North Dakota has some of the highest staffing levels in the country – no small feat considering the many pockets of rural communities. The state has achieved this because of a very supportive legislative body that recognizes the value of long-term care services, including skilled nursing, operators and associations say.

Garth Rydland, president and CEO of Valley Senior Living in the state points to two policies – equalization of rates and upper payment limits – as major contributors toward positive staffing numbers, at least compared to peers in other states.

“Equalization of rates, and then the upper payment limit, an alternative formula, ultimately put the money in the system so that we can have the staffing that we do,” he said. These policies effectively change contributions from Medicare, and in turn what the state needs to budget for when it comes to Medicaid and long-term care.

What’s more, wages increased in the state pretty consistently and small communities have been revived in part due to the oil boom in 2008 and 2009, according to Reier Thompson, president and CEO of skilled nursing provider Missouri Slope in North Dakota.

Increased wages enabled by these legislative policy moves have in turn helped retention and recruiting in North Dakota.

“Our wage inflation has been incredible. Of course, everyone’s talking about that now since Covid, but ours has been pretty good; cost of living has been pretty stable over the years,” said Thompson. “We have some of the highest reimbursement rates of Medicaid of any state in the country.”

Rydland added that the oil boom made the state “a bit recession proof,” with a two-decade run of no significant budget shortfalls.

All in all, facilities were able to increase CNA starting wages by 35% in the last three years; reimbursement especially during the pandemic has stepped up and helped give operators a chance to be successful, he said.

And North Dakota has seen a greater retention of some skilled clinical staff.

“We have a lower turnover rate for RNs in our state versus the rest of the country, but not for CNAs,” Nikki Wegner, who serves as president at the North Dakota Long Term Care Association.

The state’s 5-star direct care staffing rating was 4.25 stars out of 5, while the average for the rest of the country was 2.69, Wegner said. Total nursing was a 4.78 rating compared to 3.2 for the national average.

Meanwhile, total nursing hours per resident per day (HPRD) was 4.78 during the most recent quarter compared to 3.8 for the country, according to data collected from the Five-Star Payroll Based Journal (PBJ). Weekend HPRD was 4.04 compared to 3.33 on a national level for the same quarter.

Alaska tops the nation with 6.00 total nurse staff HPRD, and only 8 other states make it above 4.1 HPRD, according to a report issued by the Long Term Care Community Coalition (LTCCC) in July. Oregon reported 4.83 HRPD, followed by Maine at 4.37 HRPD, then Hawaii and District of Columbia tied at fifth spot for 4.27 HRPD.

Even with positive numbers for staff hours, Rydland said it’s important to note that facilities in North Dakota would only meet the federal minimum staffing requirements 51% of the time.

“North Dakota is in a great position to meet the national staffing standard, but even having said that, only half of our days are meeting that proposed standard on two of the three requirements,” said Rydland.

About 77% of nursing homes in the state do not meet the 24/7 RN staffing requirement in the proposal, he added, while 80% don’t meet the requirements based on weekend numbers.

Another hangup lies in staffing agency use – the 75 facilities in the state have 13.1% agency use compared to 8.7% across the country.

“We heavily rely on contract nursing. I think that there’s some facilities that have done really well being able to get rid of contract agency staff since the pandemic, but there are some where it’s just a hard reality that they’re going to be there for a long period of time,” said Wegner.

Policies for sustainability

Through rate equalization, present only in North Dakota and Minnesota, operators can’t charge a privately paying person any more dollars per day than what the state would pay toward a patient who has medical assistance.

“That’s what makes North Dakota fundamentally different from almost every other state. As a legislature, as a medical assistance, they have to pay their fair share,” said Rydland. “They can’t just cost shift the difference to the privately paying people.”

In other words, rate equalization makes the legislature more responsive to the needs of residents. It makes the legislators look at their responsibility and what they need to accomplish in a session, Rydland said, because if they don’t do it, there will be access issues and that cost can’t be placed on private pay, or another payor.

The upper payment limit, the other policy mentioned by Rydland, is a cap of sorts on Medicare allotted to the state. Every state has some version of the upper payment limit, but the cap differs.

“Medicare will only pay so much towards a resident’s care per day. If you approach that limit, they’re not going to send money to the state for anything above and beyond that,” Rydland said of the upper payment limit.

The state has set the upper payment limit so that Medicare isn’t paying for the gap in Medicaid – a reversal compared to the payor structure among other states.

“In most other states, Medicare has traditionally been a very profitable part of the business that helps with the cost shifting that the state legislators, when they’re not paying their fair share, will say we’re making some money on these Medicare folks,” said Rydland. “North Dakota, we hit that limit well over 10 years ago, and an alternative formula was accepted.”

The state started having costs that were above what Medicare would have originally paid due to this alternative formula the state and CMS agreed to, and so the state has been making budgetary adjustments accordingly.

“You have to have a state that’s willing to do that as well, in order to make these kinds of investments in staff and the amount of money per hour that we’re able to pay,” Rydland said.

Investing in long-term care

Ultimately, legislator action with such policies is coupled with a recognition that in a lot of communities throughout the state, especially in rural areas, nursing homes are important to the economy.

“A lot of times the nursing facility is the largest employer in town, unless you have a school, then maybe the two largest employers are the school and your nursing home,” said Thompson. “The legislative body has been very supportive because they recognize it’s so important to their constituents back home.”

The industry has a “running start” with any legislative asks, he added, and policymakers give them a prominent seat at the table to talk about what is needed to maintain and improve quality of care.

“With [reimbursement] increases that we’ve received from the legislature, it’s really given us an opportunity to be able to increase our wages, which our wages tend to be higher than the rest of the country,” said Wegner. “And then also given us an opportunity to add staff to provide quality care.”

One such example is the recent opening of the state office of immigration, Thompson said. Of course, it’s more of a federal program being tied to immigration, but the state is helping facilitate immigration to North Dakota specifically.

“That’s a new effort that they launched here in 2023. It’s a year in and they’re just starting to finally put out some guidance and some help articles, really figure out who they are [as a state department] and what they’re supposed to be doing. Time will tell how successful that is,” said Thompson.

Any sort of expansion to the program will likely happen in January 2025 with the next legislative session.