The Department of Health and Human Services (HHS) has issued a notice of proposed rulemaking that removes an exception to the definition of “lawfully present” that would then serve to include in that term individuals who have obtained temporary immigration status under the Deferred Action for Childhood Arrivals (DACA) program.
The expansion of the the definition of “lawfully present” would allow DACA recipients as of November 1, 2023 to enroll in a qualified health plan (QHP) from a health insurance exchange as established by the Affordable Care Act. Additionally, the definition change would open up eligibility for DACA recipients to enroll in a Basic Health Program, or Medicaid and the Children’s Health Insurance Program (CHIP) in states that have elected to cover “lawfully residing” pregnant individuals and children.
Individuals would qualify for affordability programs
Under the proposed rule, HHS would also open up eligibility for the insurance affordability programs to DACA recipients. This would mean that DACA recipients would be considered “lawfully present” and thus eligible for premium tax credits, advanced payment of premium tax credits and cost sharing reductions.
Each of these affordability programs is statutorily mandated by the Affordable Care Act for individuals who are “legally present” in the country throughout the period of their enrollment and meet certain income requirements.
DACA recipients were carved out of rules originally
Under the Affordable Care Act, eligibility for a QHP, Basic Health Program or Medicaid and CHIP was afforded to non-citizens as long as they were “lawfully present” in categories set forth in HHS regulations.
The base regulations, codified at 45 C.F.R. § 152.2, detail a litany of individuals who are considered “lawfully present” for purposes of Affordable Care Act programs. However, Paragraph 8 of the definition of “lawfully present” in that section contains the following exception:
An individual with deferred action under the Department of Homeland Security’s deferred action for childhood arrivals process, as described in the Secretary of Homeland Security’s June 15, 2012, memorandum, shall not be considered to be lawfully present with respect to any of the above categories in paragraphs (1) through (7) of this definition.
Those regulations govern the implementation of the Pre-Existing Condition Insurance Plan, which was a temporary high-risk plan type that was originally created by the Affordable Care Act. However, the same definition is cross-referenced in the regulations governing QHPs and the Basic Health Program at 45 C.F.R. § 155.20 and 42 C.F.R. § 600.2 respectively, so the exception listed in Section 152.2 applies to those plan types as well.
In its proposed rulemaking, HHS is planning on moving the Section 152.2 definition (adjusted to include DACA recipients, along with some other technical changes) to the QHP regulations at Section 155.20 and then replacing the definitions in the Basic Health Program (Section 600.2) and the Pre-Existing Condition Insurance Plan (Section 152.2) with a cross-reference to the QHP definition.
Medicaid and CHIP carve out was through guidance
For Medicaid and CHIP, eligibility requirements are established under Section 214 of the Children’s Health Insurance Program Reauthorization Act of 2009. That section permits states to elect to extend Medicaid and CHIP coverage to individuals who “lawfully reside” in their states.
In August 2012, after the DACA program was announced by the Department of Homeland Security, the Centers for Medicare and Medicaid Services issued a State Health Official Letter, SHO #12-002 that provided guidance to state health officials and Medicaid directors about how DACA recipients should be treated for eligibility in those programs.
Under that guidance, DACA recipients were not considered eligible as individuals who “lawfully reside” in the state for purposes of Medicaid and CHIP eligibility. The new proposed rule from HHS changes that by adding a definition of “lawfully present” and “lawfully residing” that matches the QHP definition, and thus allows DACA recipients to be eligible for those programs. The new rules will place the new definitions in the Medicaid and CHIP rules at 42 C.F.R. § 435.4 and 42 C.F.R. § 457.20, respectively.
Rule will not result in status change for individuals
The HHS proposed rule is only to determine eligibility under these particular programs. The department clarifies that the definition of “lawfully present” does not, simply by the nature of its inclusion in this rule, apply to any other program.
Also, HHS makes clear that the “proposed rule would not provide any noncitizen relief or protection from removal, or convey any immigration status or other authority for a noncitizen to remain in the United States under existing immigration laws or to become eligible for any immigration benefit” that may be available through programs governed by the Department of Homeland Security and the Department of Justice.
Finally, HHS repeatedly emphasizes that the provisions of the rule are severable such that if a court finds that one aspect of the definitional change is invalid, the remainder of the proposed rule, if made final, would still stand.
Comments are due on the proposed rule by June 23, 2023.
Reed Smith will continue to track developments on this and other HHS and CMS regulations. Should you have any questions related to this proposed rule, or any other health care issues, please do not hesitate to reach out to the health care attorneys at Reed Smith.