Summer 2025 officially started and the SDAHO Advocacy team has been busy with summer studies, a new hospital reimbursement methodology, the Big Beautiful Bill and more. The laws that passed during the 2025 legislative session officially went into effect July 1. This included independent practice changes for physician assistants, supervision requirements for physical therapist assistants, a 1.25% increase in Medicaid funding, protections for 340B covered entities to contract with any contracted pharmacies they choose, and more.
Federal Advocacy
It has been a busy time in the federal space as Congress worked to pass President Trump’s Big Beautiful Bill by July 4th. With Medicaid community work requirements being something both the House and Senate wanted included, the SDAHO advocacy team worked with our delegation to ensure exemptions for individuals who may “fall through the cracks,” such as those with mental health and substance use disorder diagnoses. The final bill included additional funding for Rural Health, with $50 billion over 5 years. At a minimum, South Dakota will see $500 million of that. SDAHO will advocate for those dollars allocated to our state be spent to help support our rural hospitals and long-term care providers. Finally, SDAHO’s former COO, Tammy Hatting, covered much of the federal advocacy work with those duties being taken up by Jacob Parsons, Director of Advocacy and Reimbursement.
State Advocacy
It is a busy interim for health care in the State Legislature with summer studies focusing on property tax relief and emergency medical services (EMS). While property tax relief doesn’t seem to be health care related, the first two meetings have both included conversations around property tax and sales tax exemptions for hospitals. The committee next meets on July 17 and SDAHO will continue to monitor where the legislators are targeting in order to provide their goal of a 50% decrease in owner-occupied property tax.
The emergency medical services committee met for the first time on June 30, where they heard from the Department of Health and many EMS representatives on the current state of EMS in South Dakota, with focuses on recruitment and retention, reimbursement, and operation issues. SDAHO’s President and CEO, Tim Rave, will present at the next meeting on July 23 to discuss how EMS fits into the health care continuum with an emphasis on facility transfers.
It has also been a busy summer tracking Medicaid’s reimbursement methodology with changes coming for hospitals, rural health clinics, and federally qualified health centers. Medicaid is changing reimbursement methodologies for hospitals effective January 1 and recently held a discussion with Critical Access Hospitals to discuss the new methodology. The change will be budget neutral to the State and hospitals should receive information soon on the estimated impacts to their facilities. For rural health clinics and federally qualified health centers, a survey went out to all providers, and a stakeholder call was held. SDAHO will continue to monitor that methodology change and update throughout the process.
SDAHO Data
The 2025 SDAHO Salary Survey went out to all SDAHO members at the beginning of the year and the results have been sent to everyone who participated. If you feel you did not receive that, please let us know. The SDAHO Transitions of Care Survey changed this year from a quarterly survey to a semi-annual survey in January and July. The July survey was recently sent to hospitals, and the results will be posted in August.
What’s Next
The SDAHO Advocacy team will continue to monitor the SD legislature during the interim with Jacob Parsons, Director of Advocacy and Reimbursement, located in Pierre and the full Advocacy Team will monitor changes at the federal level. If you have any questions about what is included in this update, or anything else related to SDAHO’s Advocacy efforts, please reach out to Jacob at Jacob.Parsons@sdaho.org.
