State of South Dakota
Representatives Olson (Mel), Bartling, Bradford, Burg, Davis, Hanson
(Gary), Hargens, Hundstad, Kloucek, Lange, Nachtigal, Nesselhuf,
Sigdestad, and Van Norman and Senators Hutmacher, Koetzle, Moore,
Reedy, Sutton (Dan), and Volesky
FOR AN ACT ENTITLED, An Act to
create a low income pharmaceutical assistance program
and to provide an appropriation therefor.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
Terms used in this Act mean:
(1) "Department," the Department of Social Services;
(2) "LIPAP," the low-income pharmaceutical assistance program.
There is hereby established the low income pharmaceutical assistance program
to provide eligible persons with assistance in paying for pharmaceutical drugs.
Any person desiring LIPAP assistance shall submit a written, signed application
for assistance to the Department of Social Services. At the time of application the person shall
produce proof of all household income, documentation of the household's pharmaceutical drug
costs, and proof of vulnerability. For the purposes of this section, a vulnerable household is one
that is responsible for paying for it's own pharmaceutical drug costs and seven and one-half
percent of the household's income goes toward the payment of pharmaceutical drugs.
Any person residing in an institution is not eligible for LIPAP assistance. For the
purposes of this section, an institution is a facility that provides living quarters and services for
a particular person or group of persons, including group homes, nursing homes, higher education
facilities, facilities administered by the Department of Human Services under
facilities administered by the Department of Corrections under
1-15-1.4, the South Dakota
State Veterans' Home administered by the Department of Military and Veterans' Affairs under
33-18-1, community residential facilities, community habilitation facilities, residential treatment
centers, special education units, residential school programs, and adjustment training centers.
To be eligible for LIPAP, a household's income may not exceed one hundred forty
percent of the federal poverty level established in 65 Fed. Reg. 7,555. To determine whether a
non-self-employed household is income eligible, the department shall compute the household's
gross income for the three months or the ninety days, whichever is less, immediately prior to the
application. The result multiplied by four must fall within the income limits established in 65 Fed.
Reg. 7,555 for a household of similar size.
A self-employed household's income shall be based on either the household's gross income
for the past twelve months or the household's gross income as shown on its most recent tax
The department shall promulgate rules pursuant to chapter 1-26 in the following
(1) Income exclusions;
(2) Income to be included for self-employed households;
(3) Maximum benefit for each household.
The department shall base the benefit levels for an eligible household on the
household's income and the cost of the pharmaceutical drugs required.
The department shall determine LIPAP eligibility within sixty days after the date
of the application. If the household is determined to be eligible for LIPAP assistance, the
department shall notify the household in writing of the amount of LIPAP assistance for which
the household is eligible. If the household is ineligible, the department shall notify the household
in writing of the reason for ineligibility. Any notice pursuant to this section shall include
information regarding the household's right to a fair hearing.
The department shall make any payments pursuant to this Act directly to the
household. The payments shall be made within twenty-one days after the department notifies the
household of eligibility.
Monthly LIPAP payments shall continue to be made to the household until one
of the following occur:
(1) The household has reached its maximum benefit;
(2) The household no longer has pharmaceutical drug expenses;
(3) The fiscal year has ended;
(4) The funds available for the LIPAP payments have been exhausted.
Once the LIPAP benefit has been determined, the department may not make any
adjustments to the benefit level due to changes in income, family size, or pharmaceutical drug
A household may only be determined eligible for LIPAP assistance once during
the fiscal year. The department shall consider it a duplicate payment if a member of a household
previously determined eligible for LIPAP assistance leaves that household and later applies for
assistance either as a separate household or as part of another household.
Any LIPAP payment made as a result of a department error or a recipient error
is considered an overpayment and is subject to recovery by the department.
There is hereby established the low income pharmaceutical assistance fund. One
million dollars of the interest credited to the tobacco prevention and reduction trust fund shall
be transferred to the low income pharmaceutical assistance fund.
There is hereby appropriated from the low income pharmaceutical assistance fund
the sum of one million dollars ($1,000,000), or so much thereof as may be necessary, to the
secretary of the Department of Social Services for the low income pharmaceutical assistance
program as provided for in this Act.
The secretary of social services shall approve vouchers and the state auditor shall
draw warrants to pay expenditures authorized by this Act.
Any amounts appropriated in this Act not lawfully expended or obligated by
June 30, 2002, shall revert in accordance with