South Dakota Medicaid Measure Raises Questions About Coverage and State Costs
A proposed change to South Dakota’s constitution could put the state’s Medicaid expansion program at risk. The measure, known as Amendment I, has created confusion because state leaders disagree about what would happen if federal funding for the program falls.
How Medicaid Expansion Works
Medicaid expansion provides health coverage to South Dakotans with annual incomes below about $22,000. Under the current arrangement, the federal government pays 90% of the cost. South Dakota pays the other 10%.
The state Legislature resisted the program for years. Voters later approved Medicaid expansion and placed it in the state constitution. The program now serves about 31,000 people across South Dakota.
That coverage is especially important for people who are struggling to afford basic needs. Housing and food costs have risen sharply, while many workers have not seen their pay increase at the same pace. For some residents, Medicaid expansion provides the only realistic way to receive regular medical care.
What Amendment I Would Change
Supporters of Amendment I say the proposal would give state lawmakers more control if the federal government reduces its share of Medicaid expansion costs.
Lt. Gov. Tony Venhuizen, Sen. Casey Crabtree and Rep. Will Mortenson, all Republicans, wrote that the amendment would not automatically end Medicaid expansion. Their explanation says lawmakers would be able to decide whether continuing the program would be worth the added expense to the state.
That description does not match the explanation written by Republican Attorney General Marty Jackley, which will appear on the ballot.
Jackley’s wording says the amendment would end expanded Medicaid coverage if the federal funding level drops below 90%. That language suggests the program could be canceled automatically once the federal contribution falls below the stated amount.
The difference between the two explanations is significant. One view presents the amendment as a way to give lawmakers flexibility. The other describes it as a direct trigger that would end the program under certain conditions.
Two Very Different Interpretations
When asked about the disagreement, Jackley stood by his interpretation. He said the language approved by the Legislature clearly explains how the change would work and emphasized that lawmakers made the decision to place it before voters.
That leaves voters with a basic question: Would lawmakers receive the power to decide Medicaid’s future, or would the program end automatically if federal support drops?
The wording matters because Amendment I would affect a program that voters already approved. Even if the federal government changes its funding rules, the amendment could create a path toward repealing Medicaid expansion.
Budget Concerns Drive Support
Supporters argue that the measure would protect South Dakota from facing a large new bill. If the federal government lowers its matching share, the state could be required to pay much more to keep the program running.
They believe the state should not be locked into a financial commitment that changes because of a federal decision. Giving lawmakers more authority, they argue, would allow South Dakota to respond to new costs.
Opponents see another way to protect the state budget: reminding federal leaders about the benefits Medicaid expansion has brought to South Dakota. Since the program began, it has brought about $870 million into the state.
The Impact Goes Beyond the Budget
Medicaid expansion is not only a question of government spending. It also affects hospitals, patients and local economies.
- The program helps people receive medical care before health problems become emergencies.
- It provides financial support to hospitals, especially in rural areas.
- It helps communities keep health services available close to home.
- It supports residents who may otherwise delay treatment because they cannot afford it.
Rural hospitals often operate with limited resources and narrow financial margins. Losing Medicaid patients or facing higher state costs could place added pressure on those hospitals. In some communities, that pressure could threaten important medical services.
Amendment I is one of several constitutional proposals placed before voters by the Republican-controlled Legislature. Another proposal would increase the approval requirement for future constitutional amendments to 60%. Supporters say that change would help protect the state constitution, though voters have rejected similar proposals twice before.
The two measures create a difficult contrast. One would make it harder to change the constitution in the future, while Amendment I could open the door to changing or ending a health program that voters previously placed in the constitution.
Whatever the intended result, Amendment I carries serious consequences. It could affect the health coverage of thousands of South Dakotans, the finances of rural hospitals and the state’s future spending decisions. The disagreement among state leaders makes the measure even more important for voters to examine carefully.