Washington, May 29, 2024 /PRNewswire/ — Paragon Health Research InstituteA leader in health care research and market-based policy proposals, Following the money: How taxes affect health carewe took a detailed look at 10 tax provisions that affect health care and insurance. Theo Merkel and Brian Blades (the top two members of the White House National Economic Council under President Trump) aim to influence major policy decisions after 2025.
The paper will provide guidance to Congress as it works to reform the tax code next year after provisions of the Tax Cuts and Jobs Act expire. Following the money: How taxes affect health careChancellors Merkel and Blasse assess the impact of 10 health care tax provisions and provide a history of their impact. What is most important for policymakers is a commitment to a fair and efficient health care system and reform proposals that reflect the lessons of what has worked and what has not worked in previous health care reform efforts.
Currently, tax law contains provisions that promote efficiency in the health sector as well as provisions that lead to waste and over-utilisation of health services. Chancellors Merkel and Blasse have proposed the following to parliament:
- Health care expenditures are not more favorable than other expenditures
- Ensure that direct medical payments are not disadvantaged compared to third-party payments
- Empowering Americans to choose the insurance and care that’s best for them
- It reduces both regressive influences and policies that over-subsidize high-cost parts of the country.
Merkel and Brese are recommending that Congress allow additional plan designs that can be linked to health savings accounts and Medicare health savings accounts, taking into account the benefits of helping people save on medical costs. They also suggest that Congress improve the 2019 individual health insurance reimbursement system.salmon roe) The rules allow employees to use their contributions across a broader range of plans.
In their tax policy related to the Affordable Care Act (ACA), Chancellor Merkel and Chancellor Brese point out many of the problems with expanded health care funding. Insurance premium tax credit The Proposed Change in Employment and Tax (PTC) allows most insurance exchange enrollees to access fully subsidized plans, resulting in a rise in wasteful spending. They do not propose repealing the PTC, but they recommend that Congress not extend the expanded subsidies after they expire next year and put limits on how much insurers can inflate the subsidies. They also recommend that Congress appropriate the ACA. Cost-Sharing Reduction Program It allows participants to receive benefits as deposits into tax-advantaged health accounts.
Merkel and Brace’s proposal does not ignore the largest tax benefit: the exclusion of employer-funded health insurance premiums from federal taxes. On a per-enrollee basis, the exemption has a lower budgetary cost than government programs or PTCs, but the authors view the tax benefit as regressive and inflationary. Congress should only address the exemption in the context of health reform that reduces reliance on public programs, or comprehensive tax reform that reduces the exclusion and lowers tax rates, and they propose limiting the exemption to 125% of the national value of employer plans.
Coming in late 2021 Brian BladesParagon Health Institute provides health policy research and market-based policy recommendations to improve public and private sector outcomes. Journalists and health analysts can find Paragon’s latest research and commentary at: Paragon Labs.
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Source: Paragon Health Research Institute
