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17 things about I nitiated Measure 17: The Definitive
Voter Guide to a Complex Ballot Initiative
We’re blessed to live in a state
where common sense typically
prevails, and people recognize that
when something sounds too good
to be true, it probably is. Knowing
this, proponents of Initiated
Measure 17 (“IM17”) have
deployed some very clever tactics
in an attempt to cloud voter
judgment and conceal the true
consequences and motives behind
their costly government mandate.
The fact is, IM17 is a terribly
complex issue that cannot be
explained in 30-second TV
advertisements. The proponents are
using this to their advantage,
expecting to lure South Dakotans
in with slick, emotional messaging.
What follows are “17 things” about
IM17, including analysis of what
the measure actually does, who is
behind it, and why it’s a bad deal
for South Dakota families and
1. Reality Check. IM17
proponents have spent a lot of
money trying to convince South
Dakotans that a “Yes” vote will
create a system of absolute “patient
choice.” Proponents have
strategically marketed IM17 as a
wave of the magic wand that would
allow anyone to see any doctor,
regardless of insurance, at no
additional cost. To call this notion
baloney is putting it way too
2. Out-of-network fees aren’t
going anywhere. IM17 is
unquestionably a health plan
mandate, not a patient rights law. If
this poorly conceived policy
passes, citizens will gain no greater
affirmative rights than they have
today. The law would instead allow
any minimally qualified doctors to
become part of a health plan’s
provider network. The “choice” to
apply for network membership
rests strictly with the doctor, and
there are many reasons they would
not or could not pursue
membership. Out-of-network fees
would remain firmly in place.
3. There’s more to this than
provider rates. A favorite talking
point of IM17 proponents is that
costs won’t increase because the
law would require providers to
satisfy insurance plans’ terms and
conditions, including price. This is
a dangerously misleading and
shortsighted argument. Health care
economics require consideration of
volume, quality, and efficiency.
4. IM17 destroys volume
incentives. Patient volume is an
important negotiating tool for
health plans. Health plans can offer
providers enhanced access to
defined groups of patients in
exchange for discounted rates
favorable to consumers. IM17
fundamentally undermines this
type of negotiation because it
grants certain providers the
government authority to essentially
make themselves party to these
agreements. With more providers
dividing up a patient pool, volume
discounts disappear.
5. IM17 doesn’t account for
quality and efficiency. Health
plans don’t simply work with the
cheapest providers. Providers are
also vetted for dependability. The
current regulatory system allows
health plans the discretion to filter
and weed out those providers prone
to poor patient outcomes and
unnecessary expenses – major
drivers of cost. When health plans
are forced to accommodate all
minimally qualified providers, the
excessive reimbursements and
administrative costs that result are
passed on to consumers in the form
of higher premiums.
6. IM17 hurts community
hospitals. IM17’s for-profit
proponents rarely treat those most
in need, seldom accepting
Medicare, Medicaid and the
underinsured. According to 2011
Cost Reports from the Center for
Medicare and Medicaid (CMS),
South Dakota’s seven physician-
owned specialty hospitals without
emergency departments provided
$196,000 in charity care. During
that same year, tiny Lead-
Deadwood Regional Hospital
provided $837,000 in charity care!
In total, South Dakota’s non-profit,
community-based hospitals
provided $36 million in charity
care in 2011.
7. Consider IM17 in any other
business context. Proponents of
IM17 are seeking a self-serving
government mandate that will
allow them to decide the parties to
a contract – pretty shocking to core
American economic values. Should
the government require Apple or
General Motors to offer jobs to any
minimally qualified person simply
willing to accept a certain wage?
8. IM17 proponents are special
interests masquerading as
populists. This measure is being
pushed by a small group of for-
profit specialty physicians and the
facilities in which they have
ownership stakes. This group has
disguised its economic motives as a
measure that would increase
patient choice and lower costs.
Unfortunately, their market
interference would actually raise
health care costs for all of us – by
thousands of dollars. This is proven
by the Federal Trade Commission
and a number of independent
academic studies.
9. South Dakota leaders already
rejected this bad idea. Gov.
Dennis Daugaard and state
lawmakers saw through this ploy
and rejected an IM17-like bill in
the 2013 legislative session.
Undeterred, these for-profit
providers invested big sums of
money to place IM17 on this fall’s
ballot and flood the airwaves with
misleading messaging.
10. IM17 proponents specialize in
shareholder care. IM17’s primary
proponents are in the business of
maximizing profits through select,
lucrative medical procedures. And
they are hardly “mom and pop”
providers. For example, Black
Hills Surgical Hospital, Sioux Falls
Specialty Hospital, and Dakota
Plains Surgical in Aberdeen are
majority-owned by a publicly
traded Canadian corporation.
Foreign shareholders aren’t the
only ones seeking big returns.
Consider the physicians who own
large stakes.
11. “Monopoly” is a great board
game, but a weak argument.
IM17 proponents enjoy suggesting
that “the big systems” oppose this
measure because the systems offer
their own insurance products. The
proponents don’t point out that the
Sanford and Avera health plans
account for only 1/5 of the
insurance marketplace in South
Dakota. Moreover, many of the
system plan offerings are highly
inclusive. In fact, Dr. Blake Curd
and Dr. Steven Eckrich, the for-
profit stars of the IM17 TV
commercials, are already part of
the Sanford and Avera health plan
12. Throwing stones in a glass
house. It’s pretty remarkable that
IM17 proponents would argue
conflicts of interest. Consider the
whole for-profit, physician-owned
specialty hospital model. The
whole concept of physician-owned
hospitals has long been under fire –
to a point it’s now illegal to open
or expand a physician-owned
hospital in the United States.
13. Not all doctors support IM17
– follow the money! IM17
proponents like to claim that nearly
every South Dakota doctor is in
favor of IM17, pointing to an
endorsement by the South Dakota
Medical Association. A
membership association
endorsement is hardly consensus.
More telling is the monetary
support for IM17. See your doc on
the list? Probably not, unless they
have something to gain financially.
14. Common sense confirms the
research. Studies aside, are South
Dakotans really to believe costs
won’t rise if we arm some of the
nation’s most expensive for-profit
hospitals with an all-access
insurance mandate?
15. Thirty-nine states don’t have
this mandate. Proponents have
made a lot of noise about eleven
states having any willing provider
laws governing medical insurance.
What they don’t say is that these
laws (along with South Dakota’s
pharmacy law) were implemented
decades ago. The cost of
everything has increased
significantly over that period of
time, so it’s deceitful to suggest
these laws have kept costs in
check. Importantly, no state has
enacted this type of mandate since
passage of the Affordable Care
Act, which contains an array of
potentially costly provisions the
proponents want voters to simply
gloss over. The proponents are
willing to gamble because they’re
doing so with your money.
16. IM17 destroys options for the
most cost-sensitive consumers.
The current insurance marketplace
contains a range of choices – from
more expensive, broad-network
plans to more affordable, defined-
network plans. Those are choices
best left for individuals and
business owners. Folks buying
insurance off the exchanges created
by the Affordable Care Act
overwhelmingly prefer narrower
network plans. IM17 undermines
insurers’ ability to craft such plans,
which will limit value-driven
options for low-income families.
17. Remember to vote this
Tuesday, November 4
. South
Dakota voting information may be
accessed at the Secretary of State’s
website. A ‘No’ vote on Initiated
Measure 17 is a vote against higher
costs and more unnecessary
government interference in health
care. A ‘No’ vote aligns with South
Dakota values, protecting our
state’s families and businesses.
Thanks for your interest and
support this election season!