Undocumented Immigrants Under Health Care Reform: A Growing Share of the Uninsured

October 2012

As policymakers plan for major coverage gains under the Patient Protection and Affordable Care Act (ACA), there is increasing awareness of the groups that will be left out of health care reform.  Among these groups are undocumented immigrants, who are excluded from participation in exchanges, enrollment in the expanded Medicaid program, and other initiatives aimed at helping the uninsured gain coverage.  As Nina Bernstein reports in The New York Times, the exclusion of illegal immigrants from the ACA’s benefits coincides with cuts in federal aid to the safety net hospitals that often treat this population.  HCFO-funded research provides additional insight into health insurance coverage among undocumented immigrants and the determinants of that coverage.

In looking at data from the Current Population Survey, HCFO researchers Stephen Zuckerman and Timothy Waidmann of the Urban Institute found the number of uninsured Americans increased by 6.7 million during the period 1999-2007.  Of those individuals, 1.8 million were undocumented immigrants, representing 27 percent of the overall increase in the number of uninsured.  The researchers attributed this finding to growth in the size of the undocumented population, not to an increase in their uninsurance rate.  When controlling for factors like income, age, and employer size and industry, the researchers found undocumented immigrants were still less likely than native-born Americans to have health insurance.

Undocumented immigrants lacking health care coverage often turn to emergency departments at safety net hospitals, which receive aid from the federal government to help compensate for large numbers of low-income patients.  As Nina Bernstein reports, the ACA will reduce these disproportionate share hospital payments starting in 2014, bringing the $20 billion in current payments down to $10 billion by 2019.  The premise is that fewer people will be uninsured after health care reform takes effect, but as Bernstein observes, the theory has done little to comfort hospital officials in poor urban and rural areas.

Zuckerman and Waidmann expect undocumented immigrants to comprise an even larger share of the uninsured population as the ACA is fully implemented.  They note that provisions in the law directly disadvantage undocumented immigrants relative to other people in similar economic circumstances.  Their research also indicates that the employers who hire undocumented immigrants are likely the types of small firms that will be exempt from the employer mandate provisions or allowed to purchase coverage through exchanges.  That leaves undocumented immigrants vulnerable to coverage disruptions, either because an employer has dropped coverage or because an individual has been screened out of the exchange.

Both the researchers and Bernstein note that some provisions in the ACA stand to benefit safety net hospitals, and by extension, undocumented immigrants.  These include increased payments for primary care providers, a larger insured patient base, and more options for using emergency Medicaid to pay for care for the uninsured.

Additional information about the study is available on HCFO’s website.