California exploiting Medicaid ‘loophole’ to pay for illegals’ health care: study
California is facing scrutiny for allegedly funneling billions of federal taxpayer dollars into paying for illegal immigrants’ health care, according to a new study conducted by the Economic Policy Innovation Center (EPIC) and the Paragon Health Institute. The study claims that California is exploiting a loophole in the law by using Medicaid provider taxes to fund health care programs for illegal immigrants.
The paper released by EPIC and the Paragon Health Institute estimates that nearly $4 billion in state funding is going toward illegal immigrants’ healthcare and other initiatives in California. However, this funding is actually coming from the federal government, as the state receives reimbursements from the federal government for Medicaid payments.
According to the study, states are required to pay Medicaid providers the same amount as taxes raised, and the federal government matches those payments by 60%. California has allegedly created a money laundering scheme that results in the state obtaining more than $19 billion in federal money without any state contribution over a certain period.
The funds obtained through this scheme have been used to implement major expansions in the Medicaid program to fund health care for illegal immigrants and long-term care for the wealthy, the study claims. This has raised concerns about enriching insurers, attracting illegal immigrants to the United States, and adding to the federal debt at the expense of working Americans.
EPIC President and CEO Paul Winfree suggested that closing the loophole that allows states like California to raise provider taxes significantly could save up to $630 billion. House Republicans are reportedly looking into this as they seek to find savings to offset the cost of President Donald Trump’s budget priorities.
The Energy and Commerce Committee is tasked with finding $880 billion in spending cuts, with a focus on rooting out waste, fraud, and abuse in federal programs like Medicaid and Medicare. Republicans have emphasized that they are looking to eliminate inefficiencies rather than cut essential services for Americans.
While the total elimination of the Medicaid provider tax loophole may be unlikely, reforming it could still potentially save billions in federal spending. California has yet to respond to requests for comment on the study’s findings.
As discussions continue on budget reconciliation and potential spending cuts, the issue of funding health care for illegal immigrants in California remains a contentious topic. The study’s claims have brought attention to the complex interplay between federal and state funding for Medicaid and the need for transparency and accountability in how taxpayer dollars are allocated.
