I
107TH CONGRESS
2D SESSION
H. R. 4801
To amend the Internal Revenue Code of 1986 to provide a 100 percent
deduction for the health insurance costs of individuals.
IN THE HOUSE OF REPRESENTATIVES
MAY 22, 2002
Mr. CHABOT introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide
a 100 percent deduction for the health insurance costs
of individuals.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘ Health Insurance Af-
fordability Act of 2002’’.
SEC. 2. DEDUCTION FOR QUALIFIED HEALTH INSURANCE
COSTS OF EMPLOYEES AND SELF-EMPLOYED
INDIVIDUALS.
(a) IN GENERAL.—Part VII of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 (relating to
additional itemized deductions) is amended by redesig-
nating section 223 as section 224 and by inserting after
section 222 the following new section:
‘‘SEC. 223. COSTS OF QUALIFIED HEALTH INSURANCE.
‘‘(a) IN GENERAL.—In the case of an individual,
there shall be allowed as a deduction an amount equal to
the amount paid during the taxable year for coverage for
the taxpayer, his spouse, and dependents under qualified
health insurance.
‘‘(b) QUALIFIED HEALTH INSURANCE.—For pur-
poses of this section, the term ‘qualified health insurance’
means insurance which constitutes medical care; except
that such term shall not include any insurance if substan-
tially all of its coverage is of excepted benefits described
in section 9832(c).
‘‘(c) SPECIAL RULES.—
‘‘(1) COORDINATION
WITH
MEDICAL
DEDUC-
TION, ETC.—Any amount paid by a taxpayer for in-
surance to which subsection (a) applies shall not be
taken into account in computing the amount allow-
able to the taxpayer as a deduction under section
162(l) or 213(a).
‘‘(2) DEDUCTION NOT ALLOWED FOR SELF-EM-
PLOYMENT
TAX
PURPOSES.—The deduction allow-
able by reason of this section shall not be taken into
account in determining an individual’s net earnings
from self-employment (within the meaning of section
1402(a)) for purposes of chapter 2.’’.
(b) DEDUCTION FOR HEALTH INSURANCE COSTS OF
SELF-EMPLOYED INDIVIDUALS INCREASED.—
(1) IN
GENERAL.—Section 162(l)(1) of such
Code (relating to special rules for health insurance
costs of self-employed individuals) is amended to
read as follows:
‘‘(1) ALLOWANCE OF DEDUCTION.—In the case
of an individual who is an employee within the
meaning of section 401(c)(1), there shall be allowed
as a deduction under this section an amount equal
to the amount paid during the taxable year for in-
surance which constitutes medical care for the tax-
payer, the taxpayer’s spouse, and dependents.’’.
(2) CLARIFICATION OF LIMITATIONS ON OTHER
COVERAGE.—The 
first 
sentence 
of 
section
162(l)(2)(B) (relating to other coverage) is amended
to read as follows: ‘‘Paragraph (1) shall not apply
to any taxpayer for any calendar month for which
the taxpayer participates in any subsidized health
plan maintained by any employer (other than an em-
ployer described in section 401(c)(4)) of the tax-
payer or the spouse of the taxpayer.
(c) DEDUCTION ALLOWED IN COMPUTING ADJUSTED
GROSS INCOME.—Subsection (a) of section 62 of such
Code is amended by inserting after paragraph (18) the
following new paragraph:
‘‘(19) COSTS
OF
QUALIFIED
HEALTH
INSUR-
ANCE.—The deduction allowed by section 223.’’.
(d) CLERICAL AMENDMENT.—The table of sections
for part VII of subchapter B of chapter 1 of such Code
is amended by striking the last item and inserting the fol-
lowing new items:
‘‘Sec. 223. Costs of qualified health insurance.
‘‘Sec. 224. Cross reference.’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 2002.
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