHICH NEVER CAME[6].
When MTM launched in Rhode Island last January, it generated an overwhelming 1,158 patient-care complaints in their first month of operations. In addition to no incentivization for quality patient care, the broker’s contract even ALLOWED THEM TO WORK WITH PROVIDERS WHICH HAD PREVIOUSLY BEEN CONVICTED OF FRAUD[7]. Some of Rhode Island’s most vulnerable patients were forced to rely on convicted fraudulent companies to transport them to crucial medical appointments, with brokers failing to enforce even basic standards of care.
In addition to allowing for poor patient care, NEMT’s brokerage model has no transparency. Once a healthcare provider hands off the ride request to a broker, there is no reliable reporting that occurs. Providers cannot view on-time rates, track where their patient is, or accurately assess any incidents that arise. In many cases, the broker tracks and reports on their own complaint/incident rate, leaving lots of room for “fudging the numbers” or downright fraud. A 2016 audit from the U.S. Department of Health and Human Services found that, in the end, only 12% of New Jersey rides provided by a Logisticare met all state requirements and upwards of 53% of patients had missed an appointment due to failed transportation from the broker. Yet Logisticare had claimed that, in the same year, THEIR COMPLAINT RATE HAD NEVER RISEN ABOVE 1%[8]. In Virginia, a state-wide broker claimed they needed a higher reimbursement amount in order to operate, but “were unwilling or unable to provide any information about their operations” to justify the cost increase. Because brokers often operate as monopolies in their various states/counties, they are free to effectively ignore regulations and reporting/transparency standards.
Healthcare providers put up with this lack of transparency, poor levels of care, and more because non-emergency medical transportation is a crucial aspect of the patient’s journey. However, the reality is that brokers are completely unnecessary to the healthcare ecosystem.
Healthcare providers put up with this lack of transparency, poor levels of care, and more because non-emergency medical transportation is a crucial aspect of the patient’s journey. However, the reality is that brokers are completely unnecessary to the healthcare ecosystem. Brokers merely pass on a service request to actual on-the-ground NEMT companies: they do not own vehicles, staff EMTs, or interact with the patient in person. Brokers primarily verify patient eligibility, take calls for ride requests, and track transportation provider credentialing. After receiving an eligible call request, the broker passes off the ride to a credentialed service provider to perform the service. Despite being the ones who actually provide the service, transport providers only receive a fraction of the payment for the NEMT trip after the broker takes their cut. Transport providers can become almost fully dependent on brokers for leads, unable to do anything if the broker decides to suddenly cut their rates for trip completion. All in all, the broker system is unreliable, opaque, and completely unnecessary with modern dispatch technology.
Brokers know this, and are beginning to feel the heat. Logisticare, the Atlanta-based broker giant, recently acquired Circulation, a platform designed to automatically match NEMT requests with local providers. Similarly, MTM invested in NEMT platform Kaizen Health. Both platforms help create a world where brokerages aren’t needed for reliable NEMT scheduling: software can now perform the role of an entire call center.
So what is our healthcare system, and transportation providers, to do? NEMT is a crucial aspect of patient health and wellbeing, yet the current model is mired in dysfunction. It’s clearer than ever that the brokerage model of patient transport needs to be replaced, but with what? How can transportation providers still receive leads without a broker, and how can we ensure a patient receives the transport they need at the right time?
READ PART 2 OF OUR BROKER SERIES HERE.
Want to read more from the Patient Care Logistics Journal? Check out our latest round-up of takeaways from Deloitte's healthcare outlook review.
1. Kheirkhah, Parviz et al. “Prevalence, predictors and economic consequences of no-shows.”BMC health services researchvol. 16 13. 14 Jan. 2016, doi:10.1186/s12913-015-1243-z
2. Health Research & Educational Trust. (2017, November). Social determinants of health series: Transportation and the role of hospitals. Chicago, IL: Health Research & Educational Trust. Accessed at www.aha.org/transportation
3. Clark, Kayla. "Patient left stranded for hours by medical transportation company Logisticare." Click on Detroit, 27 August 2019
4. Stern, Melissa. "Medical transport company leaves patients stranded". CBS 46, 23 October 2019, cbs46.com/news/medical-transport-company-leaves-patients-stranded/.
5. Parker, Paul E. "Medical ride provider fired after TV report of unsecured children". Providence Journal, 29 August 2019, providencejournal.com/news/20190829/medical-ride-provider-fired-after-tv-report-of-unsecured-children
6. Floyd, Jerrel. "Summerville man says he nearly died waiting for medical transportation van that never came". Post and Courier, 24 November 2019, https://www.postandcourier.com/health/summerville-man-says-he-nearly-died-waiting-for-medical-transportation/Anderson, Patrick.
7. "R.I. official struggles to explain changes to medical transport company's contract". Providence Journal, 6 November 2019, https://www.providencejournal.com/news/20191106/ri-official-struggles-to-explain-changes-to-medical-transport-companys-contract
8. KIYC: LogistiCare medical transport frustrations", News12 New Jersey, 12 June 2017, http://newjersey.news12.com/story/35648200/kiyc-logisticare-medical-transport-frustrations