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Tax Reform Update 12/7/2017

The U.S. House and Senate are currently negotiating a compromise between two different tax reform bills.

As it stands now, this is how the current tax bills could hurt people with mental illness:

  • Increasing the cost of health insurance
    • The Senate bill eliminates the tax penalty for not having health insurance, which effectively ends the Affordable Care Act’s individual mandate.
    • With fewer (mostly healthy) people insured, premiums will increase making insurance less affordable for people with mental health conditions.


  • Reducing incentives to develop affordable housing
    • The House bill includes language that may hurt the supply of affordable housing for people with serious mental illness.


  • Ending the tax deduction for medical expenses
    • The House bill includes a repeal of the medical expense deduction, which allows people to deduct medical expenses that exceed 10% of their adjusted gross income.
    • Repealing this deduction will harm people, including people with serious mental illness, who have very high medical expenses.
    • Eligible deductions can include payments for:
      • Visits with psychiatrists, psychologists, or therapists
      • Inpatient psychiatric and substance use stays
      • Transportation to mental health treatment
      • Mental health medications


There’s more. The Congressional Budget Office estimates this tax bill will increase the deficit by $1 trillion over 10 years. That could increase the chance that Congress will choose to reduce this deficit by cutting other programs in 2018, such as Medicaid, the largest payor of community mental health services and supports for children and adults with mental illness.

Tell Congress tax reform shouldn’t harm people with mental illness.


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