Health and Taxes: An Assessment of the Medical Deduction

Abstract

A variety of proposals for national health insurance are now receiving serious consideration in the Congress, the Administration, and public discussion. This paper examines the performance of the one national program which provides partial financing of health expenses for all Americans-the medical deduction under the personal income taxusing the Internal Revenue Service statistics on itemized deductions for 1970. Income tax deductions provide this protection in the form of an indirect subsidy to the purchase of health insurance and medical care ser-