Feds Would Likely Foot The Bill For Undocumented Health Coverage. Albany Has Days to Act.

A new letter from the federal government is energizing a push to expand health insurance for undocumented New Yorkers, but time is running out.

Sam Mellins   ·   June 7, 2023
A picture of Joe Biden with a thumbs up
President Joe Biden joins Governor Kathy Hochul on May 10, 2023 in Valhalla, New York. | Mike Groll/Office of Governor Kathy Hochul

With just days to go before they return home for the rest of the year, state lawmakers are mounting a final push for a bill that would allow New York to expand health insurance coverage for undocumented residents. A new letter from the federal government is energizing the effort — but it’s not clear whether the legislature will act before time runs out.

For years, immigrant advocates have sought to expand coverage for undocumented people, and they’ve been successful in a host of other states. Last year, Hochul promised to seek federal funds for the idea, but subsequently backtracked, citing uncertainties about how much it would cost and whether federal law would permit it.

A recent letter from the federal government suggests that federal law isn’t an obstacle, and that New York could get DC to cover the cost. In a June 6 letter to Senator Gustavo Rivera, Chiquita Brooks-LaSure, who directs the Centers for Medicare and Medicaid Services, said that New York could use a provision of the Affordable Care Act to request federal dollars to fund the expansion. Colorado and Washington have already used this provision, known as section 1332, to create coverage options for undocumented residents, the letter noted.

In May, the Hochul administration asked to use section 1332 to get more New Yorkers enrolled in a state-funded insurance program known as the Essential Plan, which currently provides low-cost coverage for nearly 1.2 million New Yorkers. The change Hochul requested would add about 20,000 people to the plan by expanding income eligibility from 200 percent of the federal poverty level to 250 percent. Both houses of the legislature sought to include undocumented immigrants in the expansion, but the Hochul administration blocked the initiative.

A bill sponsored by Rivera, known by its supporters as Coverage for All, would make undocumented immigrants eligible for inclusion. If the legislature passes the bill, the Hochul administration could amend its pending funding request to include undocumented immigrants. That would lead to about 50,000 people gaining health insurance, according to an estimate in a report prepared last year by two think tanks, the fiscally conservative Citizens Budget Commission and the liberal Community Service Society.

Rivera and Assemblymember Jessica González-Rojas, the lead Assembly sponsor of the bill, urged the legislature to act in the wake of the letter.

“Given the federal government’s clear guidance, it is essential that we pass our Coverage 4 All bill before the end of the legislative session,” they said in a joint statement. “The passage of this bill will secure quality and affordable healthcare coverage for thousands of New Yorkers at no cost to the state.”

With this year’s legislative session set to end this week, time is of the essence.

“It’s quite urgent for the legislature to act this week, because then there’s clear direction to the executive,” said Elisabeth Benjamin, vice president of health initiatives at the Community Service Society.

Senate and Assembly leadership did not respond to requests for comment on whether they plan to bring the bill to a vote. “I am confident that the Senate Democratic Conference recognizes the urgency of passing this critical bill,” Rivera said in a statement to New York Focus.

If the legislature doesn’t act on the bill before the session ends, it could still take it up next year. But that would mean a delay of months, if not longer, before undocumented New Yorkers get coverage. The Hochul administration is seeking to implement the income eligibility expansion it requested at the beginning of 2024. If the request is changed to include undocumented immigrants, their coverage could kick in at the same time. If not, New York would need to submit a new request and again seek approval from the federal government, generally a months-long process.

Hochul’s office did not respond to a request for comment.

The Hochul administration has repeatedly cited cost concerns as a reason for not including undocumented immigrants, saying that if enrollment exceeds expectations, the state could be stuck with the cost. Benjamin said that this problem could be avoided by limiting the number of immigrants who can enroll. “There’s no entitlement to Essential Plan coverage,” she said. “Put a cap of 50,000, put a cap of 75,000.”

Benjamin also said that the federal government’s letter should negate concerns about the expansion’s cost. “The Hochul administration said they wanted federal support for covering immigrants. Well now they have their answer. There’s funding,” she said. “All they have to do is amend that 1332 waiver.”

This story was updated with a statement from Senator Gustavo Rivera.

Sam Mellins is senior reporter at New York Focus, which he has been a part of since launch day. His reporting has also appeared in The San Francisco Chronicle, The Intercept, THE CITY, and The Nation. 
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