The effect of immigration reform on the Medicare Trust Fund and Social Security

Advocates for immigration reform, along with the nonpartisan Congressional Budget Office, have publicly declared that immigration reform would positively affect the United States in several different ways. Reform would create thousands of new jobs a year, dramatically reduce the U.S. deficit and spur economic growth. Along with these benefits, independent researchers have found that immigration reform would markedly improve the financial stability of the Medicare Hospital Insurance Trust Fund (HI), which is the system that supports the majority of the health care services that the millions of Americans enrolled in Medicare use.

Medicare is the United States’s largest publicly funded health insurance program. More than 50 million Americans are currently enrolled in Medicare Part A, meaning they have access to inpatient hospital services, skilled nursing facilities and home health care. Researchers studying the stability of the health care system in the U.S. have predicted that by 2026 the trust fund that finances the health care for Americans on Medicare will be depleted. Part of the reason this program’s financing will be depleted is because the number of people using Medicare is expected to grow significantly as baby boomers reach the age of 65.

However, supporters and researchers alike explain that immigration reform can help finance the trust fund for Medicare. Newly legalized immigrants would contribute tax dollars to the HI Trust Fund without drawing on its benefits for roughly 10 years. This means that the contributions of immigrants would extend the Trust Fund for at least another four years. Social Security would be impacted in the same way: If undocumented immigrant workers were legalized, they would contribute taxes to the Social Security system, thus extending its solvency for several years.

According to the National Committee to Preserve Social Security and Medicare and the Congressional Budget Office, immigration reform would be beneficial for America’s programs and positively affect the lives of the seniors in the U.S. enrolled in those programs.