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February 26, 2014 at 09:54 AM
A major new Republican tax reform proposal would reshape many tax provisions that affect health insurance and group health plans.
Today, the U.S. tax code lets an individual who itemizes expenses get a deduction for medical expenses if the expenses exceed 10 percent of the taxpayer’s adjusted gross income.
House Ways and Means Committee Chairman Dave Camp, R-Mich., is calling for Congress to eliminate that deduction.
Camp also is calling for Congress to:
- Repeal a tax exemption that helps property-casualty insurers with gross annual receipts under $600,000 and also helps the new nonprofit, member-owned Consumer Operated and Oriented Plans (CO-OPs) created by the Patient Protection and Affordable Care Act (PPACA);
- Repeal the PPACA health insurance purchase tax credit for small employers;
- Eliminate a provision in Section 833 of the Internal Revenue Service Code that provides special treatment for Blue Cross and Blue Shield carriers;
- Make certified professional employer organizations (PEOs) the employers of record for the workers who work for the PEOs for federal employment tax purposes.
Camp, who faces term limits in his home state and is retiring at the end of the current term, spent years working on the draft with Ways and Means colleagues.
