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A Bit More on Immigration and Health Reform

One other point on the issue of undocumented workers and health care insurance. The assumption here is that covering undocumented workers probably hurts documented workers. They pay more in taxes, say, or face more crowded emergency rooms.

But that misses something important. If you're an unskilled or semi-skilled native worker, the situation you should really fear is one in which employers need to provide health care for you but not the undocumented immigrants competing for the same job. That's a world in which the cost of your labor is far higher than the cost of an undocumented immigrant's labor. It makes you economically inefficient. It makes you less likely to get hired.

That's what we're seeing now. Undocumented workers use public insurance (think Medicaid, S-CHIP, etc) at pretty near the rate of documented workers. According to RAND data, it's eight percent for undocumented immigrants, 10 percent for documented immigrants, and 13 percent for native-born workers. Undocumented immigrants are already using public programs, in other words. Conversely, their rate of employer-provided insurance is much lower. Sixty percent of native-born workers report having employer-sponsored insurance, as do 43 percent of foreign-born workers. But only 22 percent of undocumented workers say the same. There are lots of reasons it's a bad idea for an employer to hire illegal workers (INS raids, say). But this is one of the reasons they do it anyway.

If you're really worried about the native-born workforce, what you want to do is minimize the differences in labor costs between different types of workers. A health care policy that enlarges those differences -- that makes documented workers more expensive compared to undocumented workers -- is actually worse for the documented workers. But that's a hard argument to make politically. So we're likely to see a debate where politicians brag about helping American workers by excluding illegal immigrants from health reform even as what they're actually doing is making illegal immigrants more economically competitive against native workers.

By Ezra Klein  |  May 18, 2009; 5:00 PM ET
Categories:  Health Reform  
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Came over here from Brad Delong's to check out your new dwellings. Hope you can bring the property values back up.

BTW, you may need to post a correction to a phrase in the fifth line of the third paragraph of this post. The phrase reads "13 percent for native-born immigrants". From elsewhere in the paragraph it's clear that you mean 'native-born workers'. 'Native-born immigrants' sounds like something out of Bush 43's mouth.


Posted by: wjlorente | May 18, 2009 5:23 PM | Report abuse

This is nitpicky, but the INS (Immigration and Naturalization Service) doesn't exist as a federal agency anymore. These days, workplace raids get conducted by Immigration and Customs Enforcement, or ICE. (The uptick in raids over the last few years is a result of this shuffle, but you already know all that.)

Posted by: DaraL | May 18, 2009 5:27 PM | Report abuse

FWIW, the overwhelming majority of undocumented workers using Medicaid are pregnant women delivering their children. Undocumented workers are typically not categorically eligible for any form of Medicaid. Nor are they eligible for Food Stamps, SSI, TANF...

Enforcement at the employer is the only way out of this situation. Whether we offer another amnesty program or not, as long as the undocumented worker is the low cost worker we have a problem. Ezra has pointed this out with regards to health care, but it includes everything we accept as part of employment in America: FICA, Workman's Comp, a safe work place.

Until we are willing to significantly punish employers for hiring an undocumented worker this will be a problem.

I would also like to point out the very significant issue of local health care costs. Our city and county health care systems bear much of the financial burden for the medically indigent, whether they are citizens or not. Texas offers a limited number of Medicaid programs and the local public sector is the last layer of the safety net. Harris County (Houston) has over a million residents who are uninsured and Harris County Hospital District is chartered to provide them care.

Posted by: Nat_51 | May 18, 2009 9:05 PM | Report abuse

The ONLY way an undocumented immigrant is eligible for any kind of public assistance is under the Emergency Medical Services for Aliens (EMSA) program. Even a woman delivering a child is not eligible unless the delivery is an emergency delivery - emergency being defined as life threatening to the mother.

It drives me crazy when people talk about undocumented immigrants sucking on the government tit. They get NADA.

Posted by: renegademom3 | May 18, 2009 9:26 PM | Report abuse

That's only true if you assume the people who care about these issues care about them because they're 'stealing' American jobs. If you assume that the bulk of these complaints stem largely from things such as bigotry, then the goals are completely different. I agree, from a policy perspective, you want to even the playing field as much as you can. However, when has the fringe right ever worried about the perspective of good policy?

Posted by: ryanstake | May 19, 2009 5:23 AM | Report abuse

Huh?....renegademom3 and ryanstake

Sacramento Cuts Free Health Care For Illegal Immigrants
Struggling with a $55 million budget deficit, a northern California county became the state’s first to eliminate free non-urgent health care for illegal immigrants and a civil rights group was quick to label the move unconstitutional.

Like many counties throughout California, Sacramento’s public clinics offer illegal aliens free medical care at an annual cost of millions of dollars. Sacramento County had five such clinics but two were closed as a result of the budget crunch and the remaining three will check for the immigration status of all patients.

The move, approved 3-2 by the Board of Supervisors, is expected to save the ailing county about $2.4 million dollars. With a population of around 1.4 million, Sacramento County is California’s prime agricultural region which for years has benefited from the cheap labor of illegal immigrants and lax enforcement of immigration laws.

A substantial chunk of the Golden State’s estimated 3 million illegal immigrants live in the region and benefit from the county’s 16 public school districts, generous medical care and an array of other taxpayer-financed benefits.

Providing free medical care for illegal immigrants has consistently been one of the state’s largest expenses, an annual cost of $775 million according to a recent news report which cited a legislative analysis. California also spends $4 billion a year to educate illegal aliens, $970 million to incarcerate them and about $500 million on other welfare benefits.

Posted by: Rainboskies | May 19, 2009 12:32 PM | Report abuse

Sorry, I left off the reference

Posted by: Rainboskies | May 19, 2009 12:47 PM | Report abuse

As someone else pointed out, the INS no longer exists. In fact, it hasn't existed for *six years*. Anyone who'd make that sort of mistake has no real clue about this issue, but that's something I've known about Ezra Klein for a while.

The policy Klein is promoting would provide yet another incentive for people to come here illegally. Those new illegal aliens (the correct, legal term) would swamp the system and eventually - after a great deal of trouble - show just how faulty's Ezra Klein's policy is.

The better solution is to provide only emergency services to illegal aliens, provide whatever health benefits only to citizens and perhaps legal immigrants, and at the same time simply enforce our laws to encourage current illegal aliens to return home over time. That is the only sensible solution if you want UHC. Anything other than that will completely fail sooner or later.

This Ezra Klein talking point is similar to another talking point that some recently have been trying to push:

Posted by: LonewackoDotCom | May 19, 2009 2:19 PM | Report abuse

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