How To Start a Medical Transportation Business

Medical transportation involves transporting patients to and from doctor's appointments.

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How To Start a Medical Transportation Business

Medical transportation involves transporting patients to and from doctor's appointments. NEMT services are comprised of ambulatory transportation to door-through-door transportation. These services are in high demand, due to the growing aging population and developments in medical care. According to reports, NEMT's global market is expected to hit $15.57Bn by 2028, almost double growth from 2021's $8 billion.

With the expected growth and increasing demand for these services, starting a medical transportation business is one of the most lucrative ideas to consider in 2023. Are you wondering how to become a Medicaid transportation provider in 2023? 

Here is a detailed guide with ideas and tips on how to start a medical transportation business.

What Is NEMT?

Non-emergency medical transportation (NEMT) is a professional service that transports people with various health complications or those who have sustained non-critical injuries to the doctors' offices.

These services are rapidly reducing the curve of over 3.6 million Americans missing or delaying their medical appointments for lack of transportation. In fact, Medicaid beneficiaries are the majority of its users. Also, law firms rely on these NEMT providers to help injured clients make court appearances and get to depositions or interviews (also known as workers’ comp). Crossover between industries can happen quite frequently when NEMT drivers also provide transportation for schools and courier services.

The rules of becoming a NEMT provider vary from one district to the next. Thus, you should research how NEMT services work in your state and the medical transportation provider application requirements.

What Are the NEMT Vehicle Requirements?

Safety, reliability, and comfort are necessary when purchasing a NEMT vehicle. A bus, minivan, or full-sized van can work well for you, provided it has wheelchair access, a dialysis machine, oxygen tanks, and gurney access.

Other requirements to look out for when purchasing a NEMT vehicle include sufficient door opening height (56 inches is ideal) and a wheelchair ramp with at least 600 pounds weight capacity. Likewise, ensure the stairs and doors are non-slip, it has gear shift interlock, wide wheelchair lifts (at least 30 inches), and is customizable to fit the needs of every client. 

In addition, check the corresponding ADA compliance requirements to ascertain that your vehicle meets the necessary standards.

How Much Does It Cost to Start a Medical Transportation Business?

NEMT services are essential in helping patients without transportation to receive medical attention at the right time. But how much does non-emergency medical transportation cost, especially for starters?

The cost and how to start a non-emergency medical transportation business varies widely depending on several factors. According to Profitable Venture, starting a non-emergency medical transportation business costs approximately $350,000. However, other sources indicate that the starting costs can range from as low as $12,000 and $25,000. Many variables play a part in determining the initial start-up costs.

What Factors Affect the Cost of Starting a NEMT Business?

The costs can vary depending on several factors, including whether you have transportation means ready or not. Also, your state's legal requirements will cause many disparities in cost. 

The scope of your business will bring differences in the cost of starting a non-emergency medical transportation business. Here are some dominant factors that determine the cost of starting a business.

  • Purchasing vehicles
  • Renting and maintaining a facility
  • Fuel and vehicle maintenance
  • Hiring and paying drivers and other professionals
  • Utility bills
  • Training drivers
  • Getting the necessary gear, such as a first-aid kit
  • Marketing the business
  • Administration costs
  • Additional costs (for promotions, business cards, and signage)

So, how much does it cost to start a non-medical transportation business?

Where you are, how unique you want your business to be, and the expected company size will determine your cost when starting the company. 

Types of Medical Transportation

Medical transportation is a general term for transporting patients to and from their medical specialists for various health-related services. That includes severe and less critical health issues. There are two main types of medical transportation: emergency medical transportation (EMT) and non-emergency medical transportation (NEMT).

Non-emergency medical transportation focuses on transporting patients with difficulties getting means of conveyance to and from their doctors' appointments. The services are best suited for patients that do not require emergency medical attention but aim at finding reliable means of transportation to their doctors for other health-related problems.

Government and other established organizations majorly control EMT services. Thus, NEMT is the open alternative for many to venture into. Here is how to build a business in this field.

How To Start a Medical Transportation Business

Here are easy-to-follow steps on how to start a non-emergency medical transportation business.

Step 1: Have a Business Plan

A business plan provides a road map into everything you need to do and the direction to take when building your company. It will help you approximate the non-emergency medical transportation cost of the startup and guide you into developing a workable strategy for your operations.

Step 2: Determine the Costs Involved

While working your way up, you must prepare your budget early and understand all the necessary financial commitments required.

This step is crucial in measuring whether this business will be worth all the effort you want to dedicate. Compare the average costs of operations with the approximate non-emergency medical transportation business income.

Also, knowing the total cost of starting a NEMT business will help you balance your budget and limit your scope to the services you can afford at the start.

How Much Does It Cost to Start a Non-Emergency Medical Transportation Business?

The cost of starting non-emergency medical transportation varies depending on several factors. Some typical costs to prepare to incur include:

  • Acquiring licenses, permits, and certifications
  • Training and hiring drivers
  • Insurances
  • Taxes
  • Registration costs
  • Marketing and Promotions

Step 3: Build Your Business

Decide whether you want to register your NEMT business as a sole proprietor, partnership, corporation, or limited liability company (LLC).

Next, register your business and get a license and insurance coverage. With your business ready, you can get the vehicle and start operations. For fleets, you may also want to hire drivers, marketing teams, and other staff to kick off.

Non-Emergency Medical Transportation License

Starting a NEMT business requires a non-emergency medical transportation license to authenticate your operations. Your non-emergency transportation business will also need an array of legal permits, certifications, and insurance covers to be valid.

The exact documents can differ from one state to the next. If unsure, check your state's non-emergency medical transportation provider application website to learn about the processes and the required documents.

Here are some top categories of non-medical transportation licensing and documentation to consider.

NEMT Licensing

Licensing requirements differ depending on where you operate. Check with your local government and other relevant departments on the appropriate NEMT operational rules and regulations and what you need to obtain the license.

These documents and information are necessary across the country.

  • Your criminal history
  • Driver's health certificate
  • Penalty issues on your driver's registration
  • Transport liability insurance package
  • Proof of negative drug check

NEMT Insurance

Insurance coverage is just as essential as a NEMT business license. It protects your business from unexpected occurrences and helps you secure your fleet from accidents caused by risky driving. Depending on your needs, you can decide to take the:

  • Commercial auto insurance
  • General liability insurance
  • Professional liability insurance
  • Workers' compensation

The rules may differ from one state to the next. However, getting insurance will also demand you provide the documents under licensing, including verification for transport liability insurance.

How Much Does a Medical Transportation Business Make?

The revenue of medical transportation companies differs due to factors such as the type of patients, whether they operate day or night, and the client's needs.

Similarly, the location of operation, mode of transport, mileage, and whether the service is Medicaid or privately paid will also determine how much you earn as a NEMT provider.  

Who Pays for Non-Emergency Medical Transportation?

If an individual (the patient or their kin) hires your service (private hires), they will cater to the bills. On the other hand, registering your services with Medicaid allows you to carry the program's beneficiaries. Thus, your payment will come from the program.

How Much Does a Non-Emergency Medical Transportation Business Make?

The earnings range for a non-emergency transportation business depends on where the company operates. For instance, studies indicate that Hawaiian NEMT providers earn the least in the USA, with their monthly income averaging $2,500 and yearly earnings at $30,000.

On the other hand, New York NEMT providers make the most money in the states, with each vehicle driving home around $4666.67 monthly and $56,000.

How Much Does Medicaid Pay for Non-Emergency Transportation?

Different states do not necessarily have to report their Medicaid NEMT expenditure. Thus, detailed information about the program’s NEMT expenditure is not available. However, reports indicate that the program uses up to $3 billion on non-emergency medical transportation yearly.

Is Non-Emergency Medical Transportation a Good Business?  

Non-emergency medical transportation is a good business, especially if you understand the legal process and deploy the right technology to keep your business in high strides and profits. 

At MediRoutes, for instance, we use the latest cloud technology to help you streamline all your services to empower your business and get you started with the right competitive advantage.  

Check out our services for optimized NEMT scheduling, real-time dispatching, reporting, and billing, alongside other essential services.

Ready to start using MediRoutes today?

Schedule a Demo