Immigrants’ Premium Contributions Exceed Payer Spending on Care
Although immigrants and US-born citizens had similar premium contributions, payers spent 22.3 percent less on healthcare for immigrants than they did for US-born citizens.
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- Immigrants’ premium contributions in 2017 were $58.3 billion higher than what private insurers and public programs spent on their healthcare, suggesting that immigrants help subsidize the US healthcare financing system.
Despite their low rate of healthcare utilization, some people have voiced concern that immigrants are a burden to the US economy and the healthcare system. The study, published in JAMA Network Open, assessed immigrants’ financial contributions to US healthcare programs to determine the validity of those concerns.
Researchers used data from the 2017 Medical Expenditure Panel Survey (MEPS), the 2018 Current Population Survey (CPS), and American Community Survey data from 2014 to 2018 to assess third-party healthcare expenditures and premium contributions.
The final sample included 210,669 participants, 180,084 of whom responded to the 2018 CPS and 30,585 who responded to the 2017 MEPS. Among the 180,084 CPS respondents, 14.1 percent were immigrants. Almost 7 percent of the population were citizen immigrants, 3.7 percent were documented noncitizen immigrants, and 3.6 percent were undocumented immigrants.
Premium and tax contributions for immigrants and non-immigrants were similar to their proportion of the population. For example, immigrants paid 14.2 percent of total premiums and taxes for healthcare ($288.1 billion), while US-born citizens paid 85.5 percent ($1,741.2 billion).
Among immigrants, citizen immigrants contributed 8.2 percent ($165.9 billion), documented noncitizen immigrants contributed 2.8 percent ($57.7 billion), and undocumented immigrants paid 3.2 percent ($64.5 billion).
US-born citizens paid $67.2 billion less in premiums and taxes than healthcare insurers spent on their care in 2017, the study found. Meanwhile, immigrants spent $58.3 billion more in premiums and taxes than payers spent on their care. Undocumented immigrants accounted for 89 percent of this spending.
While immigrants and US-born citizens contributed similar amounts of premiums and taxes, third-party payers spent 22.3 percent less on care for immigrants than they did for US-born citizens.
Immigrants contributed $1,284 more per person than was paid on their behalf, with undocumented immigrants paying the most at $4,418 more per person. Documented noncitizen immigrants paid $175 more per person and citizen immigrants paid $197 more per person. On the other hand, US-born citizens incurred a negative contribution of $242 per person.
The study assessed premium contributions and healthcare expenditures for Medicare, Medicaid, and private insurers. US-born citizens contributed $19.2 billion less than what Medicare spent on their care, $13.7 billion less than what Medicaid paid, and $39.3 billion less than private insurers spent.
Immigrants contributed $13.7 billion more in premiums and taxes than Medicare spent on their care, $10.2 billion more than Medicaid spent, and $39.3 billion more than private insurers spent. Immigrants experienced a small deficit for uncompensated care of $4.9 billion.
Undocumented immigrants spent more on healthcare premiums than Medicare ($20.8 billion), Medicaid ($21.3 billion), and private payers ($14.7 billion) spent to care for them. Documented noncitizen immigrants spent $9.1 billion less than Medicaid spent and $9.2 billion more than private payers spent on their care.
Immigrants’ contributions to healthcare premiums and taxes exceeded third-party payer spending on their behalf every year from 2012 to 2016. Between 2012 and 2017, they paid $184.2 billion more than the costs incurred by payers for their care.
In contrast, US-born citizens paid $185.2 billion less on premiums and taxes than payers spent on their care.
“Immigrants’ substantial contributions to health care funding (despite their relatively low incomes) may be associated with their high labor force participation rate, particularly among men who have recently arrived in the US,” researchers wrote. “Hence, they and their employers (whose benefit payments are widely considered part of the employee’s earned compensation) contribute to health insurance premiums as well as payroll and other taxes.”
The findings suggest that the concerns about immigrants depleting healthcare resources may be unfounded, as immigrants help subsidize the healthcare financing system in the US with their premium contributions, the study concluded.
