No Taxpayer Funding for Abortion and Abortion Insurance Full Disclosure

Floor Speech

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Ms. COLLINS. Mr. President, government shutdowns are never the answer. No matter how difficult the problem, we should never resort to shutting down government. It harms too many innocent Federal employees--in this case, 800,000 Federal employees and their families-- and it hampers the ability of American citizens to deal with their government.

At the same time, we do have a problem at our southern border. We do need to strengthen our border security and fix our broken immigration system. We need to address the issue of the Dreamers population, those young children brought to this country through no decision of their own who are now, often, young adults and who are going to school or working or otherwise serving in the military or contributing to our country.

The outlines of a compromise are evident, but in order to get there, I believe we need to assure the President that we will seriously consider his supplemental request for border security, a request that includes not just funding for additional physical barriers to supplement the more than 600 miles of physical barriers--walls, fences--that were built during two previous administrations but also includes $800 million to meet the humanitarian needs of those who are crossing the border. It also includes additional funding for Border Patrol agents and for Immigration and Customs and Border Enforcement.

This simply cannot continue. We need to come together in good faith, reopen government for a limited period of time at least, and negotiate a package that will strengthen security on our borders, and that is what I would urge the President, his administration, and my colleagues on both sides of the aisle to do.

In the meantime, we also need to get back to the work of the Senate. That, too, is important, and today I rise to introduce a bill that would help Americans who are struggling with high healthcare expenses. The tax deduction for certain unreimbursed, out-of-pocket medical expenses affects many taxpayers significantly.

Regrettably, the threshold to claim this important tax deduction rose from 7.5 percent to 10 percent of income at the end of 2018, ending its value for many American taxpayers who simply will no longer qualify.

Today, I reintroduce legislation, which I have sponsored with my colleague Senator Cantwell, that would reinstate and make permanent the lower income threshold for the medical expense deduction. Our bill, the Medical Expense Savings Act, would once again allow taxpayers to deduct unreimbursed healthcare costs that exceed 7.5 percent of their income.

For those who suffer from preexisting medical conditions, have chronic illnesses, experience unexpected sickness or injuries, or require long term care, out-of-pocket healthcare expenses can quickly become an unbearable burden. Too many Americans are forced to choose between medical services and other equally necessary expenditures or they find themselves going deeply in debt.

The Affordable Care Act increased the income threshold for taxpayers to deduct their medical expenses from 7.5 percent to 10 percent. I very much opposed that provision of the ACA. For individuals under 65, the increase went into effect in 2013, but for those over 65, individuals would have been exposed to this higher threshold for the first time in 2017. Fortunately, we were able to remedy that for those over age 65.

When the ACA increase was phased in, many individuals struggling with serious health conditions saw their financial health worsen. For example, a 2016 study estimates that parents, including many with limited means, already provide nearly $36 billion annually in uncompensated medical care at home to children with special healthcare needs, such as muscular dystrophy and cystic fibrosis.

A 2016 survey of cancer survivors showed that one-third go into debt, and of those, more than half incurred more than $10,000 in unreimbursed expenses.

For seniors with significant long-term care needs, the deduction helps with the cost of home health or personal care services or, when needed, the cost of a long-term care facility, such as a nursing home. The deduction can also be used for other expenses that Medicare generally does not cover, including dental treatment, vision care, and certain transportation costs. Seniors can also use the medical expense deduction for expenses like wheelchair ramps, installing railings and support bars in bathrooms, and lowering or modifying kitchen cabinets and equipment and other home modifications made for medical reasons. These improvements can allow seniors with medical conditions or disabilities to live at home in the safety, comfort, and familiarity of their own home.

Some seniors find that their savings become rapidly depleted. They may spend down their financial resources in order to receive the services and support they require through the Medicaid Program. According to Genworth's 2018 Cost of Care Survey, home health aide services can cost $50,000 annually, while a private room at a nursing home can cost nearly $100,000. By retaining a lower threshold for the medical expense tax deduction, some families would be able to continue to pay these essential costs themselves.

Some erroneously believe that this deduction only benefits the wealthy, when, in fact, it is mainly lower and middle-income Americans who have been hurt. According to AARP, nearly 70 percent of taxpayers taking the deduction in 2014 reported income of $75,000 or less, and nearly half reported incomes of $50,000 or less. In Maine, according to AARP, almost 36,000 of our residents claimed this deduction in 2014, and nearly 19,000 of these individuals reported an income of $50,000 or less.

That is why, during the tax reform debate in 2017, I introduced a successful amendment that rolled back the income threshold to 7.5 percent for taxpayers to deduct their medical expenses in 2017 and 2018. My amendment expanded upon the efforts of Senators Rob Portman and Sherrod Brown, who had worked to prevent this increase from going into effect for individuals over 65. As I said, my amendment was incorporated into the new tax law, and thus, for 2017 and for 2018, the threshold for deducting these out-of-pocket medical costs was 7.5 percent of income. But at the end of last year, that expired.

The AARP and 44 other consumer groups have strongly endorsed the effort undertaken by Senator Cantwell and me, stating that ``it provides important tax relief which helps offset the costs of acute and chronic medical conditions for older Americans, children, pregnant women, disabled individuals, and other adults as well as the costs associated with long-term care and assisted living.''

This is a step we can take to reinstate an expired tax deduction that will make a real difference to people who are struggling with high out- of-pocket medical costs.

I urge my colleagues to support our legislation that will help our families cope with high medical costs by making sure that this important deduction remains available for future tax years.

Hon. Susan Collins, U.S. Senate, Washington, DC. Hon. Maria Cantwell, U.S. Senate, Washington, DC.

Dear Senators Collins and Cantwell: On behalf of our members and all Americans age 50 and older, AARP is writing to thank you for introducing the Medical Expense Savings Act (S. 110), legislation to permanently extend the 7.5 percent income threshold for the medical expense deduction AARP, with its more than 38 million members in all 50 states, the District of Columbia, and the U.S. territories, represents individuals seeking financial stability while managing their health care and every effort should be made to keep the threshold for the deduction as low as possible to help protect those with high medical costs.

The medical expense deduction provides important tax relief that helps offset the cost of acute and chronic medical conditions for older Americans, children, and individuals with disabilities. For many, the medical expense deduction can help offset high out-of-pocket expenses--expenses that qualify include money paid for diagnosis, treatment, equipment, long-term care services, and long-term care insurance premiums.

The tax filers who claim the medical expense deduction have historically been age 50 or older and living with a chronic condition or illness. The average Medicare beneficiary spends about $5,680 out of pocket on medical care. The medical expense deduction makes health care more affordable for people with significant out-of-pocket expenses.

Furthermore, older Americans often face high costs for long-term services and supports--which are generally not covered by Medicare--as well as hospitalizations and prescription drugs. The median cost for a private room in a nursing home is over $97,000 annually, while the median cost for even more cost-effective home-based care is still over $30,000 per year (for 20 hours of care a week). In 2013, roughly 25.8 million beneficiaries in traditional Medicare spent at least 10 percent of their income on out-of-pocket health care expenses. Tax relief in this area can provide needed resources, especially important to middle income seniors with high long-term care and medical costs.

The medical expense deduction is a critical tool in managing health care cost for Americans with high out-of- pocket expenses. For these reasons, we are pleased to endorse this legislation and look forward to working on a bipartisan basis with you to enact this legislation into law. If you have any questions or need additional information, please feel free to contact me or Jasmine Vasquez. Sincerely, Joyce A. Rogers, Senior Vice President, Government Affairs.
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