South Dakota

SUMMARY

In a past legislative term, South Dakota sought to regulate healthcare price transparency. The state legislature passed SB118, which requires health carriers to provide prospective enrollees with drug formularies and detailed plan descriptions that explain plan coverage limitations and their financial impact on enrollees (e.g., co-insurences, out-of-pocket expenses, etc.).

 

LEGISLATION/REGULATION

South Dakota’s regular legislative session has ended for 2017.

 

Recent Legislative Developments

Healthcare Transparency

2015-2016 SB118 AN ACT TO PROVIDE ADDITIONAL TRANSPARENCY FOR PRESCRIPTION DRUG PLANS: requires health carriers to provide prospective enrollees with written plan descriptions, including: (i) coverage provisions, benefits, and exclusions; (ii) authorization and review requirements; (iii) the existence of any financial agreements or contractual provisions with review companies that would limit services offered, restrict referrals, or limit treatment options; (iv) explain plan limitations and their impacts on enrollees (including coinsurances and out-of-plan services); (v) accessibility and availability of services and an easily accessible list of providers and facilities in the network, whether they are accepting new patients, the addresses of primary care physicians and participating hospitals, and provider specialties; and (vi) drug formulary provisions that are promptly updated with any adverse change. Passed—Signed by the Governor on 3/12/15.

 

Healthcare Cost

  • None identified.

 

Healthcare Markets

  • None identified.

 

Ballot Measures

  • Voters in the November 2014 election cycle approved Initiated Measure 17 with a 62-38 percent margin, adopting an Any Willing Provider (AWP) statute which states that no health insurer may exclude a healthcare provider from participating in the insurers panel of providers if the provider is located within the geographic coverage of the benefit plan and is willing and qualified to meet the terms and conditions of participation as established by the provider.
    • Initiated Measure 17 was opposed by health insurers because they claim it prevents carriers from controlling costs by negotiating volume discounts with providers. Insurers are also concerned that opening their networks to physician-owned specialty hospitals may incentivize cream skimming and disrupt the narrow-network trend, which otherwise allows insurers to control cost growth by excluding certain providers on the basis of their overall cost. Advocates of the measure assert that the law will protect consumer choice by allowing more providers into benefit plan panels.

 

Key Statutes

We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.

 

Transparency in Healthcare

  • SD Codified L § 34-12E-8 requires that all fees and charges for healthcare procedures must be disclosed by a healthcare provider or facility upon request of a patient. Facilities or providers who fail to comply with a request are subject to disciplinary action.

 

  • SD Codified L § 34-12E-11 requires that licensed hospitals annually report charge information for each inpatient All Patient Refined Diagnosis Related Group (APR-DRG) for which there are at least ten cases rendered during the preceding twelve month period. The Department of Health is directed to promulgate standards that provide for the comparability of charge reports.

 

  • SD Codified L § 34-12E-11.1 directs the South Dakota Association of Healthcare Organizations to develop a website (implemented as the South Dakota Hospital PricePoint), available to the public at no cost, containing charge information that compares hospital-specific data to hospital statewide data. The website must be updated at least annually. Charge information is to include “the number of discharges; average length of stay; average charge; median charge; demographic information; payer mix; charges not paid and charges paid by medicare, medicaid, and other government programs, and private insurance; and uncompensated care.”

 

  • SD Codified L § 1-43-19 through 1-43-33 directs the Department of Health to create a comprehensive health data system to monitor costs at provider and plan levels, improve the ability of consumers to make choices about health care, and assist in planning efforts. Annual reports of data collected pursuant to the system are to be made available to the public. Implementation of the system is contingent upon the receipt and availability of federal funding.

 

FY 2018 BUDGET 

South Dakota’s fiscal year runs from July 1 through June 30 and is referred to by the year in which it ends. The South Dakota Legislature enacted the FY 2018 Budget in the 2017 regular legislative session. To view South Dakota’s Department of Health FY 2018 spending plan, visit pages 26-29.

 

LITIGATION/ENFORCEMENT

  • None identified.

 

KEY RESOURCES

South Dakota Legislature

South Dakota Office of the Attorney General

South Dakota Department of Labor and Regulation

South Dakota Association of Healthcare Organizations