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Friday, January 25, 2013

Legal immigrants and the Medicaid expansion debate

Posted By on Fri, Jan 25, 2013 at 5:07 PM

Because of a quirk in the Affordable Care Act, there’s been an odd little story circulating this week about Arizona Governor Jan Brewer's decision to support Medicaid expansion. In states that don't expand, legal immigrants below the poverty line would end up with more insurance options than native-born citizens below the poverty line—some have speculated that may have pushed Brewer, a staunch anti-Obamacare conservative, toward expansion. Charlie Frago had a good roundup (paywall) this morning on the impact here in Arkansas.

This sounds to me like much ado about nothing, but here's the deal. If a state does not expand Medicaid, as we've explained, folks without coverage below 100 percent of the federal poverty level (FPL) would be out of luck. But there's an exception: The way the law is constructed, legal immigrants will be eligible for subsidies to buy private health insurance on the exchange no matter what. (See the p.p.s. below for a detailed explanation of why and how this came to be).

The Associated Press noted on Wednesday that state officials had pointed this out to Brewer and an item in the Washington Post yesterday speculated that Brewer may have been swayed by the optics of foreigners getting new coverage while poor folks born in the USA don't.

Color me skeptical. If you read the relevant budget memo, the gist is what we already knew: given the amount of federal dollars coming in to the state, it's just too good of a deal to pass up. I think it's the billions of dollars that got Brewer's attention, not the short graph about "legal aliens." As for the legal immigrants (and we should stress legal—the Affodable Care Act has no prevision for people in the country illegally), they're eligible for the subsidies regardless, so it's not as if they are somehow getting a bonus if Arizona doesn't expand. The idea is just that, while Brewer didn't feel sorry for poor Arizonans who would be denied coverage without expansion, now she feels sorry for them because someone pointed out that some other poor Arizonans—legal immigrants—wouldn't be denied. (Or more to the point, that this would look bad.)

There's a fairness issue here, I suppose, but the real scandal if we don't expand Medicaid has nothing to do with where you were born, it has to do with income. Without expansion, people between 100 and 400 percent of the FPL will get government subsidies to buy health insurance. People below 100 will not. So an individual making $40,000 or a family of four with an income of $90,000 could get help; a single parent with two kids making $16,000 or an individual making less than $11,000 would be left out in the cold. That is, as Surgeon General Joe Thompson ethically upside down. Or as expansion skeptic Sen. Michael Lamoureux admitted, "that's not a good situation."

The difference uncovered by the Arizona officials: poor legal immigrants won't be stuck in that hole of coverage that poor native-born folks will. From my perspective, the less in that hole the better, but maybe the fairness issue is easier to highlight if a few people with foreign accents are getting a leg up.

Frago's article in the D-G notes that there are 87,000 foreigners residing legally in Arkansas but many of them already have insurance. And obviously some (I'm guessing most) of those folks are above 100 percent of FPL in any case. Local Democrats and expansion proponents are selling this as another possible argument for expansion, but I'm not seeing it.

For one thing, it's really a sleight of hand: "If we don't expand Medicaid, we'll be giving immigrants subsidies to buy insurance while native-born citizens go without coverage"—that's pretty misleading, because the immigrants will get the subsidies no matter what. For another, do expansion proponents really want to be arguing that the REAL reason we should expand Medicaid is to make sure there's no special treatment for foreigners? Finally, Republicans aren't going to respond by saying, okay, we'll expand Medicaid. They'll say, this is yet another reason that Obamacare is a bad law, we keep finding new problems every day, etc.

p.s. my officemates think I'm being wildly naive about the effectiveness of jingoistic/racist arguments among the Republican base. My counter: politicians often use fear or dislike of the other to promote taking stuff AWAY ("welfare queens," "self-deportation"). Can you think of an example of the reverse? More public services for the majority because the minority have them?

Even if a liberal was cynical enough to make this argument, I think they're dreaming if they think it's going to make conservatives want to increase public services for American-born poor folks. If anything, it will galvanize them to try and take those services away from folks born somewhere else.

p.p.s. For those interested, here's the reason for the oddity in the law:

Subsidies to buy private health insurance on the exchange are available for the 100-400 FPL group but not for the 0-100 group because the latter would be covered by Medicaid expansion. Legal immigrants have a five-year waiting period before they can gain Medicaid coverage, so to make sure they got covered, legal immigrants in the 0-100 category can get subsidies on the exchange. Thus, when the Supreme Court threw the Medicaid expansion question to the states, we ended up with this peculiar situation: 1) legal immigrants 0-400 FPL get subsidies 2) native-born Americans 100-400 get subsidies 3) native-born Americans 0-100 get squat if states don't expand Medicaid. Like most oddities of the law, the original framing of the statute would have worked fine, but the Supreme Court rendered aspects of the ACA nonsensical if states say no to expansion.

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