Thousands of South Dakotans are paying the price for Governor Dennis Daugaard's and the SDGOP's intransigent opposition to expanding Medicaid under the Affordable Care Act. We are all paying the cost of turning away hundreds of millions of dollars of economic stimulus that the ACA Medicaid expansion would bring our state.
Governor Daugaard is imposing additional costs on the thousands of South Dakotans who are buying insurance on the federal health insurance exchange. States could go four ways to set up ACA marketplaces: active purchaser, open clearinghouse (Minnesota's MNSure), federal partnership, or totally federal (the South Dakota model, in which we do nothing and leave all the work to Uncle Sam).
A new study in Health Affairs shows that the Minnesota model, the state-run clearinghouse, is offering customers lower premiums than the federal exchange:
Using publicly available premium data and other sources, Health Affairs found state-based clearinghouse models had lower premiums compared with active-purchaser states, partnership states and federally-facilitated states. The journal found no difference between federally faciliated exchanges and federal partnership exchanges.
Policies from all exchanges come in four levels, with the lower ones costing less in monthly premiums with higher cost-sharing when someone seeks medical care. The lowest is bronze, followed by silver, gold and platinum, which Health Affairs didn’t score because of inconsistencies in availability.
The lowest-cost bronze plans in state-based clearinghouses average $157.53 per month versus $179.49 in active-purchaser states; $196.92 compared with $225.37 for the lowest-cost silver plans; $205.30 versus $245.27 for the second lowest silver plan; and $233.96 compared with $266.91 for the lowest-cost gold plan.
Looking at differences between clearinghouse states and federal exchange states, the lowest-cost silver plan was $196.92 compared with $229.87 in partnership exchanges and $224.02 in federally facilitated exchanges [Chris Kardish, "Which health Exchanges Have the Lowest Premiums?" Governing, 2015.01.07].
Generally, the Minnesota model saves customers over $300 a year compared with the South Dakota surrender.
Governor Dennis Daugaard may think the Affordable Care Act is a lemon, but he could try a little harder to make some lemonade.