Medicaid Transportation Policy manual Effective Date: 08/25/2023
Page 47 of 52
Surety Bond Requirement
The OMIG has found that several ambulette providers have gone out of business or changed
ownership while having outstanding debts owed to the Medicaid program. Medicaid regulations
allow for financial security, provided in the form of surety bonds, to be required as a condition of
participation or continued enrollment in the Medicaid program for providers where claims
submitted for payment are expected to exceed $500,000 in a single year or $42,000 in any
month.
The OMIG has determined that applicants for ambulette services located in Nassau,
Westchester, Monroe, Erie, Orange and Suffolk Counties that submit their applications on or
after March 1, 2011, will be required to submit a surety bond prior to enrollment if the ambulette
provider is determined to be otherwise eligible for enrollment.
In New York City, ambulette providers enrolled as a result of an ownership change will be
required to submit a bond.
The surety bond requirement will apply to all applicants for new enrollment in the Medicaid
program with service addresses in the counties listed above, and for enrollment as a result of an
ownership change in New York City and the counties listed above where there is a new entity
purchasing the company. The initial bond must be submitted prior to enrollment and the term of
the bond must be for at least one calendar year.
The applicant will be contacted by the OMIG once an initial determination has been made that
enrollment can otherwise be granted. At that time, the provider will be asked to submit a surety
bond within 90 days in order to secure enrollment. If an applicant fails to provide a bond, the
application will be denied.
The OMIG will request surety bonds for ambulette providers in the amount of $100,000 per year
per applicant, or $25,000 per year for each ambulette owned or used by the applicant,
whichever amount is lower. All surety bonds must be renewed annually. If the amount initially
requested is less than $100,000, the amount of the bond may increase, up to $100,000, upon
renewal if the number of ambulettes owned or used by the applicant increases. It should be
noted that surety bonds are issued by insurance companies and the amount of the bond would
be much higher than the actual cost to the applicant.
If an applicant estimates that the company will bill less than $500,000 for ambulette services in
the first full year of Medicaid enrollment, the applicant may submit a letter with the company’s
enrollment application stating this and requesting an exception to the bond requirement. The
letter must include an estimate of the company's annual Medicaid billings, as well as the
number of ambulettes the company owns or leases and plans to purchase or lease in the first
year of operation. OMIG will review this information, as well as billings of similar companies, to
make a determination as to whether the bond will be required.
In addition to the pre-enrollment bond requirement in the counties listed above, all applicants
approved for enrollment for ambulette services that submit an application on or after March 1,
2011, regardless of where the company is located, will be subject to a review of claims after