The federal government is sounding the alarm on Medicaid fraud, and states have shifted into high gear. Dr. Mehmet Oz, administrator for the Centers for Medicare and Medicaid Services (CMS), issued a nationwide mandate requiring all 50 states to submit comprehensive two-year strategies to audit and revalidate Medicaid providers within 30 days. The directive came amid staggering losses: A study in JAMA estimated that fraud, waste, and abuse (FWA) cost the U.S. healthcare system $760-$935 billion every year, and Medicaid is squarely in the crosshairs.
The consequences are already landing. Congress has active fraud investigations underway in at least 11 states, and CMS recently moved to withhold $1.3 billion in Medicaid payments to California alone. Non-emergency medical transportation (NEMT) can be a high-risk category for FWA, and with regulators demanding immediate action, NEMT brokers and health plans face a critical question: When auditors come calling, will your compliance infrastructure hold up?
Compliance as an Operational Imperative
For years, regulators approached provider compliance with NEMT through periodic reviews or a point-in-time verification that credentials were in order. CMS has retired that model and is now hyper-focused on high-risk provider categories, including those without a National Provider Identifier, as well as providers of home- and community-based services, durable medical equipment, non-emergency medical transportation, and other services. The agency’s message is clear: Provider compliance must be an ongoing operational priority, not a scheduled audit.
Transportation providers face a compliance landscape that demands real-time monitoring. When a provider’s credentials lapse, their insurance expires, or a disqualifying event occurs, health plans and brokers need to know immediately, not at the next quarterly review. Continuous monitoring against federal exclusion databases, state Medicaid enrollment records, and licensing authorities is quickly becoming the baseline expectation, not a differentiator.
Failure to complete revalidation should result in disenrollment, without retroactive reactivation. Gaps in compliance translate directly into gaps in payment and service continuity, a serious operational and financial risk for any organization participating in Medicaid transportation.
A Proactive Approach to FWA Prevention
The most effective compliance and FWA programs don’t wait for retrospective audits to surface problems. They embed controls throughout the transportation lifecycle. This means real-time eligibility and benefit validation at the time each ride is scheduled and machine learning tools capable of detecting duplicate rides, inflated mileage, and suspicious activity patterns before claims are submitted. Truly fraudulent rides should be flagged and canceled before they even take place.
These are the kinds of controls that regulators and managed care organizations will increasingly demand as audit scrutiny intensifies. States that are now activating their revalidation strategies under the CMS mandate will be looking for partners that can document and demonstrate provider compliance at any moment, with an audit-ready evidence trail that holds up to federal review.
What States and MCOs Should Be Asking Now
With the 30-day deadline for state revalidation plans now passed, managed care organizations and NEMT program administrators should be asking hard questions about their current infrastructure: Can they demonstrate continuous compliance validation? Do they have documented evidence trails that would satisfy a federal audit? Are their FWA controls proactive or reactive?
The CMS mandate is not a one-time compliance exercise. It signals a sustained shift toward greater accountability across Medicaid’s highest-risk provider categories. For NEMT programs, the window to get ahead of this scrutiny is narrow. Organizations that have already built compliance and FWA prevention into their daily operations will be far better positioned than those scrambling to retrofit controls after the fact.
The Stakes for Patients Are Real
It is easy to discuss Medicaid fraud in the abstract—billions lost, audit mandates issued, payment withheld. But compliance failures impact the patients who depend on care as a lifeline. Most NEMT providers are working hard to serve the people who depend on their transportation benefit, staying well within the limits of the law. But for low-income seniors who can no longer drive, children with complex medical needs, and adults with disabilities managing chronic conditions, a missed or cancelled ride is not a minor inconvenience. It can mean a skipped dialysis appointment or a gap in care that compounds over time. Patients and taxpayers bear the burden of worse health outcomes and higher healthcare costs across the entire industry.
When a few fraudulent providers are allowed to operate within NEMT networks, they don’t just drain program dollars. They displace legitimate providers, erode trust in the system, and put vulnerable members at risk of receiving substandard or no service at all. Strengthening compliance infrastructure is a direct investment in the people Medicaid was designed to serve. That is the case regulators are making, and it is one the industry should take seriously on its own terms.
Robbins Schrader
Robbins Schrader is the Co-Founder and Chief Executive Officer of SafeRide Health, a technology platform modernizing access to life sustaining care. Under his leadership, SafeRide delivers 12 million plus non-emergency medical transportation trips a year and serves the nation’s premier commercial, Medicare, and Medicaid payers.
Robbins previously served in the U.S. Navy and held roles at BCG and Alvarez & Marsal leading complex initiatives across operations and finance. He holds a BA in History from Cornell University and an MBA from the Wharton School at the University of Pennsylvania.
