The Biden administration recently finalized a rule extending subsidized health coverage to approximately 100,000 people without health insurance who entered the United States illegally. These folks are part of the Deferred Action for Childhood Arrivals, or DACA, program — a group sometimes known as “dreamers.”
The new rule effectively rewrites substantive parts of Obamacare by executive decree. It’s hard to know what’s more troubling — that President Biden believes he can get away with such a flagrant violation of the Constitution, or that he actually might.
DACA is an Obama-era program established by executive action that enables people who came to the United States illegally as children to remain in the country temporarily without facing deportation. As the name implies, it “defers action” on these individuals’ immigration cases. It also authorizes them to work for renewable two-year periods.
DACA does not establish a pathway to U.S. citizenship. Dreamers are not citizens, so they’re not eligible for many federal benefits. The Affordable Care Act barred non-citizens from purchasing insurance coverage through the law’s exchanges. As such, non-citizens are also ineligible for federal tax credits that subsidize exchange coverage.
Changing the law should require an act of Congress — a body to which Biden hasn’t belonged since 2009. But a divided legislature is unlikely to do his bidding. So the Biden administration has resorted to rewriting his old boss’s eponymous law.
The president likely recognizes the egregiousness of his action — and has taken some steps to make it more palatable. In a clumsy bit of legal sleight of hand, for instance, the administration asserts that it’s not rewriting the law but “redefining” DACA enrollees as “lawfully present” for the purposes of buying coverage through the exchanges and receiving federal subsidies.
The irony, of course, is that DACA itself is not a product of law but of presidential decree.
Even putting these legal issues aside, the new rule remains misguided. The cost of exchange subsidies to taxpayers has surged in recent years.
The Inflation Reduction Act of 2022 made all Americans eligible for subsidized coverage, regardless of their income. Obamacare only subsidized coverage for those making less than 400% of the federal poverty level — nearly $125,000 for a family of four.
The IRA also capped premiums for everyone at 8.5% of income, with taxpayers picking up the rest. Those who make less than 400% of poverty cover even less of their premiums. And those with incomes below 150% of poverty — $46,800 for a family of four — are eligible for premium-free coverage.
These enhanced subsidies are slated to expire December 31, 2025. But Democrats are intent on extending them permanently.
According to a September 2023 Congressional Budget Office report, federal subsidies for the insurance exchanges are expected to reach $1.1 trillion between 2024 and 2033. Making 100,000 more people eligible for taxpayer-subsidized coverage will only increase that figure.
That level of spending simply isn’t sustainable. Nor would it be necessary if Obamacare’s insurance market regulations hadn’t outlawed bare-bones low-cost coverage and sent premiums and deductibles soaring.
Republican presidential candidate Donald Trump’s newly named running mate Sen. J.D. Vance, R-Ohio, has been one of the most vocal opponents of Obamacare for Dreamers. In 2023, he introduced legislation that would amend the Affordable Care Act to explicitly exclude DACA recipients from eligibility and bar the use of federal taxpayer dollars from subsidizing health coverage for illegal immigrants.
By sidestepping the legislative process, President Biden has forestalled the need to defend his DACA rule as both legal and prudent, much less desirable. Americans need practical healthcare reforms aimed at lowering costs and improving the quality of care. Biden’s vision for our health sector continues to fall tragically, embarrassingly short.
For him, there’s nothing wrong with Obamacare that more federal spending can’t fix. And if he needs to flout the law to keep that money flowing, so be it. Expanding federally subsidized exchange coverage to non-citizens is just one more step on the path toward a government-run, single-payer healthcare system.