Why Would Illegal Immigration Cost the US $2 Trillion in Medicaid?

Published on 9 October 2024 at 20:23


Illegal immigration is projected to have a hefty $2 trillion impact on Medicare spending under Kamala Harris' Medicare for All plan, as per a recent Tholos Foundation study.


The analysis highlights the significant pressure that Vice President Kamala Harris's amnesty initiative would impose on the Medicare system, particularly in relation to her own Medicare for All framework. This examination raises concerns about the sustainability and viability of such a comprehensive healthcare reform in the context of existing Medicare resources.

Despite her current stance, which may suggest a lack of support for Medicare for All, Harris has a documented history of advocating for this healthcare model. Americans for Tax Reform (ATR) has gathered numerous instances where she has expressed strong support for the initiative. Notably, she was the first senator to co-sponsor Senator Bernie Sanders' Medicare for All legislation, which proposes a more extensive approach to healthcare than many international models of socialized medicine.

The Sanders-Harris proposal diverges significantly from systems like Canada's, where approximately 30 percent of healthcare expenditures are covered by private insurance. In contrast, the Sanders-Harris plan envisions a system devoid of private insurance involvement. Harris's commitment to this vision was evident during her 2020 presidential campaign, where she developed her own version of Medicare for All, underscoring her dedication to this transformative healthcare agenda.

 Both Kamala Harris and her vice-presidential running mate, Tim Walz, have publicly endorsed the establishment of a pathway to citizenship for the estimated 11 to 12.5 million undocumented immigrants currently living in the United States. This support for immigration reform is part of a broader political agenda that seeks to address the status of these individuals, yet it raises significant concerns regarding the potential economic implications of such policies.

 The urgency of these proposals is underscored by the projected insolvency of Medicare by the year 2036, which could lead to severe consequences if implemented under a Harris-Walz administration. A recent study highlights that approximately 90 percent of undocumented immigrants are under the age of 55, suggesting that granting amnesty would substantially expand the pool of individuals eligible for Medicare benefits. The financial burden of this expansion is staggering, with estimates indicating that the cost for each undocumented immigrant receiving benefits over a decade could reach $163,650, culminating in a total expenditure of around $1.8 trillion for the first ten years alone.

 Furthermore, the introduction of a Medicare for All system would exacerbate these financial challenges, potentially adding an additional $2 trillion in costs over the same ten-year period. The implications of such socialized healthcare initiatives are particularly alarming in light of the current fiscal landscape, where the national debt has surpassed $35 trillion. With the U.S. government projected to incur over $1 trillion in interest payments by the end of this month, the strain on the economy could become untenable, raising critical questions about the sustainability of these proposed reforms.


Under Medicare for All, Americans would see an increase in taxes by $14.3 trillion. This would significantly impact taxpayers across the country.


Taxpayers would bear the burden of the additional expenses associated with the proposed amnesty. The Medicare for All initiative, which Kamala Harris supported during her tenure as a Senator, is projected to result in a tax increase of approximately $14.3 trillion over the next ten years. This translates to an average increase of around $26,000 per household annually. However, this substantial tax hike would only cover a small portion of the estimated $44 trillion required to implement a single-payer healthcare system.

According to Senator Sanders, individuals earning more than $29,000 annually would face higher tax obligations under the Medicare for All framework. This reality stands in stark contrast to Kamala Harris's commitment to refrain from raising taxes on anyone with an income below $400,000, thereby raising questions about the feasibility and integrity of such promises.

The array of proposed tax increases within the Sanders-Harris healthcare plan is extensive and alarming. Among the suggested measures are a new 4 percent payroll tax for employees, a 7 percent payroll tax for employers, the removal of health tax expenditures, the abolishment of Health Savings Accounts (HSAs), a staggering 70 percent tax rate on ordinary income and capital gains, and a 77 percent estate tax, among numerous other tax increases. These proposals reflect a significant shift in the tax landscape, raising concerns about their potential impact on the economy and individual taxpayers.


Implementing Medicare for All without proper cost controls could lead to unsustainable levels of government spending, potentially bankrupting the country.


The Tholos Foundation highlights various proposed reforms aimed at tackling immigration, Medicare, and fiscal challenges. One notable suggestion is the establishment of a robust federal spending cap, which would restrict annual expenditure increases to a rate that aligns with the combined growth of the population and inflation, akin to the framework established by Colorado’s Taxpayer’s Bill of Rights (TABOR).

Additionally, the analysis explores the possibility of instituting work requirements and the implementation of block grants for social welfare programs, which could significantly reshape the landscape of social assistance.


Expanding work requirements and providing block grants to states for government social programs, such as Medicaid, would enhance the economic contributions of both native-born and foreign-born recipients. The introduction of work requirements for these programs would promote greater self-sufficiency and diminish reliance on taxpayer-funded assistance.


The paper addresses the significance of the rule of law and the enforcement of existing border policies, alongside the topics of visa auctions and market-oriented immigration reform.


The advantages of immigration in terms of economic growth need to be weighed against immediate expenses and adherence to legal frameworks. As a sovereign nation, the United States has established borders and legal procedures for entry and citizenship. Although immigration can contribute to economic expansion, it is crucial to uphold the integrity of the legal system and prevent the encouragement of unlawful entry, as this not only jeopardizes the rule of law but also places a financial burden on taxpayers.


Milton Friedman famously asserted that it is impossible to maintain both unrestricted immigration and a welfare state concurrently. The implications of this statement are particularly relevant in the context of contemporary policy discussions surrounding initiatives such as Medicare for All and immigration amnesty. The financial burden of these proposals could amount to trillions of dollars for taxpayers, leading to severe economic repercussions. The combined fiscal impact of these measures could jeopardize the stability of the Medicare system, pushing it toward a state of collapse.

In light of these challenges, it is crucial to oppose such initiatives while simultaneously advocating for reforms that prioritize sustainable budgeting and adherence to the rule of law. The need for a balanced approach is paramount, as it ensures that any proposed changes do not compromise the integrity of essential services or the financial well-being of the nation. By focusing on responsible fiscal policies and maintaining a commitment to legal frameworks, we can work towards solutions that are both equitable and economically viable.




Thank you for your donation!



Add comment

Comments

There are no comments yet.