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Could Medicaid Expansion debate turn into an immigration issue?

By Julie Appleby, Patricia Borns | February 26, 2014

This story was produced in partnership with the <img src="http://media.khi.org/img/photos/2014/02/26/miami-herald.png" /<

Protesters gather in the Miami office of Florida State Rep. Manny Diaz as they protest his stance against the expansion of health coverage in Sept. 2013. A new bill to expand Medicaid coverage in Florida argues that not doing it would deprive some U.S. citizens health coverage while legal immigrants get help to afford it.

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Florida lawmakers backing expansion of the state’s Medicaid program plan to mount a new argument this legislative session: That voting against extending the program would deprive low-income U.S. citizens of access to insurance that’s available to some legal immigrants.

At issue is a little-noticed provision of the federal health reform law that allows some low-income immigrants who are living here legally to qualify for subsidies to help them buy private insurance through online marketplaces.

Poor U.S. citizens aren't eligible for those subsidies because the law provided for an expansion of Medicaid to help them get coverage.

But a U.S. Supreme court ruling made this provision voluntary, and Florida was among two dozen states that opted out, leaving an estimated 760,000 state residents ineligible for either subsidies or Medicaid.

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Nearly 182,000 Kansans in the ‘Eligibility Gap’

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Kansas has also chosen not to expand its Medicaid program — leaving 182,000 Kansans in the 'eligibility gap.'

"It doesn't matter where you are on the immigration issue ... It's a fairness issue," said Republican state Sen. Rene Garcia of Hialeah, who has introduced a bill in the session that begins March 4 to accept billions in federal dollars to extend coverage to hundreds of thousands of Floridians.

But in a state with a large foreign-born population, the immigration issue injects a political wild card into a debate that has largely revolved around ideological differences.

Critics of the health reform law argue the federal government can't be counted on to continue paying for expanded benefits. Proponents say it would be foolish to walk away from billions of federal dollars that would extend coverage to hundreds of thousands of poor Floridians and reduce uncompensated care costs for health care providers.

In Arizona, concerns about the political fallout of the immigration issue were said to have helped persuade Republican Gov. Jan Brewer, an ardent foe of the health reform law, to expand Medicaid eligibility last year. Brewer's budget advisers said that without expanding the program, "only legal immigrants, but not citizens [below the federal poverty line] would be eligible for subsidies," according to documents obtained by the Associated Press.

But in Florida, proponents see an uphill battle. Last year, the Republican-controlled state Senate and Gov. Rick Scott, a Republican, blessed a similar expansion bill, but the House, also controlled by Republicans, refused to go along.

"I don't think [this] will change the landscape," said Thomas W. Arnold, the state's former Medicaid director, who is now a lobbyist for the health care industry.

To be clear, the health reform law provision does not apply to immigrants in the country illegally, who are barred from Medicaid, subsidies or even from purchasing private coverage at full cost through new online marketplaces.

But the law's framers sought an option for legal immigrants, many of whom are barred from enrolling in Medicaid for five years. If those immigrants are in the five-year waiting period and earn less than the federal poverty level — $11,400 for an individual or $19,530 for a family of three — they can qualify for a subsidy to help them buy private insurance. To get this help, they cannot be offered affordable health insurance through their jobs.

In addition, those earning between 100 percent and 400 percent of the poverty level — up to about $46,000 for an individual or $78,120 for a family of three — are eligible for the same subsidies as U.S. citizens.

The provision for poor, legal immigrants has received little publicity to date, in part because even advocates of Medicaid expansion prefer to talk about its financial and health benefits, rather than raise an issue that might spark backlash against immigrants.

"The optics of it are difficult," said Jennifer Ng'andu, until recently the director of health and civil rights at the National Council of La Raza, an Hispanic advocacy group. "It makes it look like legal immigrants are getting better treatment than U.S. citizens, but this was born out of Congress being punitive to immigrants ... [wanting] to maintain the restrictions that prevent low-income immigrants from Medicaid."

Opponents of expansion, too, could find the discussion politically difficult.

"It's hard to see there would be any traction for anyone on this issue," said Joseph Antos of the conservative American Enterprise Institute. "There's a lot of sensitivity, not just about immigration, but there is also an element of racial issues and discrimination. No one wants to be in the position of saying something discriminatory to anybody."

'Very Few Are Aware'

Currently, Florida does not offer Medicaid to adults without dependent children, no matter how low their income. For parents, the income cutoff is 38 percent of the federal poverty level, or $7,421 for a family of three. Children in families earning more would qualify under more generous rules for kids.

But in participating states, the health reform law expands the program to cover everyone up to 138 percent of the federal poverty level, about $15,900 for an individual, including adults without children.

The federal government pays 100 percent of the cost of newly eligible enrollees for the first three years, and scales back over time to 90 percent. Expanding the program could bring Florida about $66 billion in federal dollars over the next decade, according to a 2013 report from the Urban Institute. It would cost the state about $5 billion over that same period.

Garcia's legislation, which has a House companion sponsored by state Rep. Amanda Hickman Murphy, a Democrat, calls for using federal dollars to buy private insurance policies for those newly eligible for Medicaid.

Under the proposal, the state would use federal dollars to allow Medicaid enrollees to buy private insurance policies. Arkansas and Iowa have adopted similar programs and several other states have shown interest.

But despite support from Scott and the state Senate last year, Florida House members preferred a much smaller expansion that would have used state dollars only.

Republican House Speaker Will Weatherford's opposition to Garcia and Murphy's bill remains unchanged, spokesman Ryan Duffy said in an email. He did not respond to questions about the differing access to subsidies for U.S. citizens versus legal immigrants.

Garcia said he plans to publicize how rejecting the expansion creates a disparity between some citizens and legal immigrants.

"Very few are aware of that component of the law," he said. "When they realize it is there, it may change some mindsets," he said.

Immigrants May Still Have Trouble Getting Coverage

Despite their inclusion in the health reform law, getting insurance is proving difficult even for legal immigrants who qualify for a subsidy.

For one thing, they still must pay about 2 percent of their household income toward the premium, which could be a stretch for some families.

"I don't go to the doctor regularly, why am I going to pay for a service I don't use?" asked Fila Granados, an immigrant in this country legally who works at Plants in Design nursery in Homestead.

And simply finding out about the option may be difficult since few insurance brokers and counselors are familiar with the provision.

At a recent enrollment event in Florida City, a community with many Haitian and Hispanic immigrants, many of the trained counselors were unaware that some immigrants could qualify for subsidies.

"I didn't know about the rule," said Kristia Stewart, a case manager of Community Health of South Florida (CHI), who is in charge of outreach and enrollment. Greg Jenkins, a navigator with the Epilepsy Foundation of Florida, which assists people with health plan enrollments in 35 Florida counties, also knew nothing about it.

Technical issues with HealthCare.gov have also hampered efforts.

"If you are in a non-expansion state, it will say you are not eligible for Medicaid or the subsidies," said Shelby Gonzales, senior policy analyst at the Center for Budget and Policy Priorities.

She and others said the Department of Health and Human Services is working to resolve the problem. In the meantime, advocates suggest that legal immigrants in the waiting period consider filing an appeal if they are below poverty and have been rejected for subsidies.

—Daniela Hernandez contributed to this report.

KHI News Service coverage of Medicaid expansion

Medicaid Access Coalition launches online "ticker" showing foregone federal dollars (2/13/14)
→ KHI report: Nearly 182,000 Kansans in the ‘Eligibility Gap’ (1/11/14)
House speaker says Medicaid expansion is "up to the governor" (1/10/14)
KS Senate president says Medicaid expansion unlikely to gain approval this session (1/7/14)
Profiles of the coverage gap: Kathleen Christian (1/6/14)
Efforts continue to expand Medicaid in Kansas and Missouri (1/6/14)
Hospital association hires former Bush HHS secretary to help craft a plan Kansas Republicans might support (12/23/13)
Iowa wins approval to expand Medicaid by using federal funds to buy private insurance (12/11/13)
White House officials hold call to urge Medicaid expansion in Kansas (11/21/13)
Republican governor talks up plan to expand Medicaid — his way (10/28/13)
Challenger says Brownback owes voters a decision on Medicaid expansion (10/22/13)
Nearly 5.2M Americans fall in coverage gap in states not expanding Medicaid (10/16/13)
Sebelius: Feds flexible on how states expand Medicaid (9/22/13)
Sebelius says Kansas and Missouri are missing the boat on Medicaid expansion (9/20/13)
Medicaid expansion coalition finds strength in numbers (9/17/13)
Republican Gov. Corbett proposes expanding Pennsylvania Medicaid (9/16/13)
Kansas lawmakers urged to consider Medicaid expansion by Wesley CEO (8/29/13)
Estimating maneuver could help more people gain from Obamacare: How the poor might qualify for Affordable Care Act subsidies in states that don't expand Medicaid (8/12/13)
Report: States not expanding Medicaid stand to benefit most from doing so (7/18/13)
CMS won’t penalize hospitals in states slow to expand Medicaid (5/14/13)
Insurer Centene: We can do Arkansas-style Medicaid (5/14/13)
The Arkansas Medicaid Model: What you need to know about the 'private option' (5/2/13)
Nothing to be done about coverage gap in states not expanding Medicaid, feds say (4/29/13)
Brownback says he's listening to Medicaid expansion proponents, opponents (4/5/13)
Oregon shows costs of putting Medicaid enrollees in private coverage (3/29/13)
Governor urged to expand Medicaid eligibility (3/27/13)
Arkansas Medicaid expansion attracts other states' interest (3/26/13)
Senate president prefers options remain open on Medicaid expansion (3/25/13)
States urged to expand Medicaid with private insurance (3/22/13)
Senate budget amendment underscores opposition to Medicaid expansion (3/21/13)
Study: Kansas employers face millions a year in possible penalties without Medicaid expansion (3/15/13)
More than 30 Kansas groups pushing for Medicaid expansion (3/12/13)
Health insurers see big opportunities in health law’s Medicaid expansion (3/8/13)
Medicaid expansion supporters to step up lobbying efforts (3/7/13)
Budget committee hears resolution opposing Medicaid expansion (2/22/13)
Legislators focusing on Medicaid expansion cost estimates (2/19/13)
Kansas hospital group study predicts expanding Medicaid would generate 4,000 jobs (2/18/13)
Brownback officials release their cost projections for Medicaid expansion (2/8/13)
Medicaid expansion bill introduced (1/22/13)
Kansas hospitals worried about loss of dollars for charity care (1/14/13)
Brownback compiling own estimate of Medicaid expansion cost (12/20/12)
Group urges Brownback to expand Medicaid eligibility (11/9/12)
Debate begins on possible Kansas Medicaid expansion (10/25/12)
Amerigroup CEO says states ‘need’ to go along with Medicaid expansion (7/11/12)
Kansas hospitals ready to get on with federal health reform, spokesman says (7/2/12)
Kansas AG claims partial victory in health reform case (6/29/12)
High court upholds Affordable Care Act, but ruling puts limits on Medicaid expansion (6/28/12)

Commentary
→ Kansas Hospital Association: An opportunity for the Kansas Medicaid program
→ Americans for Prosperity-Kansas: Well-intentioned policies do more harm than good
→ Health Reform Resource Project: The cost of not expanding Medicaid
→ Rep. Jim Ward: Medicaid expansion essential for healthier Kansas
→ Rep. David Crum: Reasons for opposing Medicaid expansion
→ National Academy for State Health Policy: Much ado about Arkansas: Medicaid in the insurance exchange

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Kaiser Health News (KHN) is a nonprofit news organization committed to in-depth coverage of health care policy and politics. The Washington, D.C.-based news service is a partner of KHI News Service.



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