You don't have to be a U.S. citizen to be eligible for health insurance subsidies through the ACA's exchanges.

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How immigrants are getting health coverage

You don't have to be a citizen to benefit from the ACA; in fact, you may already have access to coverage and Obamacare subsidies

  • By
  • healthinsurance.org contributor
  • January 18, 2017

For more than a decade, roughly one million people per year have been granted lawful permanent residence in the U.S. In addition, there are about 11 million undocumented immigrants in the U.S, although that number has fallen from a high of more than 12 million in 2005.

New immigrants can obtain health insurance from a variety of sources, including employer-sponsored plans, the individual market, and health plans that are marketed specifically for immigrants.

The Affordable Care Act has made numerous changes to our health insurance system over the last several years. But recent immigrants are often confused in terms of what health insurance options are available to them. And persistent myths about the ACA have made it hard to discern what’s true and what’s not in terms of how the ACA applies to immigrants.

So let’s take a look at the health insurance options for immigrants, and how they’ve changed – or haven’t changed – under the ACA.

Lawfully present immigrants

You do not have to be a U.S. citizen to benefit from the ACA. If you’re in the U.S. legally – regardless of how long you’ve been here – you’re eligible for subsidies in the exchange if your income is in the subsidy-eligible range and you don’t have access to an affordable, minimum value plan from an employer. (Premium subsidies are available to exchange enrollees if their income is between 100 percent and 400 percent of the federal poverty level.)

Calculate your subsidy eligibility.

Special enrollment period for new citizens

And when you become a new U.S. citizen or gain lawfully present status, you’re entitled to a special enrollment period in your state’s exchange. You’ll have 60 days from the date you became a citizen or a lawfully present resident to enroll in a plan through the exchange, with subsidies if you’re eligible for them.

Subsidies for recent immigrants

The ACA called for expansion of Medicaid to all adults with income up to 138 percent of the poverty level, and no exchange subsidies for enrollees with income below the poverty level, since they’re supposed to have Medicaid instead. But Medicaid isn’t available in most states to recent immigrants until they’ve been lawfully present in the U.S. for five years. To get around this problem, Congress included a provision in the ACA to allow recent immigrants to get subsidies in the exchange regardless of how low their income is.

Low-income, lawfully present immigrants – who would be eligible for Medicaid based on income, but are barred from Medicaid because of their immigration status – are eligible to enroll in plans through the exchange with full subsidies during the five years when Medicaid is not available. Their premiums for the second-lowest-cost Silver plan are capped at 2.04 percent of income in 2017. (This number changes slightly each year.)

In early 2015, Andrew Sprung explained that this provision of the ACA wasn’t well understood during the first open enrollment period, even by call center staff. So there may well have been low-income immigrants who didn’t end up enrolling due to miscommunication. But this issue is now likely to be much better understood by exchange staff, brokers, and enrollment assisters. If you’re in this situation and are told that you can’t get subsidies, don’t give up — ask to speak with a supervisor who can help you (for reference, this issue is detailed in ACA Section 1401(c)(1)(B), and it appears on page 113 of the text of the ACA).

Lawmakers included subsidies for low-income immigrants who weren’t eligible for Medicaid specifically to avoid a coverage gap. Ironically, there are currently about 2.6 million people in 18 states who are in a coverage gap that exists because those states have refused to expand Medicaid. Congress went out of their way to ensure that there would be no coverage gap for recent immigrants, but they couldn’t anticipate that the Supreme Court would make Medicaid optional for the states, and that numerous states would block expansion, leading to a coverage gap for millions of U.S. citizens.

Exchange coverage for recent immigrants 65+

Most Americans become eligible for Medicare when they turn 65, and no longer need individual-market coverage. But recent immigrants are not eligible to buy into the Medicare program until they’ve been lawfully present in the U.S. for five years.

Prior to 2014, this presented a conundrum for elderly immigrants, since individual market health insurance generally wasn’t available to anyone over the age of 64. But now that the ACA has been implemented, policies in the individual market are available on a guaranteed-issue basis, regardless of age. And if the plan is purchased in the exchange, subsidies are available based on income, just as they are for younger enrollees. (It’s unlawful to sell an individual market plan to anyone who has Medicare, but recent immigrants cannot enroll in Medicare).

The ACA also limits premiums for older enrollees to three times the premiums charged for younger enrollees. So there are essentially caps on the premiums that apply to elderly recent immigrants who are using the individual market in place of Medicare, even if their income is too high to qualify for subsidies.

Undocumented immigrants

Although the ACA provides benefits to U.S. citizens and lawfully present immigrants alike, it does not directly provide any benefits for undocumented immigrants.

The ACA specifically prevents non-lawfully present immigrants from enrolling in coverage through the exchanges [section 1312(f)(3)]. And they are also not eligible for Medicaid under federal guidelines. So the two major cornerstones of coverage expansion under the ACA are not available to undocumented immigrants. Since they’re not allowed to enroll in the exchanges or Medicaid, undocumented immigrants are exempt from the penalty that’s assessed on people who are uninsured.

It’s important to understand that if you’re lawfully present, you can enroll in a plan through the exchange even if some members of your family are not lawfully present. Family members who aren’t applying for coverage are not asked for details about their immigration status. And the immigration details you provide to the exchange during your enrollment and verification process are not shared with any immigration authorities.

How many undocumented immigrants are uninsured?

In terms of the insurance status of undocumented immigrants, the numbers tend to be rough estimates, since exact data regarding undocumented immigrants can be difficult to pin down. But according to Pew Research data, there were 11 million undocumented immigrants in the U.S. as of 2014. And as of October 2016, the Kaiser Family Foundation’s analysis of the uninsured population indicates that there are 5.4 million undocumented immigrants among the uninsured in the U.S. – about 20 percent of the total uninsured population.

So roughly half of the undocumented immigrant population has some form of health insurance coverage. Kaiser Family Foundation’s Larry Levitt noted via Twitter that “some are buying non-group, but I’d agree that it’s primarily employer coverage.” And in 2014, Los Angeles Times writer Lisa Zamosky explained the various options that undocumented immigrants in California were using to obtain coverage, including student health plans, employer-sponsored coverage, and individual (i.e., non-group) plans purchased off-exchange.

Uninsured undocumented immigrants do have access to some healthcare services, regardless of their ability to pay. Federal law (EMTALA) requires Medicare-participating hospitals to provide screening and stabilization services for anyone who enters their emergency rooms, without regard for insurance or residency status.

Since emergency rooms are the most expensive setting for healthcare, local officials in many areas have opted for less expensive alternatives. Of the 25 U.S counties with the largest number of undocumented immigrants, the Wall Street Journal reports that 20 have programs in place to fund primary and surgical care for low-income uninsured county residents, typically regardless of their immigration status.

Verifying immigration status in the exchange

As part of the enrollment process, the exchanges are required to verify lawfully present status. In 2014, enrollments were terminated for approximately 109,000 people who had initially enrolled through HealthCare.gov, but who were unable to provide the necessary proof of legal residency. (Enrollees generally have 95 days to provide documentation to resolve data matching issues for immigration status.)

By the end of June 2015, coverage in the federally facilitated exchange had been terminated for roughly 306,000 people who had enrolled in coverage for 2015 but had not provided adequate documentation to prove their lawfully-present status. And in the first three months of 2016, coverage in the federally facilitated exchange was terminated for roughly 17,000 people who had unresolved immigration data matching issues.

There’s concern among consumer advocates that some lawfully present residents have encountered barriers to enrollment – or canceled coverage – due to data-matching issues. If you’re lawfully present in the U.S (which includes a wide range of immigration statuses), you can legally use the exchange, and qualify for subsidies if you’re otherwise eligible. Be prepared, however, for the possibility that you might have to prove your lawfully present status.

There are enrollment assisters in your community who can help you with this process if necessary. But if you’re not lawfully present, you cannot enroll through the exchange, even if you’re willing to pay full price for your coverage. (You can, however, apply for an ACA-compliant plan outside the exchange, as there’s no federal restriction on that.)

California has abandoned its efforts to insure undocumented immigrants

California wanted to open up its state-run exchange to undocumented immigrants who can pay full price for their coverage. The state already changed the rules to allow for the provision of Medicaid (Medi-Cal) to undocumented immigrant children, starting in 2016. As a result, about 170,000 children in California gained access to coverage.

And in June 2016, California Governor Jerry Brown signed SB10 into law, setting the stage for the state to eventually allow undocumented immigrants to enroll in coverage (without subsidies) through Covered California, the state-run exchange.

In September 2016, after obtaining public comment on the proposal, Covered California submitted their 1332 Innovation Waiver to CMS, requesting the ability to allow undocumented immigrants to enroll in full-price coverage through Covered California. But in January 2017, just two days before Donald Trump’s inauguration, the state withdrew their waiver proposal, citing concerns that the Trump Administration might use information from Covered California to deport undocumented immigrants.

Changes on the federal level?

Bernie Sanders’ Medicare for All single-payer proposal would have expanded coverage to virtually everyone in the U.S., including undocumented immigrants. Hillary Clinton’s healthcare reform proposal took a more measured approach, and included a provision similar to California’s 1332 waiver. It would have allowed undocumented immigrants to buy coverage in the exchanges, although subsidies would not be available.

But over the first three years of exchange operation, roughly 85 percent of exchange enrollees have been eligible for subsidies, and only 15 percent have paid full price for their coverage. So it’s unclear how many undocumented immigrants would actually enroll in coverage through the exchanges without financial assistance.

Harold Pollack has noted that our current policy of entirely excluding undocumented immigrants from the exchanges is “morally unacceptable.” As Pollack explains, Clinton’s plan to extend coverage to undocumented immigrants by allowing them to buy unsubsidized coverage in the exchange is a good first step, but it must be followed with comprehensive immigration reform to “bring de facto Americans out of the shadows into full citizenship.”

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