Medicaid, CHIP enrollment could plummet if Trump administration finalizes 'public charge' rule

Medicaid
Ninety-four percent of nonresidents could be barred from permanent resident status for using public benefit programs, such as Medicaid. (Getty/juststock)

Between 2 and 5 million individuals could unenroll from Medicaid and the Children's Health Insurance Program (CHIP) if the Trump administration finalizes a rule prohibiting noncitizens who might use public benefits from becoming permanent residents, according to a new Kaiser Family Foundation (KFF) analysis.

If this happens, it could create ripple effects throughout the healthcare system and beyond, KFF wrote. And it could lead to financial repercussions for providers by increasing levels of uncompensated care.

Under the rule, the Department of Homeland Security (DHS) would consider a variety of factors to make a “public charge” determination when people apply for permanent residency. Factors that would work against an applicant include an income below 125% of the federal  poverty level, being in a household of three or more people, lacking private health insurance, not having a high school diploma and being currently enrolled in a public benefit program.

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At least one of these characteristics applies to nearly all immigrants (94%) who entered the U.S. without permanent residency. That also applies to 89% of native-born and naturalized American citizens. 

Bar chart results: 94%, household of three or more: 78%, no private health coverage: 59%, no high school diploma: 40%, family income below 125% FPL: 34%, unemployed: 31%, limited English: 27%, enrolled in public benefit: 26%

In addition, some groups are more likely to be subject to the rule than others: 65% are parents, and 59% are women.

RELATED: Study finds immigrants a source of profit for private insurers

This proposal would “likely” lead many people seeking lawful permanent resident status to forego or discontinue enrollment in Medicaid and other public programs, even among groups of immigrants (and American-born children of immigrants) not applying to change their immigration status, KFF said.

Immigrants often face poor health outcomes due to poverty, trauma, stress and limited access to care. By slashing healthcare coverage, as well as enrollment in nutrition programs like SNAP, the proposed rule would exacerbate these problems.

In fact, DHS itself noted that the rule would likely:

  • Worsen health outcomes particularly among pregnant or breastfeeding women, infants, and children,
  • Reduce prescription adherence,
  • Increase emergency room utilization due to delayed care,
  • Increase the prevalence of certain diseases,
  • Increase poverty and housing instability, and
  • Reduce productivity and educational attainment.

The rule would also negatively affect providers by reducing revenue and, by the same token, increasing uncompensated care.

RELATED: Hospital groups say 'public charge’ rule could drive up costs

Perhaps most surprisingly, however, is the extent to which it could affect the economy of entire communities. DHS said pharmacies, groceries, agricultural producers and other businesses could see drops in revenue as well, while costs would spike for organizations that provide services for immigrant families.