21,000 undocumented Coloradans could lose Medicaid coverage under Trump tax bill

More than 21,000 undocumented people in Colorado could lose Medicaid coverage if the Republicans’ bill to extend 2017 tax cuts makes it through the final gauntlet in Congress.

H.R. 1, the legislation formerly known as the One Big Beautiful Bill Act, has a provision that would penalize states such as Colorado that use their own funds to cover undocumented people. Colorado covers any undocumented children who sign up for Medicaid, but restricts coverage for adults to pregnant and postpartum women.

The bill would reduce the federal government’s share of the costs for what’s known as the expansion population — adult citizens who earn up to 138% of the poverty line and don’t qualify for Medicaid because of pregnancy or a disability — from 90% to 80%, forcing states to either come up with millions to cover that population or to stop insuring undocumented people.

Colorado could lose about $300 million in federal funding annually if the federal government reduced its share, Gov. Jared Polis said.

The state faces a $700 million budget hole next year and recently announced it would lay off 11 people in the health department if it couldn’t regain a $1.9 million federal grant — meaning it would be fiscally almost impossible to accept a loss of hundreds of millions, even if lawmakers want to continue covering undocumented people.

The Congressional Budget Office estimated about 11.8 million people would lose coverage and the federal government would spend about $1.1 trillion less on health insurance programs if the bill passes in its current form, with the vast majority of cuts coming from Medicaid. At the same time, the bill would increase the deficit by about $3.3 trillion because of tax cuts and increased spending on other priorities.

The House and Senate passed different versions, with deeper cuts in the Senate. Either the House can accept the Senate’s version, or a negotiating committee can come up with a compromise bill that both chambers will put to a vote. President Donald Trump has said he wants the bill enacting much of his policy agenda on his desk by Friday.

The Colorado Department of Health Care Policy and Financing reported 21,261 undocumented people had Medicaid coverage as of June 22.

More than three-quarters were children, with the rest qualifying because they were pregnant or in the postpartum period. A department spokesman said they will release the cost of insuring the group in July or August, after compiling numbers from the fiscal year that ended June 30.

The bill in Congress also would narrow the group of immigrants with legal status who can receive tax credits to purchase health insurance on the federal marketplace.

Federal law prohibits low-income immigrants from enrolling in Medicaid if they’ve lived in the country for less than five years, but has allowed them to qualify for subsidies to buy insurance.

Only permanent residents (those with so-called green cards), certain Cuban and Haitian immigrants, and people from countries in the Compact of Free Association, such as Palau and the Marshall Islands, would qualify.

The Trump administration also announced on June 20 that it would no longer allow undocumented people who entered the country as children, or “Dreamers,” to purchase coverage on the marketplace.

Connect for Health Colorado estimated that about 6,000 people in the state would likely lose marketplace coverage if the bill passes. They wouldn’t qualify for any programs offering insurance, but could receive some help through a state law requiring hospitals to offer discounted care to people with low incomes, or through limited programs covering services such as family planning, a spokeswoman said.

Three of Colorado’s four Republican members of Congress — Rep. Gabe Evans, Rep. Lauren Boebert and Rep. Jeff Crank — signed a letter to Polis urging the state to end its coverage of undocumented people. Rep. Jeff Hurd, a Republican who represents much of western and southern Colorado, was the exception.

In the letter, they said that covering undocumented people would take benefits from “those who need it most,” especially if the bill in Congress reduces federal payments to the state.

“We stand united in the common cause of protecting Medicaid for generations to come by ensuring only lawful beneficiaries can access this critical program,” the letter said.

Most Medicaid services are mandated by law, meaning the state has no choice but to pay for care that children, pregnant women and other qualifying people need, even if it would prefer to redirect that money. The most significant exception is “waiver” services provided to help people with disabilities stay in their homes.

Raquel Lane-Arellano, communications manager at the Colorado Immigrant Rights Coalition, said taking coverage from immigrants is “short-sighted,” especially since all states have to cover care for undocumented people through “emergency Medicaid.”

That program pays for labor and delivery, dialysis for people with end-stage kidney disease and emergencies that could kill someone or cause them to lose a limb.

For example, if an undocumented woman with a low income arrived at a hospital in labor, emergency Medicaid would cover the delivery, but not any follow-up care she might need. (The baby would be eligible for full Medicaid coverage, having been born in the United States.)

Covering a delivery, but not the prenatal care needed to give a baby the best chance of being healthy, doesn’t make sense, Lane-Arellano said. Undocumented people do important jobs, which they won’t be able to do if they get sick from lack of care, she said.

“We know that preventive care is the most effective way to cover our communities, and to take that away seems cruel,” she said.

Dr. P.J. Parmar, who runs a clinic primarily treating refugees at Mango House in Aurora, said he worries less about the state dropping undocumented people from coverage than about overall budget cuts to Medicaid.

Refugees qualify for Medicaid without the five-year waiting period, and relatively few undocumented people have the wherewithal to get through the process of signing up for Medicaid or the individual marketplace, he said.

“Though Colorado tries and gets points for trying, we don’t cover many undocumented people,” he said.

Jim Garcia, CEO of Tepeyac Community Health Center in Denver’s Elyria-Swansea neighborhood, said he doesn’t know how many patients might become uninsured, because they don’t ask about immigration status when providing care.

But any reduction in Medicaid revenue would be a problem, he said. The organization had to lay off medical and dental providers at the end of the COVID-19 public health emergency, when about 537,000 people lost Medicaid coverage. Some have regained it since.

Tepeyac is trying to bring in more patients with private insurance and to attract more philanthropists interested in health care for low-income communities, but Medicaid will remain the centerpiece of its model for the foreseeable future, he said.

“That’s not going to be enough (to avoid cuts) if we’re talking about a major reduction in Medicaid,” he said.

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