A tax overhaul is underway, as the House and Senate strives towards reshaping health care. Having failed to repeal and replace the Affordable Care Act, here are 5 different avenues by which the tax legislation could change health policies:
- Repeal the requirement for most people to have health insurance or pay a tax penalty.
The measure would not technically remove the requirement for people to have insurance, but it would eliminate the fine that citizens would face if they were to remain uninsured.
- Repeal the medical expense deduction
Tax-payers’ ability to deduct medical expenses that exceed 10% of their gross income will be eliminated with the house-passed tax bill.
- Trigger major cuts to the Medicare program
It is foreseen by budget analysts that the passing of this legislation will trigger another law to kick in. Such a measure will require cuts to federal programs if the federal budget deficit is increased.
- Change tax treatment for graduate students and those paying back student loans
The house-passed tax bill would require graduate students to pay tax on the value of tuition that universities do not require them to pay.
- Change or eliminate the tax credit that encourages pharmaceutical companies to develop drugs for rare diseases
The house-passed tax bill would eliminate tax credit on drugs treating rare diseases.
This Congressional Tax Legislation is going to bring about a lot of change within the health care industry – including an overwhelming amount of nonprofit organizations. Therefore, it is essential that we remain well informed and prepared for the future.
Read more from journalist, Julie Rovner, about how the Congressional Tax Reform could transform health care.