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Healthcare Ridesharing Makes Inroads in Lost Revenue

Analysis  |  By Jack O'Brien  
   August 23, 2018

Health systems are recouping lost patient revenues by removing barriers to access treatment, and reducing operational costs by coordinating with ridesharing services.

Nearly 4 million patients per year miss out on care due to lack of available transportation options related to cost or geographic barriers, according to the 2017 American Hospital Association study, "Transportation and the Role of Hospitals."

This has created not only a clinical care concern for health systems but a financial worry as well.

The National Center for Mobility Management estimated the range of lost revenue for a health system due to patients' missed appointments is between $150 to $274 per patient. If the system's no-show rate is 10% (about half of the national average), and they treat 45,000 patients annually, those missed appointments amount to between $675,000 to $1.2 million in lost revenue per year. 

Considering the additional costs for follow-up visits to the emergency room and overnight hospital stays due to the inability to discharge a patient with no way to get home, health systems have approached transportation network companies (TNC) to bridge the treatment gap and aid their bottom line.

In June, Partners Healthcare announced a partnership with Circulation, a TNC that provides affordable transportation options to low-income patients at 70 health systems in 45 states.

Circulation provides software to connect companies with standard vehicles that transport patients to medical facilities for treatment, as well as vehicles that accommodate patients with disabilities and those in wheelchairs.

Lyft and other TNC operators qualify as non-emergency medical transportation (NEMT) services, which allows them to cater to low-income populations and file expenses through Medicaid. Last year alone, NEMTs filed expenses totaling $3 billion, according to the Transit Cooperative Research Program.

This provides TNCs the ability to enter into a new market—the healthcare industry—thus providing financial incentives for hospital executives.

Circulation CFO Cindy Nguyen told HealthLeaders that the company plans to focus its efforts on inbound requests for managed care organizations to achieve a broader spectrum and larger population base.

"The goal for us is to not just be the transaction fee related to a ride, we want to move the needle on overall healthcare expenses in a significant way," Nguyen said.

What are the benefits?

Two years ago, CareMore Health System reviewed its available transportation services, specifically analyzing how it provides rides for Medicare patients with complex health needs. 

The organization decided to partner with Lyft to "improve the program and experience for our patients," which provided significant preliminary results published in the September 2016 issue of Journal of the American Medical Association (JAMA)

  • 32% cost reduction in transportation services
  • 30% shorter wait times for patients
  • 80% patient satisfaction 

Due to the successful results, CareMore told HealthLeaders that it has expanded its partnership with Lyft across its Medicare Advantage markets in California, Arizona, Nevada, and Virginia. CareMore said that nearly 95% of standard "curb-to-curb" rides are administered by Lyft, while the remaining rides that require additional patient assistance are handled by other NEMTs. 

Though CareMore is satisfied with the outcomes Lyft has delivered, the system also maintains an in-house operation that triages patient transportation requests and coordinates directly with transportation services.

Positive feedback from partner providers has emboldened Lyft's mission, as the transportation company pledged in March to reduce 50% of missed doctor's appointments at partner systems by 2020.

JAMA study points to inconclusive results about ridesharing

Despite the promise of ridesharing in healthcare from a financial angle, skepticism has emerged regarding just how effective it is for the patient experience.

In February, JAMA published a review of ridesharing services and missed primary care appointment rates for patients with Medicaid. The study found that despite being offered free Lyft rides, "the missed appointment rate was not significantly different between patients offered rideshare-based transportation services compared with controls."

Researchers speculated that nearby public transportation options, communication issues to patients about the free rides, and unfamiliarity with ridesharing services might have contributed to the no-shows.

Lyft responded to the JAMA study by saying the results contradicted its experience of decreasing wait times, transportation costs, and increasing customer satisfaction with its health system partners.

"It's also important to note that this study only examines certain factors—it is limited to a single urban neighborhood, offers only one ride over the length of the study, and provides transportation to primary care physician offices," Gyre Renwick, vice president of Lyft Business, said. "In future studies, we would like to expand upon those factors and examine passengers who need rides for more pressing NEMT needs, such as for dialysis appointments."

Correction: A previous version of this article referred to Circulation as a TNC. Circulation provides software that connects hospitals with TNCs, like Lyft. This story has been updated to reflect that.

“The goal for us is to not just be the transaction fee related to a ride, we want to move the needle on overall healthcare expenses in a significant way. ”

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.

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