How Does Tax Reform Affect Your Mental Health?


When you hear about tax reform, you may not think it affects people with mental health conditions and their families. But the bills in Congress do. Here’s how:

1. Increases the cost of health insurance. Under the Senate bill, people will no longer be fined if they do not have health insurance (also known as the individual mandate). This will increase the number of uninsured Americans by an estimated 13 million. With fewer healthy people insured, premiums will increase—making insurance less affordable for people with mental health conditions.

2. Ends the tax deduction for medical expenses. The medical expense deduction allows people who spend at least 10% of their income on medical expenses to deduct those costs from their taxes. This can include payments for:

  • Visits with psychiatrists, psychologists or therapists
  • Inpatient psychiatric and substance use stays
  • Transportation to mental health treatment
  • Mental health medications

The House bill will end this tax deduction, taking money out of the pockets of people with serious mental illness who can least afford it—and may even lead to people going without treatment.

3. Reduces incentives for affordable housing. Too many people with mental illness lack affordable housing. The House bill will hurt, not help. It will repeal the tax exemption on private activity bonds, which the National Housing Trust projects will result in 950,000 fewer units of affordable rental housing. This will cause even greater challenges for people with serious mental illness who rely on the Section 811 program for housing.

The House could vote as early as today. Tell Congress that tax reform shouldn’t harm people with mental illness.