By Ana B. Ibarra for CalMatters
For the first time since the passage of the Affordable Care Act, undocumented immigrants who were brought to the U.S. as children can purchase subsidized health plans through Covered California, the state’s insurance marketplace.
This move is expected to provide relief to thousands of so-called Dreamers, especially those who are freelancers, self-employed or have no other means of health coverage.
But the expansion is coming at an uncertain time both because of Donald Trump’s election as president and because of an ongoing lawsuit that contests the move to allow certain undocumented immigrants to buy health insurance through Affordable Care Act exchanges.
Trump in his first administration unsuccessfully tried to undo both the Affordable Care Act and the Obama-era policy known as Deferred Action for Childhood Arrivals (DACA) that protects certain undocumented immigrants.
Covered California officials and immigration attorneys say that while it is difficult to predict what will happen in the coming months, those eligible should take the opportunity and get health insurance as soon as possible.
“Coverage is here right now. So if you need to go to the doctor, if you’ve been putting off care that you need, if you’ve never had the opportunity to get your preventive care, you can do that right now,” said Jessica Altman, the executive director of Covered California. “Let’s not let fears about the future prevent what can happen in the here and now and what you can have access to.”
Altman and her team have been touring the state to spread awareness of the open enrollment period and this new access for DACA recipients.
Created in 2012, DACA does not grant recipients legal status, but it does protect them from deportation and allows them work authorization. Up until now, they’ve only been allowed to sign up for health coverage through an employer. In California low-income DACA grantees can also sign up for Medi-Cal.
The Biden administration announced a rule change in May that updated the definition of “lawfully present” for Affordable Care Act eligibility so that DACA recipients could buy insurance in the federal or state insurance marketplaces.
“The rule is correcting a long-standing mistake of exclusion,” said Nicholas Espíritu, a deputy legal director at the National Immigration Law Center.
For Trump’s Health and Human Services department to undo the rule, it would have to go through a similar administrative process, which includes a notice and public comment period, Espíritu explained. This route could take quite some time.
By some estimates more than half a million people are protected by DACA, but it’s unclear exactly how many of them are without health insurance. One survey from UC San Diego and the National Immigration Law Center estimates about 20% are uninsured. That’s because with permission to work, most have been able to obtain coverage through an employer.
Expanding coverage to DACA recipients is estimated to cost the federal government between $240 million to $300 million a year. However, because DACA recipients are young, with an average age of 30, they could potentially have a positive impact on the health insurance risk pool — younger and healthier individuals can help bring down the cost of premiums for everyone enrolled in marketplace plans.
Covered California estimates that about 40,000 DACA recipients residing in this state are eligible for marketplace coverage this enrollment season.
Open enrollment started Nov. 1 and runs through Jan. 31. People must sign up by Dec. 31 if they want their coverage to kick in Jan.1. DACA recipients can also get coverage for December 2024 if they sign up before the end of this month.
GOP states challenge Affordable Care Act expansion
The most immediate threat to Dreamers’ access to the Affordable Care Act is being fought in a North Dakota courtroom.
In August, a group of 19 Republican attorneys general — from Kansas, Alabama, Florida, Texas, Idaho and other states — filed a lawsuit in federal court challenging the insurance marketplace expansion to DACA recipients.
They argue that allowing DACA grantees into the marketplace creates “additional administrative and resource burden” in states that run their own exchanges. They also argue that access to subsidized health care is likely to encourage undocumented immigrants to remain in the U.S., and may eventually lead to more illegal immigration.
California and 18 other states last month filed a brief in defense of the Biden benefit expansion.
“Dreamers pay billions of dollars in taxes each year to help fund programs like the Affordable Care Act. Yet until now, they’ve been unable to access these programs themselves,” California’s Attorney General Rob Bonta said in a statement. “As home to more Dreamers than any other state in the country, California is proud to stand up for their right to access affordable healthcare.”
DACA grantees in California pay an estimated $2.1 billion a year in federal taxes and another $1 billion in state and local taxes, according to figures from Center for American Progress.
Biden health subsidies could end under Trump
Arguably no other state has done more to expand health insurance coverage for its residents, including its immigrants, than California. The federal government’s move to open the insurance marketplaces to Dreamers complements California’s efforts.
The state already offers Medi-Cal coverage to low-income earners regardless of their immigration status. But thousands of workers who earn above the Medi-Cal income limit don’t have many options for affordable coverage. Undocumented people technically can purchase a health insurance plan directly from a broker in the private market, but that’s without any type of financial assistance, making it unaffordable for most.
Health policy experts say one way that Trump and the incoming Republican-led Congress could undermine the Affordable Care Act, not just for DACA recipients but for everyone, is by not renewing the “enhanced premium subsidies” afforded by the Inflation Reduction Act, which are set to expire at the end of 2025. The enhanced subsidies increased the amount of financial assistance available to those already receiving it and made aid available to others for the first time by capping what they pay for the premium of a standard plan to 8.5% of their income.
Increasing the cost of coverage likely would result in some people going without health insurance. The Congressional Budget Office estimates 4 million people nationwide would drop their coverage in 2026 if Congress does not act to extend the subsidies.
It’s unclear if Trump will once again go after the Affordable Care Act in its entirety. Republican efforts to repeal the health law in the past have failed, but during his first term, Trump was successful in eliminating or changing pieces of it.
California health leaders say that they are having conversations about how to prepare for potential federal decisions that could impact the gains in coverage that California has made.
“We’ve made such progress, and it’s been incredible and hard-fought,” said Altman at Covered California. “Even through the pandemic and the Medi-Cal redeterminations we’re at the lowest uninsured rate on record. We’ve lowered our uninsured rate more than any other state in the nation.
“And so really it’s just thinking about…how do we keep moving forward on our mission, whether we have headwinds or tailwinds,” she said.
Supported by the California Health Care Foundation (CHCF), which works to ensure that people have access to the care they need, when they need it, at a price they can afford. Visit www.chcf.org to learn more.
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