By Brad Schneck
For the last 56 years, Medicaid has been a part of the American safety net, helping provide medical coverage to millions who desperately need it. The states and federal government share the burden of funding, but it is the states that manage implementation. In fact, the burden of financial responsibility is fairly even with the feds footing about 57% of the bill. It’s because of this that standards to receive benefits vary broadly across the country, and access to Medicaid can be more difficult to acquire in some places than others.
Since the implementation of the Affordable Care Act, federal money has been available for South Dakota to expand our Medicaid program to more of our citizens. However, SD legislators and politicians refuse to accept money based mostly on partisan political reasons. They claim that the increased funding from the feds would leave the state footing the bill in the long run and that South Dakota can’t afford it. But there’s plenty of reasons to accept the increase that would help the entire state of South Dakota. It is time for our state to expand Medicaid in order to improve our economic conditions, stimulate the healthcare industry in the state, and provide care to South Dakotans who desperately need it.
In South Dakota, our standards for income-based eligibility for Medicaid are $9,528 annual income for single adults and $14,292 for couples. With the Federal Poverty Level (FPL) set at $12,880 for individuals and $17,420 for married couples, this sets the eligibility for Medicaid in South Dakota at 74% of FPL for individuals and 83% FPL for couples.
South Dakota does have a lower cost of living comparative to the national average. In fact, according to bestplaces.net, our cost of living falls 12 points below the national average. An argument could be made based on comparative analysis of these two metrics that South Dakota is just adjusting federal guidelines to actual state needs. But let’s take a look at what it’s like to live right at the federal poverty level here in our state.
At $12,880/year, your wages break down to $1,074 a month. The average cost of a one bedroom rental is $625, which sets your housing cost at 58% of your income right off the bat. Now, if we assume you have absolutely no debt whatsoever, that leaves you $449 to cover utilities, groceries, transportation and other expenses before you can even think about affording health insurance.
For people at federal poverty level in South Dakota, private health insurance just isn’t an option. This creates major problems for our state, as those people don’t just stop requiring medical care. They either forego it until major issues arise, or they are forced to choose between basic living expenses and medical expenses. In either case, the burden of medical care becomes a major hurdle to getting ahead and oftentimes is a huge factor in keeping people stuck in poverty.
In 2014, a pivotal Supreme Court ruling on Medicaid expansion wrapped up in the Affordable Care Act (ACA) allowed states to opt in to federal funds to expand Medicaid to adults under 65 whose income was up to 133% of FPL. The deal wasn’t that they’d fund the expansion fully forever. The funds did lessen over time until we come to 2020 where they would rest at 90% of the expansion covered by the Federal Government.
Many states jumped on the 100% funding right away and steadily went about the work of expanding their programs within the state and taking on the new recipients. But many states did not. South Dakota didn’t outright reject the offer at first. Governor Dennis Daugaard initially embraced a proposal with a modest rise to 100% FPL to take advantage of the government’s offer of full funding. That increase was estimated to have helped 50,000 South Dakotans access healthcare that previously did not have it. It would have also cost nothing to the state for three years while they went through the legislative process to adjust budgets accordingly.
Despite this fact, the effort was stalled in the legislature in 2016, and by the end of the year, a newly elected White House pretty much sealed its fate. Governor Dauugaard dropped the effort after a meeting with VP Mike Pence made it clear that the entire ACA was in the new administration’s crosshairs. But in four years, the Trump administration was unable to remove the popular legislation, even with two years of complete control of the Executive and Legislative branches. Governor Kristi Noem succeeded Daugaard in 2018 and soon made clear her political alliances as a hyper partisan ally of Donald Trump. There seems to be hope amongst Republicans that the ACA, and all its expansions of the federal healthcare programs, will someday meet its demise. They hope this even as millions of Americans and the communities they belong to benefit from Medicaid expansion in their states.
So, as our state Executive and Legislative branches follow the lead of their national parties, there seems little hope of realizing a much needed and beneficial expansion of Medicaid here in our state where real South Dakotans face real problems with medical care and its costs.
When low income families and individuals are required to live without healthcare, they are playing a game of roulette with their well being that eventually becomes a problem of the state. Whether you have insurance or not, you are guaranteed care in this country. The problems usually come when the cost of that care is not able to be recovered. But lost profits and increased costs aren’t the only negatives to low-income Americans who lack affordable health insurance. Many times these people forgo basic medical treatment because of lack of affordable care options.
The overall health of adults and children directly affects the health of our schools, workplaces, and community centers. If you can’t afford to lose wages, oftentimes you must choose to work while potentially infectious or send your kids to school because you can’t afford to keep them home. Long-term expenses like medication and treatment for chronic illness is also an issue as people are forced to choose between their health and basic needs like food or clothing. And when there is no choice, our neighbors have to take on debt in order to make ends meet each month. Our health and well being should not be a choice we have to make in direct contrast with our ability to financially survive.
A healthier and more productive South Dakota is not the only benefit of Medicaid expansion. Healthcare is a major industry in our state, and it employs many people. With more low-income people accessing healthcare through Federally-funded programs, more money will be coming into our state and its healthcare industry. That is money that wouldn’t be here otherwise, and it helps create jobs, support families, and attract qualified healthcare professionals to South Dakota. Those professionals build homes, pay taxes, and build their lives here in our state. Having a robust healthcare industry within a state dedicated to its stability and growth as a way to keep its citizens healthier and more productive also attracts more qualified professionals to contribute. When we have top-tier medical care right here in South Dakota, it also means that our people don’t have to travel to other states to receive care and only helps improve the financial stability right here at home and keep our dollars in our own communities.
Federal Medicaid funds also translate to community improvement as our towns and cities realize the benefits of a healthier and more productive population. A healthy and financially stable citizenry translates to less burden on the government over time and more economic mobility overall. Nobody wants to be in poverty. There are many conditions and circumstances that lead to that outcome. If we can alleviate the detrimental effects of costly healthcare expenses on our more impoverished citizens, that gives those folks one less financial burden to deal with, keeps them healthy, productive workers, and helps create healthier communities and industry in our beautiful state.
It’s time for South Dakota to join the majority of states in updating its threshold for Medicaid in our state to 133% of FPL and take advantage of the funding provided by the federal government. It’s time to drop the political posturing and make decisions that make sense for South Dakota. It’s time for our state government to listen to the people of this state who routinely are required to bring their issues up for vote by way of initiated measures. Our legislators would prefer to spend their time bringing up bills paid for by wealthy out-of-state lobbying organizations who use our state as a testing ground for their extremist legislative goals. It is up to us to act in bringing this issue forward if our elected representatives refuse to act in our interests.
The decision to expand Medicaid in South Dakota comes with many benefits that make it a low-cost, high-return investment for our state and its citizens. If you remove all the political undertones, this just makes sense for South Dakota. Since our legislators and Governor are more worried about supporting national partisan issues than taking care of what is needed here at home, I encourage you to sign the petition for Medicaid Expansion to go on the ballot and use our ballot initiative process to make this happen.