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SD gov. cautious about expanding Medicaid himself

By Chet Brokaw

PIERRE (AP) — South Dakota Gov. Dennis Daugaard said Thursday he would be reluctant to expand the state's Medicaid program without first getting the Legislature's agreement.

Daugaard last month asked federal officials to let South Dakota expand its Medicaid program in a way that would provide medical services to fewer poor people than envisioned in the federal health overhaul law. But with only two weeks remaining in the main run of this year's legislative session, he's received no response from those federal officials.

Republican House and Senate leaders said earlier Thursday they believe if federal approval is received after the legislative session ends, the governor could implement the partial expansion of Medicaid without calling a special session of the Legislature.

Daugaard said he technically could make the decision himself, but he would be cautious about changing program eligibility without getting the Legislature's approval for whatever changes federal officials might allow. Legislative approval would come in the form of budget provisions that allow the spending of extra state and federal money in a revised program, but those budget changes could be made retroactively next year.

"I guess I would want to be sure the Legislature was in agreement," the Republican governor said.

The federal health overhaul gives states the option of expanding Medicaid to cover people earning up to 138 percent of the federal poverty level. Daugaard and Republican lawmakers want to expand eligibility only up to 100 percent of the poverty level because those above that mark can buy subsidized private insurance through the new health care law.

Federal officials last year rejected a similar waiver request, but Daugaard in late January sent U.S. Health and Human Services Secretary Kathleen Sebelius a letter renewing the request to provide Medicaid coverage to people earning less than 100 percent of the poverty level who are working or have lost jobs in the past 12 months.

House Speaker Brian Gosch, R-Rapid City, said Sebelius may be more willing now to accept such a proposal because other states have sought waivers.

South Dakota's Medicaid program now covers about 116,000 children, adults and disabled people. Full expansion to 138 percent of the poverty level would add an estimated 48,000 people, mostly adults without children.

People earning up to 138 percent of the poverty level — about $16,000 for a single person or $33,000 for a family of four — would be covered by a full expansion. The federal government would fully cover those added to Medicaid rolls through 2016, and the state's contribution would rise in stages to 10 percent of the costs by 2020.

An expansion to 100 percent of the poverty level would cover a single person earning up to about $11,700 and a family of four earning $23,850.

If state and federal officials reach agreement after South Dakota's legislative session ends, the state might have enough money to cover a Medicaid expansion without changing the budget that will be passed before the session's main run ends March 14, Gosch said. That would mean Daugaard could expand Medicaid without calling a special legislative session, he said.

Senate Republican Leader Tim Rave of Baltic said Sebelius might agree to negotiate with the state on details of any partial expansion.

When Daugaard was asked what he would do if federal officials approved a partial expansion of Medicaid but would not permit a work requirement, he said he would want to consult the Legislature before deciding what to do.

"I think this is a decision I should not make unilaterally," Daugaard said.

House Democratic Leader Bernie Hunhoff of Yankton said he still believes South Dakota should expand Medicaid all the way to 138 percent of poverty level. He hopes the Legislature can approve some kind of expansion in the next two weeks.

"I don't care how it happens as long as it happens," Hunhoff said.