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South Dakota’s Medicaid expansion begins Saturday

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(The Center Square) — South Dakota’s Medicaid expansion goes into effect July 1 and will cost an additional $66 million in new state general funds, with state taxpayers covering approximately $13 million in the first two years, according to the South Dakota Department of Social Services.

Voters approved the Medicaid expansion in November, opening Medicaid eligibility to an estimated 52,000 new individuals, according to DSS.

The expansion raised the income requirement to 138% of the Federal Poverty Level and up to an income of $41,400 for a family of four. It also opens Medicaid up to single adults as young as 19.

Before the expansion was approved, there was no medical coverage group in the state for adults aged 19 to 64 who are not blind, disabled, pregnant, or a parent or a relative caretaker of a child, according to DSS.

During the first two years, American Rescue Plan Act funds will be available to help cover the new costs. ARPA gives 5% one-time matching funds to any state expanding Medicaid, which is about $54 million for South Dakota.

After 2025, the new state general funds needed to pay for the Medicaid expansion will continue to be $66 million.

To be eligible under the new expansion, applicants must be 19-64 years old, live in South Dakota, be a U.S. citizen or qualified immigrant, and have a social security number or at least apply for a social security number, according to DSS.

Gov. Kristi Noem was against expanding Medicaid, especially opening it up to young, single individuals who were “able-bodied, able to get a job and a career in South Dakota and have the potential to earn benefits that would pay their medical bills,” the governor said.

Voters approved the constitutional amendment to expand Medicaid by 56% of the vote, while 44% of voters said “no.”

Six other states approved Medicaid expansion by ballot measure, including Idaho, Maine, Missouri, Nebraska, Oklahoma and Utah, according to the Health Policy Institute at Georgetown University.

The expansion comes months after the continuous coverage requirement for Medicaid, implemented in 2020 near the beginning of the COVID-19 pandemic, became no longer effective. In April, states began returning to regular Medicaid practices and removing those from their rolls that were no longer eligible.

DSS requested 68 new full-time equivalent employees to help administer South Dakota’s Medicaid expansion. It also called for modifications to information technology systems, including mainframe applications and third-party software.

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