Increase tax credit for long-term health insurance
"As governor, Bob McDonnell will provide for an increase in the refundable tax credit for purchase of long term health insurance."
Legislators haven't funded larger tax credit
Updated: Monday, August 6th, 2012 | By Nancy Madsen
When he was running for governor, Bob McDonnell made a pledge to encourage Virginians to buy long-term care insurance.
The policies cover the cost of care for assistance in daily activities -- such as dressing, bathing, walking and eating -- that a person can no longer perform because of chronic conditions, age or disability. The plans have become increasingly popular as Americans live longer and the cost of health care rises.
The McDonnell campaign, in a health policy paper released in September 2009, made this promise: "As Governor, Bob McDonnell will provide for an increase in the refundable tax credit for purchase of long-term care insurance.”
The General Assembly passed legislation in 2006 that allows Virginians to claim a 15 percent state income tax credit for the premium costs of long-term care policies. McDonnell, in his position paper, said the credit should be increased to 30 percent.
As governor, McDonnell backed legislation in 2010 and 2011 that would have expanded the tax credit to 30 percent. The General Assembly passed the measure in 2011 but did not provide funding for it. The final version of the bill, which McDonnell signed, required lawmakers to approve the measure again and pay for it.
Last December, McDonnell submitted a budget that included $1.2 million per year to cover the cost of the tax credit. But the General Assembly did not approve the appropropriation. Lawmakers said they will take up the bill again next year.
Del. T. Scott Garrett, R-Lynchburg, has been the patron of the bill for the last few years. He said he understands the pressures on the budget committees to balance a variety of immediate needs.
"It"s not a huge big-ticket item, unlike the state"s funding impact of Obamacare, but it"s a balancing decision with public education, public safety, infrastructure and transportation,” he said.
McDonnell has pushed forward on his pledge to expand tax credits for those who purchase long-term care policies and has suffered near-misses in the General Assembly. The legislation is expected to come up again next year, so we rate this promise In the Works.
McDonnell for Governor, health care plan, Sept. 10, 2009.
Legislative Information System, 2006 H.B. 786, accessed July 30, 2012.
Legislative Information System, 2011 H.B. 1840, accessed July 30, 2012.
Legislative Information System, 2012 H.B. 505, accessed July 30, 2012.
Senate Finance Committee, Resources subcommittee reporton SB 29 and SB 30 from 2012 session, accessed July 30, 2012.
Email from Taylor Thornley, July 30, 2012.
Interview with Del. T. Scott Garrett, July 31, 2012.
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