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Federal legislation provides tax breaks, opportunities for ODs
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The Omnibus Appropriations Act, which Congress approved in late December 2015, included a number of provisions that will positively affect optometry, according to the American Optometric Association.
AOA President Steven A. Loomis, OD, told Primary Care Optometry News, “From fighting for increased funding to help expand access to doctors of optometry in our nation’s underserved areas to working with pro-optometry leaders in Congress toward a meaningful delay in harmful taxes and an extension of tax incentives that will help small business optometry practices, our AOA continues to work for member doctors on a growing number of fronts while remaining squarely focused on bettering our patients, practices and profession.”
The Omnibus Appropriations Act includes funding to expand services at community health centers that target underserved populations, including vision services that can be offered by ODs contracting with local facilities, the AOA told PCON. Health centers are able to apply for these expansion grants, which were originally authorized under the Affordable Care Act (ACA).
Under the tax code’s Section 179, small businesses have been permitted to take an immediate expense deduction for purchases of depreciable business equipment instead of depreciating the asset over time. With that break slated to sunset, the appropriations act extended and increased this tax incentive, the AOA said.
The ACA originally included a 2.3% excise tax on the sale of medical devices, but optometry was able to win an exclusion for contact lenses and glasses. However, the AOA said, manufacturers of other devices have had to pay the tax, with the consequence of raising equipment prices for optometrists. The appropriations act delays this tax for 2 years.
A series of economic stimulus packages dating back to 2008 has allowed business owners who purchase new equipment to write off a percentage of the equipment cost, but that provision was set to expire at the end of the year, the AOA told PCON. The act extended this incentive and set bonus depreciation at 50% for property placed in service during 2015, 2016 and 2017, with a phase-down to 40% in 2018 and 30% in 2019.
The Omnibus Appropriations Act also includes a 2-year delay of the “Cadillac tax,” which, starting in 2018, would place a 40% tax on high-cost health plans. While the AOA said the cost of vision care is exempted, the organization was still concerned that coverage would be shifted from plans with robust benefits and wide networks to smaller networks and benefit packages, resulting in fewer ODs able to participate on panels.
Language was also included in the act encouraging the U.S. Department of Education to better identify children who may not be prepared for school because their visual needs are not being met. The AOA wishes to see the department “more fully embrace the children’s vision essential health benefit as an improved strategy aimed at better ensuring school readiness.”
“AOA members are ensuring that optometry has a seat at the table in Washington whenever health care policy decisions are being made,” Loomis concluded. – by Nancy Hemphill, ELS, FAAO
- For more information:
- The American Optometric Association can be reached at www.aoa.org.
Disclosure: Loomis is president of the AOA.