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16,800 South Dakotans Could Lose Health Insurance Subsidies; Daugaard Shrugs

The U.S. Supreme Court will rule this month on King v. Burwell, a case that questions whether Congress intended to offer tax subsidies for health insurance to all income-qualified Americans or just to policy purchasers in states that set up their own ACA health insurance marketplaces. If the Supreme Court strictly interprets the ACA, it will create chaos in the insurance industry and price millions of Americans back out of health insurance

…to which prospect Governor Dennis Daugaard shrugs:

Gov. Dennis Daugaard says it’s up to federal officials to come up with a potential solution for thousands of South Dakota residents whose insurance premiums could jump thousands of dollars a year if the U.S. Supreme Court strikes down a key provision of the Affordable Care Act.

Daugaard, a Republican, said recently that he doesn’t envision a state fix to help preserve financial assistance if the high court decides to scrap insurance premium subsidies for consumers in the more than 30 states, including South Dakota, who sign up for coverage under the federal marketplace….

“We certainly don’t have the wherewithal in our budget to restore subsidies, so that’s just not even a practical reality,” Daugaard told The Associated Press. “What will happen, I expect, is unless the federal government produces some solution to replacing the subsidies, it will revert back to pre-Obamacare conditions where people buy insurance at the marketplace rates without a subsidy if they can” [James Nord, “Daugaard: Up to Feds If Health Subsidies Go Away,” AP via, 2015.06.06].

Creating a state marketplace would indeed be costly and complicated. Other states have seen operating budgets for their exchanges running around $28 million to $32 million. But consider the cost of letting ACA subsidies disappear from South Dakota. Nord reports that an adverse ruling in King v. Burwell would nix health insurance subsidies for 16,800 South Dakotans. Those policyholders get an average monthly subsidy of $229 a month. That’s $46.2 million a year coming from Uncle Sam to (1) help South Dakotans get health care and (2) stimulate our economy. Take away subsidies, and those 16,800 South Dakotans either end up paying extra thousands out of their own pockets, taking away their purchasing power for other goods and services and putting a drag on our state economy, or going without insurance, which means either going without health care, going bankrupt to get health care, or going to the emergency room and saddling hospitals and the rest of us with the cost of uncompensated care, all of which put a drag on our state economy.

Governor Daugaard keeps saying we can’t afford to help South Dakotans get health insurance. I’d say we can’t afford not to help.

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Ron Pollack of the Health Affairs blog says there is “ample reason” to believe the Supreme Court will preserve the health insurance subsidies:

Abundant precedents in past Court decisions make clear that statutory interpretation requires an examination of the whole statute and its context to review meaning, rather than a blinkered focus on only a few words (see note). If the Court follows these clear precedents, it will find that an interpretation of the Affordable Care Act (ACA) that withdraws premium subsidies is contradictory to the law Congress crafted [Ron Pollack, “GOP King v. Burwell ‘Fixes’ Not Fixes at All, Would Make Health Care Worse,” Health Affairs, 2015.06.05].

To support this hope, Pollack cites Justice Antonin Scalia:

See Antonin Scalia & Bryan Garner, Reading Law: The Interpretation of Legal Texts, page 63 (2012). As Justice Scalia indicates in his treatise, in interpreting a statute, courts must choose a textually permissible reading that furthers the evident purpose of the law over one that obstructs the statutory purpose. This well-worn canon of construction “flows inevitably from the facts that (1) interpretation always depends on context, (2) context always includes evident purpose, and (3) evident purpose always includes effectiveness” [Pollack, 2015.06.05].

Governor Daugaard makes his decisions in the context of corporate colonialism and Republican wealth hoarding. His evident purpose is to ensure that the working class is held under ever-greater restraints. And the last thing he wants is an effective Affordable Care Act that withstands the test of time and litigation and proves his party’s propaganda wrong.

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But on the other side, have fun reading the libertarian Cato Institute’s busting of seven alleged myths about King v. Burwell.


  1. jerry 2015-06-07

    Daugaard thinks he is clever banker, but, in reality, a damn fool of a poker player. If King goes south, so will the state of South Dakota. This shenanigan, that has been perpetuated by the republican junta from the get go, will do nothing but cost local taxpayers a bundle to fix. Medicaid expansion and putting together an exchange would have shown outside interests that South Dakota is set as a business minded community. Good luck in finding a business that will move here that means anything as this bunch has shown. Unlike Daugaard, along with the rest of his crooks and liars, businessmen and women understand that government has a crucial part to play in the field of expanding business, both new and existing, that are more than a shooting range. Thanks Cory for pointing out the disgust Daugaard and company feel about the working poor in the state as well as our sick and dying neighbors that have been affected by this genocide. Daugaard and company have no higher power other than there own blind ambitions at the weak’s expense.

  2. grudznick 2015-06-07

    That’s a lot of money that could be used for giving good teachers raises instead of backfilling the Obamacare ratholes.

  3. Mr. Sol 2015-06-07

    Governor Daugaard was merely giving his assessment of the reality of the situation. No shrug intended.

  4. Roger Elgersma 2015-06-07

    Medicare has passed the test of time. All old people get health care if their life savings disappeared in inflation or not. We have not had a depression lately so we have become callous to the fact that anyone can go broke. But a broke respectable human being should also be able to go to the doctor without being embarrassed.
    Those same Republicans do not want to lower the defense spending one iota because they want their back covered in the event of a problem.
    I once knew a millionaire who thought Reagan was to liberal but liked him because he was the best he had seen. He told me that he thought Reagan should end all social programs so that the poor would learn to trust God. I told him that if he trusted God he could drop the starwars defense system so he could learn to trust God against the evil empire of Russia. Not sure if that is why they dropped the starwars system or not.

  5. caheidelberger Post author | 2015-06-07

    He looks at a bad situation for thousands of the citizens he serves and says, not my problem? That’s a shrug. Reality is what we choose to make it. The Governor chooses to do nothing, making the problem worse.

  6. Dana P 2015-06-07

    Gov D continues to make me shake my head. His fellow GOP Gov in New Jersey (Christie) expanded Medicaid, and said, “We can’t afford NOT to.” Basic economics aren’t a “thing” for this state. It is all about what is politically expedient. Economists are using terms like “catastrophic” and “disastourous” if a ruling goes in favor of the plaintiffs this month. And all Denny can do is say, “meh, we can’t afford it.” Or your words Cory, shrug. (very appropriate)

    Also the Gov needs to keep in mind that if many millions of people in this country (16,800 in South Dakota) lose these subsidies and are no longer in the insurance pool, that is going to impact those remaining with insurance. In other words, THEIR premiums are going to skyrocket. (how ’bout that free market, GOP?) And if/when that happens, will Mr Thune say anything about higher insurance premiums then? (as he did this week?)

  7. bearcreekbat 2015-06-07

    Doesn’t our state pay for health insurance for the Governor and all of his staff, and their families? Likewise, doesn’t our state pay for the health insurance of all state employees? Why should they worry about other folks?

    And how many of our legislators are 65 or older and on Medicare? Why should they worry about younger folks, and sick folks that cannot afford the high cost of insurance premiums?

  8. larry kurtz 2015-06-07

    Sanford and RCRH are lobbying DD to help them cover mounting uncollectables that only Medicaid expansion can pay.

    The Feds are putting the screws to the state but if there were only 35 counties instead of 66 strain of paying for indigent care would be better managed.

  9. jerry 2015-06-07

    Daugaard and his haggard crew all have health insurance courtesy of you bearcreekbat and the rest of us taxpayers. The state employees also have health insurance that is provided for and administered by Dakotacare. So now you know why Dakotacare did not give a comment on the bullshit that Daugaard and the rest of his sorry crew is spewing.

  10. mike from iowa 2015-06-07

    I do not recall any group of people? that work as hard as wingnuts to cause the less privileged among Americans grief of all kinds while rewarding the wealthy for being wealthy. This has to be unprecedented in America’s shameful history. How can these heartless bastards look in the mirror???? Christians my ass!

  11. Deb Geelsdottir 2015-06-07

    Roger E said, “if he trusted God he could drop the starwars defense system so he could learn to trust God against the evil empire of Russia.”

    What a great response. That’s perfectly apt for those who urge others (Note-Not them.) to *trust*. It fits with the fact that it is those who have no need for health care who complain about those who do.

    Shame, shame, shame.

  12. Lars Aanning 2015-06-08

    The governor’s (and his administration’s) stance on healthcare for the poor is simply stunning…perhaps he (and they) should buy their own health insurance on the open market…and perhaps the Governor’s Club should be registered as a for-profit scam…

  13. leslie 2015-06-08

    cory, cato’s article doesn’t help anybody but republicans and is of questionable veracity, as usual.

  14. leslie 2015-06-08

    dana p-thank you for your huffpo cite for the other side

  15. leslie 2015-06-08

    politically, how and why did SCOTUS take up the KING V. BURELL line of cases??

  16. jerry 2015-06-08

    leslie, in my opinion, this SCOTUS is the most political right wing outfit that has ever existed in world history. They took this case, not because it has anything whatsover to do with law, it has to do with politics and the removal of the signature law that President Obama signed into law. The republican right wing wants to erase all that has ever had to do with Obama as if he never existed and this is the focal point. Take a look at the clowns that filed this brief in the first place. All are now either 65 or over so they are enrolled in Medicare or the VA so it was never about anything other than corrupted politics.

    If King stands, America falls on her ass and will have trouble getting back up, it is that serious. The terrorists will strike again, only this time, they will be wearing 5 black robes.

  17. leslie 2015-06-08

    lars-that is what we dems are trying to achieve in a long-lost state.

    jerry-my gut tells me you are right.

  18. jerry 2015-06-08

    More from the president on the thugs like Daugaard and their attempt to steal.

    “Obama rejected the basis for the challenge and said it is “well documented” that the authors of the Affordable Care Act “never intended” to block people on federal exchanges from obtaining the subsidies.
    “There is no reason why the existing exchanges should be overturned through a court case,” he said.

    He declined to answer questions about his contingency plans for a Supreme Court decision against the law, and said people should “assume” that it will be upheld. […]

    “I think it’s important for us to go ahead and assume that the Supreme Court is going to do what most legal scholars who’ve looked at this would expect them to do.” […]

    “Part of what’s bizarre about this whole thing is, we haven’t had a lot of conversation about the horrors of ObamaCare because none of them have come to pass,” he said.”

    Shame on them all for not being united as Americans, but acting only as racketeers in their corruption.

  19. leslie 2015-06-08

    the Burwell line of cases obama says SCOTUS “should not have even been taken up [for review]” include Pruitt v. _______. Pruitt, as said before, is the new darling of the GOP, the missouri AG who is in bed with every lobbying energy company and other big corporate interests whose strategy is to overwhelm the government Justice Dept. with a majority of red state Attorneys General’s offices which field hundreds if not thousands of publicly paid lawyers who will fight for red causes.

  20. leslie 2015-06-09

    sorry, pruitt is oklahoma’s AG. see 10.08.13 the hill, dick morris article tying FORBES, Pruitt and the then 26 state AGs he commands and his companion suit against ACA on behalf of FORBES. i seem to remember this group of state employeed-lawyers and energy companies ect also are in bed w/media, could be wrong-will refresh my memory.

    add thune’s six million citizens to the 48,000 denied MEDICAID expansion coverage and subsidy-threatened 16,800, to the 30-90 dead south dakotans annually, and you can see thune’s, daugaard’s and forbe’s bloody hand holding with republican Attorneys General.

  21. leslie 2015-06-09

    as i understand some recent articles i will try to find, avera is bitchin but sanford and dakota care say they are not having such problems.

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