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Providers warn North Dakota PRTF payment structure is outdated as rule changes move forward
Summary
PRTF operators told the Administrative Rules Committee the state’s payment methodology is roughly 30 years old, producing multi‑million‑dollar shortfalls that threaten in‑state care; providers urged the committee to approve minor rule fixes now while expediting a planned study and legislative cleanup to prevent out‑of‑state placements.
Members of the Administrative Rules Committee heard urgent testimony from psychiatric residential treatment facility (PRTF) providers who said current payment rules leave them operating at heavy losses and place in‑state treatment capacity at risk.
"This is a 30‑old metric," said Tim Ganger of Dakota Boys and Girls Ranch, testifying that the Ranch operates 48 PRTF beds in North Dakota and that last year the organization absorbed a $7.5 million loss while a sustainable breakeven target would be closer to a $2.5 million loss. "We cannot continue on like this," he told the committee, adding that the payment structure and administrative caps do not reflect modern costs such as electronic health records and cybersecurity.
The Department of Health and Human Services (DHHS) staff told the committee the agency opened parts of the PRTF rules for revision, added hospital‑leave days and other clarifications, and intends to meet with providers to pursue follow‑up work. Leanne Theo, the department’s rate‑setting staff member, said DHHS is committed to continued meetings with providers to research outstanding rate‑setting issues and implementation details.
Committee members pressed for accountability and speed. Senator Larson and others said preserving in‑state care for children is an urgent priority and asked how lawmakers can ensure the agency follows through. DHHS said some items require additional research, CMS approvals, or budgetary review and that the department’s 2023‑25 budget includes funding for a study of PRTF payment structure.
Providers and some legislators urged a two‑track approach: accept the noncontroversial rule changes now so helpful items (for example, hospital‑leave days and clarifying language) are not lost, while elevating the planned study and, where needed, pursuing legislative fixes to address parent‑travel reimbursement, home‑visit days, and the size and labeling of administrative cost buckets.
Several senators and representatives underscored that even if rule changes are technical and helpful, a legislative or expedited administrative follow‑up may be required to secure longer‑term solvency for PRTFs. The committee did not vote on PRTF rules at this meeting; testimony and discussion were part of the DHHS presentation on rate‑setting and service licensing.
