Star Tribune (Minneapolis): Health Care Finance Reforms: Give Doctors Tax Credits for Free Care

The “Physician Pro Bono Care Act” is a bill designed to incentivize doctors to offer pro-bono health care services to some Medicaid or Children’s Health Insurance Program (CHIP) patients. Physicians who render free medical services would be permitted to deduct the costs from their taxes. A doctor would not be able to write off more than he or she earned in a year. And they could only write off a fraction of the value of any single service. The 1.1 million-member Association of Mature American Citizens (AMAC) has worked extensively over the past two years in support of this bill.

Current tax law only allows physicians to deduct pro-bono services they render to a 501(c)(3) charitable services institution. They are not allowed to deduct medical services provided in clinics and offices to low-income individuals who don’t have insurance and are eligible for Medicaid and CHIP. The Physician Pro Bono Care Act is a simple measure that corrects this gap. The federal legislation could help more than 70 million Americans enrolled in Medicaid and CHIP, including more than a million Minnesotans.

Reducing the demand on Medicaid through the measure would help states like Minnesota cope with growing Medicaid expenses.

Pro-bono services rendered by doctors would translate into a significantly larger payout if the billing were handled through Medicaid services. For example, $6.6 billion could be saved a year in national Medicaid disbursements for emergency room visits alone, according to an estimate by AMAC. That figure is based on a scenario in which the 7 million Medicaid patients who visited an emergency room once in 2016, at the average Medicaid payout of $1,100, would instead have received pro-bono treatment from a doctor at the cost of a deduction of roughly $50.

While the measure is not a panacea, it’s an important part of the solution when considering Medicaid’s burgeoning costs. For states like Minnesota, it would help relieve some budgetary pressures of an expanded Medicaid program.

Aside from the dollars-and-cents benefits, the bill encourages lower-income people to form traditional patient-doctor relationships that can contribute to better health. That relationship can be critical in seeking preventive care before conditions become acute. Without access to a primary care physician, many patients put off seeking medical help until their ailments become so serious that they have no choice but to make emergency room visits. Emergency room care can be 20 times as expensive as physicians’ office visits.

With some doctors no longer accepting Medicaid patients because of the convoluted and time-consuming requirements of the program, the Physician Pro Bono Care Act offers physicians an opportunity to treat lower-income patients. While the tax deduction they’d receive would be less than they’d get through Medicaid, the advantage is in shredding bureaucratic red tape.

This bill relies not on ideology of any stripe but on a creative solution that will help ensure that our most vulnerable Americans have access to the care they need, from the doctor they choose. Minnesotans deserve strong bipartisan support from their congressional delegation around this common-sense bill. Reps. Peterson and Stauber are to be commended for co-sponsoring this important piece of bipartisan legislation.