New Act Mandates Medicaid for Lawfully Residing Immigrants, Opens ACA Subsidies to Authorized Non-Citizens

The Health Equity and Access under the Law for Immigrant Families Act of 2025 is a major overhaul of how health insurance works for non-citizens in the U.S. Simply put, this bill moves to remove several major roadblocks that currently prevent legally present individuals from accessing federal health programs like Medicaid, CHIP, and the ACA Marketplaces.

This legislation tackles access on multiple fronts, making it easier for people who are legally in the country to get coverage and financial help. It also gives states the option to extend coverage even further. If this bill passes, it fundamentally changes who qualifies for subsidized health coverage in the U.S.

The Mandatory Shift: Medicaid for Legal Residents

For many lawfully residing individuals, getting Medicaid has been a state-by-state headache, often blocked by rules stemming from a 1996 welfare reform act. This bill cuts through that complexity. Section 3 mandates that states must provide Medicaid coverage to all individuals who are lawfully residing in the U.S., provided they meet the state’s income and other standard eligibility requirements. This isn’t optional; it removes the power states currently have to restrict Medicaid access for legal permanent residents.

Real-World Impact: If you are a green card holder or other lawfully residing immigrant who meets the low-income threshold, your state can no longer refuse you Medicaid based on your immigration status. This change takes effect quickly—states have 90 days after enactment to comply, though some might get an extension if they need legislative approval.

An interesting detail in Section 3 is the protection for sponsors. If a sponsor signed an affidavit of support for an immigrant who later receives Medicaid under this new rule, the sponsor will not face debt collection for those medical costs. This removes a significant financial risk for families helping relatives immigrate.

Federally Authorized Status and the ACA Marketplace

For those with Federally authorized presence—which includes people with pending or approved deferred action applications—Section 4 is the game-changer. It makes these individuals eligible for the full suite of ACA benefits, including coverage through the Health Insurance Marketplaces, premium subsidies (tax credits), and cost-sharing reductions (help with deductibles and copays).

Real-World Impact: Previously, many people with authorized status were shut out of subsidized coverage. Now, a person working in the U.S. under deferred action, for example, could qualify for financial help to afford a private health plan on the ACA exchange. Section 4 even requires a special enrollment period for newly eligible individuals so they don't have to wait until the next open enrollment to get covered.

Furthermore, Section 5 streamlines the ACA rules for everyone. It removes immigration status barriers entirely for Premium Tax Credits, Cost-Sharing Reductions, and eligibility for the Basic Health Program (BHP). This means that if you’re a non-citizen who can’t enroll in Medicaid due to status, you can now be eligible for the ACA tax credits, simplifying eligibility for millions. These ACA changes start applying to plan years beginning after December 31, 2025.

The State Option: Expanding Coverage to Undocumented Residents

Section 6 introduces a major policy choice for states: the option to expand Medicaid and CHIP coverage to individuals who currently lack lawful presence. This is entirely up to the state legislature. If a state opts in, it can remove the citizenship requirement for Medicaid and CHIP eligibility, allowing coverage for people who otherwise meet income and other requirements.

Real-World Impact: This provision allows states to address the healthcare needs of their entire population, regardless of immigration status. However, because it is purely optional, access to care for undocumented residents will likely remain highly unequal across the country. States that choose to opt in will face increased costs, although the bill implies federal matching funds will be available for this new cohort, just as they are for other Medicaid groups.

Medicare and the End of Outdated Language

Finally, Section 8 updates the language in Medicare Parts A and B eligibility rules. It replaces the outdated and problematic term “alien” with “an individual who is lawfully present.” This change isn't just cosmetic; it ensures that people with federally authorized presence, including those with deferred action, are clearly included in Medicare eligibility, bringing consistency across major federal health programs.