Press "Enter" to skip to content

Daugaard Ignores Current Surplus, Recommends Whacking State Employees with Health Insurance Premiums

We have a current surplus of $14.3 million, so what should we do? Hit state employees with new health insurance premiums!

In his final budget address yesterday (see slides here), Governor Dennis Daugaard said the surplus will disappear, despite current budget strength:

We are currently growing 6.1 percent in sales and use taxes. Video lottery is 3.9 percent higher than the previous year. We anticipate a healthy housing market. Even with these, the anticipated revenue is approximately 2.3 million lower than the budget adopted last March [Gov. Dennis Daugaard, in Del Bartels, “Governor Daugaard’s Budget Proposal,” Pierre Capital Journal, 2018.12.04].

He still proposes 2.3% increases for state aid to education and state employees, but he also wants to shift health care costs to state employees:

South Dakota has a self-insured health plan. It used to offer three plans, now just two plans. To maintain, not continue to eat away at it, the state employees will pay a premium for health care coverage. This change will require a change in state statute [Daugaard, in Bartels, 2018.12.04].

Daugaard’s plan would give state employees $8.7 million in raises but claw back $4.1 million in new health insurance premiums, meaning their effective raise would really be 1.1%.

Governor Daugaard says we can save $15.6 million this year with downward adjustments to Social Services and K-12 state aid (less utilization, fewer kids enrolled). Those savings would stave off the premiums he wants to foist on state employees for almost four years, but Governor Daugaard would rather emergency-appropriate $7.4 million to expand the Jameson Annex at the state pen, $3.9 million on National Guard facilities, $2.3 million on lawsuits, and $1.6 million on the Department of Public Safety’s metrology lab.

28 Comments

  1. mike from iowa 2018-12-05

    Healthy housing market? Higher materials costs are also hammering the industry.

    A spike in lumber prices caused by the Trump administration’s tariffs on Canadian wood products is one of the biggest burdens on builders, Dietz said.

    Lumber prices in the United States have risen 62 percent since January 2017, Dietz said.

    “We get a third of the lumber we use in the U.S. from Canada,” he said. “A lumber tariff is very much a tax on homebuyers. It’s pushed up the price of a typical home by $9,000.”

    https://www.mcall.com/business/realestate/mc-biz-homebuilding-tariffs-cost-20180618-story.html

  2. Rorschach 2018-12-05

    We are an austerity state. The business of state government is to manage decline, and state employees must accept decline in their own finances.

  3. leslie 2018-12-05

    Similarly, republican outgoing Gov Scott walker “exits” with Wisconsin GOP chaos stripping power from incoming Democrats elected to finally introduce divided government to the once Republican autocracy there. Daugaard slams the door on state employees. Typical Republican “leadership “.

  4. Rorschach 2018-12-05

    That’s not all Leslie. In Michigan, GOP losers on the way out are trying to cut and delay minimum wage increases the voters passed.

  5. o 2018-12-05

    Rorschach, I disagree; I do not think we should ever define ourselves or our state in those terms (austerity). If we do, then the logical conclusion is that we ought to constantly work toward no services and no state government. Really, that is removing the cohesion of our society.

    Instead I think we have to define what our expectations of state government and services are – then from those expectations mandate the appropriate (not excessive) funding for THOSE priorities. I have never believe we should or should not do things because the cost a lot or a little; we should do things because they are important and have value — and pony up for those decisions.

  6. o 2018-12-05

    Rorschach, I also should say that I realize you were not advocating that austerity view, but were making an observation of how things seem to be. I didn’t mean for my criticism to be of you and your advocacy, but a criticism of the system you accurately identify as the SD status quo.

  7. Steve Pearson 2018-12-05

    It is time for Medicare for all. I expect a proposal from you Corey and how to pay for it. Please include brainiancs like Ocasio-Cortez regarding this.

  8. jerry 2018-12-05

    Prickly PEARson, here are the ways to pay for it, simple ways to gain 5.1 Trillion over 10 years savings! Wow!!

    “How Will We Pay for It?
    The most important thing to remember when discussing taxes and Medicare for All is that the new taxes are not an additional net cost or spending burden. Rather, they will amount to a mere fraction of what Americans currently spend on premiums, co-pays, and deductibles, which will all be eliminated.

    The PERI authors are quick to point out that there are many workable approaches to raising the needed $1.05 trillion in tax revenue, and that their proposed methods are not definitive. Their approach differs from the approach offered in Sanders’s bill, for instance. But they explain that they decided on these particular taxes in an effort to finance the program in a progressive manner, with the greatest savings going to the working class and the greatest burden falling on the wealthy.” https://jacobinmag.com/2018/12/medicare-for-all-study-peri-sanders

    So simple especially when you look at what insurance premiums are today. Thanks for asking.

  9. Cory Allen Heidelberger Post author | 2018-12-05

    Medicare for All would save the South Dakota state budget millions of dollars.

  10. Jason 2018-12-05

    The report and charts I posted showed expanded medicaid would cost the SD taxpayers more money.

  11. jerry 2018-12-05

    Trolling trolling trolling, jason keeps on trolling, keep that trolling going…dummeeee

  12. Jenny 2018-12-05

    How to pay for Medicare – taxes.
    Maybe move some our tax money over from the trillion dollar plus military industrial complex budget to pay for Medicare for all. Their money making wars are immoral. Let’s do something humane for once in this country and make Medicare available for anyone that wants to purchase it.
    I know one thing, Medicare for all won’t happen under a GOP President. We will have to wait for a Democrat to get elected.
    In the meantime, call or email your Congress person to voice your support for Medicare for all Americans. We deserve better than this horrific overpriced healthcare system we have.

  13. Jason 2018-12-05

    TAPPER: Your platform has called for various new programs, including Medicare for all, housing as a federal right, a federal jobs guarantee, tuition-free public college, canceling all student loan debt.

    According to nonpartisan and left-leaning studies friendly to your cause, including the Center on Budget and Policy Priorities or the Tax Policy Center, the overall price tag is more than $40 trillion in the next decade.

    You recently said in an interview that increasing taxes on the very wealthy, plus an increased corporate tax rate, would make $2 trillion over the next 10 years.

    So, where is the other $38 trillion going to come from?

    https://www.wtva.com/content/national/493616201.html

    Ocasio-Cortez couldn’t answer it. Can you Jenny?

  14. Jenny 2018-12-05

    Jason, I hope you understand that the richest country in the world could have had Medicare for all or something like it years ago, but the Corporations and the corruption of Congress chose not to go that route and would rather have you think that it would be too expensive to undertake. Think about it, you really think the richest country in the world could not afford it?

    There is too much money to be made by charging outrageous Health Insurance premiums instead. Our current healthcare system is a racket and my DFP friends understand this. We want you and people like you to understand this also and to realize that the politicians don’t run Congress – the lobbyists and corporate elite do, and yes both sides Dem and Republican – stink to high hell. We just think that there are some Dems out there that really do want better than what we are getting. Maybe there are some republicans out there also, but until our rotten system changes we are stuck with what we have.
    Medicare for All!

  15. Jason 2018-12-05

    I assume you didn’t see my post while you were typing your post. I will await your answer to Jake Tapper’s question.

  16. Jenny 2018-12-05

    Jason – taxes.
    Call me a democratic socialist, I don’t care. I just Medicare for All.

  17. Jason 2018-12-05

    DId you not read what Jake Tapper said?

    Where are you going to get the $38 Trillion from?

  18. Jenny 2018-12-05

    Eat the rich :)

  19. o 2018-12-05

    Jason, you cannot continue to ignore the answer of paying for medicaid for all in large part from diversion of current insurance/healthcare spending. You keep asking the question and keep being given that answer.

    Your Tapper question also holds no context: what is the wealthy + corporate tax rate the referred to revenue estimate is based on.

  20. Jason 2018-12-05

    Show the math o.

  21. Scott 2018-12-05

    Better put up some more billboards to find help for the state hospital at Redfield. You start taking away healthcare from the workers at that facility, the state hospital will struggle way harder to find and keep employees. I’m sure other state employees work for the healthcare benefits too and that will mean more turnover. That will just mean it will cost us taxpayers more to hire and train new workers.

  22. Debbo 2018-12-05

    Rohr said, “The business of state government is to manage decline.”

    Wow. That is a bleak assessment, but it seems to be the plan of the SDGOP. They’ll keep inflicting pain till there’s no one left to bleed. What they’re doing really is that cruel and heartless, though only the upper levels are aware of that, and they don’t care.

  23. Debbo 2018-12-05

    Yep, Medicare for All. Private insurance will still be available so those who are so opposed to Medicare should be sure not to use it and instead, buy their own insurance. Stand for your principles! 😁😁😁

  24. jerry 2018-12-05

    “How Will We Pay for It?
    The most important thing to remember when discussing taxes and Medicare for All is that the new taxes are not an additional net cost or spending burden. Rather, they will amount to a mere fraction of what Americans currently spend on premiums, co-pays, and deductibles, which will all be eliminated.

    The PERI authors are quick to point out that there are many workable approaches to raising the needed $1.05 trillion in tax revenue, and that their proposed methods are not definitive. Their approach differs from the approach offered in Sanders’s bill, for instance. But they explain that they decided on these particular taxes in an effort to finance the program in a progressive manner, with the greatest savings going to the working class and the greatest burden falling on the wealthy.” https://jacobinmag.com/2018/12/medicare-for-all-study-peri-sanders

    Here we are, here is how to pay for Medicare for all.

  25. o 2018-12-06

    Jason: “The total costs for a typical family of four insured by the most common health plan offered by employers will average $28,166 this year, according to the annual Milliman Medical Index. https://www.usatoday.com/story/money/business/2018/06/06/health-care-costs-price-family-four/676046002/

    That is the starting point for funding. Certainly it will cost money to shift to medicare for all; those costs, right off the bat, are offset by insurance premiums no longer needed or collected. That is always the element you choose to ignore: you focus only on the increases — never the displacement of costs and savings from insurance premiums unpaid. Current premiums become the new “tax” to pay for the program.

    At $3.4 trillion being spent annually, that gives us 34 trillion over the decade you are projecting costs (which assumes no inflation in health care costs which underestimates the revenue). My point and the point of so many Medicare for all advocates is that given a pool of spending that large, we should expect better. That money is being spent, let us use it to get something better for medical coverage for the nation.

    Now, answer my “show me the math” question: what is the rate of corporate tax/wealthy tax that Tapper used to project revenue of $2 trillion? Rates affect revenue. Maybe that tree deserves a bit harder shake.

  26. o 2018-12-06

    Jaaaaaaaaaaaaaaason, come out to plaaaaaaaaaaaaaaaaaay. (clinking bottle sound effects).

    It looks like Jerry and I both showed some math; have you and your fabricated objections left the discussion?

  27. Debbo 2018-12-07

    https://www.facebook.com/1539955764/posts/10217866904334499/

    The link shows a bar graph of Minnesota’s budgets the past 16 years. The first 8 were under Repub control with budget forecasts as high as $6.2 billion in the red in 2010. Democratic Gov. Dayton took over that year. His first budget forecast was -$5 billion. All the rest have been pluses, as much as $1.8 billion. Gov. Dayton is leaving in January with a budget forecast of $1.5 billion and a record $2.5 billion in reserved.

    Republicans just can’t handle budgets, not in Minnesota, SD, any other states or DC.

  28. Jason 2018-12-07

    You haven’t shown your math 0.

    Keep in mind when you are doing the math that almost half of America doesn’t pay any income taxes.

    Google where Tapper got that information.

Leave a Reply

Your email address will not be published.