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Start a business · Behavioral health clinic · South Dakota

How to start a behavioral health clinic in South Dakota

South Dakota requires a DSS accreditation to provide substance use disorder services (ARSD 67:61) or community mental health services (ARSD 67:62) from South Dakota Department of Social Services — Division of Behavioral Health, Office of Licensing and Accreditation to operate a behavioral health clinic.

Verified Oct 6, 2026Sources: state agencies, CMS and OIG

License required
YesDSS accreditation to provide substance use disorder services (ARSD 67:61) or community mental health services (ARSD 67:62)
Application fee
—
Processing time
—
Mental health counseling
$42.50
Organizations in the state
181NPPES, Sep 13, 2026
On this page
Licensing

South Dakota behavioral health clinic license

South Dakota requires a DSS accreditation to provide substance use disorder services (ARSD 67:61) or community mental health services (ARSD 67:62) from South Dakota Department of Social Services — Division of Behavioral Health, Office of Licensing and Accreditation to operate a behavioral health clinic.

License required
Yes
License
DSS accreditation to provide substance use disorder services (ARSD 67:61) or community mental health services (ARSD 67:62)
Renewal
Re-accreditation every two or three years based on the prior on-site score: 90% or higher earns a three-year certificate; 70-89% earns a two-year certificate.
Accreditation
State accreditation by DSS is the operating credential; SUD treatment programs must hold it to operate. DSS accredits the state's 11 community mental health centers.
Survey and inspection
On-site survey with records review and interviews; reviews recur every two to three years.
Regulation
ARSD Article 67:61 (substance use disorder services) and Article 67:62 (community mental health centers)
How to apply

Steps to get licensed in South Dakota

In order, as the licensing agency describes the process.

  1. Review ARSD 67:61 (SUD) or 67:62 (community mental health) for the services to be offered
  2. Apply to the DSS Office of Licensing and Accreditation for accreditation of the specific services
  3. Prepare policies and procedures, personnel files and case files for review
  4. Complete the on-site survey (policy, personnel and case file review plus interviews with clients, administration and staff)
  5. Receive an accreditation certificate for two or three years depending on the score
Documents

What you need to submit

4 documents listed by the licensing agency.

Document
Accreditation application
Policies and procedures
Personnel records
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Medicaid

Enrolling as a South Dakota Medicaid provider

Program
South Dakota Medicaid (Department of Social Services, Division of Medical Services)
Application fee
SD Medicaid's enrollment page says no application fee is charged. (Federal rule 42 CFR 455.460 allows the fee; CMS set it at $750 for 2026.)
Fingerprinting
Under federal rules (42 CFR 455.434 and 455.450), the state places provider types in 'limited', 'moderate' or 'high' risk levels. High-risk providers, and anyone who owns 5% or more of one, must submit fingerprints for a criminal background check. The SD DSS enrollment page we could reach does not describe a separate state fingerprint process (its maintenance/revalidation page returned an error).
Site visit
Under federal rule (42 CFR 455.432), the state must visit moderate- and high-risk providers before and after enrollment. Every enrolled provider must allow unannounced on-site inspections. The SD DSS enrollment page we could reach does not describe a separate state site visit process.
Revalidation
Federal rule (42 CFR 455.414) requires the state to revalidate every enrolled provider at least once every 5 years. SD Medicaid ran a portal-wide revalidation when the PE Portal launched in 2021 (due June 7, 2021). Records that could not be revalidated were terminated, and existing providers did not have to re-sign provider agreements.

Full South Dakota Medicaid enrollment guide →

Certificate of need

Does South Dakota require a certificate of need?

CON program
No
Moratoria
A nursing facility bed moratorium dates to 1988 and was extended indefinitely in 2005 (SDCL 34-12-35.4). The Department of Health may let a facility add beds or approve a new nursing facility only by redistributing beds from closed facilities or voluntarily surrendered beds, so the statewide total cannot exceed the 2005 level. Redistribution runs through periodic requests for proposals (held most years from 2013 to 2025), and the department reports annually to the Legislature on the need for more beds (SB 6, 2017).

South Dakota certificate of need details →

Labor

South Dakota wage floor

State minimum wage
$11.85 an hour
Effective
2026-01-01
Scheduled increases
Adjusted each January 1 by CPI; the state publishes the new rate by October 15. The 2027 rate was not yet found.
HCBS 80/20 rule
Federal baseline: 42 CFR 441.302(k) requires the state to show that each provider spends at least 80% of Medicaid payments for homemaker, home health aide and personal care services under 1915(c) waivers on direct care worker pay and benefits. Compliance starts 2030-07-09 (for managed care, the first rating period starting on or after that date); annual payment-adequacy reporting under 441.311(e) starts 2028-07-09. A state may set a lower share for state-defined small providers and exempt providers facing hardship, each only through a public notice-and-comment process. The eCFR text has not changed since 2024-07-09. No state-published 80/20 implementation step (small-provider criteria, hardship exemption or reporting guidance) was found for this state in the official sources reviewed.
Market

South Dakota market size

Counts from federal public files: NPPES (active organization NPIs), CMS Care Compare and CMS Medicaid enrollment.

Community/behavioral health agencies and mental health clinics — active organization NPIs (NPPES)
181 (as of Sep 13, 2026)
Total Medicaid and CHIP enrollment (latest reported month)
138,321 (as of Jun 1, 2026)
Rates

What South Dakota Medicaid pays

Behavioral health: published South Dakota fee-for-service rates, each linked to its source.

ServiceCodeSouth Dakota ratePer hourRank
Mental health counselingLicensed mental health clinician98012$42.50—1 of 12
Outpatient psychotherapy and diagnostic evaluationLicensed mental health clinician90863$93.65—6 of 28
Mental health assessment (non-physician)Physician or licensed psychologist90791$130.75—13 of 27
Mental health service plan developmentLicensed mental health clinicianT1007$31.76per 15 min$127.04—
Community-based wraparound servicesLicensed mental health clinicianH2021$44.85——

All South Dakota Behavioral health Medicaid rates, ranked →

Waivers

South Dakota HCBS waivers

Medicaid home and community-based services programs that may pay for this service.

  • SD Assistive Daily Living Services Waiver (1915(c))
  • SD CHOICES Waiver (1915(c))
  • SD Family Support 360 Waiver (1915(c))
  • SD Home and Community-Based Options and Person-Centered Excellence (HOPE) Waiver (1915(c))

South Dakota waivers and waiting lists →

FAQ

Frequently asked questions

Do you need a license to start a behavioral health clinic in South Dakota?

South Dakota requires a DSS accreditation to provide substance use disorder services (ARSD 67:61) or community mental health services (ARSD 67:62) from South Dakota Department of Social Services — Division of Behavioral Health, Office of Licensing and Accreditation to operate a behavioral health clinic.

Does South Dakota require a certificate of need for a behavioral health clinic?

No. South Dakota has no certificate of need program.

How do you become a Medicaid provider in South Dakota?

Enroll through South Dakota Medicaid Provider Enrollment (PE) Portal (https://dss.sd.gov/medicaid/providers/enrollment/enrollment.aspx).

What does South Dakota Medicaid pay a behavioral health clinic?

South Dakota Medicaid pays $42.50 for mental health counseling, effective Jun 1, 2026, ranking 1 of 12 states.