Health insurance in South Dakota
- The South Dakota health insurance marketplace uses the federally run exchange so applicants enroll through HealthCare.gov.
- COVID-related enrollment window continues through August 15 (no qualifying event needed).
- Short-term health insurance is available in South Dakota with initial plan terms up to six months.
- More than 29,000 South Dakotans enrolled in 2020 coverage through the South Dakota health insurance marketplace.
- South Dakota has not accepted the ACA’s Medicaid expansion, but advocates are working to get Medicaid expansion on the 2022 ballot in the state.
- South Dakota’s lawmakers are mostly Republican and mostly opposed to the ACA.
- Nearly 179,000 South Dakotans are enrolled in Medicare.
This page is designed to provide information on health insurance options available in South Dakota. You’ll find information about the types of health insurance coverage available, the basics of the South Dakota health insurance marketplace and enrollment options (including open enrollment, special enrollment periods, and the one-time COVID-related enrollment period in 2021); brief overviews of Medicaid and Medicare options; a quick look at how short-term health insurance is regulated in the state; and a collection of health insurance resources for South Dakota residents.
Health insurance marketplace basics
The health insurance exchange is a good resource for people who don’t have access to group insurance coverage through the business where they are employed, or who do not meet eligibility income/age/other requirements for coverage under Medicaid or Medicare. Small business owners can purchase ACA-compliant small group health coverage directly from insurance companies in South Dakota, but there are no longer any SHOP-certified plans available in the state.
The health insurance marketplace (also called an exchange) was launched as part of the Affordable Care Act (Obamacare). States had the option to establish their own marketplace or leverage the federal marketplace: South Dakota elected to use the federal marketplace. The insurers that participate in the exchange in a given state may cover the entire state or a limited service area (i.e., just in certain counties); both of South Dakota’s exchange insurers offer coverage state-wide.
The marketplace helps people compare available health plans, get a customized quote regarding the rates/costs for those plans, and enroll in their preferred plan. The ACA requires all individual and small group health plans (on-exchange or off-exchange) with effective dates of January 2014 or later to cover essential health benefits with no annual or lifetime dollar caps. One of the most important and consumer-friendly provisions of the marketplace is that people with a pre-existing condition cannot be denied coverage, and the insurers cannot exclude the pre-existing conditions from the enrollee’s coverage.
You can also use the insurance marketplace to see if you qualify — based on your income — for premium subsidies or cost-sharing reductions (CSR) to help you pay your monthly premiums or reduce your out-of-pocket costs (note that premium subsidies are larger and more widely available in 2021, due to the American Rescue Plan).
Please know that enrollment options, service areas, and costs change from year to year. And a change in your family’s circumstances (like job changes, hitting age milestones, having a baby, etc.) can affect your eligibility to enroll via the exchange and for subsidies or cost-sharing reductions (CSR).
South Dakota’s health insurance marketplace
The South Dakota health insurance marketplace uses the federally run exchange, so residents enroll through HealthCare.gov. There are two insurers — Avera and Sanford — that offer coverage through South Dakota’s marketplace for 2021, and both offer plans statewide.
Read our overview of the South Dakota health insurance marketplace – including news updates and exchange history.
When can I enroll in health insurance in South Dakota?
In South Dakota, the open enrollment period for 2021 health plans ran from November 1 through December 15, 2020. Outside of that window, a qualifying event is normally necessary in order to enroll in an individual market plan (on-exchange or outside the exchange). But the rules are different in 2021, due to the ongoing COVID pandemic. An enrollment window is available through August 15, 2021, and South Dakota residents do not need a qualifying event to use it.
The enrollment window through August 15 is an excellent opportunity for people to take advantage of the newly enhanced premium tax credits (premium subsidies) created by the American Rescue Plan. Uninsured residents can enroll, and people with off-exchange coverage can transition to the exchange — which is necessary in order to take advantage of premium tax credits, which are available in 2021 to some people who were formerly not eligible due to the “subsidy cliff.” And current enrollees can switch to a different plan if they choose to do so, which might help them take full advantage of the additional premium tax credits and eligibility for cost-sharing reductions.
South Dakota enrollment in qualified health plans
31,375 people enrolled in coverage through South Dakota’s exchange during the open enrollment period for 2021 coverage, which was a record high. The previous high point was in 2018, when 29,652 people enrolled.
Read more about open enrollment and premiums in our overview of the South Dakota health insurance marketplace.
South Dakota and the Affordable Care Act
South Dakota’s U.S. Congressional delegation is comprised entirely of Republicans: John Thune and Mike Rounds in the Senate, and Dusty 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), and has been in the governor’s office since early 2019.
South Dakota has had only GOP governors since 1979 — the longest streak of Republican governors in the country. Former Gov. 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.
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% of South Dakota residents were uninsured in 2013, and that had dropped to 8.7% by 2016 — although it has been steadily increasing since then, reaching 10.2% in 2019. Nationwide, the uninsured rate started out significantly higher, at 14.5%, but had dropped to 8.6% by 2016, and had increased to 9.2% by 2019 (various Trump administration policies had the effect of increasing the number of Americans without health insurance).
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 14000 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.
Medicaid is a health insurance option jointly administered by the state and federal government. The federal government establishes broad eligibility categories, and each state defines specific income requirements. Medicaid is available to people with disabilities and individuals/families with low incomes. The ACA offered an option to expand eligibility to adults without dependents. South Dakota is one of 12 states that has not adopted Medicaid expansion as of 2021 (Missouri and Oklahoma plan to expand Medicaid by mid-2021; a dozen other states have not yet made steps to do so).
Medicaid expansion in South Dakota
South Dakota has not expanded Medicaid under the ACA and has no imminent plans to do so. Instead, during the Trump administration, South Dakota was seeking federal approval to impose a work requirement in two counties for the existing Medicaid population (the Biden administration has notified states that Medicaid work requirements are a non-starter).
In the dwindling minority of states, like South Dakota, where Medicaid has not yet been expanded, Medicaid 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% of poverty.
As a result, in 2021, approximately 16,000 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.
Total enrollment in Medicaid/CHIP has increased nationwide by an average of 35% since 2013 (mostly as a result of the ACA’s expansion of Medicaid), but in South Dakota, it has only increased by 3%. And even that slight increase has been driven by the COVID pandemic, with widespread job/income losses. Prior to the pandemic, Medicaid enrollment was lower in South Dakota than it had been in 2013.
But South Dakota Medicaid expansion advocates are working to gather enough signatures to get Medicaid expansion on the 2022 ballot in South Dakota. This is how Medicaid has been expanded in Maine, Utah, Idaho, and Nebraska. Voters in Oklahoma and Missouri approved Medicaid expansion ballot measures in 2020, which is why those states are expanding Medicaid in 2021 (funding for Medicaid expansion in Missouri is still uncertain as of the spring of 2021).
Read more about Medicaid expansion in South Dakota.
Short-term health insurance in South Dakota
Federal regulations changed for short-term health insurance as of 2018, allowing for longer short-term plans. But they are clear in noting that a state can impose stricter guidelines.
Until late 2020, South Dakota imposed a six-month limit on short-term plans. But that changed in late 2020, when the state relaxed its rules to allow short-term plans to follow the federal guidelines that the Trump administration implemented in 2018. Short-term plans in the state can now have initial terms of up to 364 days, and total duration, including renewals, of up to three years (insurers can still choose to offer shorter terms and limit renewals).
Read more about short-term health insurance in South Dakota.
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 covers people who are age 65 or older, certain people with disabilities, and people with end-stage renal disease (ESRD) or ALS. You can visit our Medicare resources website for detailed information.
- Original Medicare includes both Part A and Part B. Under original Medicare, the federal government pays directly for services you receive. You can also buy a Medicare Supplement (Medigap) policy and/or a standalone Part D Prescription Drug Plan.
- Medicare Part A covers inpatient hospital care, skilled nursing facility care, hospice care, and some home health care; however, it does not cover long-term care/custodial care.
- Medicare Part B covers outpatient medical care and services, including physician services and some preventive care and vaccines.
- Medicare Part D covers prescription drugs. You can get drug coverage with Original Medicare by enrolling in a stand-alone Part D Prescription Drug Plan (PDP), or by enrolling in a Medicare Advantage plan that includes Part D coverage.
- Medicare Part C, which is usually referred to as Medicare Advantage, rolls the benefits of Original Medicare into one plan together with various other benefits. Most Medicare Advantage plans include Part D coverage for prescription drugs; these plans are called MAPDs, which stands for Medicare Advantage Prescription Drug. With Medicare Advantage, you can choose from one of several private health plans that provide service in your state, and the federal government pays the plan for the healthcare service you receive. A Medicare Advantage plan may include additional, optional benefits, like vision or dental coverage, within a single premium.
Medicare coverage and enrollment in South Dakota
The number of South Dakotans enrolled in Medicare reached 181,162 as of January 2021.
Read more about Medicare in South Dakota, including the state’s rules for Medigap plans.
South Dakota health insurance resources
- Division of Insurance – South Dakota
- Western South Dakota Community Action Partnership (ACA navigator organization)
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.