Medicaid rates, capitation and budget drivers outlined as state weighs provider inflation and ambulance increase

Summary

At an Appropriations Human Resources Division hearing, Medical Services Division leaders reviewed Medicaid rate methodologies, the governor's provider inflation request and proposed targeted rate increases for ambulance providers; officials also described 2025 capitation rates for Medicaid expansion and changes to managed-care safeguards.

Sarah Acre, executive director of the Division of Medical Services at the North Dakota Department of Health and Human Services, told the Appropriations Human Resources Division that the governor’s executive budget includes a $16.2 million request to increase provider rates through inflation and a $4.3 million targeted increase for ambulance reimbursement.

Acre said traditional Medicaid still uses fee-for-service payment methods—cost-based per diems for nursing homes and per‑episode classification systems (DRGs and EAPGs) for hospitals—while Medicaid expansion is paid through a monthly capitation payment to a managed-care organization (MCO). “I am Sarah Acre. I’m the executive director of the division of medical services,” Acre said when introducing the presentation and then described the two distinct rate methodologies.

The nut of the discussion centered on how the state sets those payments and how the governor’s budget would change…

Medicaid rates, capitation and budget drivers outlined as state weighs provider inflation and ambulance increase

Summary

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