Bill Overview
Title: To amend the Internal Revenue Code of 1986 to allow an above-the-line deduction for health insurance premiums.
Description: This bill allows an individual taxpayer a deduction from gross income for insurance premiums paid for the health care coverage of the taxpayer and the taxpayer's spouse and dependents. The bill makes the deduction available whether or not the taxpayer itemizes other deductions.
Sponsors: Rep. Biggs, Andy [R-AZ-5]
Target Audience
Population: People who pay for health insurance premiums
Estimated Size: 180000000
- The bill targets individual taxpayers, including those who do not itemize deductions, meaning it applies broadly across the population who pay for health insurance.
- The bill impacts those who pay for health insurance out of pocket, as it provides a tax deduction for these expenses.
- It specifically impacts taxpayers who have dependents and purchase health insurance for them, as they can deduct these premiums too.
- Since it amends the Internal Revenue Code of 1986, it primarily affects individuals who file taxes in the United States.
Reasoning
- The bill affects a large portion of the population who purchase health insurance premiums, either through individual plans, employer plans, or directly.
- Considering the high number of individuals it potentially impacts, the policy must be cost-effective to fit within the specified budget of $15 billion in year 1 and $169.8 billion over 10 years.
- Given the relatively broad applicability, we expect a range of impacts from none (for those who don't pay premiums) to high (for families who pay substantial premiums).
Simulated Interviews
IT Specialist (Texas)
Age: 45 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 15/20
Statement of Opinion:
- This deduction will help me save money for my kids' tuition.
- It's a relief not needing to itemize to benefit.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 6 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 6 |
Freelance Writer (California)
Age: 32 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 10/20
Statement of Opinion:
- I've been paying a lot for my insurance, so this bill will cut my yearly costs.
- I might have more disposable income as a result.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 8 | 6 |
Retired (Florida)
Age: 61 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- At this stage, every dollar counts, so the deduction is welcome.
- I hope it influences more people to secure health insurance.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 4 |
Marketing Manager (New York)
Age: 28 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 12/20
Statement of Opinion:
- This deduction makes it easier to afford my first solo insurance plan.
- Anything that helps financially in New York is impactful.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
Construction Worker (Illinois)
Age: 39 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 18/20
Statement of Opinion:
- I'm not sure how much I'll save, but every bit helps.
- Hopefully future increases in premiums are less burdensome with this deduction.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
School Teacher (Ohio)
Age: 50 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 6/20
Statement of Opinion:
- Finally a policy that acknowledges working, non-full-time employees!
- I hope this makes it easier for more people to consider part-time work.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 6 |
| Year 3 | 9 | 6 |
| Year 5 | 9 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 9 | 6 |
College Student (North Carolina)
Age: 22 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 20/20
Statement of Opinion:
- Doesn't impact me yet, but it will when I start my job and need my own plan.
- It's good to know something's in place for future expenses.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 7 |
Small Business Owner (Georgia)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 9/20
Statement of Opinion:
- Insurance costs are part of my top expenses, so I'm glad to see some relief.
- I believe this will help other small business owners focus resources on growth.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 6 |
| Year 10 | 9 | 6 |
| Year 20 | 8 | 6 |
Labor Union Representative (Washington)
Age: 55 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 14/20
Statement of Opinion:
- This tax deduction helps support our unionized workers' healthcare costs.
- We need policies that support working-class individuals.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 7 | 6 |
Non-profit Manager (Colorado)
Age: 48 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 7/20
Statement of Opinion:
- This bill will decrease my taxable income, which is crucial on a non-profit salary.
- Hopefully, the freed-up funds from this deduction help my non-profit grow.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Cost Estimates
Year 1: $15000000000 (Low: $13000000000, High: $17000000000)
Year 2: $15500000000 (Low: $13500000000, High: $17500000000)
Year 3: $16200000000 (Low: $14000000000, High: $18400000000)
Year 5: $17000000000 (Low: $14600000000, High: $19400000000)
Year 10: $18500000000 (Low: $16000000000, High: $21000000000)
Year 100: $30000000000 (Low: $25000000000, High: $35000000000)
Key Considerations
- The policy's success in reducing taxes depends on how many eligible taxpayers choose to claim the deduction.
- Effects on healthcare spending and insurance markets will need monitoring.
- Tax revenue loss could impact government programs reliant on such funds.