Is Care for Illegal Immigrants Too Costly?

Whether you are a progressive or a fiscal conservative, there is a simple truth that we can all agree on: there are limited resources.  That is why there is an energized debate about caring for undocumented immigrants who have limited legal standing. Common sense suggests that these people should be relegated to the last place in line for health care, but, in reality, there are some compelling reasons why they should be provided with at least basic health care.

It is estimated that there are about 3.9 million uninsured, illegal immigrants in the country.  Each year, these illegal residents consume almost $4.6 billion in health services annually that are funded by federal taxes, $2.8 billion worth funded by state and local taxes, $3 billion worth by hospitals and $1.5 billion in charity services.  Unauthorized immigrants also benefit from $0.9 billion federal subsidies for nonprofit hospitals and $5.7 billion from the employer tax exclusion.

In total, illegal immigrants obtain almost $18 billion in health care services annually that could be spent on pressing public health issues like the opioid crisis or mental health services. Although current laws prohibit the use of federal tax dollars for illegal immigrant health care, almost $11 billion is spent on just that through a variety of governmental channels.

American taxpayers are not only responsible for the tax burden imposed by these additional, uninsured consumers, but also pay in terms of higher health care costs.  If hospitals are saddled with unrecoverable debts, they typically employ dynamic cost shifting to insured patients in an effort to recoup some or all of those unpaid amounts.

Eighteen billion dollars may seem like a relatively minor sum considering that the federal budget for 2017 was $4.1 trillion, and the national debt is $13.6 trillion, but there is a strong argument for fiscal responsibility. Our rapidly ballooning national debt could quickly tip over into unsustainability during a major panic or extended economic downturn. Small steps like limiting funding for the care of undocumented immigrants could help stave off a financial disaster.

On the other hand, it is unlikely that ignoring the problem of ailing residents is likely to improve the situation. Although almost 4 million illegal aliens are uninsured, the vast majority—7.7 million—are covered through a public or private insurer.  Eventually, many of the undocumented are going to seek treatment for a health issue, most likely via an expensive emergency room visit.

It may clash with the views of many Americans, but it may be wiser to allow undocumented aliens to purchase health coverage and have them pay into the insurance pool.  In terms of public health resources, it is more prudent to manage these health conditions when they are still developing and relatively inexpensive, than to allow them to grow into life-threatening issues that are extremely costly to treat.

That is not say that taxpayers should pay for this coverage.  However, as long as it is a legal responsibility for hospitals to treat medical emergencies, it is inevitable that taxpayers will shoulder at least some of this financial burden.