The HEALTH Act of 2025 lets qualified physicians deduct the ‘‘unreimbursed Medicare-based value’’ of charity care they furnish to individuals enrolled in Medicaid (title XIX) or CHIP (title XXI). The bill uses the Medicare physician fee schedule as the valuation benchmark and expands the deduction to taxpayers who use the standard deduction rather than itemizing.
Separately, the bill adds a new federal limitation of liability in the Public Health Service Act that bars civil suits for harms arising from qualified charity care unless the conduct was intentional, knowing, reckless, or grossly negligent, and it preempts inconsistent state law absent greater defendant protection. The combination of a federal tax incentive and a preemptive liability rule aims to encourage pro bono services but raises implementation, documentation, and accountability questions for payers, providers, and states.
At a Glance
What It Does
Grants physicians a tax deduction equal to the Medicare-fee-schedule value of uncompensated care provided to Medicaid and CHIP enrollees, and creates a federal civil-liability shield for physicians and attending medical personnel when furnishing that care unless the conduct is intentional, knowing, reckless, or grossly negligent. It also allows the deduction to be claimed by taxpayers who do not itemize.
Who It Affects
Directly affects physicians (as defined by Social Security Act section 1861(r)) who provide uncompensated services to Medicaid/CHIP enrollees, attending medical personnel receiving liability protection, and the IRS and HHS for valuation and enforcement. Indirectly affects state tort regimes, malpractice insurers, and Medicaid administrators.
Why It Matters
It creates a federal financial incentive to increase physician pro bono care to low-income children and adults enrolled in state programs while changing the legal exposure for providers nationwide. That mix of tax policy and federal preemption could shift where and how safety-net care is delivered and how states regulate medical liability.
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What This Bill Actually Does
The bill creates a new federal tax deduction for physicians who provide uncompensated services to patients enrolled in Medicaid or CHIP. Instead of measuring the deduction by the provider’s billed or out‑of‑pocket costs, the statute ties the allowable amount to the Medicare physician fee schedule — the amount Medicare would pay for the same service.
The deduction applies to services provided ‘‘without reimbursement or the expectation of reimbursement’’ to enrolled individuals, so it targets true charity care rather than care for which payment is expected.
To reach a broader pool of physicians, the bill amends the definition of taxable deductions so that the new charity-care deduction can be claimed even by taxpayers who take the standard deduction (it inserts the new deduction into section 63(b)’s list). The text sets an effective date for care furnished after December 31, 2025.
The bill also specifies a short list of excluded services — notably services barred by certain appropriations provisions and gender-affirming surgeries and hormone treatments — which limits the universe of deductible charity care.The bill pairs the tax incentive with a federal limitation on civil liability inserted into the Public Health Service Act. That provision immunizes physicians and attending medical personnel from federal or state civil actions for harms arising from qualified charity care unless the provider’s conduct was intentional, knowing, reckless, or grossly negligent.
The statute expressly preempts inconsistent state laws except where a state affords greater protection to defendants, effectively setting a federal floor for liability exposure tied to charity care.Operationally, the statute leaves several routine implementation questions to agencies: neither the tax language nor the PHSA amendment prescribes a certification process or documentation standard for proving ‘‘qualified charity care,’’ nor does it describe how a physician should calculate aggregated unreimbursed Medicare-based value across mixed patient populations. That means IRS and HHS rulemaking — and provider recordkeeping practices — will determine how readily physicians can claim the deduction and rely on the liability shield.
The bill’s mechanics reorient incentives (using Medicare prices) and legal risk (raising the negligence threshold), but they do not build an administrative ledger or verification system into the statute itself.
The Five Things You Need to Know
The deduction equals the Medicare physician fee schedule amount (the Section 1848 schedule) for each unreimbursed service rather than a provider’s billed charge or actual cost.
Qualified charity care is limited to services provided without reimbursement or expectation of reimbursement to individuals enrolled under title XIX (Medicaid) or title XXI (CHIP) of the Social Security Act.
The bill explicitly excludes services barred by sections 506 and 507 of title V of division D of the Further Consolidated Appropriations Act, 2024, and excludes sex reassignment surgeries and hormone treatments for gender alteration.
The tax change is available to taxpayers who do not itemize by inserting the new deduction into section 63(b); the statutory effective date applies to care furnished after December 31, 2025.
The civil-liability limitation bars state or federal civil suits for harms from qualified charity care unless the conduct was intentional, knowing, reckless, or grossly negligent, and it preempts less‑defendant‑friendly state rules (but not state rules that are more protective of defendants).
Section-by-Section Breakdown
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Short title
Names the statute the "Helping Everyone Access Long Term Healthcare Act of 2025" or "HEALTH Act of 2025." This is purely captions the rest of the bill; it does not alter substance but frames legislative intent to combine tax and liability tools to expand access to long‑term and safety‑net care.
Creates a deduction for qualified charity care
Adds a new section to the Internal Revenue Code allowing physicians to deduct the ‘‘unreimbursed Medicare‑based value’’ of qualified charity care. Practically, that ties the deduction to Medicare’s physician fee schedule (section 1848 of the Social Security Act) instead of provider costs. The section defines ‘‘physicians’ services’’ by cross‑reference to the Social Security Act and narrows eligible patients to Medicaid and CHIP enrollees; those definitional cross‑references shape who qualifies and which CPT/HCPCS codes are in scope for valuation.
Makes the deduction claimable without itemizing and sets effective date
Amends section 63(b) so taxpayers who take the standard deduction can still claim the new physician charity‑care deduction, lowering the practical bar for solo practitioners and employed physicians. The statute applies to qualified charity care furnished after December 31, 2025, which forces providers and tax advisors to plan documentation and potential retroactive adjustments only for care after that date.
Specific service exclusions
The statute carves out certain services from the deduction: services barred by specified appropriations provisions and gender‑affirming surgeries and hormone treatments. Those exclusions limit the deduction’s reach and signal legislative choices about which clinically and politically contentious services are excluded from the charity‑care incentive.
Federal liability limitation and preemption
Inserts a new subsection into the Public Health Service Act that shields physicians and attending medical personnel from civil liability for harms arising from qualified charity care unless their conduct was intentional, knowing, reckless, or grossly negligent. It also includes an express preemption clause that overrides state laws that are inconsistent with the federal standard unless the state law offers greater protection for defendants. That provision sets a federal negligence floor while allowing states to expand defendant protections further.
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Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Physicians providing unreimbursed care to Medicaid/CHIP enrollees — they receive a tax incentive calculated at Medicare rates, which can significantly offset the financial burden of pro bono care and is available even if they take the standard deduction.
- Small and solo practices — because the deduction is claimable by non‑itemizers, smaller providers who typically use the standard deduction can capture the benefit without changing their filing status or absorbing itemization compliance costs.
- Volunteer medical organizations and safety‑net clinics that rely on attending medical personnel — the liability shield reduces malpractice exposure for clinicians who staff free clinics or mobile outreach programs, lowering a barrier to volunteerism.
Who Bears the Cost
- Federal taxpayers — the deduction reduces federal revenue, and the bill contains no offsets or caps, so the fiscal cost grows with uptake unless later constrained by regulation or law.
- Patients and tort claimants — the raised standard for liability (intentional/knowing/reckless/gross negligence) narrows civil remedies for injured patients receiving charity care, shifting some costs of adverse events away from providers and insurers toward claimants or public programs.
- State governments and courts — the federal preemption alters state tort regimes and could complicate state attempts to regulate provider conduct or pursue claims, especially in states that favor broader patient remedies; states may face pressure to change their laws or to grant greater protections to defendants to remain exempt from preemption.
Key Issues
The Core Tension
The bill trades expanded access incentives for reduced legal accountability: it uses federal tax and preemption power to encourage physicians to provide unpaid care to Medicaid/CHIP enrollees, but by raising the civil‑liability bar and avoiding detailed verification rules it risks undercutting patient remedies and inviting inconsistent implementation, leaving regulators to choose between broad uptake and strict safeguards.
The bill creates a strong incentive by valuing charity care at Medicare prices, but the statute does not provide a practical verification system for ‘‘unreimbursed Medicare‑based value.’” That raises immediate questions: how should physicians aggregate services across payors and episodes of care, which CPT/HCPCS codes map to the Medicare schedule for charity services, and what documentation will satisfy IRS auditors? Because the statute ties the deduction to Medicare payments rather than costs, physicians could claim a deduction that exceeds their incremental cost of providing the service, generating potential windfalls and complicating fiscal forecasting.
The liability shield produces a parallel set of tensions. Raising the negligence threshold will reduce malpractice exposure for many charity providers, but the text leaves ‘‘attending medical personnel’’ undefined beyond the common statutory phrase and does not provide procedural safeguards for patients (such as notice or mandatory reporting).
The preemption clause imposes a federal floor on liability exposure but permits states to adopt more defendant‑friendly rules; that asymmetry could prompt states to alter their laws or increase regulatory oversight of charity programs. Finally, the statute excludes gender‑affirming surgeries and hormone treatments and references specific appropriations prohibitions, which creates a legal patchwork: some charity services will be deductible and shielded while nearby services are not, producing operational complexity for providers and possible legal challenges over definitions and equal protection claims.
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