GOP Tax Plan Could Take Toll on SNF Residents, Operators

As Congressional Republicans attempt to pass their new tax plan before the holiday recess in December, one major group in the long-term care industry says the legislation would harm residents and providers.

LeadingAge — a trade group that represents non-profit nursing homes and other elder-care providers — spoke out against H.R. 1, claiming that House Republicans’ tax bill would harm seniors by removing deductions for health expenses and eliminating useful tax breaks for non-profit operators.

Taxpayers who put more than 10% of their overall income toward medical expenses can write them off, and while CNBC noted that only about 5% of Americans take advantage of this benefit, any attempt to change the rules would disproportionately affect the elderly — many of whom do not have significant incomes and can spend a significant amount of money on out-of-pocket medical expenses.


“America’s families will be shocked by the changes in the tax code,” LeadingAge CEO Katie Smith Sloan said in a statement. “Those who are older will find the loss of the medical deduction a bitter pill to swallow. And for our members, providers of services to older people, this could be devastating.”

But the plan won’t just have an impact on residents: LeadingAge noted that the bill eliminates the use of private bond funding for developers of low-income housing, which could hamstring non-profit operators: Without those dollars, these groups would have a harder time building or upgrading continuing care retirement communities (CCRCs), LeadingAge said in its rebuttal to the plan.

In addition, changes to the way charitable donations can be deducted could have an outsized effect on not-for-profits, LeadingAge said.


“Most of our members rely on charitable donations to bridge the gap between Medicaid reimbursements and the actual costs of care. Any changes to that tax deduction, indirectly accomplished by the bill’s increase of standard deductions, will widen the gap,” the group said. “Many of our communities, particularly in rural areas, will face the harsh choice of curtailing services or closing.”

The American Health Care Association, which represents a range of for-profit long-term care operators, took a more moderate tack in its response to the GOP’s tax bill, which party leadership hopes to send to President Trump’s desk in time for Christmas.

“We are reviewing the bill and will continue to monitor it through the legislative process, including committee markup. We encourage Congress to look for ways to make long term care more accessible and affordable for the millions of seniors and individuals with disabilities who depend on it,” an AHCA spokesperson told SNN.

Written by Alex Spanko

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