Editor's Note: In a new issue brief for the Robert Wood Johnson Foundation's State Health and Value Strategies program, Manatt Health provides an overview of the national immigrant health coverage landscape and offers considerations for policymakers related to state-funded affordable coverage programs for low-income individuals who do not qualify for subsidized health insurance under the Patient Protection and Affordable Care Act (ACA) or other public programs due to immigration status. The issue brief, summarized below, is the first release in a new series, "Supporting Health Equity and Affordable Health Coverage for Immigrant Populations." Click here to download a free copy of the full issue brief.

The crisis in immigrant health coverage has been both highlighted and exacerbated by the recent pandemic. COVID-19 has taken a heavy toll on immigrants, who are disproportionately frontline/service workers, making them particularly vulnerable to the virus. High rates of uninsurance among the nation's immigrant population are compounding COVID-19's impact. Immigrants (including "lawfully present" and undocumented individuals) make up 23 percent of the uninsured nationally.

Access to affordable health coverage and health care for immigrant populations in the U.S. is critical to advancing health equity and reducing health disparities. In recent months, many states and localities have focused on covering the remaining uninsured and providing access to health care as COVID-19 continues to surge. To cover low-income residents who are ineligible for subsidized health insurance under the ACA or through Medicaid/the Children's Health Insurance Program (CHIP), states are pursuing legislative or administrative actions to extend affordable health care coverage to all residents, regardless of immigration status, using state-only funds (state-funded affordable coverage programs).

Potential Eligibility for Federally Funded Coverage Programs Based on Immigration Status

An individual must be lawfully present (authorized to live in the U.S.) to be potentially eligible for federally funded health coverage programs. In general, lawfully present immigrants can purchase coverage through the Marketplace and access federal subsidies to offset the cost of that coverage. Only lawfully present immigrants with a "qualified" status can be eligible for Medicaid/CHIP, and some qualified immigrant populations must wait five years after obtaining lawful status before they can enroll in Medicaid/CHIP coverage, while others, such as refugees and victims of trafficking, are exempt from this "five-year bar." States also have the option under the Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA) to expand Medicaid coverage to lawfully present children and pregnant individuals, regardless of whether they are qualified.

In contrast, individuals who are undocumented and those with Deferred Action for Childhood Arrivals (DACA) status (Dreamers), among others, are ineligible for health insurance under the ACA (and are prohibited from purchasing Marketplace coverage even without subsidies), with the exception of temporary, limited-scope coverage for emergency services (emergency Medicaid). The uninsured immigrant population in the U.S. includes people who are eligible for health insurance under the ACA or other public programs but are not enrolled, as well as those who are ineligible for government-sponsored coverage due to citizenship status.

State-Funded Affordable Coverage Programs for Immigrants

States are relying on two predominant models to offer access to affordable coverage for immigrant populations that are ineligible for federally funded health coverage: (1) establishing state Medicaid/CHIP-equivalent or comparable programs; and (2) creating state premium or cost-sharing subsidies to enable individuals to purchase Marketplace coverage.

State coverage solutions for immigrants are being advanced primarily by leveraging state Medicaid/CHIP programs to provide access to coverage for children and adults. As of September 2021, six states (California, Illinois, Massachusetts, New York, Oregon, Washington) and the District of Columbia (D.C.) are implementing affordable Medicaid/CHIP-equivalent or comparable coverage programs subsidized through state funds for low-income children and adults who do not qualify for subsidized health insurance under the ACA or through other public programs like Medicaid/CHIP, including because of their immigration status.

Other states have established programs at the local level to achieve the same aim. Momentum appears to be growing, as several other states (e.g., Connecticut, New Jersey, Vermont) have recently enacted state budgets or passed legislation authorizing similar programs expected to take effect in 2022 or later. Generally, state and local policymakers are seeking to advance coverage solutions for immigrants in an effort to cover their remaining uninsured residents, who are disproportionately undocumented people.

State-Funded Affordable Coverage Programs for Immigrants: Considerations for Policymakers

The design and features of state-funded affordable coverage programs for people who do not qualify for subsidized Marketplace coverage under the ACA or other public programs due to their immigration status vary depending on the makeup of the state's uninsured population, policy objectives and available resources, among other factors. As noted above, two predominant models that states are relying on to offer access to affordable coverage for immigrant populations that are ineligible for federally funded health coverage are (1) establishing state Medicaid/CHIP-equivalent or comparable programs; and (2) creating state premium or cost-sharing subsidies to enable individuals to purchase Marketplace coverage. There are a variety of considerations related to opting for one model over the other, including availability of state funding, political and cultural considerations in the state, desire to align coverage to either Medicaid/CHIP or Marketplace coverage, and bandwidth of the state agency (Medicaid program, Department of Insurance or Marketplace) to implement the program.

Below are other key program design considerations related to state-funded affordable coverage program development.

Program Costs. Projected program expenditures differ depending on program eligibility (i.e., age and income level), take-up and, in the case of state programs that mirror Medicaid/CHIP-like benefits, generosity of benefits.

Eligibility and Enrollment. All states implementing state-funded affordable coverage programs for immigrants without access to subsidized health insurance coverage under the ACA or other public programs offer services for children and adolescents. California, Colorado, D.C., Illinois and New Mexico have or are developing initiatives that cover adults. Most states set income eligibility standards for their programs, sometimes paired with asset tests.

Communication and Outreach. Through their efforts to extend coverage to individuals ineligible for federally funded health insurance programs, regardless of immigration status, states have learned that addressing systemic barriers to enrollment requires targeted, community-based outreach paired with investment. Combining community-based outreach with investment is particularly important in light of enrollment barriers and reluctance to engage with the state for fear about the potential impact on immigration status.

Cost-Sharing. Among the states with Medicaid/CHIP-equivalent or comparable state-funded affordable coverage programs that impose copayments and/or premiums, most use a tiered structure based on household income and family size. A few states do not require cost-sharing in their programs at all. While cost-sharing creates hurdles to equitable health coverage for low-income individuals, imposing copayments and premiums on higher-income enrollees may be appropriate (e.g., for people with incomes above 400 percent of the FPL in states that do not have income limits).

Benefits. To ensure access to comprehensive health coverage for all, several states align benefits in state-funded affordable coverage programs for immigrants to their Medicaid state plan benefits. Other states limit the scope of benefits in these programs (e.g., to primary care, preventive services) and/or impose service limits (e.g., dental care up to $1,000 per year, up to 20 behavioral health outpatient visits per year). In the case of states pursuing state premium subsidy programs, individuals will likely have access to individual market coverage that provides access to Essential Health Benefits (EHBs), though states can opt to provide less robust (and therefore less costly) coverage that does not meet ACA qualified health plan (QHP) standards.

Financing. The influx of federal stimulus dollars, and American Rescue Plan Act (ARP) funding in particular, has provided substantial relief to state budgets, likely contributing to lawmakers' ability to finance and garner support for state-funded affordable coverage programs. States standing up coverage for their residents without access to subsidized coverage due to their immigration status are financing these programs using state general funds, including funds generated through health insurance premium taxes, other provider taxes, tobacco taxes and disease management program savings.

Conclusion

Extending state-funded coverage to low-income children and adults who do not qualify for subsidized health insurance under the ACA or through Medicaid/CHIP due to their immigration status has long been a strategy available to states, and the significant burden that COVID-19 has placed on immigrant populations has catalyzed further action. As the immigrant population grows at a rapid pace, states have an imperative to address persisting structural racism that impacts the health of immigrants, by closing the gap in coverage and better integrating immigrant families into the health care system.

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