MN House Republicans move HF10 to eliminate taxpayer-funded programs for illegal immigrants
This week, the Minnesota House of Representatives’ Health Policy and Finance Committee passed legislation to roll back a new taxpayer-funded program to provide health insurance to illegal immigrants. Republican Rep. Isaac Schultz’s House File 10 eliminates state health care funding through Minnesota Care program to foreign nationals who lack legal status. The program to offer taxpayer-funded health care to illegal noncitizens was signed into law by Governor Tim Walz on June 5, 2023.
Minnesota House Republicans now enjoy a one-seat majority (at least until a special election on March 11), creating an opportunity to advance bills aimed at some of the most overreaching legislation passed in Governor Walz’s second term.
Offering taxpayer-funded health care to illegal immigrants has become a hot potato for Minnesota democrats stung by national voter opposition to sanctuary policies. Schultz’s bill could also become an opportunity for federal DOGE hawks who have begun circling above federal monies questionably spent by states, NGOs and foreign countries.
Rep. Schultz asked the committee, “Why should people who broke the law to come to the country illegally to benefit from our programs pay less than struggling families who are just trying to make ends meet?” In fact, most people on the program pay little or nothing. What began as a premium-supported health care fund for low-income Minnesotans thirty years ago, has (after federal Medicaid expansion) morphed into a multi-billion-dollar piggy bank called the Health Care Access Fund. Fed almost exclusively by a Minnesota-only “sick tax” and federal Medicaid funds, last year, premiums accounted for only $493,000 out of total expenditures of $1,897,567,000. That means 99.97% of the money spent from the HCAF[i] is non-premium revenue.
By law, Minnesota may not use any federal funds when paying for the health care of citizens who lack legal status. The federal component of the Health Care Access Fund is forecasted to decrease in FY26 and FY27[ii], putting additional pressure on the fund. The complicated mix of federal and state funds in this unusual program could draw DOGE curiosity to determine exactly how federal dollars are being segregated from the projected $100 million for illegal immigrant care. Some worry that this could risk conditionally granted federal waivers to provide care to those legally present in the state.
The potential for fraud seems obvious. From a January 2024 Minnesota Department of Human Services Bulletin “MNCare eligibility to include undocumented individuals:” the program not only welcomes illegal immigrants who attest to their unlawful status, but also appears to extend amnesty to those who have previously committed fraud. “When an enrollee who previously indicated that they are a U.S. citizen or lawfully present noncitizen, corrects or updates their information to indicate they are not considered lawfully present, the new attested information is not subject to verification. Eligibility must be redetermined and if eligible, the enrollee will qualify for state-funded MinnesotaCare with fee-for-service benefits delivery beginning the next available month.”
A long state history of comparatively generous entitlement programs, an ambitious governor and a rare break from divided government, aligned to allow this unlikely bill to pass.
In 2023, Minnesota Governor Tim Walz was building his national profile by enacting legislation that went too far for governors in most dark blue states. The traditionally purple voters in Minnesota gave Walz the narrowest of Democratic majorities (one seat in the Senate and six in the House) to push through his aggressive agenda that eliminated decades of bipartisan abortion restrictions, outlawed nonrenewable energy by 2040, legalized marijuana, and gave drivers licenses and taxpayer-funded health care to foreign nationals without legal status. Some democrats worried that the agenda would risk the tiny majorities. They proved to be correct.
“You win elections to burn political capital,” Walz said at a June 2023 bill signing. Burning too much apparently loses elections. Seventeen months later, voters rejected his Vice-Presidential bid as well as his party’s majority in the Minnesota House.
Bipartisan cooperation to correct overreaches like this will help rebuild and protect the state’s fragile health care system.
[i] https://mn.gov/mmb-stat/documents/budget/operating-budget/forecast/feb-2024/feb24-hcaf.pdf
HCAF budget tracking
[ii] https://mn.gov/mmb-stat/000/az/forecast/2024/budget-and-economic-forecast/november.pdf
November 2024 Minnesota forecast