PIERRE, S.D. (AP) — Federal officials have rejected a request by South Dakota Gov. Dennis Daugaard for a partial expansion of Medicaid.

The federal health overhaul gives states the option of expanding Medicaid to cover people earning up to 138 percent of the federal poverty level. Daugaard and Republican lawmakers wanted to expand eligibility only up to 100 percent of the poverty level because those above that mark can buy subsidized private insurance through the new health care law.

The Argus Leader newspaper reports that federal Medicaid administrator Cindy Mann held a conference call with state legislative leaders on Tuesday and told them the request is denied.

Daugaard aide Tony Venhuizen says it's disappointing that the federal government isn't willing to be flexible.