Unauthorized Immigrants Prolong the Life of Medicare’s Trust Fund

By Leah Zallman MD, MPH, Fernando A. Wilson PhD, James P. Stimpson PhD, Adriana Bearse MS, Lisa Arsenault PhD, Blessing Dube MPH, David Himmelstein MD, Steffie Woolhandler MD, MPH
Journal of General Internal Medicine, June 18, 2015

Abstract

Background and Objective

Unauthorized immigrants seldom have access to public health insurance programs such as Medicare Part A, which pays hospitals and other health facilities and is funded through the Medicare Trust Fund.

Design and Main Measures

We tabulated annual and total Trust Fund contributions and withdrawals by unauthorized immigrants (i.e., outlays on their behalf) from 2000 to 2011 using the Current Population Survey and Medical Expenditure Panel Surveys. We estimated when the Trust Fund would be depleted if unauthorized immigrants had neither contributed to it nor withdrawn from it. We estimated Trust Fund surpluses by unauthorized immigrants if 10 % were to become authorized annually over the subsequent 7 years.

Key Results

From 2000 to 2011, unauthorized immigrants contributed $2.2 to $3.8 billion more than they withdrew annually (a total surplus of $35.1 billion). Had unauthorized immigrants neither contributed to nor withdrawn from the Trust Fund during those 11 years, it would become insolvent in 2029—1 year earlier than currently predicted. If 10 % of unauthorized immigrants became authorized annually for the subsequent 7 years, Trust Fund surpluses contributed by unauthorized immigrants would total $45.7 billion.

Conclusions

Unauthorized immigrants have prolonged the life of the Medicare Trust Fund. Policies that curtail the influx of unauthorized immigrants may accelerate the Trust Fund’s depletion.

http://link.springer.com/article/10.1007/s11606-015-3418-z?wt_mc=email.e…

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Unauthorized immigrants prolong the life of Medicare Trust Fund: JGIM study

PNHP, June 23, 2015

Unauthorized immigrants pay billions more into Medicare’s Hospital Insurance Trust Fund each year than they withdraw in health benefits, according to research from Harvard Medical School, the Institute for Community Health and the City University of New York School of Public Health at Hunter College.

In 2011 alone, unauthorized immigrants paid in $3.5 billion more than they utilized in care.  Unauthorized immigrants generated an average surplus of $316 per capita to the Trust Fund, while other Americans generated a deficit of $106 per capita. The authors conclude that reducing unauthorized immigration would worsen Medicare’s financial health.

Payroll taxes are the major revenue source for the Trust Fund, which mostly pays hospital bills. Unauthorized immigrants often pay these taxes, usually under a borrowed or invalid Social Security number. Unauthorized immigrants are mostly working age, have high rates of labor force participation, and hence contribute substantial payroll taxes. Medicare outlays for unauthorized immigrants are low because they are ineligible for Medicare benefits.

Senior author Dr. Steffie Woolhandler, professor of public health at City University of New York and lecturer in medicine at Harvard, said: “The numbers contradict the myth that unauthorized immigrants are a drain on the health system. Reducing immigration would worsen Medicare’s financial woes.”

http://www.pnhp.org/news/2015/june/unauthorized-immigrants-prolong-the-l…

Discussions of expanding health care coverage to everyone frequently result in expressions of concern about immigration policy. That unauthorized immigrants place a burden on our public resources has become a meme that is not substantiated in fact. This study adds to the evidence that unauthorized immigrants contribute more toward our public resources than they consume in benefits. Their contributions have reinforced our Medicare trust funds.

Under a single payer system, everyone is included. Studies such as this should allay fears that the nation cannot afford the costs of including unauthorized immigrants. Acknowledging that they are here and are important contributors to our economy should ease concerns about the need to move them from non-compliant use of Social Security numbers to a transparent system of accurate identification. Under single payer, they would openly contribute their equitable share to our pooled health care funds.

Everyone should have health care whenever needed. Let’s fix our system.