Medicaid Transportation: Section 1115 Waivers and Care Delivery Transformation

Kevin Mehalick

The Medicaid program is a joint state and federally funded program that provides healthcare services to nearly 67 million Americans with low income. States are subject to federal standards for how state Medicaid programs are designed. The Centers for Medicare and Medicaid Services (CMS) grant Section 1115 waivers to allow states to test healthcare coverage approaches that are not allowed under traditional Medicaid.

According to, the Section 1115 Waivers are an invitation for states to propose “reforms” that build upon the lessons of past demonstrations and innovative solutions designed to promote Medicaid’s objectives. These reforms should aim to:

  1. Improve access to high-quality, person-centered services that produce positive health outcomes for individuals;
  2. Promote efficiencies that ensure Medicaid’s sustainability for beneficiaries over the long term;
  3. Support coordinated strategies to address certain health determinants that promote upward mobility, greater independence, and improved quality of life among individuals;
  4. Strengthen beneficiary engagement in their personal healthcare plan, including incentive structures that promote responsible decision-making;
  5. Enhance alignment between Medicaid policies and commercial health insurance products to facilitate smoother beneficiary transition; and
  6. Advance innovative delivery system and payment models to strengthen provider network capacity and drive greater value for Medicaid.

Ultimately, Section 1115 waiver projects present opportunities for states to institute new policies and processes that focus on better health outcomes and improving the quality of life for Medicaid members. One such opportunity is Medicaid transportation. At Roundtrip, we’ve been keeping our eye on several states using Section 1115 waivers to expand services for social determinants of health (SDOH), above and beyond the coverage mandated under Medicaid. Here are three states currently pursuing delivery system reforms that we believe will positively impact transportation insecurity for Medicaid members:

  • North Carolina– North Carolina’s 1115 demonstration, Healthy Opportunities, authorizes the creation of community-based organizations to manage a network of social service and health care providers to deliver case management and services relating to housing, food, transportation, and domestic violence. The state’s Medicaid health plans must participate in Healthy Opportunities, determine member eligibility for SDOH services, including NEMT (non-emergency medical transportation) and track the adoption and effectiveness of services.
  • Michigan– A key feature of Michigan’s Healthy Michigan Plan is the Healthy Behaviors Incentives Program, which encourages Medicaid managed care members to maintain and implement healthy behaviors. Utilizing preventative care services, such as cancer screenings and dental services, are considered healthy behaviors. Patients without access to a car or public transportation will struggle to access preventative care and achieve the healthy behaviors incentive, reducing their insurance co-pays for that year. Under this plan, transportation plays a key role in preventative care utilization and member cost savings.
  • California– California’s waiver, Medi-Cal 2020, includes a $3 billion pilot program to improve care for Medi-Cal beneficiaries by supporting local efforts that embrace a “whole person care” philosophy. Health care providers, social services, and community partners, such as housing support organizations, work together to identify their highest-need clients and provide them with comprehensive, coordinated care – including access to transportation services for patients who have a transportation barrier.

As of this year, 16 states have been granted Section 1115 waivers to use their Medicaid funds to creatively reform care delivery systems. The Centers for Medicare and Medicaid Services continue to grant new Section 1115 waivers, so we will continue to monitor the regulatory environment and assess the impacts of new releases on Medicaid member access to non-emergency medical transportation (NEMT) services.