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Marketing campaigns, fear of tax penalties drive SD residents to sign up for health insurance

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SIOUX FALLS, South Dakota — More prominent marketing campaigns, fear of potential tax penalties and an overall better understanding of the nation's health care law drove thousands of South Dakota residents to sign up for private health insurance during the second enrollment period that ended Sunday, health insurers said, resulting in a 60 percent increase in signups from last year.

A federal report released by the U.S. Department of Health and Human Services this week shows that 21,183 South Dakotans selected a plan during the three-month enrollment season, that's about 8,000 more signups compared to last year. The figure includes first-time enrollees and people who were re-enrolled.

Sunday was the nationwide deadline for the second sign-up period under President Barack Obama's health care law, which offers subsidized private coverage to people without access to it on the job. The law requires that all Americans have insurance or face a tax penalty, with plans in South Dakota offered through a federal website known as marketplace.

"I'm cautiously optimistic that in our state in particular, which is a very conservative and pragmatic state, we have moved ourselves past the initial suspicion related to the marketplace and how it was going to work," said Debra Muller, chief administrative officer for Avera Health Plans, which offered 11 individual plans and estimates to have signed up more than 10,000 people.

Muller said she believes the increase in enrollees was a result of a "good, old-fashioned neighbor talking to neighbor" about their experiences after obtaining insurance.

South Dakota residents shopping for a plan on the federal website had three insurers to choose from: Avera Health Plans, Sanford Health Plan and Dakotacare. Consumers could choose from an average of 38 health plans in their county, that's six more plans compared to 2014.

The chief marketing officer for Dakotacare, Greg Jasmer, said the insurer this enrollment period had a more aggressive marketing campaign in hopes of encouraging people to sign up. He said it is likely that more people signed up because they understood better the financial help available. But, he added, the potential punishment for going against the law also influenced people.

"People having a better understanding of the penalties involved if they did not carry health insurance and those penalties increasing from 2014 to 2015 also played a role in the increase enrollment," he said.

For 2014, the fine was the greater of $95 per person or 1 percent of household income above the threshold for filing taxes. That fine will be collected when taxpayers file their 2014 returns. But this year the fine will jump to the greater of 2 percent of income or $325.

About 88 percent of South Dakota consumers who signed up qualify for a federal subsidy that on average covers about $234 of their monthly premiums, according to the U.S. Department of Health and Human Services.

Enrollment figures could increase because the deadline has been extended to Sunday for people who faced computer glitches and long waits while trying to enroll over the phone last week. But they could also decrease if people do not pay their premiums.

Sanford Health Plan this enrollment season decided to contact by phone all marketplace enrollees to ensure that they fully understood the plan they selected. Lisa Carlson, the insurer's director of planning and regulation, said enrollees were also reminded during those calls to pay their premiums if they hadn't yet done so.

Carlson said the more functional http://www.healthcare.gov , which was marred with glitches last year, made the enrollment process more consumer-friendly.

"I would give it a B+," Carlson said of the overall enrollment season.

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