After Medicaid Expansion was put into the state constitution by voters, many thought that was the end of the battle. Potential changes in D.C., however, is prompting a legislative effort to tighten South Dakota’s Medicaid rules.
Currently, expanded Medicaid is funded at a 90/10 ratio between federal and state governments. Effectively, this means for every 10 cents in state tax dollars to fund the program, DC provides 90.
As a result of expanded Medicaid’s passage, 28,000 additional people across the state became eligible for health insurance, and it was placed in the state constitution. That means another constitutional amendment is necessary to change it.
However, Medicaid is seen as a target to save money by some in power, meaning that ratio could soon change. That motivated lawmakers to bring HJR 5001, which would put to voters an opportunity to condition expanded Medicaid in South Dakota on that 90/10 ratio.
Sioux Falls Republican Tony Venhuizen is the primary sponsor.
“The voters made a decision in 2022 to take advantage of the 90/10 match – yes they did," Venhuizen said. "We have honored that and implemented it, but it was central to the decision the voters were given. So, if the deal changes, we should have the opportunity to reconsider the deal.”
Venhuizen estimates for each 10 percent the federal government drops from that deal, South Dakota’s rate would go up $20 million. However, some on the board were left with questions.
Sioux Falls Democrat Erin Healy said she’s not sure she wants to put Medicaid expansion back in the hands of lawmakers who had already balked at the proposal.
“I was also sitting here thinking during testimony about the many chances the Legislature has had over the past few years," Healy said. "How many chances? Fourteen, I believe somebody said. I just can’t support this motion. It makes me really nervous to put this into the hands of the Legislature when the legislature has already made it very clear this is something they don’t want.”
In 2022, expanded Medicaid passed on a 56-43 margin, and just 9 states have yet to enact Medicaid expansion.
The proposal advanced out of the House State Affairs committee on an 11-2 vote Friday. It will next be heard on the House floor.