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The Impact of Immigrants on State Medicaid Budgets

What is the impact of immigrants on state Medicaid budgets?

Medicaid, which is jointly funded by the states and the federal government, is the chief source of state financing to pay for the health needs of low-income residents.  According to a Kaiser Family Foundation study,   it represents $1 out of every $6 spent on health care in the US. The Pew Charitable Trust analyzed state Medicaid data. Examining budgets from 2000—2013, it found that the percentage of states’ own funds spent on Medicaid in fiscal year 2013 was higher in 49 states.

In 2014, A report by the Center for Immigration Studies analyzed government data, and found that immigrants and their children accounted for 42 percent revealed that of the growth in Medicaid enrollment from 2011 to 2013. Among the report’s findings:

  • The number of immigrants and their U.S.-born children (under 18) on Medicaid grew twice as fast as the number of natives and their children on Medicaid from 2011 to 2013 — 11 percent vs. 5 percent.
  • About two-thirds of the growth in Medicaid associated with immigrants was among immigrants themselves, rather than the U.S.-born children of immigrants.
  • The increase in Medicaid enrollment among immigrants and their children can be roughly estimated as costing $4.6 billion annually. By 2013, 25 percent of immigrants and their children were on Medicaid, compared to 16 percent of natives and their children.”

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Those immigrants who enter the United States illegally present special, and potentially costly, health care concerns. Officially, Illegal aliens are not eligible for Medicaid, other than limited emergency services, and Obamacare omits coverage for them.  However, their U.S.-born children are eligible. It should also be noted that individual states may choose to use their own resources to pay for the health care needs of illegals.

A 2007 Congressional Budget Office (CBO) study,  reported that “State and local governments incur costs for providing services to unauthorized immigrants and have limited options for avoiding or minimizing those costs…Rules governing many federal programs, as well as decisions handed down by various courts, limit the authority of state and local governments to avoid or constrain the costs of providing services to unauthorized immigrants…The tax revenues that unauthorized immigrants generate for state and local governments do not offset the total cost of services provided to those immigrants.”

People entering the United States illegally from less developed areas present health care challenges.

The Southern Medical Association (SMA) reports that there’s a growing health concern over illegal immigrants bringing infectious diseases into the United States. Approximately 700,000 illegal immigrants enter annually, and three-quarters of these illegal immigrants come from Mexico, El Salvador, Guatemala, and Honduras. Those entering the U.S. legally are required to be screened for infectious disease.  One thinks of those vintage images of people being screened on Ellis Island.  But similar examinations are not similarly performed on those entering the nation unauthorized.  SMA notes that “Illegal immigration may expose Americans to diseases that have been virtually eradicated, but are highly contagious, as in the case of TB… Immigrants coming here have been documented as having communicable diseases such as tuberculosis and swine flu…individuals coming in contact with people with these diseases are at risk of becoming infected. Those most vulnerable to contracting illnesses from illegals are the first responders such as the Border Patrol agents. In turn, they may pass diseases and conditions on to their children, spouses, seniors and those with whom they come in contact who have compromised immune systems…It isn’t the diseases that we have been vaccinated against that are the most concerning, but ones like TB, which have developed multiple drug resistance, or tropical diseases such as Dengue fever that doctors may have difficulty diagnosing and for which there is no treatment.”

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Obamacare’s Demise, and its Replacement

In a 51-48 vote, The Senate yesterday took an important step to replace Obamacare. The measure was a nonbinding budget bill that establishes the path for a repeal of the failing Affordable Care Act within the next few months.

U.S. Senate Majority Leader Mitch McConnell (R-KY)  stated “Too many have been personally hurt by this law. Too many feel they’re worse off than they were before Obamacare…Too many Americans say their Obamacare plans are too expensive to actually use. Too many say their Obamacare premiums have gone up and up though their options have diminished.”

While, as the 51-48 vote indicates, repeal is largely the work of the Republican majority, the reality is that Obamacare was collapsing under its own weight in what some pundits have termed a “death spiral.” Skyrocketing premiums, diminished choices, physicians opting to not take Obamacare-covered patients, a sharp decline in enrollments, and vanishing co-ops have been key indicators that its demise was inevitable.  Public support for the 2010 Affordable Care Act legislation, which was passed without the public being informed of the details (former House speaker Nancy Pelosi (D-California) famously told the public that they would have to pass the bill to see what was in it) had dropped precipitously. Subsequent to its enactment, the laws’ architect, Jonathon Gruber attributed its passage to the “stupidity” of the American people.

Young people have been forced to buy policies which included costs for services they didn’t need. Seniors have been denied necessary treatments because of expense factors. Those with irregular incomes face constant changes in coverage. Physicians are drowning in inadequate reimbursement and bureaucracy. Obamacare in general charges excessive rates and imposes deductibles that make the concept of coverage more illusion than reality.

Many of the legislation’s own advocates had seen it as only an interim step towards the implementation of completely nationalized health care under a single payer plan. But that could not be sold to an American public that was well aware that the concept has failed wherever it has been tried.  Indeed, many in the United Kingdom, whose National Health Service was, quietly, the admired model of Obamacare advocates, have sought methods to extricate themselves from their failing system.

Those advocates who have claimed that Obamacare has had some success are fudging facts. As the National Center for Policy Analysis, quoting a Heritage study  noted in 2014: “while health insurance coverage — whether in the private market or in Medicaid — grew by 8.5 million individuals in 2014, the vast majority (71 percent) of that gain was due to increases in Medicaid. According to the authors, “[T]he inescapable conclusion is that, at least when it comes to covering the uninsured, Obamacare so far is mainly a simple expansion of Medicaid.”

The need to address Obamacare has been summarized by the Heritage Foundation,  which outlined how the legislation detrimentally affects Americans:
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“Seniors: The law cuts an estimated $716 billion from Medicare over ten years. However, these “savings” are not set aside to preserve Medicare’s future, instead they are used to fund new spending created by the law. Nearly one-third of all seniors rely on Medicare Advantage, the private health care option in Medicare. Despite the program’s growing enrollment and beneficiary satisfaction, Obamacare makes deep cuts to the program that jeopardize its viability in coming years. In addition to payment cuts, Obamacare imposes new taxes on drug companies and medical device makers, and new regulations that will make health care more costly for seniors.

“Doctors: The United States is facing a severe physician shortage. By 2020, the nation will need an additional 91,500 doctors to meet medical demand. Obamacare exacerbates this problem by further increasing physicians’ workload and worsening their attitudes regarding the health care system. A 2012 survey found that Obamacare is motivating doctors to change their retirement timeline, with 43 percent of respondents stating that they are considering retiring within the next five years as a result of the law.

“Business & The Economy: The Congressional Budget Office estimates that the Obamacare subsidies will discourage Americans from working, and cause 2.5 million employees to drop out of the labor force.Obamacare’s employer mandate will raise the minimum cost of hiring a full-time worker to $10.30/hour in 2015. Congress has already raised the minimum wage from an employer’s point of view, but the money goes to the government instead of the employees.

“States: Obamacare’s Medicaid expansion worsens the already heavy burdens facing states. By 2021, approximately 78 million people are projected to be enrolled in Medicaid—requiring billions of dollars from state budgets and taxpayers. In the individual market, Obamacare’s exchanges have on average decreased insurer competition by an estimated 29 percent nationwide. Furthermore, over half of the counties in the U.S. have only one or two insurers to choose from in their Obamacare exchange.

“Families: Obamacare adds nearly $2 trillion in new health care spending according to the Congressional Budget Office. Over the next 10 years, Obamacare will levy about$771 billion in new taxes and fees. Obamacare imposes significant financial penalties on the decision to get or remain married – over $10,000 per year for certain couples.

“Uninsured: The Congressional Budget Office estimates that “between 6 and 7 million fewer people will have employment-based coverage each year from 2016 through 2024 than would be the case in the absence of [the new health law].”In 2024, after ten years of full implementation, 31 million people are projected to remain uninsured.”

The Report Concludes on Monday

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Medicaid patients encounter difficulties getting appointments

Disturbing information continues to build concerning the growing difficulty of individuals covered under the affordable care act as well as those under Medicaid in finding physicians who will treat them.

According to Healthline News, “many of the newly insured will have trouble finding a doctor. Those who do may have difficulty getting quick appointments. Many have gained or will gain coverage under the expansion of Medicaid. …A big problem, even for those who do live in Medicaid expansion states, is that there are not enough primary care physicians to treat people on the government insurance plan. This was a problem even before the expansion.” Healthline News reports that those not able to obtain primary care frequently end up in emergency rooms.

Part of the reason is that, this year, primary care doctors are receiving lesser reimbursement.

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To address the problem, which can greatly increase costs to states and local governments, which in many cases are responsible for the emergency room expenses incurred at public hospitals, “Fifteen states indicated that they will continue the primary care fee increase in 2015, at least in part” according to a Kaiser Family Foundation study.

Adding to the difficulties faced by Obamacare enrollees, a CNN Money study  finds that “Deductibles, co-payments, and drug payments are higher under the average Obamacare silver-level plans — the most popular — than employer policies.”

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Will Obamacare Survive 2015?

Supporters of the Affordable Care Act, better known as Obamacare, may find 2015 troublesome.

The law may be increasingly criticized by those with rejected claims. Increasingly, reports from medical billers interviewed by the New York Analysis report that rejections of claims for coverage are being denied with great frequency. Further, many are finding that the rates are not as “affordable” as the title of the legislation suggests.

Much of the financial burden is being placed on Medicaid. According to the Heritage Foundation,  “Medicaid enrollment increased by almost 6.1 million—principally as a result of Obamacare expanding eligibility to able-bodied, working-age adults.” The Political Insider website has noted that “Across the nation, states from California to Rhode Island, are facing new concerns that their Medicaid costs will rise as a result of the federal health care law.”

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On March 4, the U.S. Supreme Court will hear the case of King v. Burwell.  In this case, the plaintiffs contend that the law only permits subsidies on state-run exchanges, making the federal versions essentially illegal. About 5 million people are covered under federal exchanges.

Ultimately, Obamacare’s political fate will hinge on how effectively and affordably it provides coverage. Indications are the critics, who have expressed concern about its cost to the nation, and the possibility that financial concerns will cause rationing of service, may be proved correct.

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Immigrants account for 42% of Medicaid growth

While Americans continue to struggle with the high cost of medical care, the expensive but poor coverage provided by Obamacare, and high taxation, a huge portion of  the growth in Medicaid spending has been going to immigrants.

A startling report by the Center for Immigration Studies http://cis.org/immigrant-families-accounted-for-42-percent-of-medicaid-growth-since-2011 reveals that  “A new analysis of government data shows that immigrants and their U.S.-born children (under age 18) have been among the primary beneficiaries of Medicaid growth…The data show that immigrants and their children accounted for 42 percent of the growth in Medicaid enrollment from 2011 to 2013… It seems almost certain that immigrants and their children will continue to benefit disproportionately from Obamacare…

“Among the findings:

  • The number of immigrants and their U.S.-born children (under 18) on Medicaid grew twice as fast as the number of natives and their children on Medicaid from 2011 to 2013 — 11 percent vs. 5 percent.
  • Immigrants and their children accounted for 42 percent of Medicaid enrollment growth from 2011 to 2013, even though they accounted for only 17 percent of the nation’s total population and 23 percent of overall U.S. population growth over this time period.
  • About two-thirds of the growth in Medicaid associated with immigrants was among immigrants themselves, rather than the U.S.-born children of immigrants.
  • The increase in Medicaid enrollment among immigrants and their children can be roughly estimated as costing $4.6 billion annually.
  • By 2013, 25 percent of immigrants and their children were on Medicaid, compared to 16 percent of natives and their children. “

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As the New York Analysis of Policy & Government has frequently pointed out, the United States cannot afford to be the welfare agency for the entire planet.  Immigration is, overall, a positive contribution to the United States, but only if those coming to America are contributing to, not taking from, those already in the nation.