Since its inception in 1942, the deduction for qualified medical expenses has offered a type of federally funded insurance to taxpayers who itemize. By allowing the deduction of out-of-pocket medical spending that exceeds a threshold, the deduction is similar to a high-deductible health plan, under which the federal government subsidizes subsequent spending at one’s marginal tax rate.
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Matrix Global Advisors (MGA) is an economic policy consulting firm in Washington, DC, specializing in fiscal, health care, and tax policy matters. Drawing on years of policy experience, the MGA team writes white papers and expert reports, and offers strategic advice to our clients.