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CBO: Senate immigration bill would expand Obamacare

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If the Senate immigration bill becomes law, federal health care spending would increase by $112 billion over the next decade as more people take advantage of Medicaid, Medicare and subsidies from President Obama’s health care law, according to the Congressional Budget Office.

In a highly anticipated report, the CBO found that overall, the immigration bill would reduce deficits by $197 billion in the first decade and $700 billion in the following decade, based on the assumption that a flow of new tax revenue would more than offset increased spending on federal benefits and other provisions of the law.

That said, CBO noted that the current language in the bill leaves it unclear which  categories of immigrants would be eligible for various government benefits. Under CBO’s interpretation, passage of the bill would boost spending on subsidies to purchase health insurance on Obamacare’s health insurance exchanges by $82.3 billion from 2014 through 2023; increase Medicaid spending by 29.3 billion; and raise Medicare spending by $0.8 billion. In the second decade following passage, the law would increase federal spending on low-income health programs by $400 billion, according to the CBO.

By way of background, Obamacare extends eligibility to those “lawfully present” in the United States. Separately, the immigration bill would create a new legal status for currently illegal immigrants: Registered Provisional Immigrant. The authors specified that though those with new RPI status would become legal residents in general, they wouldn’t be considered “lawfully present” when it came to collecting subsidies to purchase insurance on Obamacare’s exchanges. However, the immigration bill would also increase the population of other categories of immigrants, such as lawful permanent residents and temporary workers in visa programs, and those groups would qualify for the exchange subsidies.

In an email, Sen. Marco Rubio’s spokesman Alex Conant pushed back against the idea that the immigration bill would expand Obamacare, noting that the bill made sure that those currently here illegally couldn’t qualify for Obamacare’s exchange subsidies once they obtained RPI status through the passage of the bill.

“The only way that someone could say we were ‘expanding’ Obamacare is because we are letting more people in under the new visas (H1B, W, etc),” Conant wrote. “But giving those people access to Obamacare is current law (something we are actively working to repeal).”

I have several issues with Conant’s point. One, it’s indisputable that if this immigration bill passes, the federal government will spend more on Obamacare than if it did not pass. Fundamentally, that’s why I think it’s fair to say the bill effectively represents an expansion. Even accepting Conant’s argument about the exchanges, however, it’s important to keep in mind that the exchanges aren’t the only component of Obamacare. Another major component is the expansion of Medicaid. And according to CBO assumptions, some currently illegal immigrants who obtain RPI status under the immigration bill would be able to receive Medicaid benefits. Furthermore, as I noted on Monday, the immigration bill has to be crafted under the assumption that Obamacare will remain the law of the land, not based on the aspiration that it will be fully repealed.

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