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South Dakota health insurance

Two insurers are offering 2019 individual market coverage. Open enrollment continues through December 15.

Health insurance in South Dakota

South Dakota’s health marketplace

South Dakota uses the federally run exchange, so residents enroll through HealthCare.gov.

Open enrollment for 2019 coverage started November 1 and runs through December 15, 2018.

South Dakota has two carriers – Avera and Sanford – offering 2019 health plans in the exchange. Both carriers also offered 2018 coverage.

Health insurance premiums for 2019 are about 5 percent higher than they were in 2018, before any premium subsidies are applied. About 93 percent of the those who had coverage through South Dakota’s exchange in 2018 received premium subsidies that paid an average of 85 percent of their total premium.

South Dakota enrollment in qualified health plans

In late 2013, the Kaiser Family Foundation estimated that 118,000 South Dakota residents were potential exchange customers, and that about 70,000 of them would qualify for premium subsidies. By April 2014, at the end of the first open enrollment period, 13,104 people had finalized their enrollment in qualified health plans through South Dakota’s exchange, and 89 percent of them qualified for premium subsidies.

By March 31, 2016, effectuated enrollment stood at 24,578. At the end of open enrollment on January 31, 89 percent of those who bought private health insurance plans through South Dakota’s exchange also received financial assistance.

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.

Enrollment has continued to grow each year in South Dakota’s exchange, which has not been 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.

Read more about South Dakota’s health insurance exchange.

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 on 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.

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.

As a result, in 2018, approximately 15,000 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.

Despite a lack of Medicaid expansion, average monthly enrollment grew by 3,849 from 2013 to June 2016, a 3 percent increase. By late 2018, however, it had declined slightly, reducing the net increase since 2013 to just 2 percent.

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 Kristi Noem in the House. All three are opposed to the ACA; Rounds has called Obamacare “fatally flawed.” In 2018, Noem successfully ran for governor in South Dakota, and Dusty Johnson, another Republican, won the election to take Noem’s place 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 has been 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. But Governor Daugaard indicated in early 2018 that the state was not reconsidering Medicaid expansion in the near future. Instead, the state is seeking federal approval to impose a work requirement on the existing Medicaid population.

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

South Dakota Medicare enrollment reached 170,912 as of September 2018. That’s about 19 percent of the state’s total population and slightly higher than the national rate of about 18 percent.

The state’s enrollment breaks down to 88 percent who qualify based on age alone and 12 percent who qualify due to disability.

In 2016, Medicare’s per recipient spending in South Dakota (for those enrolled in Original Medicare) was among the lowest in the nation, at $8,158 per beneficiary each year, which is 14 percent lower than the national average of $9,533 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.

Read more about Medicare in South Dakota.

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.