Why California wants health insurance for undocumented immigrants

State lawmakers in California want a waiver on an Obamacare ban that prohibits undocumented immigrants from purchasing care on the exchanges.

California officials are petitioning the federal government to sign off on a plan that would allow an estimated 50,000 undocumented immigrants living there to buy health insurance through the state exchange.

Advocates of the plan, signed into law in June by California Gov. Jerry Brown, say that giving the undocumented access to preventative care will improve their health outcomes and reduce costs incurred in emergency rooms.

"Our entire community benefits when we ensure that everyone in California has access to comprehensive health coverage benefits,” wrote the state’s congressional delegation in a letter to the secretaries of Health and Human Services and the US Treasury, according to Talking Points Memo.

“Billions of dollars are spent every year on uncompensated care, providing health care services to the uninsured. Enrolling people in comprehensive coverage is not only a more humanitarian approach, it is also more cost effective," they wrote.

The plan would formalize a strategy already employed by states and counties across the country that have a large population of undocumented immigrants. In March, The Wall Street Journal noted that many such areas have instituted preventative care programs for the low-income uninsured that don’t ask about patients’ immigration status, with some county politicians calculating that such programs are both cheaper and more effective than leaving treatment for emergency rooms.

“If federal programs exclude people who live here and get sick here, then someone has to care for them,” said George Leventhal, a Democratic council member in suburban Montgomery County, Md., in an interview with the Journal. “We all pay anyway.”

The Affordable Care Act prohibits the undocumented from using exchanges to purchase healthcare – a feature of the law included as a concession to Congressional Republicans. It was a sticking point, anyway: In a widely publicized 2009 incident, Rep. Joe Wilson (R) of South Carolina interrupted President Obama during a health care policy speech to Congress, accusing him of lying about the prohibition.

But the Act allows states to apply for “innovation waivers” that exempt them from certain requirements, if they can prove that federal dollars won’t go toward funding the program. California state senator Ricardo Lara (D) told the Hill that state lawmakers had been engaged in discussion with Obama administration officials about such a waiver since July, adding that he was “very hopeful” about its prospects.

About a quarter of California’s immigrant population, or 2.7 million people, are undocumented. Community health care workers say the number who would take advantage of the waiver would probably be significantly smaller, in part because undocumented buyers wouldn’t be eligible for federal subsidies under the plan.

Critics of the health care law and conservative immigration activists are likely to see a waiver as one in a string of broken promises from the president on the health care law.  

Michael Cannon, health policy director at the Cato Institute, told The New York Times that the undocumented should be able to buy healthcare on the private market, but not on public exchanges.

“This certainly has the potential to become a welfare magnet,” he said. “You could easily imagine families with high medical expenses moving to California.”