SD gov likely to urge delay in Medicaid decision

PIERRE, S.D. (AP) — South Dakota Gov. Dennis Daugaard will likely recommend that the Legislature once again delay a decision on expanding the state’s Medicaid program to cover the health care costs of more low-income people, he told The Associated Press on Friday.

The Legislature earlier this year agreed with Daugaard’s original recommendation to delay a decision on the expansion under the federal health care law.

Daugaard said he is still leaning against expanding Medicaid, at least until he can obtain more information on who would be covered, how it would affect Native Americans who now get care from the Indian Health Service on reservations and whether federal officials would give South Dakota some leeway in deciding which income levels are covered.

In addition, South Dakota might want to wait and see how President Obama’s entire health care law works, Daugaard said.

“In the face of uncertainty, I’m no different than anyone. One tends to be cautious and be more prone to wait and see until the landscape becomes clearer,” Daugaard said.

Organizations representing South Dakota doctors and hospitals have urged the state to expand Medicaid, arguing it will help the poor receive better and earlier care. Unpaid emergency room expenses incurred by low-income people are passed on to patients with private insurance, they said.

“Expanding Medicaid will provide much needed coverage to our low-income patients, improve access to health care and improve the health and well-being of the newly insured. We know that those without coverage live sicker and die younger,” said Dr. Daniel Heinemann, president of the South Dakota State Medical Association.

The federal health care law seeks to provide more people with insurance through subsidized private insurance offered through online marketplaces called exchanges. States also have the option of expanding Medicaid to cover people considered too poor to get the subsidized insurance.

South Dakota’s Medicaid program now covers about 116,000 children, adults and disabled people. The expanded eligibility would add an estimated 48,500 people, mostly adults without children.

People earning up to 138 percent of the federal poverty level — $15,451 for a single person or $31,809 for a family of four — would be covered by an expansion. The federal government would fully cover those added to Medicaid’s rolls through 2016, and the state’s contribution would rise in stages to 10 percent of the medical costs by 2020.

Daugaard said he has renewed a request that South Dakota be allowed to expand Medicaid only up to 100 percent of the poverty level because those over that mark can qualify for subsidized private insurance. Federal officials rejected that request earlier.

“I thought, let’s explore that again,” Daugaard said.

Daugaard said he’s still uncertain whether the federal government will be able to meet its pledge of paying most of the costs of expanding Medicaid.

Aside from the health care law, Daugaard also addressed school funding, saying it is unlikely South Dakota will have enough money next fiscal year to give districts much extra aid.

State law requires aid to school districts increase each year by the level of inflation, up to a maximum of 3 percent. In some years, the Legislature has given schools extra money, but there was no increase in 2010 and aid was cut in 2011 when the sluggish economy limited state tax collections.

A legislative study committee has recommended that school aid next year be raised to $4,805 per student, the amount that was provided before the 2011 cut. It also recommended that the full Legislature guarantee schools a minimum 2 percent increase in aid each year, with Daugaard and lawmakers deciding on additional funding up to a maximum 5 percent boost.

The governor said revenues through the first three months of this budget year are up just slightly from projections. If that trend continues, there won’t be much for schools beyond the 1.6 percent increase required in state law, he said.

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