I
106TH CONGRESS
2D SESSION
H. R. 5093
To amend title XVIII of the Social Security Act and the Internal Revenue
Code of 1986 to improve the ability of medical professionals to practice
medicine and provide quality care to patients by providing reimbursement
and a tax deduction for patient bad debt.
IN THE HOUSE OF REPRESENTATIVES
JULY 27, 2000
Mr. THORNBERRY introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend title XVIII of the Social Security Act and the
Internal Revenue Code of 1986 to improve the ability
of medical professionals to practice medicine and provide
quality care to patients by providing reimbursement and
a tax deduction for patient bad debt.
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 ‘‘Patient Fairness and
Indigent Care Promotion Act of 2000’’.
SEC. 2. RESTORATION OF BBA REDUCTION AND REIM-
BURSEMENT OF HOSPITALS FOR 100 PER-
CENT OF MEDICARE BENEFICIARY BAD DEBT.
Section 1861(v)(1)(T)(iii) of the Social Security Act
(42 U.S.C. 1395x(v)(1)(T)(iii)), as added by section 4451
of the Balanced Budget Act of 1997, is amended by strik-
ing ‘‘during a subsequent fiscal year’’ and inserting ‘‘dur-
ing fiscal year 2000’’.
SEC. 3. BAD DEBT DEDUCTION FOR CASH BASIS HEALTH
CARE PROVIDERS FOR UNPAID SERVICES
PROVIDED TO LOW-INCOME INDIVIDUALS.
(a) IN GENERAL.—Section 166 of the Internal Rev-
enue Code of 1986 (relating to bad debts) is amended by
redesignating subsection (f) as subsection (g) and by in-
serting after subsection (e) the following new subsection:
‘‘(f) UNPAID MEDICAL CARE PROVIDED TO LOW-IN-
COME INDIVIDUALS.—
‘‘(1) IN GENERAL.—In the case of a taxpayer
to whom this subsection applies, the deduction under
subsection (a) for worthless qualified medical care
debt shall not be less than 75 percent of the tax-
payer’s charge for such care.
‘‘(2) TAXPAYER
TO
WHOM
SUBSECTION
AP-
PLIES.—This subsection shall apply to any taxpayer
who is engaged in the trade or business of providing
medical care other than as an employee and who
used the cash receipts and disbursements method of
accounting.
‘‘(3) QUALIFIED
MEDICAL
CARE
DEBT.—For
purposes of this subsection, the term ‘qualified med-
ical care debt’ means any debt for medical care pro-
vided by the taxpayer to a low-income individual.
‘‘(4) 
DETERMINATION
OF
CHARGE.—The
amount of the taxpayer’s charge which may be taken
into account—
‘‘(A) shall not exceed the amount of the
charge that would be recognized for purposes of
title XVIII of the Social Security Act, and
‘‘(B) shall not include any amount for
which the taxpayer is not entitled to reimburse-
ment from the low-income individual.
‘‘(5) LOW-INCOME INDIVIDUAL.—For purposes
of this subsection, the term ‘low-income individual’
means an individual with a modified adjusted gross
income (as defined in section 34(c)(5)) below 135
percent of the income official poverty line (as de-
fined by the Office of Management and Budget, and
revised annually in accordance with section 673(2)
of the Omnibus Budget Reconciliation Act of 1981)
applicable to a family of the size involved.
‘‘(6) MEDICAL
CARE.—For purposes of this
subsection, the term ‘medical care’ has the meaning
given to such term by section 213(d).’’
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to taxable years beginning after
the date of the enactment of this Act.
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