Changes Include:

  • Impose $2,500 annual cap on FSA contributions (indexed to CPI)
  • Increase Medicare wage tax by 0.9% and impose a new 3.8% tax on unearned , non-active business income for those earning over $200k/$250k (not indexed to inflation)
  • Generally increases (7.5% to 10%) threshold at which medical expenses, as a % of income, can be deductible
  • Eliminate deduction for Part D retiree drug subsidy employers receive
  • Impose 2.3% excise tax on medical devices
  • Medicare cuts to hospitals who treat low-income seniors begin
  • Post-acute pay for quality reporting begins
  • CO-OP Program: Secretary awards loans and grants for establishing nonprofit health insurers
  • $500,000 deduction cap on compensation paid to insurance company employees and officers
  • Part D “donut hole” reduction begins, reaching a 25% reduction by 2020