The afternoon of June 30, Jeremy Ricky was shutting down his Boise transportation company. As the 14 full-time drivers at Trinity Transport parked their vehicles for the last time, Ricky said a change in a state contract had slashed payments to his business, forcing it to close. He worried the contract also will cause missed therapy or medical appointments for Idaho’s most vulnerable residents.
The Idaho Department of Health and Welfare chose a new contractor to arrange transportation for Medicaid patients to go to health care-related appointments. After evaluating bids from five companies, the state hired Veyo, a San Diego startup that uses Uber-like technology in urban areas to move patients in a way it says is more efficient and less costly.
The state and Veyo say the new contract will make nonemergency medical transportation for Idahoans on Medicaid an easier, more transparent process, while the transportation providers who pick up and drop off those Idahoans will be able to make more money than they did working under a higher-paid transportation broker.
“I would be incredibly impressed if they can pull it off,” Ricky said. “Then they don’t need me.”
Despite Trinity Transport’s closure, the state and Veyo say the transportation companies do not need to worry about losing money from lower payments or worry that their customers’ transportation needs will go unmet.
“I don’t think people like change, and it was somewhat controversial,” said Tom Shanahan, a Health and Welfare spokesman. “There will be differences, for sure. I think the transportation industry overall has evolved.”
Service during the first week of Veyo’s contract drew mixed reactions. One parent, and representatives of organizations that assist local refugees and caretakers of Medicaid recipients, said they want to give Veyo time. Another parent said the transportation of her daughter and daughter’s roommate, who have developmental disabilities, since Veyo’s launch in Idaho was “awful.”
For several years, Colorado-based American Medical Response had a multimillion-dollar contract to be the nonemergency medical transportation broker making sure patients get to their appointments. Nearly 300,000 Idahoans are on Medicaid, and the state says it pays for about 100,000 trips each month.
The contract expired and came up for rebid for fiscal year 2017, which began July 1. A three-year contract was awarded to Veyo for $70.4 million, after evaluators gave Veyo the highest score based on its cost and technical proposals.
Veyo’s total bid was about $3 million less than the company with the next-lowest bid, Logisticare, which pledged to keep less of Idaho’s money for overhead but still ended up more expensive than Veyo.
American Medical Response, doing business as Access2Care, bid $74.3 million, in the middle of the five companies that bid.
Veyo formed about a year ago under its Arizona parent company, Total Transit, which has been in the nonemergency medical transportation business for about 15 years, according to Veyo founder Josh Komenda.
The startup’s goal is “to innovate in all aspects,” Komenda told the Idaho Statesman. Veyo uses GPS, cloud-based and mobile systems, data analytics and other technology to track and monitor drivers and trips in real time, he said.
It launched with an Uber-like model — a last-minute, ad-hoc ride-sharing system that supplements Veyo’s regular scheduled drivers — in January in Arizona.
“It’s going really well,” Komenda said. “On-time rates (are) 99.5 percent, and grievance rates are 0.1 percent. … Much, much lower than industry standards.”
Soon after Veyo won the Idaho contract, Health and Welfare began hearing from drivers and owners of transportation companies. They worried that Veyo would slash their payments, and they questioned the Uber-style approach.
The company was posting ads on Craiglist for those independent drivers as of this week, offering a $100 signing bonus. The company had signed up 33 independent drivers for that system in Southwest Idaho when it took over the state contract.
Shanahan said he expects Veyo to use the Uber-like network for about 10 percent of all trips.
Kleeta Newby, co-owner of KDN Transportation in Boise, said the switch makes her feel her business is on shaky ground.
Newby said her 10 drivers make about 230 trips each day. They pick up and drop off clients — mostly refugees and people with developmental disabilities — in Ada, Canyon and Gem counties.
“I know Jeremy (Ricky) shut his doors, and I feel like I will follow behind him,” she said.
The new contractor isn’t the problem — the low payments are, Newby and Ricky said.
“We personally have never had a raise (from Medicaid) in 10 years,” Newby said. “I’ve had to hock my wedding ring several times to make payroll as it is, and the thing Veyo promised me was, of course, I get paid the same.”
Veyo eventually agreed to give most of the state’s transportation providers the choice of being paid their old rates or taking Veyo’s new rates, which pay about 9 cents more per mile and $1.70 less each time a driver drops off a passenger. The Veyo rate is better for drivers when a customer needs to travel 6 miles or more, Shanahan said.
But the company did not factor in the need to pay a premium rate for certain Medicaid customers, Ricky said.
“I think they think they have it covered,” he said. “I think that looking into it, they’re going, ‘We should be good.’ But I transport 300 of the hardest transports on a daily basis, and when Trinity Transport exits the system, it leaves a 300-person gap.”
He said that in some cases, a Medicaid customer does not show up at the door or is combative or otherwise cannot travel.
“Let’s say Mrs. Johnson lives in Meridian,” Ricky said. “Her telephone doesn’t work, and I travel all the way out to pick up Mrs. Johnson, and she isn’t there. The bottom line is, (the contractor) is still obligated to take Mrs. Johnson. … How do they convince providers like myself to take Mrs. Johnson?”
Those customers made up about half of Trinity Transport’s business, and he estimates about a quarter of the overall Medicaid transportation customer base is tough to transport.
A couple of years ago, American Medical Response made a handshake deal with Ricky to persuade him to keep picking up the Mrs. Johnsons of the Treasure Valley. The contractor paid Ricky’s company a “premium blend.” Basically, for customers who no-showed half the time, Ricky’s company would be paid double. That kept Trinity Transport — and any other providers who received a higher rate — from losing money on those clients, he said.
Veyo did not offer such an option, he said.
Komenda, the Veyo founder, disputed that, saying the company would pay extra “if providers say they are not able to take the call without a premium rate.”
He declined to say what the premium rates would be — they “are negotiated on a case-by-case basis” — and said Veyo has not provided those rates to Health and Welfare.
“The offer they made to providers around the state is not a viable (payment rate),” Ricky said on June 30. “If I accept it, I wouldn’t be able to make payroll within a month and a half.”
Komenda said Veyo expects that about “10 to 20 percent” of the trips will be a “big challenge” to get fulfilled — less than Ricky’s 25 percent or more estimate. In other places, Komenda said, Veyo has used automated reminder phone calls and a data team to improve service to customers who have a high no-show rate, in some cases cutting the no-show rate by half.
“Being a technology broker and a data-oriented broker, there’s a lot of ways to innovate,” he said.
The company’s contract with the state puts 1 percent of its contracted rate at risk, based on whether it hits performance marks. One of those marks is that no more than 0.5 percent of its trips can go unfulfilled. In its first week, Veyo’s missed-trips rate was about 1 percent.
A Boise woman who cares for two adults with developmental disabilities said the first week and a half under Veyo left her with “the worst feeling in the world.”
Sharon Boltz’s daughter, who has autism, and her daughter’s roommate are on Medicaid and relied on Trinity Transport to get to a developmental therapy center.
The first day of Veyo’s contract, Boltz said, a green taxicab showed up to pick up the two women. The driver arrived at 8:10 a.m., but the nearby care center did not open until 8:30 a.m. Boltz’s phone rang minutes after the women left the house.
“(The daughter’s roommate) called to say she thought the cabdriver was going to leave them,” Boltz said. “I go … ‘Let me talk to this guy.’ I said, ‘Look, you cannot drive off and leave these people and expect them to know what to do for 20 minutes.’ ”
The driver called dispatch and agreed to stay in the parking lot with the two women, Boltz said.
“To me, it’s still hanging in the air,” Boltz said. “I’ve never had a feeling of such sadness when I sent her off.”
Organizations that help refugees said they’re hoping for the best.
“I’m at least willing to give it some time, knowing it’s a new system … because honestly, what we had before was awful,” Julianne Donnelly Tzul, executive director of the International Rescue Committee’s Boise office, said Friday.
Donnelly Tzul said it is crucial for the IRC’s refugee Medicaid clients to get to their appointments at the scheduled time and day.
Refugees are eligible for Medicaid for eight months. That means refugee families have a short window to get their health care needs met — from vaccinations for children before they start school, to surgery for a long-undiagnosed problem, to getting mental health care for psychological trauma.
The IRC had seen “constant problems with taxi rides that weren’t completed” in recent years, and it took as much as two hours on the phone to book transportation for a family of eight, she said.
Renee Hage, local World Relief office director, said the system “wasn’t perfect” under the previous contract.
Last week, as Veyo advanced from just booking trips to actually sending out drivers, Donnelly Tzul said her staff noticed the appointment-confirmation process could be confusing, and some clients got to appointments but had trouble getting home.
But the online booking system has been a breath of fresh air, she said.
Hage said Veyo seems receptive when World Relief employees call to report bugs in the system. She and Donnelly Tzul are watching how Veyo reacts — and whether the bumps in the road they expect during a transition become long-term problems.
“Ask me in a week or two,” Hage said. “Everybody’s eyes are on this.”