In late February, Republican Sens. Dan Debicella of Shelton and John McKinney of Fairfield proposed a “healthy living tax break” that would allow residents to deduct out-of-pocket expenses from their state income taxes, including insurance premiums, deductibles, and physician office co-payments.
McKinney said if the bill is passed, Connecticut would become the first state in the nation to enact such a tax credit.
The proposed incentive emerges alongside a cottage industry to help employers design such programs, whether medical centers like Bridgeport Hospital; insurers like Farmington-based ConnectiCare; or for-profit consultancies.
“What we”™re hoping to do ”¦ is to shift our focus and discussion from what is largely a treatment-based model to a prevention-based model,” McKinney said, in introducing the bill. “What all of our parents said to us and taught us as kids ”“ ”˜an ounce of prevention is worth of a pound of cure”™ ”“ is right. Our parents were right; our grandparents were right, and its time government started understanding those basic, simple concepts.”
Debicella said the incentives would be pegged to guidelines published by the American Medical Association, including gender and age-specific exams such as mammography and prostate screens. After a rigorous physical, patients would submit a physician-signed checklist and any clinic receipts with their tax returns to obtain the tax credit.
According to Debicella, the Office of Fiscal Analysis estimated Connecticut would save about $1 million for every one percent of the state”™s population that took advantage of preventative health exams to take advantage of the tax credit.
“Many of our customers are becoming more and engaged in keeping their employees healthy,” said Dr. Peter Bowers, lead medical director for Anthem Blue Cross and Blue Shield. “These programs include ”¦ programs to help people manage their weight, kick the tobacco habit, better manage the stress in their lives and improve their fitness and nutrition.”
Separately, Democratic Rep. Thomas Kehoe of Glastonbury has proposed the state create a 50 percent tax credit for small businesses that offer wellness incentives to their employees. Kehoe”™s bill did not initially set a cap on qualifying expenditures.
The New York Assembly is considering a similar bill.
Corporate Connecticut has proven responsive to tax credits in the past ”“ in the 2005 fiscal year, companies took nearly $94 million in various tax credits in Connecticut, largely for equipment and property purchases, and for research.
At the federal level, the U.S. Senate and House of Representatives are considering legislation dubbed the Healthy Workforce Act that would allow employers to take a tax credit for half of corporate wellness programs ”“ up to $200 per employee for businesses with 200 or fewer employees, and $100 per worker for larger companies.
Eligible wellness program costs could include fitness equipment use; on-site health screenings and seminars; subsidies for nutritious food at cafeterias; and even upgrading stair wells to encourage people to skip the elevator ride.
Employers with existing programs would only get to take the tax credit for three years; those introducing a wellness program would get the tax break for a decade.
The House version of the bill is currently under consideration by the Ways and Means Committee, whose members include Hartford Rep. John Larson.
