November 6, 2017, Emily Mongan, McKnight's Long-Term Care News - A tax cuts bill released Thursday by House lawmakers could be “devastating” for long-term care providers, according to the nation's largest nonprofit provider group. The Tax Cuts and Jobs Act, H.R. 1., would change individual tax rates, get rid of some credits and repeal individual deductions such as the medical expense deduction, which applies to people who spend more than 10% of their income on out-of-pocket medical bills.
The bill also would lower the corporate income tax rate to 20%, which lawmakers say would boost incentives for businesses to create new jobs. LeadingAge said the group opposes any bill that eliminates tax exemptions for affordable housing, changes charitable deductions, or gets rid of the medical expense reduction.
“America's families will be shocked by the changes in the tax code,” said CEO Katie Smith Sloan in a statement released Friday. “Those who are older will find the loss of the medical deduction a bitter pill to swallow. And for our members, providers of services to older people, this could be devastating."
For providers, LeadingAge said changing tax deductions for charitable donations — which help “bridge the gap” between Medicaid funding and care costs — could spell trouble for providers in the nonprofit sector.
“Any changes to that tax deduction, indirectly accomplished by the bill's increase of standard deductions, will widen the gap,” the group's statement reads. “Many of our communities, particularly in rural areas, will face the harsh choice of curtailing services or closing.”
The American Health Care Association/National Center for Assisted Living said in a statement to McKnight's that the group is “reviewing the bill and will continue to monitor it through the legislative process, including committee markup.”
“We encourage Congress to look for ways to make long term care more accessible and affordable for the millions of seniors and individuals with disabilities who depend on it,” AHCA said.
The Center for Medicare Advocacy and Medicare Rights Center issued a joint statement expressing concerns that the legislation “sets the stage for deep cuts to Medicare, Medicaid, and Social Security in the near future.”
“Any tax reform must promote retirement security for all Americans, recognize the high out-of-pocket costs that older adults and individuals with disabilities already pay, and ensure stable revenue for our essential programs,” the groups said.
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