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Immigrants are net contributors to U.S. Medicare program : study

By Susan Heavey

WASHINGTON (Reuters) - Immigrants for years have paid far more into Medicare's coffers than they have pulled out, effectively subsidizing rising healthcare payments to the aging U.S. population, a study released on Wednesday showed.

The analysis from Harvard Medical School showed immigrants generated a $13.8 billion surplus for the U.S. government healthcare program for the elderly in 2009, the most recent figures available.

From 2002 through 2009 immigrants posted a Medicare surplus of $115 billion, while the American-born population logged a deficit of $28 billion in contributions.

The Harvard study was posted in the June issue of the medical journal "Health Affairs." It counters impressions that immigrants put a strain on healthcare resources.

A Reuters/Ipsos poll in February showed that more than half of U.S. citizens think most unauthorized immigrants should be deported. Opponents said the immigrants take Americans' jobs, drive down wages, and are a drain on benefits.

Researchers did not break down the Medicare contributions or use by legal and illegal immigrants and noted that the study may undercount contributions from so-called undocumented workers.

The Harvard researchers said their analysis offers the first look at immigrants' contributions to Medicare and thus the potential impact any changes to U.S. immigration policies could have on the nation's healthcare funding.

"Policies that reduce immigration would almost certainly weaken Medicare's financial health, while an increasing flow of immigrants might bolster its sustainability," they wrote.

U.S. officials estimate that funds for the insurance program will run out in 2024 as health costs for aging Americans surpass revenues. Immigrants, for now, are paying heavily into a system they are not yet using, the analysis said.

Immigrants are more likely to be younger and of working age than the U.S.-born Americans who make up the bulk of those aged 65 and older and are thus eligible for the Medicare program, which is funded through workers' payroll taxes.

Some immigrants might retire to their home country, or simply have less access to care, researchers said.

The analysis comes as lawmakers in Congress consider legislation to revamp the nation's immigration policy.

The legislation includes addressing the roughly 11 million immigrants now in the country illegally but also how to structure legal immigration, including rising demand for workers at technology companies.

The researchers said the results support the argument that immigrants are a key component to sustaining popular government benefits like Medicare.

The bipartisan plan moving through the Senate includes a path to citizenship for the millions of undocumented immigrants already in the United States to transition to legal residency and then obtain permanent resident status.

Critics of such a "pathway" say it would reward those who come into the country illegally and add to the burden on the government, which is already struggling to find its financial footing.

The Harvard-led team said the pathway would have a dual impact on Medicare funding: in the short-term it would likely boost payroll tax collections from working immigrants, but over time it could also increase the number of immigrants eligible for Medicare and thus the cost of the program.

For now, the benefits of having a younger pool of workers, including immigrants, outweigh the potential future payouts, they said. The first wave of baby boomers is becoming eligible for Medicare and the nation's low birth rate means there are fewer homegrown workers to pay for it.

(Reporting by Susan Heavey; editing by Ros Krasny and Jim Loney)

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