SD governor against quick Medicaid expansion

PIERRE, S.D. (AP) -- Gov. Dennis Daugaard decided against expanding Medicaid to cover thousands of additional low-income South Dakotans because he's uncertain the federal government can afford to pay the bulk of the cost, a state official told lawmakers Thursday.

Deb Bowman, a senior adviser to the Republican governor, said Daugaard has decided against recommending an expansion of Medicaid for now, but the governor and lawmakers could decide to make that move later.

Bowman and other state officials briefed state lawmakers on the Medicaid expansion, a part of the federal health care overhaul, in an hourlong meeting attended by about half the members of the House and Senate.

Some lawmakers, particularly members of the Democratic minority, said South Dakota should take advantage of generous federal funding to cover an additional 48,000 people in the state-federal program that covers health care for the poor and disabled. Others urged caution, saying they want more information or oppose increasing federal spending for the program.

The state's Medicaid program covers about 116,000 children, adults and disabled people, or about one in every seven South Dakotans. If the state decided to expand eligibility, an estimated 48,000, mostly adults without children, would be added to the program.

People with lower incomes — up to 138 percent of the federal poverty line — would be covered by a Medicaid expansion. The federal government would pay all expansion costs through 2016. The state's contribution to actual medical care would rise in stages to 10 percent in 2020, but South Dakota would also face some additional costs in administrating a larger program.

Bowman said Daugaard is recommending against the expansion for now because there's no guarantee the federal government will continue to cover 90 percent of the costs after 2020.

"It isn't that I have this boss that's this coldhearted person and he made the decision based on that," Bowman said. "He made the best decision he could, given the information and facts we have right now and the uncertainty of the future we face."

House Democratic Leader Bernie Hunhoff of Yankton, who favors expanding Medicaid, said lawmakers routinely have to make decisions amid uncertainty.

"If the only concern is we're uncertain about the future, we should all just stay in bed," Hunhoff said after the meeting.

Other lawmakers asked state officials for more detailed information on the Medicaid program and the possible expansion.

State Social Services Secretary Kim Malsam-Rysdon said the state's share of Medicaid is now about $294 million a year, or nearly 27 percent of total state spending from general tax revenue. One-third of all South Dakota children younger than 19 are covered by Medicaid or related programs, and half the children born in the state are on Medicaid or related programs during their first year of life, she said.

Rep. Jim Bolin, R-Canton, asked whether the governor has the final say on the issue. Bowman said the Legislature could decide to expand Medicaid by amending the state budget.

Several lawmakers said they favor expanding Medicaid because uninsured people now delay getting medical care until they are very sick and go to hospital emergency rooms. Since they cannot afford expensive emergency care, hospitals and clinics have to charge insured patients more to offset losses in charity care.

"Their health care costs will be paid somewhere, and it will be paid out of South Dakotans' pockets," said Sen. Stan Adelstein, R-Rapid City.