A recently released report from the United States General Accounting Office (GAO) examined the relationship between treating undocumented aliens and hospitals’ costs not paid by patients or insurance.  Additionally, the GAO examined federal funding available to help hospitals offset costs of treating undocumented aliens and the responsibility of the Department of Homeland Security for covering medical expenses of sick or injured aliens discovered by Border Patrol and U.S. port-of-entry officials.

The GAO’s findings were inconclusive regarding an accurate measure of undocumented aliens’ impact on hospitals’ care costs not paid by patients or by insurance, because hospitals generally do not collect information on their patients’ immigration status.  Additionally, the GAO was unable to determine the effect of undocumented aliens on hospitals’ uncompensated care costs because of a low response rate to key survey questions and challenges in estimating the proportion of hospital care provided to undocumented aliens.

The GAO did determine that three federal funding sources have been available to help cover costs of treating undocumented aliens.  Medicaid covers emergency medical services for undocumented aliens who meet Medicaid eligibility requirements.  Medicaid disproportionate share hospital payments have provided supplemental payments to certain hospitals serving a larger number of low-income patients.  The Balanced Budget Act of 1997 made $100 million available to 12 states in fiscal years 1998 through 2001 for emergency services furnished to undocumented aliens. 

Additionally, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 was recently enacted and appropriated $1 billion over fiscal years 2005 through 2008 for payments to hospitals and other providers for emergency services provided to undocumented and certain other aliens.  Border Patrol officials reported to GAO that while the agency may cover medical expenses only for people in its custody, sick or injured people they encounter generally receive medical attention without being taken into custody.  In most situations, Homeland Security is not responsible for aliens’ hospital costs.

The GAO recommended that the Secretary of Health and Human Services develop appropriate internal controls to ensure payments are made only for emergency services for undocumented or certain other aliens that were not reimbursed.  The Centers for Medicare and Medicaid Services and Homeland Security agreed with the GAO’s recommendation.