[Congressional Record Volume 148, Number 32 (Tuesday, March 19, 2002)]
[Extensions of Remarks]
[Page E379]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 THE MEDICAL COST DEDUCTION ACT OF 2002

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                          HON. PHILIP M. CRANE

                              of illinois

                    in the house of representatives

                        Tuesday, March 19, 2002

  Mr. CRANE. Mr. Speaker, I am pleased to join with my friend and 
colleague Mr. Johnson of Texas to introduce the Medical Cost Deduction 
Act of 2002. This legislation makes health care more affordable by 
allowing individuals to deduct most of their medical expenditures that 
exceed 2 percent of their Adjusted Gross Income (AGI).
  The rising costs of health care are a major concern for many 
Americans. Whether it is increased costs in health insurance premiums 
or the high cost of prescription drugs that seniors pay out of their 
own pocket, if it is unaffordable, many of these individuals will go 
without necessary health care treatment. The Medical Cost Deduction Act 
will help lower the tax burden and help families defray the rising 
costs of health care.
  Since 1942, taxpayers that itemize have been able to deduct health 
care costs that are in excess of a statutory percentage of their AGI. 
The current threshold where deductions begin is after 7.5 percent of 
AGI. Because of this relatively high floor, few taxpayers that itemize 
can reduce their taxable income through the existing deduction because 
their unreimbursed medical expenses are unlikely to exceed 7.5 percent 
of their AGI. For instance, under current law, a taxpayer with an 
income of $30,000 would need to have out-of-pocket health care costs of 
$2,250 before they could begin taking deductions. Under my proposal 
that reduces the AGI requirement to 2 percent, that same taxpayer can 
start taking medical care deductions after $600 in expenses.
  Back in 1954 when the threshold for deductibility of health expenses 
was lowered from 5 percent to 3 percent, the House Ways and Means 
Committee included in it's report that there is a ``general agreement 
that limiting the deduction only to expenses in excess of 5 percent of 
AGI does not allow the deduction of all extraordinary medical 
expenses.'' By lowering the deduction for medical expenses to 2 percent 
of AGI seniors may be able to better afford necessary medications and 
individuals may be better able to afford increased health care 
premiums. Mr. Speaker, I ask for my colleagues for their consideration 
and support of the Medical Costs Deduction Act.

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