America’s Healthy Future Act

Major Provisions of Finance Committee’s America’s Healthy Future Act
(source: Taylor, English, Duma LLP)

Excise Tax on High-Cost Insurance Policies. An excise tax of 40 percent would be imposed on insurance premiums in excess of $8,000 for individuals and $21,000 for families. For individuals with high-risk jobs or those over age 55 and not enrolled in Medicare, the threshold would be $9,850 for individuals and $26,000 for families. The threshold would be indexed to the consumer price index for urban consumers (CPI-U) plus 1 percentage point.

Tax Credit to Buy Insurance. Beginning in 2013, tax credits would be available to help offset the cost of private health insurance premiums. The credits would be paid directly to insurers. The credits would be based on the percentage of income the cost of premiums represents, rising from 2 percent of income for those at 100 percent of the poverty line to 12 percent of income for those at 300 percent of poverty. Individuals between 300 percent to 400 percent of poverty would be eligible for a premium credit based on capping an individual’s share of the premium at a flat 12 percent of income.

10 Percent Floor on Itemized Medical Deductions. Only medical expenses in excess of 10 percent of a taxpayer’s adjusted gross income would be allowed to be deducted, up from the current level of 7.5 percent. The 7.5 percent level remains unchanged, however, for taxpayers 65 or older.

Penalties on Uninsured Individuals. The excise tax for failing to buy insurance would be phased in over several years, growing from a maximum penalty of $200 per adult in 2014, to $400 in 2015, $600 in 2016, and $750 in 2017. The maximum penalty would be indexed to CPI-U beginning in 2018.

No Criminal Penalties. Unlike for income taxes, criminal penalties for failure to pay the excise tax on individuals could not be imposed. Collections of the excise tax would be limited to withholding of federal payments due.

Hardship Waiver. Individuals who are unable to find insurance that costs less than 8 percent of their adjusted gross income would be exempt from the requirement to have health insurance.

Caps on FSAs. Contributions to tax-free flexible spending accounts in cafeteria plans would be limited to $2,500 per year and over-the-counter medicines purchased without a prescription no longer would be eligible for reimbursement from health savings plans.

New Option for Long-Term Care Insurance. The proposal would allow individuals to use FSAs to pay for long-term care insurance.

Elimination of Medicare Part D Deduction. Businesses that receive subsidies for providing prescription drug plans valued at as much as Medicare Part D for their retirees no longer would be allowed to exclude the subsidy payments from their gross income.

Increased Penalty for Nonqualified Distributions. The penalty for using health savings account funds for nonqualified medical expenses would be raised to 20 percent from 10 percent.

New Requirements for Nonprofit Hospitals. Tax code section 501(c)(3) hospitals would be required to conduct regular “community health needs assessments” to verify that they are providing a public service for the tax benefits they receive.

Reporting Value of Health Benefits. Business would be required to report the value of health benefits on W-2 forms.

Health Insurance Executive Compensation. A health insurance company would be prohibited from deducting any executive pay in excess of $500,000 if at least 25 percent of its gross premium income is derived from health insurance plans that meet the minimum requirements of the Finance Committee plan. Under current law, businesses can deduct up to $1 million annually per executive.

Corporate Information Reporting. The plan would require firms that pay more than $600 per year to corporate providers of property and services to file an information report with each provider and with the Internal Revenue Service.

Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS®

Co-CEO and Founder oXYGen Financial, Inc.

Request a FREE consultation: www.oxygenfinancial.net


oXYGen Financial, Inc. co-CEO Ted Jenkin  is one of the foremost knowledgeable professionals in giving financial advice to the X and Y Generation.

Securities and Investment Advisory Services offered through NFP Advisor Services, LLC (NFPAS), Member FINRA/SIPC. Oxygen Financial is not affiliated with NFPAS. NFPAS does not provide tax or legal advice.   This site is published for residents of the United States only. Registered Representatives and Investment Advisor Representatives of NFP Advisor Services, LLC (NFPAS) may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed. Not all products and services referenced on this site are available in every state and through every representative or advisor listed. For additional information, please contact NFPAS Compliance Department at 512-697-6000.   PLEASE NOTE: The information being provided is strictly as a courtesy. When you link to any of the web sites provided here, you are leaving this web site. NFP Advisor Services, LLC makes no representation as to the completeness or accuracy of information provided at these web sites. Nor is NFP Advisor Services, LLC liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, web sites, information and programs made available through this web site. When you access one of these web sites, you are leaving our web site and assume total responsibility and risk for your use of the web sites you are linking to.

About the author  ⁄ Ted Jenkin @ Your Smart Money Moves

Ted Jenkin @ Your Smart Money Moves


My friends and family all think I’m a workaholic, but I say I’m just a guy that loves to help people do better in life.

My mother is still the only one that calls me by my real name Theodore Michael, my wife calls me Teddy, but for the rest of you it is just plain old Ted.

Ever since I was a little kid, I always loved money and being an entrepreneur. In fact, I still have cassette tapes of me talking to my grandmother at the age of five and my mother tells me all the time how much I played with money as a kid...

Read More About Ted Here

Ted Jenkin is a frequent guest columnist for the Wall Street Journal and Headline News Weekend Express. He is the co-CEO of oXYGen Financial. You can follow him on LinkedIn @ www.linkedin.com/in/theceoadvisor or on Twitter @tedjenkin.

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice.

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor regarding your individual situation. 

Background and qualification information is available at FINRA's BrokerCheck website.

No Comments

Leave a Comment