22,000 South Dakotans could lose Medicaid now, about half could get it back later, state says

Roughly 22,000 South Dakota Medicaid recipients are “likely to be ineligible” in the coming months as pandemic protections expire, but perhaps half of them could qualify again in July when a voter-approved expansion takes effect, Deputy Director of Medical Services Sarah Aker told the state Board of Social Services at its Tuesday meeting.

The decline in eligibility is because the state is clearing out its Medicaid rolls now that the coronavirus public health emergency has expired and continuous Medicaid enrollment ended in March. The provision, which temporarily prohibited states from purging their Medicaid enrollment lists, was funded in part through the first federal coronavirus relief package in 2020.

Medicaid is a federal-state health insurance program for low-income people. Between 5 million and 14 million people across the country are expected to lose Medicaid coverage during the “unwinding” of the continuous enrollment provision, according to the Kaiser Family Foundation.

Since March 2020, the South Dakota Department of Social Services said average monthly Medicaid enrollment increased over 30 percent — from about 115,000 to nearly 152,000.

Aker said the state will focus first on reviewing cases of those most likely to be ineligible due to increased income or aging out of coverage. Roughly 64% of Medicaid recipients in South Dakota are children. 

South Dakota was one of five states that announced it would start scrubbing Medicaid rolls as early as it could: April 1. The DSS started notifying Medicaid applicants in February about the change.

But, Aker also offered an impromptu estimate for the board that a significant number of those who lose coverage might be eligible under Medicaid expansion. In November, South Dakota voters approved an expansion to cover adults with an income up to 138% of the federal poverty level.

The DSS is budgeting $578.9 million to fund the benefit and administrative costs for Medicaid expansion and adding 68 full-time staff to the department.

The expansion becomes law on July 1, and Aker estimates that 10,000 to 12,000 of those flagged as “ineligible” in the next few months could become eligible again this summer.

“It’s challenging because we don’t have up-to-date income data,” Aker said.

Aker told the board that DSS is working with providers to identify patients who could lose coverage and try to find them coverage elsewhere, even if they qualify for Medicaid expansion again in a few months.

One possible coverage option is through the Health Insurance Marketplace, according to a news release from the Community HealthCare Association of the Dakotas.

“Many people we have assisted this year were able to get a plan for $10 or less a month with assistance from premium tax credits,” said Lindsey Karlson, director of programs and training for the association.

Help navigating the enrollment process is available at www.GetCoveredSouthDakota.org or by dialing 2-1-1.

EDITOR’S NOTE: This story has been updated with additional information since its original publication.