Paying your doctor a retainer -- also known as "concierge medicine" -- has been a growing trend since the 1990s. The doctors in such practices promise less waiting time and more personal attention than you get in a conventional practice. Whether or not the retainer is deductible -- or partly deductible -- depends on what you get in exchange for your payment.
Not all medical expenses are deductible. Fees you pay your doctor for most medical services are valid deductions, for example the cost of annual checkups, emergency visits, lab fees and prosthetics. They're still deductible if your doctor runs a concierge practice. If you go to the same practice for plastic surgery or a hair transplant, those costs wouldn't be deductible -- they never are, with any doctor, regardless of how you pay for services.
Deducting the retainer itself plunges you into murkier waters. The IRS says retainers may be deductible -- or a legitimate expense for a health savings account -- depending on what you get for your money. If your fee pays for you to get a physical once or twice a year, plus ready access in emergencies, then you're paying for deductible services and the retainer is also deductible. If all you get is access -- the fee doesn't pay for any services -- there's no write-off. If part of the fee is for services, that part is deductible.
Claiming the Write-Off
Neither retainers nor fees for service are deductible unless you itemize your expenses. Medical costs are an itemized write-off on Schedule A, but you never get to deduct all of them. Add together your expenses and any bills you paid for your spouse and dependents, then subtract any reimbursement from your insurer. On top of that, subtract 10 percent of your adjusted gross income. If you have any expenses left over after the subtracting, you can deduct them.
If you take the standard deduction, paying concierge fees won't affect your taxes at all. If you itemize and the medical deduction is an option, talk to the practice about the details of the fee. The staff should be willing to explain whether you're getting medical services or just access to services. It may be that the advantages that come with the retainer -- some concierge doctors guarantee house calls, for instance -- are more important than the tax questions.
- Healthcare Professionals Network: Retainer-Based Medicine: Making Patients VIPs
- Internal Revenue Service: Medical and Dental Expenses
- Benefit Beat: IRS Clarifies Qualified Medical Expenses
- New York Times: Using Pretax Money to Cover Concierge Practice Fees
- Bankrate: Concierge Medicine, Now for the Not-so-Rich
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