Published on:

Misclassification in Medicaid Transportation Practices for Ambulette Service Providers

In these difficult economic times, the New York State Office of the Medicaid Inspector General has been scrutinizing the practices of ambulette providers in a possible effort to save money and avoid paying bills for transportation services and to protect the integrity of the services provided. Our Westchester County Medicaid Lawyers have seen increased enforcement by the Division of Medicaid Investigations regarding the issue of use of subcontractors by ambulette providers.

Under the terms of New York Transportation Manual and Policy Guidelines, Ambulette Service Providers must own or lease ambulettes and employ by its drivers. The following are examples of acceptable and unacceptable practices in subcontracting.

Examples of Acceptable Practices Under Medicaid Guidelines

An Ambulette Service Provider may subcontract or lease with another Medicaid-enrolled provider for a short-term if the existing ambulette fleet is suffering mechanical breakdowns or there are other acute emergent circumstances. This practice cannot be ongoing and must be limited to a short-term use. Long term use may lead to unpaid bills or exclusion from the Medicaid Program.

Examples of Unacceptable Practices Under the Medicaid Guidelines

An Ambulette Service Provider may not subcontract or reassign transportation trips to another provider if it has no intention to secure its own vehicles or drivers. New York State asserts that this practice jeopardizes the safety and financial controls of the Medicaid Program.

Thumbnail image for top.lawyers.arrive.mag.2011.jpgIf your business has been contacted by the New York State Office of the Medicaid Inspector General, contact our experienced lawyers at (800) 893-9645 to learn your rights and protect your business including payment of your invoices.

Not only may your company be subject to compliance issues with the Medicaid Program due to an unacceptable practice, it may also face employment law exposures if it misclassified its ambulette service provider drivers as independent contractors instead of as employees. This misclassification error could be significant and be subject to scrutiny by the federal and state Department of Labor and IRS and cause you to owe overtime pay. One of the key factors (but not the only factor) that the government considers is the amount of control and direction you provide to your drivers. The greater the control and direction the more likely they could be considered employees. Contact our Employment Lawyers at (800) 893-9645 to determine if there are any misclassification issues affecting your business.


Thank you for visiting our Blog. This blog provides general information and thoughts about various employment law issues primarily in the New York Tri-State area and occasionally in other areas. You are welcome to read the posts. However, do not construe any content on this blog as legal advice or the creation of an attorney-client relationship. Again, we provide the content only for informational purposes. You should not make decisions based information on our blog since the application of the law depends on the facts and each situation may be different. In addition, the law in most jurisdictions is different and changes constantly and we make no representations that any information on our blog has been updated. The Blog should not be used as a substitute for competent legal advice from an experienced employment law attorney in your state or jurisdiction.

Contact Information