Illegal Immigrants and HR 3200: Estimate of Potential Costs to Taxpayers

By Steven A. Camarota
September 2009

Backgrounders and Reports
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Steven A. Camarota is the Director of Research at the Center for Immigration Studies.

Based on our analysis of Census Bureau data, we estimate that there are 6.6 million uninsured illegal immigrants in the United States who could be covered by the new health care reform bill (HR 3200). Even though HR 3200 states that illegal immigrants are not eligible for the proposed taxpayer-funded affordable premium credits, there is nothing in the bill to enforce this. An amendment was defeated in committee that would have required the use of the Systematic Alien Verification for Entitlements (SAVE) program, used by almost all other means-tested programs of this kind.

Among the findings:

We estimate that there were 6.6 million illegal immigrants without health insurance in 2007 who had incomes below 400 percent of the poverty level, which is the income ceiling for the proposed affordable premium credits.


If all uninsured illegal immigrants with incomes below 400 percent of poverty received the proposed credits, the estimated cost to the federal government would be $30.5 billion annually.


We estimate the current cost of treating uninsured illegal immigrants at all levels of government to be $4.3 billion a year, primarily at emergency rooms and free clinics.


On July 16, an amendment by Rep. Dean Heller (R-Nev.) that would have required use of the SAVE program to prevent illegal immigrants from receiving the affordable premium credits was defeated by the House Ways and Means Committee.


At present, 71 other means-tested federal programs require use of the SAVE system to prevent illegal immigrants and other ineligible non-citizens from accessing them.


Even though there is no mechanism to prevent enrollment, it is likely that many income-eligible illegal immigrants would not enroll out of fear or lack of knowledge of the new programs. Thus, the actual costs could be less than the $30.5 billion estimated above. However, if illegal immigrants are legalized, a much larger percentage can be expected to enroll, with a corresponding increase in costs.


Uninsured illegal immigrants tend to use less health care on average than others without health insurance because they tend to be young. This fact is incorporated into our current cost estimate of $4.3 billion. However, government-provided affordable premium credits paid to insurance companies would be the same for everyone, regardless of age or preexisting conditions. Therefore, the younger age of illegals does not result in lower average costs for taxpayers for this program.


It is also worth noting that we estimate that 38 percent of illegal immigrants had health insurance in 2007 and that there are at least 360,000 uninsured illegal immigrants with incomes above 400 percent of poverty who would not qualify for benefits under HR 3200.


Illegal immigrants could benefit from the expansion of Medicaid under HR 3200. The bill does not require identity verification for those claiming U.S. birth. Of illegal immigrants with incomes under 400 percent of poverty, about half earn less than 133 percent of poverty, which is the new ceiling for Medicaid eligibility.


Lack of Enforcement in HR 3200

The America’s Affordable Health Choices Act of 2009 (HR 3200) is extremely complex and there’s no way to know how the bill ultimately will be implemented. First, it is unclear if illegal immigrants will be required to have health insurance, as would citizens and legal immigrants (green card holders). In its summary of the bill, the Congressional Research Service (CRS) states, “Under HR 3200, all legal permanent residents (LPRs), non-immigrants, and unauthorized aliens who meet the substantial presence test… would be required to obtain health insurance.â€