PROPOSED REGULATIONS UPDATE - June 9, 2020

WASHINGTON – The Internal Revenue Service today released proposed regulations addressing the treatment of certain medical care arrangements under section 213 of the Internal Revenue Code.
 
Section 213 of the Code allows individuals to take an itemized deduction for expenses for medical care, including insurance for medical care, to the extent the expenses exceed 7.5% of adjusted gross income. 
 
The proposed regulations address direct primary care (DPC) arrangements and health care sharing ministry (HCSM) memberships, and provide the following guidance:

• Payments for DPC arrangements are expenses for medical care under section 213 of the Code. Because these payments are for medical care, a health reimbursement arrangement (HRA) provided by an employer generally may reimburse an employee for DPC arrangement payments.
• Payments for membership in a HCSM are expenses for medical care under section 213 of the Code. Because these payments are for medical care, an HRA provided by an employer generally may reimburse an employee for HCSM membership payments.

The proposed regulations respond to Executive Order 13877, which directs the Secretary of the Treasury, to the extent consistent with law, to “propose regulations to treat expenses related to certain types of arrangements, potentially including direct primary care arrangements and healthcare sharing ministries, as eligible medical expenses under Section 213(d)” of the Code.

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LEGISLATIVE UPDATE - March 20, 2020

It appears that the unfavorable legislation we have all been actively opposing has been slipped into the new Senate relief bill for Coronavirus. 

Please see page 171, Section 4403.  

Any help opposing this addition would be greatly appreciated.  It would be wiser to add Senator Cruz's bill which would expand tax relief for HSA to ALL people, not just those with HDHPs.

DPC Action and all of the independent DPC physicians and their patients across the country appreciate any time and consideration you may be able to provide us.

Feel free to reach out to me or anyone on the board of DPC Action if you would like to have a call about this.

This bill will move fast so i am afraid we don't have much time.

With much appreciation-

Kimberly Legg Corba, D.O.

Green Hills Direct Family Care, Inc.

610-530-9155

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AID's response - March 20, 2020

On behalf of AID, our position is that while we support the relief efforts Congress is trying to enact with regard to the coronavirus, we resent lawmakers’ attempts to inject their unrelated agendas into a last-minute emergency bills in the hopes they’ll get passed unnoticed. My members in particular take issue with Sec. 4403, beginning on page 171. The proposed bill should not limit the scope (by definition) of who provides primary care, or cap the compensation requirement, or otherwise impede the free-market engagement of patients and their chosen physician providers.

AID concurs with AAPS that Sec. 4403 should be removed from the 3rd coronavirus bill.  “It overregulates innovative direct care arrangements that are increasing patient access to low cost, high quality medical care. Congress needs to allow patients to use Health Savings Accounts for direct care arrangements without unnecessary limits on patients' options.” 

Suggested replacement language, if there is to be any, would be either of these bills:

Original HR 365 bill would be a good replacement: https://www.congress.gov/bill/115th-congress/house-bill/365 

Or Sen. Cruz’s bill: https://www.congress.gov/bill/116th-congress/senate-bill/3112?s=1&r=5

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AID DIRECT FORUM

Through our online forum, members can get advice and information from other members and access non-physician professionals who may assist with starting, converting, or maintaining a direct-care medical practice. Please join the conversation.