Health insurance in South Dakota
- South Dakota uses the federally run exchange so applicants enroll through HealthCare.gov.
- Open enrollment for 2020 health plans has ended, although residents with qualifying events can still enroll or make changes to their coverage for 2020. The next open enrollment period, for plans effective in 2021, will begin November 1, 2020.
- Short-term health plans are available in South Dakota with initial plan terms up to six months.
- Almost 30,000 South Dakotans enrolled in 2018 coverage through the exchange.
- South Dakota has not accepted the ACA’s Medicaid expansion and is seeking federal approval for a Medicaid work requirement.
- South Dakota’s lawmakers are mostly Republican and mostly opposed to the ACA.
- Nearly 172,000 South Dakotans are enrolled in Medicare.
South Dakota’s health marketplace
South Dakota uses the federally run exchange, so residents enroll through HealthCare.gov.
Open enrollment for 2020 health plans has ended, although residents with qualifying events can still enroll or make changes to their coverage for 2020. The next open enrollment period, for plans effective in 2021, will begin November 1, 2020.
Read our full overview of the South Dakota health insurance marketplace.
South Dakota enrollment in qualified health plans
In 2016, South Dakota was the state with the ninth highest exchange enrollment increase over 2015 – and the fourth highest of those using HealthCare.gov. Yet, South Dakota’s enrollment for 2016 was the fifth lowest among states using HealthCare.gov. That said, the state’s smaller population means fewer eligible enrollees.
From 2014 through 2018, enrollment grew each year in South Dakota’s exchange, which was not the case in most of the other states that use HealthCare.gov. For 2017 coverage, 29,622 people enrolled, and for 2018 coverage, 29,652 people enrolled – the highest enrollment the state’s exchange has had to date. But enrollment dropped for the first time in 2019, when 29,069 people signed up for private plans through the state’s exchange.
But enrollment climbed again for 2020, with 29,330 people enrolling during open enrollment.
Medicaid expansion in South Dakota
South Dakota has not expanded Medicaid under the ACA and has no imminent plans to do so. Instead, South Dakota is seeking federal approval to impose a work requirement in two counties for the existing Medicaid population. Arkansas implemented a work requirement in the summer of 2018, and 12,000 people had lost coverage by November. Work requirements are a thinly veiled way to whittle down the population covered by Medicaid, and they are facing an uncertain legal future, with the requirements in Arkansas, New Hampshire, and Kentucky overturned by a judge (Kentucky’s new governor has officially rescinded that state’s work requirement).
Unfortunately, in states like South Dakota, coverage is only available based on the pre-ACA eligibility rules. For South Dakota, there’s no Medicaid coverage available for non-disabled childless adults, and parents with dependent children are only eligible if they have a household income that doesn’t exceed 58 percent of poverty.
Total enrollment in Medicaid/CHIP has increased nationwide by an average of 26 percent since 2013 (mostly as a result of the ACA’s expansion of Medicaid), but in South Dakota, it has decreased by 5 percent.
As a result, in 2019, approximately 20,000 South Dakotans remained in the coverage gap with no access to Medicaid or exchange subsidies. Their only option is to pay full price for a private plan, which is not possible for most households with incomes below the poverty level.
Read more about Medicaid expansion in South Dakota.
Short-term health insurance in South Dakota
New federal regulations regarding short-term health insurance allow for longer short-term plans, but are clear in noting that a state can impose stricter guidelines. So South Dakota’s six-month limit on short-term plans will continue to apply unless the state enacts legislation to change it.
Read more about short-term health insurance in South Dakota.
South Dakota and the ACA
South Dakota’s US Congressional delegation is comprised entirely of Republicans: John Thune and Mike Rounds in the Senate, and usty Johnson in the House. All three are opposed to the ACA; Rounds has called Obamacare “fatally flawed.”
Former Representative Kristy Noem, who is also opposed to the ACA, successfully ran for governor in South Dakota in 2018 (Johnson replaced her in the House of Representatives).
South Dakota has had only GOP governors since 1979 — the longest streak of Republican governors in the country. Outgoing Governor Dennis Daugaard was opposed to Obamacare, and opted to let HHS run the state’s exchange. But he was willing to negotiate on the issue of Medicaid expansion, proposing a compromise to cover only residents with incomes below the poverty level, rather than those with incomes up to 138 percent of poverty as called for under the ACA. But under the Obama administration, HHS rejected both of his waiver proposals.
The Trump administration is much more open to waiver proposals that were a no-go under the Obama Administration, although no state has secured approval for Medicaid expansion capped at the poverty level (Utah has expanded coverage only to the poverty level, but HHS rejected their request to receive full federal Medicaid expansion funding (ie, 90 percent), despite a partial expansion of Medicaid.
South Dakota’s state legislature has a strong Republican majority, generally opposed to Obamacare.
How has Obamacare helped South Dakotans?
With a federally facilitated exchange and without Medicaid expansion, South Dakota has not fared as well under the ACA as states that expanded Medicaid, formed a state-run or partnership exchange, or did both.
According to U.S. Census data, 11.3 percent of South Dakota residents were uninsured in 2013, and that had dropped to 8.7 percent by 2016 — although it increased to 9.1 percent in 2017. Nationwide, the uninsured rate started out significantly higher, at 14.5 percent, but had dropped to 8.6 percent by 2016, and climbed slightly, to 8.7 percent, by 2017.
If and when South Dakota expands Medicaid, the state’s uninsured rate will likely decrease sharply. Because the state has thus far refused to expand Medicaid, there are an estimated 15,000 people in the coverage gap in South Dakota, most of whom remain uninsured. They have income below the poverty level, are ineligible for Medicaid, and are also ineligible for premium subsidies in the exchange.
South Dakota and high-risk pools
Before the ACA reformed the individual health insurance market, coverage was underwritten in nearly every state, including South Dakota. This meant that pre-existing conditions could result in an application being rejected altogether, or a coverage offer with significantly higher premiums or policy exclusions. The South Dakota Risk Pool was created in 2003 to give people an alternative if they couldn’t purchase individual health insurance because of their medical history.
Implementation of the ACA and the switch to a guaranteed issue individual market made high-risk pools largely unnecessary starting in January 2014, and the South Dakota Risk Pool stopped enrolling new members as of December 31, 2013. The plan remained operational for existing members until June 30, 2015.
Medicare in the state of South Dakota
The number of South Dakotans enrolled in Medicare reached 176,603 as of October 2019. Of Medicare beneficiaries in the state, 89 percent qualified based on age alone and 11 percent who qualify due to disability.
In 2017, Medicare’s per-beneficiary spending in South Dakota (for those enrolled in Original Medicare) was among the lowest in the nation, at $8,409 per beneficiary each year, which is 14 percent lower than the national average of $9,761 per member.
Medicare beneficiaries can choose private Medicare Advantage plans instead of Original Medicare. About 21 percent of South Dakota Medicare recipients did so in 2018 (well below the national average of about 36 percent).
More than 105,000 South Dakota Medicare beneficiaries had coverage under a stand-alone Medicare Part D prescription drug plan in 2018.
South Dakota health insurance resources
State-based health reform legislation
Scroll to the bottom of the page for details about recent state-based health care reform legislation in South Dakota.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.