The Budget Deal: One Step Forward. . .

May 6, 1997 -- On Friday May 2, the White House and leaders in Congress announced that they had reached agreement on a package to balance the budget by the year 2002. The deal includes restoration of access to Supplemental Security Income (SSI) and Medicaid to large numbers of legal immigrants. Unfortunately, not all legal immigrants are included in the deal, and negotiators did not agree to restore access to Food Stamps for any legal immigrants.

Furthermore, the details of the legal immigrant provisions of the agreement remain mired in confusion and controversy. Do not believe most of you have read about those details, other than that significant restorations are included. To date, most efforts by the media to be more specific have been inadequate. Moreover, the dollar amounts that have been attributed to the changes have also been misleading.

CONTEXT: THE NATURE OF THE AGREEMENT

Adding to the confusion, many have misunderstood the nature of the agreement that was reached. The agreement is merely a proposal that will be presented to Congress for ratification in various forums over the coming months. First, Congress will be called upon to approve a "budget resolution," which contains budget instructions to the various substantive and appropriations committees that will mark-up the actual legislation. Next, Congress will begin work on thirteen separate "appropriations" bills. Finally, this year's "budget reconciliation act" will contain the substantive changes in entitlements programs necessary to carry out the budget agreement. It is this last bill that is the most likely vehicle for long-term changes in the SSI and Medicaid rules for legal immigrants.

Technically, the deadline for completion of work on all of these bills is September 30th, when the 1997 fiscal year ends. In the past, Congress has rarely met this deadline. But in the past, there has never been such an early comprehensive agreement between the President and Congress.

The bottom line is that a long and uncertain road remains between the agreement reached on Friday and the actual enactment of legislation permanently restoring assistance to large numbers of legal immigrants. Along the way, there will almost certainly need to be some kind of bridge legislation to delay the impending cutoff of SSI while permanent restoration can be enacted. Absent such a bridge and actual passage of a law providing for restoration of assistance, elderly and disabled legal immigrants will begin losing SSI in August.

DETAILS OF THE AGREEMENT

There is no official version of the agreement that has been committed to paper and signed off on by all sides. Therefore, the following was pieced together based on numerous discussions with Republicans, Democrats and advocates on Friday and over the weekend. Part of the confusion about the budget deal specifics stems from unresolved disagreements among the negotiators themselves. Discussions are likely to continue through the week to resolve these differences.

That said, the following is offered to clarify our best understanding of the agreement to date.

A. Overview.

The agreement exempts qualified immigrants who become disabled after entry from the welfare bill's immigrant restrictions on SSI and Medicaid. It also extends the refugee exemption in these two programs from 5 to 7 years. Finally, it may exempt children from the Medicaid restrictions in the welfare bill. It should be noted that all of the current exemptions, such as for persons who work for 40 quarters, will remain available to immigrants.

(1) Disabled after entry.

Qualified immigrants who became disabled after entering the United States would be exempted from the welfare bill's restrictions on access to SSI and Medicaid. Unfortunately, this exemption will be severely limited for those who enter using the new affidavits of support (required by last year's immigration bill), because these future entrants would be subjected to alien-sponsor deeming. The disabled after entry exemption raises several issues.

(a) Definition of disability.

The definition of disability contemplated in the agreement is that contained in Title II of the Social Security Act, which is the same definition that is currently used to determine eligibility for SSI. Persons qualify if they are unable to engage in "substantial gainful activity." Qualified immigrants who are currently receiving SSI because they are 65 or older will likely have to requalify as disabled to retain assistance. The majority of elderly immigrants are likely to be able to retain benefits under this standard. Due process will likely require the Social Security Administration (SSA) to make a disability determination before attempting to cut anyone off.

(b) Meaning of disabled after entry.

Disabled after entry means that the onset of the disability occurred after the immigrant was lawfully admitted to the United States as a permanent resident.

(c) Deeming of future immigrants.

New entrants, who enter in the future using the new affidavits of support, would be subject to alien-sponsor deeming. That is, they will only be able to take advantage of the new exemption for disabled after entry restored if they become disabled after entry AND if their sponsor's income and resources, added to their own, would be low enough to qualify for assistance.

It is important to note that deeming would only apply to persons who have affidavits of support. Therefore, refugees, asylees, and all others who do not use affidavits of support would be eligible if they become disabled after entry, regardless of when they came here.

(2) Refugee exemption extension from 5 to 7 years.

Refugees, asylees, and persons granted withholding of deportation would be exempted from all of the welfare bill restrictions on use of SSI or Medicaid for their first 7 years after obtaining such status. The current refugee exemption is for the first 5 years. Therefore, the change would restore eligibility to refugees who have been in the country between 5 and 7 years. It also gives future refugees an additional 2 years during which to process naturalization applications before becoming ineligible for assistance.

(3) Children's Medicaid exemption.

Finally, there are conflicting reports about whether an exemption from the immigrant Medicaid restrictions for all children has survived in the final versions of the budget agreement. It appears that at least disabled children who entered the country before the welfare bill was passed would have eligibility restored, even if they were disabled before entry. The fate of those who came after passage of the welfare bill is murky. It is possible that they would be exempted from all Medicaid restrictions except for alien-sponsor deeming.

B. Caveats.

The ink is not yet dry on the agreement, and it seems that new information about the details surfaces every few hours. In addition, as mentioned above, certain important issues remain unsettled. The most important of these is the fate of future entrants. It is possible that the final version of the agreement will drop the disabled after entry exemption entirely for those who entered the U.S. after the welfare bill was passed.

Moreover, the specifics are meaningless unless actually enacted into law. Members of Congress may attempt to save money for other uses by limiting the restoration of assistance to legal immigrants.

C. Cost Estimate.

The above changes have tentatively been estimated to restore about $10 billion in funds to legal immigrants through FY 2002. This figure really should not be compared with earlier figures, either of what legal immigrants lost or of the cost of alternative fixes. That is because the baseline numbers have changed significantly due to other changes in the proposed budget and due to changes in Congressional Budget Office (CBO) assumptions about how many people would lose SSI and Medicaid under current law.

SUPPLEMENTAL APPROPRIATIONS BILL AND BRIDGE LEGISLATION

During the budget deal negotiations, Congress also has been working on the supplemental appropriations bill for the 1997 fiscal year. This bill includes disaster relief and other new appropriations to cover unexpected expenses until the fiscal year ends on September 30th. Both the House and Senate are likely to take significant actions on the FY '97 Supplemental Appropriations bills this week, and something is likely to pass in the next few weeks.

Before the budget agreement was reached, Ted Stevens (R-AK), the Chair of the Senate Appropriations Committee had announced his intention to introduce this week a $125 million block grant to the states to cover the costs of loss of benefits to legal immigrants. This mini-block grant proposal has been roundly criticized as difficult to administer and inadequate. The $125 million figure is less than half as much as legal immigrants will lose before the end of the fiscal year. Furthermore, states would have very little time to set up a program to get the funds distributed, and many states have already concluded their legislative sessions for the year.

Several legislators, both Republicans and Democrats, have suggested, as an alternative, extending the eligibility of current SSI recipients through September. This would allow time for Congress to pass the budget deal. Even if an extension is not included in the supplemental appropriation, the budget deal has made it more likely that some kind of bridge legislation can be passed in time to avert disaster this August.

IMPACT ON OF THE BUDGET DEAL ON STATES

Many people are now asking whether there is still a need for a state safety net for immigrants cut off of SSI, Medicaid, and other programs. The answer is yes, for two reasons.

(1) We cannot be certain whether the budget deal will pass. It would be irresponsible, given the potential human consequences, to assume that sufficient changes will be actually be enacted when not a single congressional committee has yet spoken.

(2) Even if significant changes are made, states will still have to cover needs that remain unmet. Some elderly and disabled immigrants are likely to be left out of any final legislation. Moreover, the budget deal does not affect the immigrant Food Stamps restrictions in the welfare bill, which will result in cut-offs and possible malnutrition for nearly a million legal immigrants in the coming months.

NEXT STEPS

The budget deal has narrowed the debate, and it is now far more likely that real and permanent changes will be made in the legal immigrant provisions of the welfare bill. But, in critical respects, nothing has changed. No bill has actually been authored, much less passed. Moreover, a large spectrum of possible outcomes is still possible, depending largely on the degree of continuing pressure Congress and the Administration feel from their constituents. Every stage of the budget process is a critical juncture where legal immigrants could lose ground.

The following are the main points that advocates will be stressing in the next few days:

* The budget deal is not a law. It's just a proposal that may or not be passed in its present form. Legal immigrants still face an August deadline, and those who might be helped by the deal cannot feel secure until the actual law is passed.

* The changes contemplated by the agreement represent a substantial change from the welfare bill, and an advance from certain earlier, more limited, proposals to restore basic survival assistance to legal immigrants. This is a recognition by both Democrats and Republicans that the extreme legal immigrant cuts in the welfare bill were untenable, both politically and substantively. The more the public has learned about these cuts, the more unpopular they have become.

* Although it represents substantial progress, the budget agreement is inadequate because it does not restore SSI and Medicaid to all vulnerable legal immigrants, and it does not restore Food Stamps to anyone.

* Any ambiguity in the negotiations should be resolved in favor of legal immigrants, because they should have access to the social safety net that is paid for by their own taxes, and because, without SSI, state and local governments and private charities will be forced to pay for basic survival assistance for the elderly and disabled out of their own scarce funds.

Source: National Immigration Law Center -------------------------------------------

For further information, contact:

National Immigration Law Center Los Angeles Office: 213-938-6452 (general calls and requests for materials) Washington, DC Office: 202-776-0470 (calls regarding policy issues)