Immigration Reform Could Raise Cost Of ObamaCare By Hundreds Of Billions
In the wake of the U.S. Senate’s “Gang of Eight” announcement on immigration reform yesterday, President Barack Obama traveled to Las Vegas today to deliver his proposals on immigration reform.
“I am here because most Americans agree that it is time to fix a system that has been broken for way too long,” he said. He added it is time to tackle immigration reform, for immigration strengthens “our economy and our country’s future.”
Placing emphasis on bipartisanship, Obama said, “The differences are dwindling and a consensus is growing.”
Despite the years of partisanship, the president today said he felt the time has arrived to where Republicans and Democrats can “finally work together.”
Using the Kennedy-Bush amnesty plan of 2007 as a model, Obama said the infrastructure for “consensus is already in place” and he wants Congress to work immediately and take a vote on the measures “right away.”
While Obama admits those he’s helping have broken the law, he said, “They are not looking for any trouble” and “they are members of the community.”
He said the U.S. needs to make certain everyone is playing “by the rules,” but he insists “in order for immigration reform to work,” there must be a pathway to citizenship.
The president’s reasoning is that to lose these immigrants would be “bad for the economy.” He said many illegal aliens currently are studying for high tech positions but upon their graduation, they will leave America and travel to other countries with their skills.
Additionally, the president elaborated on other requirements needed for comprehensive immigration reform – elements almost identical to the proposals of the Gang of Eight from the U.S. Senate.
He said requirements for amnesty would include passing a background check, paying taxes, “going to the back of the line” and learning to speak English so that “they can earn their way to a green card and eventually citizenship.”
He also adds the nation needs to keep up enforcement and create a national system to figure out who is eligible to work and who is not.
Though the president promised to enact comprehensive immigration reform and never did, he still said in his first administration he worked to “patch up the worst cracks in the immigration system.”
The push for “comprehensive immigration reform” has not been without opposition. U.S. Rep. Steve King, R-Iowa, said yesterday, “The president has demonstrated he will only enforce the laws that he likes.”
Additionally, Congressman Steve Stockman, R-Texas, said, “I will not be supporting the Senate’s proposed ‘immigration reform’ should it reach the House. I cannot and will not support any immigration reform proposal that institutes an amnesty program or does not begin with a comprehensive plan to secure the borders.”
He continued, “It rewards law breaking and encourages a new flood of illegals, perpetuating the very problems it claims to solve.”
He also echoed the point of many other anti-illegal immigration activists by saying, “Our nation’s failed experiments with amnesty have proven it only encourages more illegals willing to wait it out for their turn at free citizenship.”
Immigration Reform Could Raise Cost Of ObamaCare By Hundreds Of Billions
Earlier today, I posted on why I thought it was unlikely that immigration reform would actually pass this year. But there’s another reason why it will be difficult for Republicans to back legislation as currently outlined – immigration reform could represent a massive expansion of Obamacare, potentially costing hundreds of billions of dollars over the next decade.
As the Washington Post’s Sarah Kliff details, legalizing immigrants who are currently in the country illegally could make millions of them eligible for Obamacare. Though the exact number is difficult to pin down for a number of reasons, and we don’t know how many immigrants would obtain legal status as a result of any reform package, one Congressional Budget Office report estimated that 7 million to 8 million illegal immigrants would be uninsured after Obamacare because they won’t qualify for benefits. If this population were legalized and became eligible, it would mean increasing the number of Obamacare beneficiaries by over 20 percent. (The CBO has estimated that Obamacare would cover 36 million people either through the Medicaid expansion or the exchanges.)
My very rough estimate based on existing CBO analysis is that an expansion of Obamacare on that scale could easily cost several hundred billion dollars over a decade – maybe more than a half trillion. The reason why it’s difficult to make a projection is that it’s hard to say who would qualify for Medicaid and who would qualify for subsidies. Also, given that the subsidies vary by income level, it’s hard to say (beyond educated guessing) where on the scale this newly eligible population would fall and thus how generous their subsidies would be. Also, it’s hard to say how many of them would have incomes low enough to qualify for existing Medicaid benefits anyway, which they would have been able to claim with or without Obamacare.
Having made these caveats, here are some ways of looking at what it could cost to insure newly eligible immigrants under various assumptions. After the Supreme Court’s Obamacare decision, the CBO estimated that the law would cover an additional 11 million people on Medicaid (at a cost of $643 billion from 2013 through 2022) and 25 million through the exchanges (at a cost of just over $1 trillion over the same period). So, for every additional 1 million people on Medicaid, the federal government will be spending about $58 billion over the next decade and for every 1 million people on the exchange, taxpayers would be spending about $41 billion. Projecting this out for 8 million new beneficiaries would give a range of $328 billion to $464 billion. This would be conservative, however, because the current 10-year CBO estimate includes fiscal year 2013, though the law isn’t going to be implemented until 2014 – thus the actual 10-year cost is understated. Also, this method understates the per capita cost, because I’m dividing for the decade as a whole, even though the population covered by Obamacare grows over time.