North Dakota Healthcare
Compliance Guide

North Dakota presents a generally favorable, albeit carefully regulated, environment for healthcare companies, including those leveraging telehealth. The state has proactively adopted policies to expand access to care, particularly in rural areas, through telehealth. Key regulatory bodies include the North Dakota Board of Medicine, the North Dakota Board of Nursing, the North Dakota Board of Pharmacy, and the North Dakota Department of Health and Human Services. The overall business climate is supportive, but strict adherence to professional licensure, corporate practice of medicine (CPOM), and prescribing regulations is paramount. Recent legislative actions have focused on solidifying telehealth parity, refining controlled substance prescribing rules, and ensuring robust patient protections. While not as restrictive as some states regarding CPOM, a nuanced understanding of its application is crucial for compliant structuring. The state's commitment to expanding healthcare access through technology is evident, but this comes with an expectation of high standards of care and regulatory compliance. Companies must navigate specific requirements for establishing patient-provider relationships via telehealth, informed consent, and adherence to professional scope of practice. North Dakota's regulatory framework aims to balance innovation with patient safety, making it an attractive, yet demanding, state for healthcare expansion. The state has also shown a willingness to participate in interstate compacts, facilitating multi-state practice for certain professionals, which further enhances its appeal for telehealth providers.

North Dakota has a nuanced approach to the Corporate Practice of Medicine (CPOM) doctrine, generally considered to enforce it but with specific exceptions and interpretations. The legal basis for CPOM in North Dakota is primarily derived from statutory provisions governing professional licensure and corporate formation, rather than extensive case law. North Dakota Century Code (N.D.C.C.) Title 43, which governs professions and occupations, implicitly restricts unlicensed individuals or entities from practicing medicine or employing licensed professionals in a manner that interferes with their independent professional judgment.

Key Principles:

• Prohibition on Lay Ownership/Control: Generally, corporations cannot practice medicine, nor can they employ physicians in a way that allows non-physicians to control medical decision-making. N.D.C.C. § 43-17-10 prohibits the practice of medicine by any person not licensed by the Board of Medicine. This extends to corporations that would effectively be practicing medicine through employed licensees.
• Professional Corporations/Limited Liability Companies: North Dakota permits the formation of professional corporations (PC) or professional limited liability companies (PLLC) for the practice of medicine, dentistry, and other licensed professions. These entities must be owned and controlled by licensed professionals. N.D.C.C. Chapter 10-31 (Professional Corporations) and Chapter 10-31.1 (Professional Limited Liability Companies) outline these requirements, stating that all shareholders or members must be licensed in the profession for which the entity is organized. This is the primary permitted ownership structure for medical practices.
• Non-Physician Ownership: Non-physicians generally cannot own a medical practice that directly employs physicians and controls their clinical judgment. However, there are exceptions for certain types of facilities or services not considered the 'practice of medicine' itself, or where the entity provides only administrative or management services.

Impact on Specific Models:

• Telehealth Companies: Telehealth companies must carefully structure their operations to avoid CPOM violations. A common compliant model involves a Management Services Organization (MSO) that provides administrative, technical, and non-clinical support services to a physician-owned Professional Corporation (PC) or PLLC. The PC/PLLC directly employs or contracts with the licensed providers and maintains full clinical autonomy. The MSO cannot direct or interfere with medical judgment, diagnosis, or treatment.
• Medspas: Medspas offering medical services (e.g., injectables, laser treatments) must operate under the direct supervision and ownership of a licensed physician or other authorized professional. Non-physician ownership of the medical entity providing these services is generally prohibited. The 'medspa' entity itself might be lay-owned if it only provides non-medical services (e.g., traditional spa services) and contracts with a separate, physician-owned entity for medical procedures.
• Dental Practices: Similar to medical practices, dental practices must be owned and controlled by licensed dentists, typically through a professional entity structure (N.D.C.C. Chapter 43-28, Dentistry).
• Wellness Clinics: The applicability of CPOM to wellness clinics depends on the nature of services offered. If services involve diagnosis, treatment, or prescribing, they fall under the practice of medicine and are subject to CPOM restrictions. If services are purely advisory, educational, or non-medical (e.g., fitness coaching without medical claims), CPOM may not apply, but careful delineation is essential.

Restrictions: The primary restriction is that only licensed professionals can own and control entities that directly provide professional medical services. Any arrangement where a lay entity dictates clinical decisions, controls provider employment, or receives direct payment for professional services without proper structuring is at high risk of violating North Dakota's CPOM doctrine. Fee-splitting with non-licensed individuals or entities for professional services is also generally prohibited.

North Dakota has embraced telehealth as a means to expand access to care, particularly in its rural communities. The state's regulatory framework for telehealth is outlined primarily in N.D.C.C. Chapter 43-51 (Telehealth) and various board regulations.

Establishment of Patient-Provider Relationship:

• Yes, a patient-provider relationship can be established via telehealth in North Dakota. N.D.C.C. § 43-51-02(10) defines 'telehealth' broadly, and N.D.C.C. § 43-51-03 states that a health care provider may provide health care services through telehealth if the provider is licensed in North Dakota and acts within their scope of practice. The standard of care for telehealth services is the same as for in-person services.
• The establishment of a legitimate patient-provider relationship typically requires a synchronous, interactive audio-visual encounter sufficient to conduct an appropriate medical evaluation. While audio-only may be permissible in certain circumstances (e.g., follow-up, mental health), an initial diagnosis and treatment plan generally necessitate a visual component to meet the standard of care.

Permitted Modalities:

• Live Two-Way Audio-Visual (Synchronous): This is the preferred and most widely accepted modality for establishing new patient relationships and delivering comprehensive care. N.D.C.C. § 43-51-02(10) includes 'real-time interactive audio and video' in its definition of telehealth.
• Audio-Only (Synchronous): Permitted for certain services, particularly in mental health and for follow-up care, but generally not for establishing a new patient relationship requiring a physical exam or complex diagnostic assessment. The provider must determine if audio-only is clinically appropriate and meets the standard of care.
• Asynchronous (Store-and-Forward): Permitted where clinically appropriate, typically for reviewing medical images, data, or previously collected health information. It is not generally suitable for initial patient evaluation or complex diagnoses without a synchronous component. N.D.C.C. § 43-51-02(10) includes 'store-and-forward technology' in the definition.
• Remote Patient Monitoring (RPM): Permitted for monitoring physiological data and other health metrics. This is often used in conjunction with synchronous or asynchronous encounters.

Telehealth Registration Requirements:

• North Dakota does not have a separate 'telehealth registration' requirement for licensed providers. Providers must be fully licensed in North Dakota to provide telehealth services to patients located in the state. N.D.C.C. § 43-51-03 explicitly states that a provider must be licensed in North Dakota.
• For physicians, participation in the Interstate Medical Licensure Compact (IMLC) allows for expedited licensure in North Dakota, facilitating multi-state telehealth practice.

Informed Consent Requirements:

• Yes, informed consent specific to telehealth services is required. N.D.C.C. § 43-51-04 mandates that a healthcare provider must obtain informed consent from a patient before providing telehealth services. This consent must include information about the nature of telehealth, potential risks, patient rights, and confidentiality protections. The provider must ensure the patient understands the limitations and benefits of telehealth.

Geographic Restrictions:

• There are no specific geographic restrictions within North Dakota for receiving telehealth services. Patients can be located anywhere within the state. However, the provider must be licensed in North Dakota, and the patient must be physically located in North Dakota at the time of the telehealth encounter for North Dakota's jurisdiction to apply.

North Dakota maintains strict regulations for prescribing controlled substances via telehealth, largely aligning with federal Drug Enforcement Administration (DEA) requirements and state-specific mandates.

Controlled Substance Schedules Prescribable via Telehealth:

• Generally, all schedules (II, III, IV, V) can be prescribed via telehealth, provided a legitimate patient-provider relationship has been established, an appropriate medical evaluation has occurred, and the prescribing adheres to the standard of care.
• However, the federal Ryan Haight Online Pharmacy Consumer Protection Act of 2008 requires an in-person medical evaluation (or an evaluation by a referring practitioner who has conducted one) before prescribing controlled substances via the internet, unless an exception applies. The COVID-19 public health emergency (PHE) waivers temporarily lifted this in-person requirement, but the DEA has proposed new rules to reinstate it with certain modifications. As of 2025-2026, providers should anticipate the re-establishment of an in-person exam requirement or a 'qualified' telehealth evaluation (e.g., interactive audio-visual) for initial controlled substance prescriptions, particularly for Schedule II medications, absent further federal legislative action or new DEA rules.

Specific DEA Requirements:

• Providers must hold a valid DEA registration associated with their North Dakota practice location.
• All federal DEA regulations regarding electronic prescribing of controlled substances (EPCS) apply.
• The DEA's proposed rules (anticipated to be finalized in 2024-2025) will dictate the specifics of the 'telemedicine exception' to the Ryan Haight Act. It is crucial to monitor these developments. The proposed rules generally allow for a 30-day supply of Schedule III-V non-narcotic controlled substances and buprenorphine for opioid use disorder (OUD) without a prior in-person exam, but a follow-up in-person exam would be required for continued prescribing.

PDMP Checking Required:

• Yes, North Dakota Century Code (N.D.C.C.) § 19-03.5-03 mandates that practitioners must review the Prescription Drug Monitoring Program (PDMP) database before prescribing a Schedule II, III, or IV controlled substance to a patient for the first time, and at least every 90 days thereafter for ongoing prescriptions. This applies to telehealth prescribing as well. Failure to comply can result in disciplinary action by licensing boards.

Quantity or Refill Limitations:

• North Dakota law imposes specific limitations on controlled substance prescriptions. For example, N.D.C.C. § 19-03.1-23 limits initial opioid prescriptions for acute pain to a seven-day supply for adults and a five-day supply for minors. These limitations apply regardless of whether the prescription is issued via telehealth or in-person. Refills for Schedule II substances are generally prohibited, and refills for Schedule III-V are limited to five refills within six months of the date of issue.

Special Rules for Specific Drug Classes:

• GLP-1s (e.g., Ozempic, Wegovy): While not controlled substances, prescribing GLP-1s for weight loss or diabetes management via telehealth requires a thorough medical evaluation, appropriate diagnosis, and ongoing patient monitoring, consistent with the standard of care. Off-label prescribing must be medically justified and documented.
• Testosterone (Controlled Substance, Schedule III): Prescribing testosterone via telehealth is subject to the general controlled substance rules, including the Ryan Haight Act considerations. A comprehensive evaluation for hypogonadism, including laboratory testing, and ongoing monitoring are essential. The DEA's proposed rules for telehealth prescribing of controlled substances will be particularly relevant here.
• Stimulants (Controlled Substance, Schedule II): Prescribing stimulants (e.g., Adderall, Ritalin) for ADHD via telehealth is highly scrutinized. Under the anticipated post-PHE federal rules, an initial in-person evaluation (or a qualified telehealth evaluation under specific conditions) will likely be required. Ongoing management requires careful monitoring, including PDMP checks and regular follow-ups. Many state boards, including North Dakota's, emphasize the need for robust diagnostic workup and risk assessment when prescribing Schedule II stimulants via telehealth.

North Dakota has a progressive approach to the scope of practice for advanced practice registered nurses (APRNs) and physician assistants (PAs), granting significant autonomy while maintaining appropriate oversight.

Nurse Practitioners (NPs):

• Full Practice Authority: Yes, North Dakota grants full practice authority to Nurse Practitioners (NPs), referred to as Advanced Practice Registered Nurses (APRNs) in the state. N.D.C.C. Chapter 43-12.1 (Nurses) and the rules of the North Dakota Board of Nursing (N.D. Admin. Code Chapter 54-02-04) define the scope. APRNs, including NPs, are authorized to practice independently, diagnose, treat, prescribe medications (including controlled substances), and manage patient care without requiring a collaborative practice agreement or physician supervision after meeting initial licensure and practice requirements.
• Requirements for Full Practice Authority: To gain full practice authority, an NP must hold a current, unencumbered North Dakota RN license, an APRN license, and be nationally certified in their specialty. They must also meet specific practice hour requirements (e.g., 2,000 hours of supervised practice within the last 5 years) before transitioning to independent practice. Once these requirements are met, no ongoing collaborative agreement is mandated.

Physician Assistants (PAs):

• Supervision Requirements: PAs in North Dakota operate under a 'supervision' model, but the level of supervision is generally flexible and determined by the PA's experience, the practice setting, and the complexity of the patient's condition. N.D.C.C. Chapter 43-17 (Physicians and Surgeons) and N.D. Admin. Code Chapter 54-02-08 govern PA practice. PAs must have a supervising physician who is readily available for consultation and review, but continuous physical presence is not required. The supervising physician is responsible for the overall medical care provided by the PA.
• Scope of Practice: PAs can perform medical services delegated by their supervising physician that are within the PA's education, training, and experience, and within the physician's scope of practice. This includes diagnosing, treating, ordering and interpreting tests, and prescribing medications, including controlled substances. The specific services a PA can provide are outlined in a practice agreement between the PA and the supervising physician, which must be approved by the North Dakota Board of Medical Examiners.

Other Mid-Level Providers:

• Certified Nurse Midwives (CNMs) and Certified Registered Nurse Anesthetists (CRNAs): These APRN roles also have significant autonomy in North Dakota, practicing within their specialized scopes as defined by the Board of Nursing, often without direct physician supervision after meeting initial practice requirements.

Delegation Rules for Medical Assistants in Medspas:

• North Dakota law is clear that medical acts must be performed by licensed professionals or delegated appropriately. Medical assistants (MAs) are generally considered unlicensed assistive personnel. In medspas, MAs can perform administrative tasks and certain delegated clinical tasks that do not constitute the practice of medicine and do not require independent medical judgment.
• Prohibited Acts for MAs: MAs cannot perform procedures that involve piercing the skin (e.g., injectables like Botox, dermal fillers), laser treatments, or other procedures considered the practice of medicine, even under indirect supervision. These must be performed by a physician, APRN, or PA, or a registered nurse (RN) when delegated by a physician or APRN and within the RN's scope of practice. Delegation to an MA for such procedures is not permitted. The supervising physician or APRN bears ultimate responsibility for all services rendered in a medspa setting.

Establishing a compliant healthcare business in North Dakota requires careful attention to Corporate Practice of Medicine (CPOM) laws, fee-splitting prohibitions, and professional entity requirements. The Professional Corporation (PC) or Professional Limited Liability Company (PLLC) and Management Services Organization (MSO) model is the most common and compliant structure for telehealth and other healthcare ventures.

PC-MSO Structures:

• When Needed: A PC-MSO structure is essential in North Dakota when a healthcare business intends to employ licensed medical professionals (physicians, PAs, NPs) to deliver medical services, and there is a desire for non-licensed individuals or entities to have an ownership or management interest in the overall enterprise. The PC (or PLLC) serves as the clinical entity, owned solely by licensed professionals, while the MSO provides all non-clinical, administrative, and technical support services.
• Professional Corporation (PC) Requirements: N.D.C.C. Chapter 10-31 governs Professional Corporations. A PC must be organized for the sole purpose of rendering professional services. All shareholders, directors, and officers who render professional services must be licensed in the profession for which the corporation is organized. The PC employs or contracts with the licensed providers and is responsible for all clinical decisions and patient care.
• Professional Limited Liability Company (PLLC) Requirements: N.D.C.C. Chapter 10-31.1 provides for Professional Limited Liability Companies, which operate similarly to PCs but offer the flexibility of an LLC structure. All members must be licensed professionals.

Fee-Splitting Rules:

• North Dakota law generally prohibits fee-splitting, which is the division of professional fees for medical services between a licensed professional and an unlicensed individual or entity. This prohibition is intended to prevent undue influence on medical judgment and commercial exploitation of patients. N.D.C.C. § 43-17-31 (Physicians) and other professional practice acts contain prohibitions against aiding or abetting the unlicensed practice of medicine, which fee-splitting can constitute.
• MSO Exception: In a compliant MSO arrangement, the MSO receives a fair market value (FMV) fee for its administrative and management services, not a percentage of professional fees. The MSO's compensation should be fixed or based on a reasonable cost-plus model, not directly tied to the volume or value of referrals or professional services rendered by the PC. This distinction is critical to avoid illegal fee-splitting.

Management Services Agreement (MSA) Requirements:

• The MSA between the MSO and the PC/PLLC must be meticulously drafted to ensure compliance. Key elements include:
  • Scope of Services: Clearly delineate the non-clinical services provided by the MSO (e.g., billing, scheduling, marketing, IT, office space, equipment, HR, compliance support).
  • Compensation: The MSO's compensation must be at fair market value for the services rendered and not be based on a percentage of the PC's professional revenue or referrals.
  • Clinical Autonomy: Explicitly state that the PC/PLLC and its licensed providers retain sole authority and responsibility for all clinical decisions, patient care, and professional judgment.
  • Term and Termination: Define the agreement's duration and conditions for termination.
  • Confidentiality and HIPAA: Address data privacy and security responsibilities.

How to Structure Ownership for Compliance:

• Clinical Entity Ownership: The PC or PLLC providing medical services must be 100% owned by licensed North Dakota healthcare professionals (e.g., physicians, NPs, PAs, depending on the service and scope of practice). These owners must be licensed in the profession for which the entity is formed.
• MSO Ownership: The MSO can be owned by licensed or non-licensed individuals or entities, as it does not directly provide medical services. Its role is strictly administrative and managerial.
• Avoid Indirect Control: The MSO cannot exert control over the PC's clinical operations, hiring/firing of clinical staff, or medical decision-making. The relationship must be structured to preserve the PC's independent professional judgment. Any arrangement that appears to allow a lay entity to control the practice of medicine will be scrutinized.

North Dakota's regulatory landscape for healthcare, particularly telehealth, continues to evolve, with several key developments and anticipated changes for 2025-2026.

Legislative Actions (2024-2026):

• Telehealth Parity: While North Dakota already has strong telehealth parity laws (N.D.C.C. § 43-51-05 requires payors to cover telehealth services at the same rate as in-person services), there may be ongoing legislative efforts to refine definitions, expand covered services, or address specific payment models. Providers should monitor legislative sessions for any amendments to Chapter 43-51 or related insurance codes.
• Controlled Substance Prescribing: The primary driver of change in this area will be the federal Drug Enforcement Administration's (DEA) finalization of rules for prescribing controlled substances via telehealth post-PHE. North Dakota typically aligns its state-level regulations with federal guidelines. Providers should anticipate the re-establishment of an in-person or 'qualified' telehealth evaluation requirement for initial controlled substance prescriptions, particularly Schedule II, and monitor the DEA's final rule publication, expected in late 2024 or early 2025. State boards may issue interpretive guidance or emergency rules in response.
• Interstate Compacts: North Dakota is a member of several interstate compacts, including the Interstate Medical Licensure Compact (IMLC), the Nurse Licensure Compact (NLC), and the Physical Therapy Compact. There may be ongoing legislative efforts to join additional compacts or amend existing compact statutes to streamline multi-state practice. For instance, the Psychology Interjurisdictional Compact (PSYPACT) could see further adoption. These compacts significantly ease the burden for telehealth providers seeking to expand their reach.

Board Actions and Enforcement Cases:

• The North Dakota Board of Medicine and Board of Nursing regularly issue guidance, advisory opinions, and disciplinary actions related to telehealth and prescribing. Recent enforcement trends indicate increased scrutiny of providers who fail to establish a proper patient-provider relationship, neglect PDMP checks, or engage in inappropriate prescribing of controlled substances, especially for weight loss (e.g., compounded GLP-1s without proper indication) or ADHD without thorough diagnostic workups. Providers should regularly check board websites for updated guidance and disciplinary reports.
• There's an ongoing emphasis on maintaining the standard of care in telehealth, meaning the quality of care delivered remotely must be equivalent to in-person care. Boards are keen to ensure that telehealth is not used to circumvent professional standards.

Anticipated Regulatory Focus:

• AI in Healthcare: As artificial intelligence becomes more prevalent, North Dakota's regulatory bodies may begin to issue guidance or regulations concerning the use of AI in diagnosis, treatment planning, and patient monitoring, particularly regarding professional responsibility and liability.
• Data Privacy and Security: With increasing cyber threats, there will be continued regulatory focus on HIPAA compliance and state-specific data security requirements for telehealth platforms and patient data management.

Navigating North Dakota's healthcare regulatory environment requires a systematic approach. Here's actionable guidance for companies entering or expanding in the state:

Step-by-Step Compliance Checklist:

1. Legal Entity Formation: Form a Professional Corporation (PC) or Professional Limited Liability Company (PLLC) in North Dakota for the clinical entity. Ensure it is owned 100% by licensed North Dakota professionals. Simultaneously, form a separate Management Services Organization (MSO) for administrative functions.
2. Licensure: Ensure all healthcare providers (physicians, NPs, PAs) are fully licensed in North Dakota. Utilize interstate compacts (IMLC, NLC) where applicable for expedited licensure. Verify all licenses are active and in good standing.
3. DEA Registration: All providers prescribing controlled substances must have a valid North Dakota DEA registration.
4. MSA Development: Draft a comprehensive Management Services Agreement (MSA) between the MSO and the PC/PLLC. Crucially, ensure MSO compensation is at fair market value for services and does not constitute illegal fee-splitting. Explicitly state the PC's clinical autonomy.
5. Telehealth Protocols: Develop and implement robust telehealth protocols that align with N.D.C.C. Chapter 43-51 and board regulations. This includes detailed procedures for patient identification, informed consent, medical record documentation, and emergency protocols.
6. Prescribing Policies: Establish clear policies for prescribing, especially for controlled substances. Mandate PDMP checks as required by N.D.C.C. § 19-03.5-03. Monitor federal DEA guidance for Ryan Haight Act compliance post-PHE.
7. HIPAA Compliance: Implement comprehensive HIPAA privacy and security policies and procedures, including business associate agreements (BAAs) with all relevant vendors.
8. Scope of Practice Verification: For each provider type, verify services offered are strictly within their North Dakota scope of practice. For PAs, ensure a current, board-approved practice agreement is in place with a supervising physician.
9. Insurance and Billing: Understand North Dakota's telehealth parity laws (N.D.C.C. § 43-51-05) and ensure billing practices comply with state and federal regulations.

Common Pitfalls to Avoid:

• CPOM Violations: Allowing non-licensed individuals to own or control the clinical entity, or to dictate medical decisions. Improper MSO fee structures that resemble fee-splitting.
• Inadequate Patient-Provider Relationship: Prescribing or treating without a proper initial evaluation, especially for controlled substances, or relying solely on asynchronous modalities when synchronous is required.
• Non-Compliance with PDMP: Failing to check the PDMP database before prescribing controlled substances.
• Lack of Telehealth-Specific Informed Consent: Not obtaining explicit, documented informed consent for telehealth services.
• Out-of-State Licensure: Providing services to North Dakota patients without a valid North Dakota license.

Timeline Expectations for Licensing and Setup:

• Provider Licensure: 2-6 months (can be expedited via compacts to 2-4 weeks for IMLC/NLC).
• Entity Formation: 1-2 weeks for corporate registration.
• DEA Registration: 2-4 weeks after state licensure.
• Policy & Protocol Development: Ongoing, but initial drafts 1-2 months.
• Overall Setup: Expect 3-6 months for full operational readiness, assuming all legal and compliance documentation is in order.