About 2,300 undocumented immigrants in California, also known as “Dreamers,” who were brought to the US as children, are set to lose their health insurance coverage at the end of the month. This decision was made by the federal Centers for Medicare and Medicaid Services, which oversees insurance marketplaces. Last year, the Biden administration allowed Dreamers to buy insurance through state and federally run marketplaces, but the Trump administration reversed this decision in June.
Covered California, the state’s health insurance marketplace, is working to notify all affected individuals that their coverage will end on August 31 and is helping them explore other insurance options. The Affordable Care Act has always barred immigrants living in the country illegally from purchasing health coverage on the marketplace, but Dreamers were an exception.
The decision to terminate coverage for Dreamers is “deeply unfair” according to Jessica Altman, the executive director at Covered California. Without access to the insurance marketplace, Dreamers will have to find coverage through an employer or, if their incomes are low enough, they may qualify for the state’s health insurance program for low-income people, Medi-Cal. This leaves freelancers and self-employed Dreamers in a difficult position if they earn too much to qualify for Medi-Cal but not enough to pay full price for a health plan.
Experts argue that eliminating coverage for young people, such as Dreamers, will actually increase premiums for everyone else. This is because younger and healthier people help balance the cost of covering sicker and older individuals. The federal government’s decision to cut coverage for Dreamers is expected to have a ripple effect on the insurance marketplace, potentially leading to higher premiums for all enrollees.
The Biden administration’s initial decision to insure Dreamers was met with resistance from red states, and a federal judge in North Dakota sided with the plaintiffs, stopping the rule from going into effect in 19 states. The new rule from the Centers for Medicare and Medicaid Services applies to all states, and DACA recipients are the first group of a larger number of immigrants who are expected to lose or drop marketplace coverage soon. The federal budget also eliminates marketplace financial assistance for some lawfully present immigrant groups, including refugees and asylees, starting in 2027. This could lead to many of these enrollees dropping their coverage due to unaffordability, and potentially increasing premiums for all Covered California enrollees by $101 a month starting next year.