California lawmakers are using a loophole in the Affordable Care Act (ACA) in an attempt to offer healthcare to illegal aliens. While the ACA expressly bans those living in the country illegally from applying for healthcare through the federal marketplace, it allows states to apply for an “innovation waiver” to expand coverage so long as they pay for any additional costs. The measure, which passed the legislature last week, awaits the governor’s signature before being sent to the amnesty-friendly Obama administration for final approval of the waiver request.
The bill’s sponsors estimate that approximately 390,000 of California’s more than 2.5 million illegal aliens would immediately become eligible to apply for healthcare through the state-run ACA marketplace.
What is still questionable is whether these immigrants will receive the same subsidies that citizens are given. Considering illegal alien households earn 28 percent less than American families on average, it is doubtful that many can afford full-price insurance. Given the California Legislature’s track record, it is likely that subsequent legislation would grant state assistance to illegal aliens who purchase insurance through the state-run exchange.
The average ACA subsidy doled out by the federal government amounts to approximately $3,300, which would make the price tag to cover illegal aliens approximately $1.3 billion annually. Because the law, known as SB 10, expressly prohibits illegal aliens from receiving federal subsidies to pay for healthcare under the state exchange, someone (California taxpayers, probably) will need to pick up the tab to make up the difference. Some estimates regarding the subsidy California provides to residents, especially for lower-income families, average closer to $5,200. This could raise the taxpayer burden to more than $2 billion annually.
Already bearing an oppressive debt load, Democratic governor Jerry Brown issued a press release last month admitting that the state is unable to cover its current commitments, much less pay off any of the $430 billion already owed to creditors. Covering the insurance bill for illegal aliens would further increase the high-tax state’s liabilities. The governor’s office already projects a $4 billion budget deficit by 2019.
In addition to creating a substantial amount of new debt, offering healthcare benefits to illegal aliens – subsidized or unsubsidized – only encourages more illegal immigration. Either way the taxpayer burden will become heavier in the future as projections are altered to incorporate a rising number of new beneficiaries.
For a state with a faltering economy, voluntarily aggravating the illegal alien problem is the exact opposite of sound policy. Undocumented immigrants already cost Californians $22 billion annually and it is projected that an additional $1.2 billion will be necessary to hire more than 17,000 bilingual teachers by 2018 to keep up with the influx of students with limited English proficiency. If these unsustainable costs remain unchecked, California will face an unprecedented economic disaster.