Are the costs of ABA therapy deductible as a medical expense?

I approach answering this question with some trepidation. I have not found a clear-cut answer, and there are aspects of ABA (applied behavioral analysis) therapy with which I am not familiar. Therefore, I am going to put some disclaimers directly into this post:

I. IRS Circular 230 Disclaimer

NOTHING in this post is intended or written to be used for the purpose of avoiding Federal Tax penalties, and it cannot be used by the reader or any taxpayer to avoid Federal Tax penalties, and this post was not written to support the promotion or marketing of any transaction or matter discussed in it.

II. Consult Your Tax Advisor

This is not legal advice that you can use in any way. Consult your tax advisor about whether you can or should take this as a medical deduction.

III. This does not create an attorney-client relationship.

Now, back to the question:

It is my belief that ABA therapy does qualify, in whole or in some parts, as an expense that is properly deductible on Schedule A as a medical expense. How much of the therapy you can deduct will depend upon the actual modalities used in your particular situation. The fact that something is called ABA therapy does not necessarily make it "medical" in nature. You might have to look at each particular activity and deduct some but not all activities.

Therapy to diagnose, cure, mitigate, treat, or prevent a disease or for the purpose of affecting any structure or function of the body, is deductible as a medical expense. Based upon my understanding of ABA therapy, the premise of ABA therapy would qualify under this test for deductibility as a medical expense.

Industry groups weigh in on Obama's speech

Healthcare industry groups generally agreed with President Barack Obama that the status quo on the current healthcare system was not sustainable, but offered differing views on how the system should be fixed.

Insurance regulation was a chief focus of the president's speech on Wednesday night. Obama said that a government-run public option would be a way to get insurers to lower costs. In a written statement, Karen Ignagni, president and CEO of America's Health Insurance Plans, reiterated the organization's longtime position that a public plan was not the solution to improving coverage. “New health insurance reforms and consumer protections will solve the problem without creating a new government-run plan that will disrupt the quality coverage that millions of Americans rely on today,” she said.

“America's hospitals stand ready to do our part to extend coverage to more Americans and to continually strive towards providing high-quality care for patients that is more efficient and affordable,” said Richard Umbdenstock, president and CEO of the American Hospital Association, in a written statement. The AHA continues to have concerns on how a public plan would be constructed, but is “glad to see that President Obama is open to exploring other ideas that would help us achieve our shared goal of universal coverage.” -- Jennifer Lubell

From ModernHealthcare.com

Posted: September 10, 2009 - 1:00 pm EDT

Paul’s Comment: Why has the insurance industry not already put into effect those “insurance reforms and consumer protections” that Ms. Ignagni finds acceptable? Since it takes an earthquake-sized shift in electoral politics to move Congress to enact fundamental reforms, if Congress doesn't enact some type of public option now, will there ever come another time when Congress will adopt a public option before it is too late?

The Time for Bi-Partisanship is Over

Like virtually every President in recent memory, President Barack Obama came to Washington with one of his stated goals being to emphasize bi-partisanship. In more colloquial terms, President Obama seemed to be a lover, not a fighter. But the time to fight, every President learns, is now. Except that some Presidents learn this lesson too late to be an effective President.

Everytime President Obama has talked about bi-partisanship, the Republican leadership has kicked him in the teeth. They have no interest in bi-partisanship. They want the stimulus package to fail. They want health care reform to come to naught. They are desperately looking for campaign issues for 2010 and 2012. They are interested in returning to power only for power's sake, not for the sake of the country.

It's time President Obama jettisons "bi-partisanship" and goes about the business of governing. He may need the votes of two or three Republican Senators to get health care reform passed, but that is not bi-partisanship. It is simply cobbling together a viable majority to get critical legislation passed. If the cost of getting health care reform legislation passed is watering down the proposal to get 70%, then do it.

Democrats never seem to get the message. There is no purity in politics. When Hubert Humphrey was not pure enough for many Democrats, we got Richard Nixon as President. When Jimmy Carter wasn't great enough, we got Ronald Reagan, then George W. Bush. It's time for progressives to lead the way, picking up support where possible; sacrificing perfection where necessary.

Lyndon Johnson understood the need to get important legislation passed. When he proposed his War on Poverty, a Commission studied the issue and suggested that it would take about $30 billion dollars to do it right. All President Johnson could get out of Congress was $5 billion. While this was a prescription for failure, he took what he could get, and we are better off for it. The "War" was lost in the first days, but we did get Head Start out of the ashes. What a wonderful gift to the country. We may not have gotten all of the community organizing we needed to make the War successful, but we got some very treasured programs and principles that have proved successful and long-lasting.

It's time for President Obama to "break some eggs." He needs to get significant health care reform passed this year. It doesn't have to be perfect; it just has to be real reform. Mr. President: Your Presidency and the country hang in the balance. The time to act is now.

Federal Health Care Reform Legislation

There seems to be general agreement among members of Congress that there is a significant need for health care reform. The rising cost of health care cannot continue unabated, and the need to provide affordable health care for most, if not all Americans, is subject to little debate.

Legislative action on this issue cannot be allowed to turn on anecdotes. Unfortunately, people always have and always will fall through the cracks. During the debate in Congress, one will hear of isolated incidents after isolated incidents; the person who had to wait an inordinate amount of time to get a follow-up appointment; the person who was sent to the wrong specialist. These are the statements of members of Congress who realize the need for reform, but want the reform to wind up looking as much like the current system as possible.

The real question for people to focus on is how large are the cracks in the system, and how to close those gaps? A person with cerebral palsy may need physical therapy every week for his or her life. It is a common feature of health insurance plans to pay for only 10 visits per year for physical therapy. This is a major crack in the system and needs systemic reform.

A number of organizations that are involved with people with disabilities are working hard to try to shape the legislation to address the needs of people with disabilities. One such organization is Easter Seals. You can go to its Health Care Reform Web Site for information or directly to its "Support Health Care Reform Legislation" site to send messages to your members of Congress. I hope you will go to its "Support" web page; but, if not, at least, become familiar with the issues at its Health Care Reform site.

Thank you.

Paul