President Biden’s proposal to offer public health insurance to DACA recipients

The Biden administration’s proposal to allow DACA recipients to obtain public health insurance would help reduce insurance and health disparities among Latinx Americans at a relatively reasonable cost, but would be politically divisive and would share the DACA program’s uncertain future in the courts, although it should not add to that uncertainty.

The Biden administration recently announced a proposal to allow people in the Deferred Action for Childhood Arrival (DACA) program to sign up for health insurance through Medicaid, the Children’s Health Insurance Program (CHIP), or the Affordable Care Act (ACA) marketplaces. DACA recipients are not currently eligible for those programs. About 580,000 people were in the DACA program at the end of 2022. A 2023 survey by the National Immigration Law Center estimated that 27 percent of DACA recipients did not have any health insurance; however, an analysis of 2022 Current Population Survey data by the Kaiser Family Foundation estimated a much higher uninsured rate of 47 percent. By comparison, the uninsured rate for native-born Americans is about 10 percent.

Immigrants must be “lawfully residing” or “lawfully present” in the United States to be eligible for Medicaid, CHIP, or the ACA marketplaces. Most immigrants who are not currently subject to removal from the United States by immigration authorities are considered to be lawfully in the country under Medicaid, CHIP, and the ACA, but DACA recipients are not. An ACA rule specifically excludes DACA recipients from the definition of “lawfully present.” Although no rule currently excludes DACA recipients from the definition of “lawfully residing” under Medicaid and CHIP, informal guidance from the Centers for Medicare & Medicaid Services (CMS) has excluded DACA recipients from those programs. The U.S. Department of Health and Human Services (HHS) plans to amend the rules to include DACA recipients. The Kaiser Family Foundation’s brief includes additional information on DACA and the Biden administration’s proposed rule.

Relevant research

People without health insurance are less likely to access health care and have worse health outcomes than similar people with insurance. A 2017 survey by the Kaiser Family Foundation found that, as compared with people with Medicaid or other public insurance, uninsured people were 167% more likely to postpone getting necessary care, 150% more likely to go without necessary care, and 36% more likely to postpone or go without needed prescription drugs. Similarly, a 2017 literature review in the New England Journal of Medicine concluded that expanded health insurance significantly increased “patients’ access to care and use of preventive care, primary care, chronic illness treatment, medications, and surgery” and produced “significant, multifaceted, and nuanced benefits to health.”

Of course, expanding public health insurance would also have economic consequences, but those consequences are more complicated to assess. In addition to the direct cost of covered care, expanding insurance increases the demand for health care, which can drive up costs. However, uninsured people are more likely to require emergency room care and other types of expensive, nonprimary care. Also, healthier people are more productive workers, resulting in higher incomes and increased tax revenues. The New England Journal of Medicine review concluded that expanding public health coverage generally costs money and cited an estimate that expanding Medicaid saved lives at an average cost of $327,000 to $867,000 per life saved. However, those conclusions were based on uninsured people generally. Immigrants are younger and healthier than the uninsured population as a whole; this is particularly true for DACA recipients, who are only 29 years old on average.  A 2018 review in the International Journal of Health Services concluded that both public and private insurance sources spent significantly less per capita on immigrants than on native-born Americans and that “immigrants almost certainly paid more toward medical expenses than they withdrew, providing a low-risk pool that subsidized the public and private health insurance markets.” Therefore, although the proposed rule would increase costs for federal and state governments under Medicaid and CHIP, those cost increases would likely be less per capita than for other Medicaid and CHIP expansions and there could actually be cost savings associated with insurance purchased by DACA recipients on the ACA marketplaces.

Public opinion

We did not find any national surveys on the question of providing public health insurance to DACA recipients. However, based on the results of other related surveys, it seems likely that a majority of Democrats would support the Biden administration’s proposal, while a majority of Republicans would oppose it. In a 2021 poll by the Cato Institute and YouGov, only 47 percent of Americans supported allowing immigrants to receive government financial assistance and services, including only 22 percent of Republicans; however, 70 percent of Democrats favored the idea. Similarly, a Pew Research Center poll conducted during the initial stage of the pandemic found that, while 68 percent of all Americans felt that the federal government had a responsibility to provide medical care to undocumented immigrants who were ill with coronavirus, only 47 percent of people who were or who leaned Republican agreed with that idea. If a majority of Republicans did not support providing medical care to undocumented immigrants during a national emergency, it seems unlikely that they would support the currently proposed rule. And a 2021 poll by the Public Policy Institute of California found that, while 66 percent of all Californians supported a proposal to provide state health care coverage for undocumented immigrants, only 20 percent of Republicans backed the idea. All of these polls suggest that support for the Biden administration’s proposal would be divided along party lines.

Equity considerations

Of course, DACA recipients differ from the general American public in some important ways. They are much younger than the typical American, with an average age of 29. And they are overwhelmingly Latinx: 81 percent were born in Mexico and another 15 percent were born in Central American or South American countries.

According to analysis by the Kaiser Family Foundation, 19% of nonelderly Hispanic Americans were uninsured in 2021. This was the second highest rate for any ethnic group and compared to uninsurance rates of 7% for nonelderly white Americans and 11% for nonelderly black Americans. Hispanics also have the highest rate of noncitizens among the uninsured; 48 percent of uninsured nonelderly Hispanic Americans were noncitizens, as compared with only 3 percent of uninsured nonelderly white Americans and 9 percent of uninsured nonelderly black Americans. The Biden administration’s proposal would help to address these disparities by providing expanded insurance options for the one-quarter to one-half of DACA recipients who are currently uninsured, representing 145,000 to 290,000 people.

Legal considerations

The entire DACA program has been subject to various legal challenges over the years. The Obama administration created DACA by executive action in 2012. It attempted to expand DACA by executive action in 2014 to (1) cover more childhood arrivals and (2) also cover some unlawfully present parents of U.S. citizens or legal permanent residents; the expanded program was referred to as DAPA. However, 27 states sued the Obama administration to invalidate DAPA and a federal district court issued an injunction in 2015 blocking implementation of DAPA due to failures to comply with required notice and comment procedures and conflicts with federal immigration law. The Obama administration appealed the district court’s injunction, but the Fifth Circuit Court of Appeals (by a 2 to 1 decision) and the Supreme Court (by a 4 to 4 decision) both affirmed the injunction. The Trump administration later rescinded DAPA, which prevented the need for a final decision on DAPA’s legality.

In 2018, nine states filed a similar lawsuit seeking to invalidate DACA. A federal district court held in 2021 that DACA is unlawful because it violates federal immigration law. In an attempt to save the program, the Biden administration went through the notice and comment procedure in 2022 to adopt a regulation codifying the program. In October 2022, the Fifth Circuit Court of Appeals affirmed the district court’s decision, but ordered the district court to review the new regulation to determine its effect on the litigation. Both the district court and the Court of Appeals stayed the effect of their decisions for people who were already in DACA; therefore, DACA remains in place for people admitted prior to July 16, 2021, but no people have been admitted since that date. The district court is currently following the Court of Appeal’s direction to consider the effects of the new regulation on the litigation. Its final decision in the case will again be subject to review by the Fifth Circuit Court of Appeals and the Supreme Court. DACA’s ultimate fate in the Supreme Court is uncertain; as noted above, the Court divided 4 to 4 when it affirmed the DAPA injunction in 2016 (there was a vacancy on the Court due to Justice Scalia’s death); however the Court invalidated an attempt by the Trump administration to end DACA in 2020 on technical grounds by a 5 to 4 vote, with Justice Roberts joining the four liberal justices at the time in that decision. Of course, the Court now has only three liberal justices, which could affect the ultimate outcome of the case.

If the Supreme Court invalidates the DACA program, the Biden administration’s proposed rule allowing DACA recipients to receive public health insurance would also be invalid; DACA recipients could not be “lawfully present” or “lawfully residing” in the country without the DACA program. If the Supreme Court upholds the DACA program, it seems likely that the proposed rule would also survive any independent legal challenges. Many other immigrants with similar legal status are already eligible for health insurance through Medicaid, CHIP, and the ACA marketplaces, including immigrants with Temporary Protected Status, immigrants with Deferred Enforced Departure, and immigrants with other types of deferred action status. As explained above, the rules excluding DACA recipients from these programs are not contained in legislation, but are in an administrative regulation and informal guidance from CMS. Therefore, the Biden administration should be able to modify those rules through new administrative regulations.

Conclusion

The Biden administration’s proposed rule would provide public health insurance options for the 145,000 to 290,000 DACA recipients who are currently uninsured. It would almost certainly be effective in significantly improving insurance, care, and health outcomes among this group. There would be significant costs associated with the additional Medicaid and CHIP enrollments, but those costs would likely be lower than for other Medicaid expansions and there could actually be cost savings associated with insurance purchased by these DACA recipients on the ACA marketplaces. Because DACA recipients are overwhelmingly Latinx, the proposed rule would reduce insurance and health disparities across race/ethnicity. The ultimate legal feasibility of the rule is uncertain, as the entire DACA program could soon be invalidated in the courts, but the proposed rule itself should not add any legal complications. However, there is almost certainly a partisan divide in public support for the proposed rule, with a solid majority of Republicans opposing it.

Our grades for the Biden administration’s proposed rule:

Effectiveness: A-

Equity: A

Legal Feasibility: B

Social Acceptability: C

Overall: B