The Sinking Lifeboat: Uncontrolled Immigration and the U.S. Health Care System in 2009

Executive Summary

America’s health care system is in crisis: Costs and insurance premiums are skyrocketing and the number of the uninsured is rising rapidly as millions of Americans have lost their jobs. Providers are reducing staffing and services and increasing rates, and hospitals are closing or facing bankruptcy. Into this deteriorating situation, the Obama Administration is boldly striding in an effort to extend medical insurance more widely to the uninsured. A key issue is the cost of the expansion, and that cost will be greatly influenced by the amount of coverage that becomes available to immigrants, including illegal aliens and their children—a sizable portion of the uninsured. 

The President and members of Congress have spoken extensively about the crisis in health care, but what they have ignored is the role immigration has played in driving up the number of uninsured and the rising cost of health care for native-born Americans. 

As states grapple with current budget deficits, they are cutting their health care budgets to try to make ends meet. But they are limited by current legislation from making certain cutbacks in emergency medical care that would ease some of the strain that is caused by the high level of immigrant usage, especially by illegal aliens. 

What is most frustrating to the public, federal state and local governments refuse to collect the information that would expose just how expensive health care to immigrants actually is, and how the quality and availability of health care to American citizens is suffering because of it. 

Research data described in this report substantiate the following facts:

  • Between 1989 and 2007, immigrants and their U.S.-born children accounted for 71 percent of the increase in the uninsured. 
  • Today, more than one out of every four uninsured U.S. residents is an immigrant. 
  • There are 14.5 million immigrants and their U.S.-born children without health insurance, 32 percent of the uninsured. 
  • The foreign-born make up 27 percent of the uninsured population in the U.S. 
  • 48 percent of immigrants and their children are either uninsured or depend on Medicaid. 
  • Approximately 65 percent of illegal aliens in the U.S. are uninsured. 
  • In some hospitals, as much as two-thirds of total operating costs are for uncompensated care for illegal aliens. 
  • 425,000 births a year in the U.S.—more than 1 in every 10 births—is to an illegal alien mother. 
  • Although a national total of annual unreimbursed medical expenses for illegal aliens is not available, it is likely that those costs are more than $10.5 billion.

Federal laws requiring hospitals to treat anyone who enters an emergency room regardless of ability to pay have created an unfunded mandate. States and localities may not deny emergency care to the uninsured regardless of immigration status. The problem of emergency care has grown to enormous proportions because the lack of enforcement of federal laws against illegal immigration has led to a pool of 13 million illegal aliens in the U.S.—and state and local taxpayers are being forced to foot the bill. Although immigration law enforcement is a federal responsibility, most hospitals receive little or no reimbursement for the care to immigrants that the federal government mandates that they provide. Although there was legislation passed in 2005 to reimburse hospitals that provide emergency care for illegal aliens, the funds appropriated proved to be woefully inadequate, and that appropriation has since expired.

  • Lack of insurance leads many immigrants to use hospital emergency departments—the most expensive source of health care—as their primary care provider. This leads to overcrowded conditions for citizens who seek emergency care. Nationwide, emergency room visits increased by 36 percent from 1996 to 2006. The problem has become so out of control that Mexican ambulance companies are being allowed to drive uninsured patients across the U.S. border to receive free treatment.1 
  • Many illegal aliens are taking advantage of legislation that requires emergency rooms to treat all patients, regardless of ability or intent to pay for the treatment. The cost of uncompensated care to taxpayers and insured patients continues to rise. Uncompensated costs has caused some hospitals to reduce staff, increase rates, cut back services, and close maternity wards and trauma centers.

The escalating burden incurred by hospitals and other health facilities for the uncompensated treatment of aliens is driven both by rampant illegal immigration and a legal immigration system that allows large numbers of foreigners to gain legal residence despite the fact that they are unlikely to be working in jobs with health care coverage or have personal resources sufficient to pay for health services. They are currently ineligible for Medicaid for the first five years after admission, so they, like illegal aliens, may resort to using emergency rooms. Furthermore, the sponsorship requirement for legal immigrants—intended to prevent immigrants from being a burden on the American taxpayer—is simply not enforced by the federal government. 

The federal government had been providing a limited reimbursement of the outlays caused by uncompensated medical services provided to illegal aliens. Under Section 1011 of the Medicare Modernization Act (MMA), $1 billion was appropriated for distribution over the four-year period ending in fiscal year 2008. However, the $250 million annual distribution has not come close to meeting the costs, as will be shown. 

There is no current effort to reauthorize funds for the reimbursement of uncompensated care. The plan of the Obama Administration and the congressional leadership is to cover illegal aliens under a taxpayer funded health care plan. In its present form, the proposed health care reform legislation has no provisions that will prevent illegal aliens access to taxpayer funded health care. Congress so far has rejected provisions that would prevent those in the country illegally from being covered at public expense. 

Reversing the escalating burden of uncompensated health care for immigrants and illegal aliens will necessitate true immigration reform. That will include:

  • enforcing laws against illegal immigration 
  • reimbursing states and localities for the costs of failures in federal immigration policy, but conditioned on cooperation with federal efforts to combat illegal immigration; 
  • identifying foreign users of publicly funded medical treatment (and their immigration status); 
  • establishing guarantees of medical insurance prior to admission to the country; 
  • clarifying existing federal emergency service laws regarding the termination of a hospital’s obligation for continuing care after the provision of emergency treatment to stabilize the patient. 

It will also require a change in public officials’ mindset: Instead of shifting the burden to local taxpayers (often to those least able to pay when confronted with rising insurance premiums and medical bills), lawmakers must squarely face the consequences of immigration policy decisions. Our immigration system must be made consistent with U.S. national needs and priorities. 

Yet quite the opposite is occurring. At a time when the country is struggling to provide affordable care to millions of uninsured citizens, President Obama’s priorities include the permanent incorporation of the millions of illegal aliens currently in the country through an amnesty that he terms a “pathway to citizenship.” 

The full report is available in pdf format.