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Daugaard Medicaid-IHS Transfer Saving SD $2.3M So Far This Fiscal Year

Short-sighted Republicans resisted Governor Dennis Daugaard’s plan to expand Medicaid, but part of Daugaard’s crafty plan has been saved and is saving South Dakota money. According to the Health Care Solutions Coalition, a board Daugaard created in 2015, South Dakota’s three biggest hospital systems and some other health care providers have enacted Care Coordination Agreements with Indian Health Service to take American Indian patients off Medicaid rolls and pay for their care with IHS dollars. Since the feds only pick up 55.34% of Medicaid costs while IHS pays 100%, these Care Coordination Agreements save South Dakota money:

SD Health Care Solutions Coalition, "'Received-Through' Policy: State General Fund Savings Report," included in 2018.11.28 meeting documents.
SD Health Care Solutions Coalition, “‘Received-Through’ Policy: State General Fund Savings Report,” included in 2018.11.28 meeting documents.

CCA savings in all of FY2018 totaled $4.6 million, based on savings that first accrued in November 2017; at the rate of the past four months seems comparable to the monthly rate of the last fiscal year, suggesting savings for this budget year could exceed $6.7 million.

The coalition is working on a plan to save more money by increasing referrals to IHS, with a focus on more expensive long-term care in nursing homes, psychiatric residential treatment facilities, and community support facilities. Those plans will be presented for public comment in December.

IHS suggests South Dakota use some of that money to pay for an IHS contact person for the Health Care Solutions Coalition:

The Indian Health Service has such limited funds the federal agency can’t afford to specifically assign a person as a point of contact for South Dakota’s Healthcare Solutions Coalition, state Health Secretary Kim Malsam-Rysdon said Wednesday.

But, she said, the federal agency’s acting director, Rear Admiral Michael Weahkee, identified how state government could have someone do it.

The answer might be a standard four-page government contract.

The IHS administrator suggested state government could pay the salary, according to Malsam-Rysdon.

The money would come from savings state government is seeing, as IHS pays full cost more often for healthcare services to American Indian people in South Dakota [Bob Mercer, “IHS Too Financially Strapped to Pay for South Dakota Point of Contact,” KELO-TV, 2018.11.28].

The coalition started this budget year to use some of the savings to expand substance abuse treatment to adults rather than just adolescents and pregnant women. The coalition also plans in 2019 to expand the pool of providers eligible to receive Medicaid payments for providing behavioral health and substance abuse treatment and to develop a community health worker program. (See this November 8 report to the Department of Social Services Medicaid Advisory Committee.)

Had South Dakota Republicans not been so blinded by partisanship, they could have saved South Dakota $85 million a year, more than enough to pay for an IHS contact person, Medicaid expansion, and a couple other priorities.


  1. Richard 2018-11-29 08:24

    Republicans save money? Where have you been? They racked up the worst debt since WW2! Republicans no longer care about the money. It’s the principle of the thing that now matters. And the principle here is that Native health doesn’t matter.

  2. mike from iowa 2018-11-29 10:46

    For the first time in a decade the number of uninsured children has risen. Makes one proud to be an embarrassingly red state wingnut, donut?

  3. Debbo 2018-11-29 15:35

    It looks like just another way for the SDGOP to shortchange their neighbors. Again.

  4. Cory Allen Heidelberger Post author | 2018-11-29 21:47

    I’m all for the IHS shift and having the federal government live up to its treaty obligation to provide our Native brothers and sisters with decent health care.

    I’m all for using the savings from the IHS shift for the purpose Dennis Daugaard had in mind: expanding Medicaid to provide affordable heath care to more South Dakotans.

    I’m all for the Democratic Congress voting down any more ACA repeal action and thus protecting Medicaid expansion.

    I’m all for the Democratic Congress moving beyond Kristi Noem’s empty words and providing IHS with actual funding to overcome its numerous shortfalls.

  5. MJK 2018-11-30 09:06

    In line with that, you also have to continue to fund at the state and federal level, ways to counter substance abuse programs and pregnancy education and health for women. To continue to bandaid everything does not work long term. IHS has always been short funded and short staffed. Our native brothers and sisters need our fight because they are at a disadvantage to fight for their own causes all by themselves. The tribal administrators try, but it is a battle. Many of our South Dakotans, live in poverty on the reservations.

  6. jerry 2018-11-30 09:21

    Only in a place that knows little Arithmetic can you convince the ignorant that 2.3 million is more than 85 million. Nursing home’s are being made to run on a shoestring budget thanks to Daugaard’s cutting of their funding when the crook first took office. The workers there are paid crappy wages for the important work they do to try to show the dignity of our elders. A nation and state show how good they are by the way they care for their children and elders, this state is a failed one and not likely to get better with the crew we will have in Pierre right quick like. Same old stank.

  7. Cory Allen Heidelberger Post author | 2018-11-30 12:41

    MJK raises a good point that neither Daugaard nor the Republicans nor I have raised (that I can recall) throughout the course of developing this IHS payment transfer plan. Opponents of Medicaid expansion hollered (falsely) that increasing state costs for Medicaid would cause other state programs to suffer. But no one in SD government is complaining about shifting more costs to IHS when IHS is already lacks the cash to meet its obligations.

    Shifting costs to IHS is proper: Indian health care is a federal obligation. But we need to recognize the cost of shifting that obligation from the state’s 45% match on Medicaid to the feds’ full responsibility under IHS, and we need to tell Dusty, Mike, and John to vote to appropriate more money for IHS to pay for the burden South Dakota has shifted (properly) to IHS.

  8. Debbo 2018-11-30 13:43

    Jerry said, “A nation and state show how good they are by the way they care for their children and elders.”

    This is absolutely true. The nation’s that care for children and elders well are democratic socialist countries. The US states that do the same are blue and use a state income tax to fulfill their moral obligations.

  9. Debbo 2018-11-30 13:44

    Oh, and those US states accepted the Fed’s Medicaid offer.

  10. OldSarg 2018-11-30 15:34

    Debbo, “A nation and state show how good they are by the way they care for their children and elders.”? Can you provide an example of any government that actually does this?

  11. Debbo 2018-11-30 20:43

    Use the interweb tubes yourself and look it up. There are plenty to choose from.

  12. OldSarg 2018-11-30 20:55

    Debbo, I pray Christ one day finds his way into your heart. peace

  13. Debbo 2018-11-30 21:01

    Oh. So you’ve got nothing. 😁

  14. OldSarg 2018-11-30 21:06

    I have Christ.

  15. leslie 2018-11-30 21:32

    Sarge 33 or more states have expanded Medicaid under the ACA, you will find. Well said everyone else! As usual.

  16. Cory Allen Heidelberger Post author | 2018-12-02 08:30

    I wish I could “win” arguments about public policy just by falsely asserting that my opponent hasn’t let Jesus into her heart.

    Or better yet, on those rare occasions that OS offers some shred of actual evidence, instead of pointing out the errors in that evidence, I just shout, “I have Gaia!” I win! Argument over! Yay!!!

    I have Legos! I win!

    I have psoriasis! I win!

    I have pizza rolls! I win!

  17. Debbo 2018-12-02 20:20

    Cory, you can keep the psoriasis, but I like Legos and pizza rolls. 😄😄😄😄😄

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