The CMS on Friday told states on Friday they can count the assets and income of the sponsors of legal immigrants when they're determining whether the immigrants qualify for Medicaid or Children's Health Insurance coverage.
If states don't like the methodologies suggested by the CMS, they can come up with an alternative but will need agency approval.
The guidance is part of the broader White House immigration policy strategy and tighter restrictions on legal immigrants who apply for public benefit programs. The most recent and controversial policy from the Trump administration on this front was the so-called "public charge" rule from earlier this month, which allows federal immigration officials to look at legal immigrants' use of public programs as a negative factor in applications for permanent legal residency.
This particular guidance refers to the 1965 Immigration and Nationality Act, and follows a May memo from President Donald Trump that specifically addressed enforcing "legal responsibilities of sponsors of aliens" for healthcare coverage decisions. In that memo, the president directed HHS to "take steps necessary to ensure compliance with requirements" of federal statute including the Immigration and Nationality Act.
Under one provision, the CMS says that sponsors of immigrants must reimburse state agencies for the cost of "most means-tested public benefits" when asked, with some exceptions.
This could put family members who sponsor relatives, or any group that sponsors legal immigrants, on the hook for all their medical bills. Stan Dorn of the Washington advocacy group Families USA predicted that this would have a severe chilling effect on anyone willing to step up as a sponsor, given the financial risk of healthcare costs.
"No church, no synagogue will ever again sponsor people fleeing oppression from abroad, out of fear they will go bankrupt," he said. "Kindhearted American citizens who want to help out a citizen coming from another country will risk the loss of their entire life savings."
In another provision, the CMS said that states must deny or terminate a legal immigrant's eligibility if the sponsor or the applicant "fails to cooperate in providing information or documentation necessary to determine eligibility."
There were some exemptions listed within the rules. But the agency is leaving it up to the state agencies themselves to make the case-by-case decisions.
One exemption applies to sponsored immigrants who are victims of extreme cruelty or battering — and who could include parents of a battered child, children of a battered parent, or the victims themselves. This exemption could apply for 12 months. After that time is up, the state agency would need to review the case and federal agencies like the Justice Department or Department of Homeland Security would need to approve an extension.
The second exemption applies to those whom the state determines to be "indigent," or unable to find food or shelter without public assistance.
"Within these statutory parameters, states have discretion to adopt reasonable standards for making this determination," the CMS said in the bulletin, before outlining a few ways that states have set their own standards.
The CMS also said states can offer sponsors some leeway on the income and asset calculations. For example, states could factor in a sponsor's dependents or the legal immigrant's dependents, and deduct those costs from the overall calculation. Or states could overlook assets like a sponsor's retirement account.
The CMS said it's also open to states' suggestions of other factors, but said it "would not be reasonable to use this option to categorically exclude all of a sponsor's income and/or resources in determining the eligibility of the sponsored immigrant."
Dorn framed the guidance as another "weaponization of paperwork" that states can use to disqualify people from public health insurance.
"The states that want to knock people off the rolls now have a new tool," Dorn said.