S.D. Codified Laws § 58-18B-25
In applying minimum participation requirements with respect to a small employer, a small employer carrier may consider employees or dependents who have creditable coverage in determining whether the applicable percentage of participation is met. If any employee or dependent with other creditable coverage is to be considered towards calculating the applicable percentage of participation, the employee or dependent shall be counted as participating in the plan.
A carrier may provide up to a twenty percent discount for any small employer who achieves a one hundred percent participation rate in the prior year. The discount may be less than the base rate by a factor up to twenty percent. However, no discount below the base rate may be used in determining the index rate for that class of business.
SDCL 58-18B-25