Gov. Dennis Daugaard expects to hear soon whether he will receive federal approval for his plan to expand Medicaid, a federal health care program for needy individuals.

“I think we’ll hear by the end of the (legislative) session,” he said. “We could hear in two weeks.”

Daugaard provided the update this week during an interview with the Press & Dakotan.

His plan calls for the federal government to pay the entire bill for Native Americans receiving care outside the Indian Health Service. In turn, the state – which currently covers half the amount for those patients’ care – would use the freed-up dollars to expand Medicaid for another 50,000-55,000 South Dakotans.

Medicaid expansion would cost the state an estimated $57 million by 2021, the governor said. The $57 million price tag would eat up the state’s projected revenue growth factor of $59 million, leaving little or nothing for current or new programs, he said.

And that’s where shifting all Native American health costs to the federal government comes into play, he said. The state paid $67 million for Native American health care last year, so freeing up those dollars would make Medicaid expansion affordable for South Dakota, he said.

“We’re just asking the federal government to honor its treaty obligations (for providing Native Americans with health care),” Daugaard said.

The governor said he has seen encouraging signs from the federal government regarding his proposal.

“The feds have put out a white paper on this,” he said, referring to an authoritative report or guide on an issue. “It would affect not just South Dakota but all states with a Native population.”

Anyone with Native American ancestry, regardless of whether they live on a reservation, is entitled to use the Indian Health Service, he said.

However, not all Native Americans live near an Indian Health Service facility, Daugaard said. In other cases, Native Americans may require additional or specialized care found in another facility, he said. The specialized care could range from cancer to cardiac problems to neonatal care.

The governor pointed to the example of a Yankton Sioux tribal member using Avera Sacred Heart Hospital in Yankton or a Rosebud Sioux tribal member using Rapid City Regional Hospital.

For Daugaard, the call for Medicaid expansion – given the proper funding – represents a change from his past position.

He had opposed expansion because of the demand for ongoing state funding, particularly as the federal share declines in future years. He also held concerns whether the federal government would honor its financial commitment. He pointed to the rising national debt and the federal government’s past failure to pay its share of programs.

However, Daugaard said his current proposal would allow Medicaid expansion without the ongoing commitment of additional state dollars.

Daugaard acknowledged his proposal faces a challenge winning passage in the Republican-dominated Legislature.

On the other hand, Democrats have actively sought Medicaid expansion in South Dakota. Democrats point to the available federal funds for Medicaid expansion and the projected boost to South Dakota’s economy and health care. In addition, they note the prediction of lower medical costs under Medicaid expansion. Fewer low-income patients would postpone care until their condition worsened or rely on the emergency room for expensive treatment, they say.

District 18 Sen. Bernie Hunhoff (D-Yankton) has served on the governor’s Medicaid expansion task force. Hunhoff stepped down from his legislative leadership role to focus on the issue.

Hunhoff told the Press & Dakotan Tuesday that federal officials had arrived in Pierre for a fact-finding mission on the governor’s proposal.

“A team of IHS and Medicaid folks from Washington and around the state are here at the Capitol today, working to figure out some of the intricacies of how IHS and Medicaid might work together. I’ll be meeting with some of them tonight, so I’ll know more (Wednesday),” Hunhoff said.

“But overall, I believe the plan is coming together nicely. We may be able to provide health care access to 50,000 low-income South Dakota workers without raising taxes — and in fact by possibly spending less than we are today. So, as unbelievable as it sounds, it would be a big public policy win.”

Hunhoff said he sees Daugaard’s plan as a good starting point.

“I don’t agree with all the details of the governor’s plan. We should expand the poverty limits for Medicaid, for example,” Hunhoff said. “But we’re all going to have to compromise.”

Hunhoff said he has seen opposition among some GOP lawmakers.

“Some of my Republican colleagues are justifiably concerned about the soundness of the federal budget and whether Medicaid expansion will add to the nation’s deficit,” he said. “It’s a valid concern, but the nonpartisan Congressional Budget Office estimates that the Affordable Care Act could actually reduce the federal budget by taking advantage of preventative care, improving technology and finding smarter ways of doing things, such as providing medical ‘homes’ or advisors for chronically ill patients who often need assistance as they access services.”

The issue regarding federal coverage of Native American health care isn’t new, Daugaard said. He pointed to frustrations experienced by former South Dakota governors Bill Janklow and Mike Rounds.

Janklow complained to the federal government, while Rounds filed a lawsuit seeking relief, Daugaard said.

Medicaid expansion and the agreement with the Indian Health Service could open the door for more medical options for Native Americans, Daugaard said.

Yankton Sioux tribal leaders have spoken about the growing problem of drug use – particularly methamphetamine – among tribal members.

In response to a question about the issue, Daugaard said law enforcement cases involving Native Americans are handled by tribal and federal officials. However, the governor said his health plan could offer more substance-abuse treatment for Native Americans and others.

Follow @RDockendorf on Twitter.


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