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Fact check: What are the estimated costs of providing universal healthcare to all residents, including undocumented immigrants, in the US?
Executive Summary
Major studies and reviews disagree on whether a universal U.S. system that includes undocumented immigrants would raise or lower total spending; most academic modeling finds net savings driven by administrative simplification, while government analysis finds large federal budgetary increases even if national spending could fall or remain similar [1] [2] [3]. Recent literature focused on undocumented populations documents access gaps and state-level patchworks but does not produce a definitive dollar estimate for the incremental cost of covering all residents, including undocumented immigrants [4] [5] [6] [7].
1. Why estimates diverge: bureaucracy versus budgetary framing that sparks debate
Estimates split along analytical choices: academic and advocacy-led microsimulations emphasize administrative savings and lower provider prices under single-payer or a National Health Program, projecting modest percentage reductions in total national health expenditures and sizable lives saved [2] [1]. In contrast, federal-budget–centered analyses by bodies like the Congressional Budget Office present the same reforms as large increases in federal outlays because they count existing private spending shifting onto public budgets even when total national spending might fall [3]. This methodological framing—national spending vs. federal budget—explains most headline disagreements.
2. What peer-reviewed modeling actually finds about total costs
Multiple systematic reviews and modeling studies from 2020–2024 show a consistent pattern: most economic models predict net savings to the health system within a few years, primarily from sharply lower administrative costs and simplified payment systems, with median first-year savings around a few percent of total health spending [1]. One microsimulation projecting a National Health Program estimated health service use would rise by 14.6 percent while overall costs would fall about 2.4 percent (roughly $10.2 billion annually in that model), highlighting trade-offs between utilization increases and system-wide efficiencies [2].
3. Why the CBO’s federal-budget view shows huge headline costs
The CBO’s analysis emphasizes fiscal flows: converting private insurance to a Medicare-style public payment system would shift trillions from private premiums and employer contributions into federal subsidies, producing projected federal subsidy increases of $1.5–$3.0 trillion in their 2030 scenarios even while national health expenditures could fall modestly or rise slightly [3]. This produces politically salient figures that can be framed as either a necessary public investment or as dramatically higher federal spending depending on the speaker’s objective. The divergent conclusions reflect legitimate but different policy accounting priorities.
4. The evidence gap on undocumented immigrants specifically
Recent reviews and health-access studies focused on undocumented residents highlight substantial barriers to care, emergency-only coverage, and geographic disparities, but they explicitly do not provide comprehensive national cost estimates for including undocumented immigrants in universal coverage [4] [5] [6]. State-level programs and Emergency Medicaid create complex partial coverages, and the literature calls for targeted modeling rather than extrapolating from general single-payer estimates because utilization patterns, demographic composition, and legal eligibility differ from the insured population [5].
5. What plausible scenarios imply about incremental costs of including undocumented residents
Because existing system-level models that predict system savings already assume broad enrollment increases, including undocumented residents would raise utilization but likely represent a small share of total national spending, given the population’s size relative to the U.S. and current per-capita health spending. However, no cited study in the recent literature provides a single authoritative dollar figure for the incremental cost; the magnitude will depend on benefit generosity, provider payment rates, and whether coverage replaces emergency-only spending [2] [7].
6. Political and analytical agendas shaping results and headlines
Academic studies emphasizing savings often come from researchers focused on system design and public-health benefits and prioritize long-term total-cost comparisons, while government budget analyses emphasize near-term federal fiscal impacts and program financing choices [1] [3]. Reports on access problems for undocumented immigrants typically aim to document health inequities and policy gaps rather than cost accounting, so readers should treat each analysis as serving different, sometimes competing, decision-making questions [4] [6].
7. Bottom line for policymakers and analysts who need numbers
If you require a working estimate for policy design, use both types of analysis: model national health-expenditure impacts to assess system efficiency and public-health gains, and separately model federal budgetary flows to plan financing. The existing literature supports two robust facts: single-payer-style reforms frequently produce projected system-wide savings through administrative simplification, but shifting to public financing increases federal outlays by the trillions depending on scope, and the incremental cost of adding undocumented residents is recognized as nontrivial but not explicitly quantified in recent peer-reviewed literature [2] [1] [3] [5].