Society
One lesser-known way in which the tax code subsidizes healthcare spending
The tax code allows for a detailed medical deduction (IMD) that subtracts certain medical expenses from taxable income; however, it currently benefits a small fraction of the population. Reforming the IMD could expand its reach, but lawmakers must consider other options to address the financial risks of health decline. The IMD has been modified since 1942 and still represents a significant portion of medical spending. It is more beneficial for taxpayers over 65 years old.
November 19, 2025