Wall Street Journal
By Louise Radnofski
April 19, 2013
Immigrant advocates are upset with a health-care provision of the immigration-overhaul legislation that could force certain immigrants to pay a fee for lacking insurance coverage while excluding them from financial help to buy it.
The wrinkle could create the first class of Americans who would face the 2010 Affordable Care Act's penalties without having access to its main benefit. If passed into law, the immigration changes would apply to many of the 11 million immigrants living in the U.S. illegally who would have "provisional" status for a decade before becoming eligible for green cards.
Authors of the immigration legislation proposed earlier this week have included language barring people with "provisional" status from receiving federal means-tested benefits or tax subsidies that Americans will receive towards the cost of insurance premiums starting next year.
"That is a privilege that comes with citizenship, and to have people who aren't citizens be offered the benefits of citizenship would be a non-starter with the Congress," said Brian Rogers, a spokesman for Sen. John McCain (R., Ariz.), one of eight senators who worked on the legislation.
But people who gain provisional status and don't carry insurance would still have to pay a penalty that kicks in next year. That's because they will become lawfully present and required to file taxes in the U.S. before they receive green cards, said Sonal Ambegaokar, health-policy attorney for the National Immigration Law Center, which backs immigration changes to help people currently in the country illegally.
The penalty for not carrying insurance starts in 2014 at $95 a year or about 1% of a person's income, whichever is greater. It goes up in subsequent years and by 2016 will be $695 for each adult or as much as 2.5% of a person's income.
Debate over whether federal benefits should be given to people who have been in the country illegally became a hot-button issue in the fight over the passage of the 2010 Affordable Care Act.
That law specifically excludes unauthorized immigrants from using new insurance exchanges to shop for plans or apply for subsidies. Immigrants with provisional status are likely to be allowed to use the exchanges but cannot receive the subsidies.
Unauthorized immigrants will not have to pay a penalty if they do not have insurance, under rules from the Treasury Department released in January.
The National Immigration Law Center says excluding those with provisional status from insurance subsidies could harm efforts to integrate immigrants into mainstream American life and to curb the costs of care for uninsured people. Hospitals must give emergency treatment to people whether they have insurance or not. "We would rather they have a chance to pay for insurance that's affordable for them," said Ms. Ambegaokar.
The center, as well as other groups such as the National Council of La Raza, a civil-rights advocacy organization, is pushing for the bill to be changed so provisional immigrants have access to the tax subsidies. If they are not successful, advocates plan to ask for most of the immigrants to be exempted from penalties for lacking coverage alongside Americans who can show financial hardship.
The health law next year will make subsidies available on a sliding scale for Americans with incomes of up to four times the federal poverty level-currently $45,960 for a single person and $94,200 a year for a family of four. People with incomes below the federal poverty level may also be able to qualify for Medicaid in states that opt to expand the program.
Medicaid is open to some immigrants only after they have lived legally in the United States for at least five years. Under the bill, most adults with provisional status would wait a decade, and then another five years, before they became eligible for Medicaid.
The Treasury Department's rules currently say that people do not have to pay the penalty if they can show that it would cost them more than 8% of their income, after getting tax subsidies or help from their employer to buy insurance.
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