How to Start a NEMT Business in South Dakota (2027)

South Dakota runs Medicaid rides without a broker. You enroll with South Dakota Medicaid, members call your company directly, and you bill the Department of Social Services at its own fee schedule rates. A for-profit company starts as a secure medical transportation provider, for members who use a wheelchair or a stretcher. The rules below follow the Secure Medical Transportation and Community Transportation manuals updated August 2026 and the Transportation Services Fee Schedule effective July 1, 2026.

How Medicaid rides work in South Dakota

The South Dakota Department of Social Services (DSS) runs Medicaid through its Division of Medical Services. It pays enrolled ride companies fee for service under state rule ARSD chapter 67:16:25, with no broker and no regions. Members find a ride company on the provider lists DSS posts and call it. You check eligibility in the Medicaid Portal before each ride, and in-state rides need no prior approval. Medicaid pays for rides in three ways:

Program	Who rides	Who can provide it
Secure medical transportation	Members confined to a wheelchair or needing a stretcher	Any enrolled company, firm, or individual, ambulances included
Community transportation	Members riding by bus, minibus, taxi, or another transit system	Governments, registered nonprofits, and enrolled secure medical providers
Non-Emergency Medical Travel	Members traveling to another city	Mileage paid to the member, an escort, a volunteer driver, or a nonprofit

Confined to a wheelchair means the member cannot walk without the continuous help of another person, or cannot walk at all. Leaving a hospital in a wheelchair does not by itself qualify a member. Keep proof of the member’s condition: DSS recommends its Transportation Documentation Form, MS-118, signed by the member, the driver, and the clinic or pharmacy staff.

The Non-Emergency Medical Travel program pays $0.70 a mile (rate effective December 1, 2025) to members who travel to another city for care. It adds $150 a day for meals with lodging (effective November 1, 2024) on overnight specialty care trips at least 150 miles from home.

Which trips are covered

• Where. From the member’s home, work, or school to a medical provider, between providers, and back home.
• Pickups. Prescriptions, medical equipment, and optical supplies when delivery is not an option, and always for a first fill or an equipment fitting.
• How far. To the closest provider that can give the care, unless the member has a written referral. Most care outside South Dakota needs DSS prior authorization first, except care within 50 miles of the border or in Bismarck, North Dakota.
• How often. Up to four one-way trips on one date of service. A third round trip that day is the member’s own cost.

Full Medicaid and CHIP members qualify. Members covered only for pregnancy get rides to pregnancy-related care. The Medicare savings groups, such as Qualified Medicare Beneficiaries, get no rides, and the Renal Program pays travel mileage but not secure or community transportation.

Tribal nations and IHS

The Great Plains Area of the Indian Health Service (IHS) counts eight reservations in South Dakota, plus a Rapid City service unit. In South Dakota, its largest groups of eligible people living outside any service unit are in Aberdeen and Sioux Falls. Rides on and off reservation land follow the same Medicaid rules:

• Tribal ride programs. IHS and tribal 638 facilities enroll with South Dakota Medicaid and bill transportation under the same manuals. They may limit their rides to people eligible for IHS or tribal health care.
• Who you bill. Medicaid is usually the payer of last resort, but DSS names IHS as an exception. You bill Medicaid, not IHS, for a member who has both.
• 2027 exemptions. American Indian and Alaska Native members, including anyone eligible for IHS, are exempt from the 2027 work requirement and six-month renewals.
• Tribal offices. SDDOT’s list of Tribal Employment Rights Offices, updated July 16, 2025, names offices for eight tribes. Call the tribe before you base vans or hire drivers on reservation land. See NEMT on tribal lands.

2027 changes for Medicaid Expansion

Starting January 1, 2027, Medicaid Expansion adults aged 19 through 64 must show 80 hours a month of work, job training, volunteering, or school unless an exclusion applies. New applicants show it when they apply, and current members at their first renewal in 2027. They will also renew every six months instead of every 12. DSS mailed a fact sheet to Expansion members in August 2026. A member who loses coverage loses rides, so check eligibility before every trip. See the Medicaid work requirement rule and six-month renewals.

How to enroll with South Dakota Medicaid

There is no broker contract to win. You enroll with DSS, and any eligible member can call you.

If you are	Enroll as
A company with wheelchair or stretcher vans	Secure medical transportation (taxonomy 343800000X)
A nonprofit or government agency	Community transportation (taxonomy 343900000X)
A secure medical provider adding walk-on riders	Community transportation as well

The DSS enrollment page and its June 4, 2026 enrollment chart set these steps:

1. Get an EIN and a Type 2 NPI. DSS enrolls transportation companies as entities, and an entity NPI must be tied to a federal EIN in your legal business name. See how to get an NPI number and taxonomy codes.
2. Register in the Provider Enrollment Portal. A member of your own staff, not an outside credentialing firm, registers the NPI and becomes its administrator.
3. Finish the online enrollment and send every document within 30 days of starting it, or DSS denies it. There is no paper application and no application fee.
4. Email the documents to SDMedicaidPE@state.sd.us, with your NPI, company name, and “new enrollment” in the message: the signed Provider Agreement, the Disclosure form, a letter from your bank confirming the account for direct deposit, and a Transportation Provider Vehicle Details form for each vehicle.
5. Fill in the vehicle form. Version 2.1 (December 2021) asks for the plate type, VIN, garage address, dispatch phone, and every county where the vehicle picks up riders, plus signed attestations about your drivers.
6. Wait for the approval notice. DSS reviews enrollments in the order it receives them and pays claims only from enrolled NPIs. The approval notice includes any special claim instructions.

Provider Enrollment answers at 866-718-0084. Once approved, email sdmedxgeneral@state.sd.us to add or update your listing on the DSS pages members use to find rides.

Keeping your enrollment

• Changes. A new address or vehicle needs a new vehicle form, and a change of ownership needs 30 days’ written notice.
• Inactivity and revalidation. DSS may end an enrollment with no paid claims in 24 months, and it expects revalidation every three to five years. See Medicaid revalidation.
• Site visits. The Provider Agreement allows unannounced site visits by DSS, the Medicaid Fraud Control Unit, and HHS. See Medicaid site visits.

You may set limits, such as hours or a service area, but you must serve every Medicaid member inside them. See how to become a Medicaid transportation provider.

Licenses and registrations

Your company

File your LLC or corporation online with the Secretary of State. As of September 2026, it costs $150, and online filings are processed at once. Paper filings cost $165 and take one to three business days. Keep a South Dakota registered agent on file.

The annual report is due every year on the first day of the month you first filed: a company filed June 11, 2026 owes its first report June 1, 2027. It costs $55 online. Two months after the due date, the company becomes delinquent, owes a $55 late fee, and can then be dissolved.

A nonprofit corporation costs $30 to form and $10 a year to report. That matters here, because a registered nonprofit can join community transportation directly. See LLC for NEMT and starting a nonprofit NEMT.

Get your EIN from the IRS, free and at once online. The Department of Revenue says services paid directly by Medicaid are exempt from sales tax (July 2023 tax fact). Its January 2026 tax fact says buses, taxis, and similar rides wholly inside South Dakota owe sales tax, plus city tax when the ride stays in one city, so ask the department how your private pay rides are taxed.

Plates, city licenses, and federal rules

South Dakota Medicaid’s enrollment chart asks for a license only from ambulance providers. These are the rules that reach a wheelchair or stretcher van company:

If you	You need
Carry Medicaid riders in any vehicle	A vehicle owned by or registered to your company, with South Dakota commercial or exempt plates
Carry riders for pay in Sioux Falls	A city vehicle for hire business license and an operator’s permit for each driver
Run a vehicle built for more than 15 people, driver included	Federal safety rules on in-state trips, and drivers at least 21
Run a vehicle over 26,000 pounds	Federal safety rules on in-state trips
Cross a state line for pay in a vehicle built or used for 9 or more people, driver included, or rated 10,001 pounds or more	A USDOT number and the federal safety rules

A vehicle carrying people for hire is a commercial motor vehicle under SDCL 32-9-1, and SDCL 32-9-6 sends you to your county treasurer to register it and get its plates. Exempt plates are for vehicles owned by government, tribes, and licensed ambulance services, and for church buses and vans, among others (SDCL 32-5-42). To bill mileage outside city limits, ARSD 67:16:25:05 says you must have legal authority to operate there.

Sioux Falls licenses vehicles for hire, with wheelchair transport as one license type. As of September 2026, its checklist asks for a Police Department operator’s permit for each driver, commercial plates, a sales tax license number, a $500,000 auto liability certificate listing the city as an additional insured, an inspection of each vehicle on the city’s inspection form, and $50 for the first vehicle plus $25 for each one after. Vans parked at home need a home occupation permit. City ordinance 124.013, printed on the city’s 2020 rate sheet, caps wheelchair and stretcher fares within the city, adjusts them yearly, and requires the rate schedule posted in each van. Other cities set their own rules.

South Dakota applies the federal safety rules in 49 CFR parts 390 to 397 to in-state trips only for vehicles over 26,000 pounds, vehicles built for more than 15 passengers, and hazardous materials (SDCL 49-28A-3). Trips across a state line follow the federal definitions. See the DOT number guide, the North Dakota and Minnesota pages, and NEMT license requirements.

Vehicle rules

The vehicle rules in ARSD 67:16:25 apply to secure medical transportation. DSS does not inspect vans on a schedule, so the checks are yours.

Every day before a van carries a Medicaid member, make sure:

• Coolant, fuel, and windshield washer fluid are full.
• Lights, turn signals, hazard flashers, and wipers work.
• No tire shows fabric through a cut or wear, or has knots or bulges, and tread is at least 2/32 of an inch on any two adjacent grooves.

Every week or 1,000 miles, whichever comes first, inspect oil and brake fluid, tire pressure, horn, brakes, instrument panel, fan belt, the ramp or lift, securement devices, passenger heat and air conditioning, and emergency exits. Repair anything that fails before the next Medicaid ride. Record the date, odometer reading, result, and repairs on a vehicle inspection checklist, and keep lift and vehicle service records in a maintenance log.

Equipment and securement

• Safety equipment and a first aid kit in every van. The manual suggests a cell phone, a fire extinguisher, warning triangles, and an ice scraper and blanket in season. See the winter vehicle checklist.
• A securement device and an occupant restraint for each rider, installed and used as the maker says. The restraint must hold the pelvis and upper torso and meet 49 CFR 571.222, S5.4.1 to S5.4.4. A rider with a written statement from a doctor or other licensed practitioner may ride without the belt.
• Before moving, fasten the restraint, tell every passenger seat belts are required, and check that they are on. See wheelchair securement.
• A “No Smoking” sign visible to all passengers.
• Warning triangles when stopped for an emergency or broken down on a highway outside town during headlight hours: one within 10 feet of the rear and one about 100 feet back, plus one about 200 feet back on a one-way road.

A member confined to a bed whose doctor documents that a stretcher van is not appropriate goes by non-emergency ambulance instead. Oxygen and oxygen supplies are part of the base rate. See NEMT vehicle requirements.

After a complaint, DSS may inspect a van without notice. A van that needs repairs stays off Medicaid rides until you send DSS written proof of the fix, and refusing an inspection ends your contract.

Driver rules and training

Secure medical transportation drivers must meet ARSD 67:16:25:04.01 and the manual’s driver list. Community transportation drivers meet the same list, apart from the hearing rule. Keep a driver off Medicaid rides if the driver:

• Is under 18, or has less than one year of experience as a licensed driver.
• Lacks a valid license for the class of vehicle driven.
• Had a license suspended under SDCL chapter 32-12, or a conviction for driving under the influence under SDCL chapter 32-23, or similar laws of another state, in the last three years.
• Is excluded from any federal health care program or listed on the OIG exclusion list.
• Has hearing loss of more than 30 decibels in the better ear. A driver who meets the limit only with a hearing aid must wear a working one while driving.

Federal law and the state manuals also require two processes: one to deal with a driver’s violation of a state drug law, and one to disclose each driver’s driving history, traffic violations included, to Medicaid.

Before a first ride, each driver and attendant must be able to help a passenger into and out of the van and must be trained on the ramp, lift, and securement devices; on what to do in a medical emergency or accident, first aid included; and on the van’s fire extinguisher. See NEMT driver training.

Records to keep

DSS may ask to see the dates you checked each driver’s qualifications and training, signed statements on each van’s equipment and securement, inspection and service records, a statement from your insurer, accident records, driving histories, and every complaint with how you handled it. Investigate each complaint about a driver or attendant and write up the result. Use the driver file checklist and the complaint log.

The federal hours rules do not reach in-state trips in vans that SDCL 49-28A-3 exempts. On a trip across a state line in a vehicle that counts as a commercial motor vehicle, 49 CFR 395.5 allows 10 hours of driving after 8 hours off, and no driving after 15 hours on duty. See rural NEMT on long days.

Trip rules and how you get paid

Service rules

• Bill only real rides. Bill only when the member rode. Cancelled rides and no-shows are not covered, and DSS says you cannot charge the member for a missed ride either.
• Escorts. An adult escort is covered for members aged 20 or younger, or when accompanied travel is medically necessary. If your policy charges for escorts, bill T2001 at your usual charge, one unit per one-way trip. If your policy lets escorts ride free, do not bill it.
• Several stops. Bill the first two one-way trips on one line and any more on a second line with modifier 59, up to four a day.
• Homes. Community transportation does not count a hospital, nursing facility, jail, or campus setting as a member’s home.

What South Dakota Medicaid pays

DSS sets the rates in its Transportation Services Fee Schedule. As of July 1, 2026, secure medical transportation pays:

Service	Code	Rate
Wheelchair van trip	A0130	$43.39
Extra wheelchair rider	A0130-TK	$21.70
Inpatient discharge the hospital arranged	A0130-QM	$65.09
Stretcher van trip	T2005	$109.66
Extra stretcher rider	T2005-TK	$54.83
Wheelchair van mile outside city	S0209	$2.61
Stretcher van mile outside city	T2049	$2.61
Escort, per one-way trip	T2001	$2.60

That is about 4 percent above the July 1, 2025 schedule. Miles count only from the point the trip leaves city limits, with one mileage allowance per trip however many members ride. A one-way wheelchair trip with 60 loaded miles outside town pays $43.39 + (60 × $2.61) = $199.99. The same trip inside town pays $43.39 with no mileage. See A0130, T2005, and the TK modifier.

Community transportation pays much less:

Service	Code	Rate
Trip in city	A0120	$5.20
Trip outside city	A0120-TN	$7.80
Taxi trip	A0100	$5.20
Extra rider in city	A0120-TK	$2.60
Mile, 21 miles or more outside city	S0215	$1.04

Community transportation miles are paid only between cities, on trips of 21 miles or more one way. The empty drive back, or to pick up a hospital or nursing facility discharge, is paid the same way. A 40-mile trip between towns pays $7.80 + (40 × $1.04) = $49.40, and the empty drive back adds $41.60. See deadhead miles.

DSS pays the lesser of your usual and customary charge and the fee schedule, so bill your usual charge. To ask for a higher rate, send a fee schedule request in the Medicaid Portal. DSS reviews them every quarter.

Claims and deadlines

• Form. Bill on the CMS-1500 or the 837P, one claim per member. Show the pickup and drop-off addresses, in box 19 for community transportation. Bill whole miles, rounded to the nearest mile. See the CMS-1500 guide and NEMT billing codes.
• Filing limit. DSS must receive the claim within 6 months after the month of the ride, under ARSD 67:16:35:04. See timely filing limits.
• Appeals. Ask for a reconsideration in the Medicaid Portal within the filing period or within 3 months of the denial, and DSS usually answers within 30 days. Then you have 30 days to ask the Office of Administrative Hearings for a fair hearing, and a corporation must use an attorney. See how to appeal a denied NEMT claim.
• Exceptions. For a ride the rules do not cover, email the Transportation Exceptions Form, MS-120. DSS decides within five business days and approves only if it saves the state money.
• Records. Keep medical and financial records for at least 6 years after the last claim was paid or denied. See NEMT record retention.

NEMT is not on South Dakota’s electronic visit verification list, which covers personal care, home health, private duty nursing, and some in-home waiver services such as respite. See EVV for NEMT.

Insurance requirements

ARSD 67:16:25:04.06 sets the Medicaid floor for secure medical transportation:

Coverage	Minimum
Bodily injury or death, any person, one accident	$1,000,000
Property damage, one accident	$1,000,000
Single limit policy instead	$1,000,000 per occurrence

Keep a statement from your insurer that each van meets it. State law sets a lower floor for every vehicle, as of September 2026:

Coverage	State minimum
Injury to one person	$25,000
All injuries, one accident	$50,000
Property damage	$25,000
Uninsured and underinsured motorist	Equal to your injury limits, up to $100,000 per person and $300,000 per accident

The Division of Insurance warns that a personal auto policy generally excludes carrying people for a fee. You need a commercial auto policy. Sioux Falls also asks for $500,000 in auto liability with the city listed as an additional insured. See NEMT insurance requirements.

Workers’ compensation

The Department of Labor and Regulation says no South Dakota law requires an employer to carry workers’ compensation, but it strongly recommends it, because an injured worker can sue an uninsured employer in civil court. If you carry it, send the First Report of Injury to your insurer within seven days of learning of an injury, not counting Sundays and holidays. The state’s independent contractor certification is for owner-operators of trucks, so read 1099 or W-2 NEMT drivers before you treat drivers as contractors.

What it costs and how long it takes

These are the fees South Dakota sets, as of September 2026. Vans, insurance premiums, and equipment depend on your quotes. See what it costs to start a NEMT business.

Item	Cost	Paid to
EIN	Free	IRS
LLC or corporation filing, online	$150	Secretary of State
Annual report, online	$55 a year	Secretary of State
Nonprofit corporation filing	$30	Secretary of State
Medicaid enrollment	No fee	DSS
Commercial plates, up to 10,000 pounds	$85 to $130 a year by weight	County treasurer
Sioux Falls vehicle for hire license	$50, then $25 per vehicle	City of Sioux Falls

Commercial plate fees follow gross weight under SDCL 32-9-15, and a vehicle 10 or more model years old pays 90 percent of the fee. A workable order, from first call to first ride:

1. Pick your path. A for-profit company with wheelchair or stretcher vans enrolls for secure medical transportation. A nonprofit can start with community transportation.
2. Form your company online with the Secretary of State, then get your EIN and your Type 2 NPI.
3. Buy and equip your vans, put commercial plates on them, and buy commercial auto insurance of at least $1 million.
4. Get city licenses where you will operate, such as the Sioux Falls vehicle for hire license.
5. Hire and train drivers who meet the state rules.
6. Enroll with DSS in the Provider Enrollment Portal, and finish within 30 days of starting.
7. After approval, get listed for members, and meet the discharge planners, dialysis centers, and clinics that send riders.

The Medicaid enrollment review sets the pace. It runs in the order received, and DSS pays only enrolled providers. For the same steps in any state, see how to start a NEMT business.

Work beyond Medicaid

Medicaid is not the only buyer of rides in South Dakota:

• Rural and specialized transit. SDDOT passes federal Section 5311 grants to state agencies, local governments, tribes, and nonprofits that run rural public transit. Section 5310 pays up to 80 percent of equipment costs for nonprofits serving older adults and people with disabilities. Ask your local transit agency whether it buys rides from private companies. See Section 5310 grants.
• Veterans. The VA pays for special mode transportation, such as a wheelchair van, when a VA provider decides a veteran’s condition requires it and the trip is approved in advance. Ask the travel staff at VA Sioux Falls health care or VA Black Hills health care, which has sites in Fort Meade and Hot Springs. See VA transportation contracts.
• Facilities. A nursing facility cannot bill Medicaid for community transportation, because those rides count as routine costs in its cost report, so ask facilities how they cover residents’ rides. When a hospital calls you for an inpatient discharge, the higher QM rate applies. See how to get NEMT facility contracts and hospital discharge transportation.
• Private pay. Riders and families who pay for themselves add work outside the fee schedule. In Sioux Falls, stay within the city’s fare caps. See private pay NEMT.