Sponsors of the healthcare reform bills in Congress have tried hard to steer the legislation around the hot-button issues of abortion and illegal immigration, but to no avail; controversies about both continue to threaten the measures. Supporters say the bills respect the government’s long-standing approach to abortion and undocumented immigrants; opponents, however, argue that the bills would flout current policy by allowing tax dollars to finance abortion on demand and nonemergency medical care for people who are here illegally.
These disputes aren’t really about what the federal government does with tax dollars, however. They’re about the indirect effects of that spending, and that’s an unreasonable standard.
Most of the spending in the House and Senate reform bills comes in the form of subsidies to help lower-income individuals and families buy health insurance. In a nod to current policy, the bills would bar insurers from using money from the subsidies they collect to pay for any abortions that would not be eligible for federal Medicaid dollars. (Eligibility is currently limited to cases of rape, incest or threats to the mother’s life.) The bills also would prohibit private insurers from being compelled to pay for any abortions as part of their basic insurance plans. On the other hand, the bills would allow people who receive subsidies to pay extra, if they choose to, for policies that cover elective abortions. And they would require insurance exchanges -- new markets to help individuals and small businesses shop for policies -- to offer at least one plan that covers abortions and one that does not. The “public option,” a government-run insurance plan that would be one of the choices available through the exchanges, would be required to cover abortions at least to the extent Medicaid does, although it also would have to assure that no federal subsidies directly financed elective abortions.
Opponents argue that those who receive subsidies should not be able to buy a policy that covers abortion, even if they pay extra out of their own pockets, because money is fungible. By subsidizing the purchase of basic health insurance, the government in effect makes the extra coverage more affordable. But that argument is not persuasive. Federal aid for any purpose frees up money for other uses, including those that the government may be barred from supporting. Should Congress not give tax credits to a publisher who sets up shop in a distressed community if it finds that he’s using the savings to start a religious broadcasting arm? Besides, the federal government already provides indirect aid for elective abortions by exempting employer-provided health benefits -- many of which cover abortions -- from income taxes.
Abortion opponents also argue that the public insurance plan shouldn’t cover elective abortions because its outlays technically are considered federal spending. That’s a semantic argument, though, and not a very good one. The plan would, in fact, be self-funded, covering its operations (and repaying the federal government for its start-up costs) entirely through the premiums it collects.
The real goal of abortion opponents isn’t to maintain the status quo. It’s to extend federal prohibitions into private pocketbooks. By restricting coverage offered through the exchange, they hope to make abortion coverage so unattractive that insurers eventually stop offering it in the market for individual and small-group policies.
As for illegal immigrants, the bills explicitly prohibit the government from providing insurance subsidies to anyone other than citizens and legal residents. They also call for the government to verify applicants’ qualifications by checking their personal income tax returns, a step that would help discourage fraud. Still, critics say the proposals should go further to assure that only qualified applicants obtain subsidies. The Senate Finance Committee’s bill and the Obama administration’s proposal would also bar illegal immigrants from buying individual health insurance policies through the new exchange with their own money, which the House bill (H.R. 3962) would allow.
Arguing in favor of more uninsured people is akin to lobbying for poorer public health and more crowded emergency rooms. Yet there’s something askew about the House’s approach to illegal immigrants. H.R. 3962 would require illegal immigrants to obtain health insurance, but with no subsidies available, families living near the poverty line would be hard-pressed to comply. The insurance mandate would be enforced through income-tax penalties, and the threat of those penalties could encourage lower-income illegals working on the books and paying taxes to vanish into the underground economy.
On the other hand, a sizable number of undocumented immigrants would be able to afford insurance; after all, a study by the Pew Hispanic Center found that the median income of unauthorized immigrants was $36,000 in 2007. The younger, healthier people in this group may choose not to obtain coverage, especially if they’re out of reach of the Internal Revenue Service. Those with preexisting conditions or declining health, however, would be strongly motivated to buy policies through the exchange, where insurers could not turn them away or charge them more based on their medical histories. So the likely effect of the bill would be to drive just the costliest illegal immigrants onto the insurance rolls.
The effect on other consumers would depend on how many undocumented immigrants signed up for policies and how much care they needed. Recent studies have shown that, as a group, immigrants tend to use healthcare services less than the average American. And illegal immigrants’ demand for policies is likely to be dampened by the high cost of insurance combined with the threat of exposure. Still, on this issue, the House bill doesn’t strike the right balance between promoting public health and controlling costs. Lawmakers should address that problem by finding better ways to prod younger and healthier people to buy coverage, rather than blocking all undocumented immigrants from obtaining it.