Our marketing director recent got back from Washington D.C for the IHRSA Legislative Summit. The summit focused on two particular acts that representatives are trying to get passed to better improve our nations health in the way of holistic instead of reactive! It is an exciting time for the health industry and this is a great opportunity to change the way our health care system works!
The first act is "Personal Health Investment Today". I will be referring to it from now on as PHIT.
PHIT Act
The PHIT act seeks to create a financial incentive for Americans to engage in physical fitness and exercise. It is in hope that with additional money dedicated to this act, more money would exist to create team sports, fitness and exercise, recreation, and other physical activities.
The PHIT Bill was introduced in 2007 by Jerry Weller (IL-11). Since then there are 17 co-sponsors in the House. Be sure to contact your local representative and get this Act pushed!
Here are some main points of the PHIT bill, as presented by the IHRSA Briefing Booklet.
- THe PHIT Act would help reverse the trend of rising physical inactivity and obesity rates, and the resulting increase in health care costs, by eliminating a federal policy barrier and providing an important tax incentive to promote exercise.
- Public health experts agree that regular physical activity substantially reduces the risk and symptoms of numerous chronic diseases and medical conditions, resulting in fewer hospitalizations, physician visits, and medications, as well as lower health care costs.
- Under the current set-up, Americans predominantly use pre-tax accounts to pay for treatment and detection of illnesses: prescription drugs, doctor visits, and examinations, and screening.
- The PHIT Act would allow consumers to include prevention in the form of increased physical activity, allowing fitness center dues, payments for some exercise equipment, and other fees associated with physical activity programs such as youth sports leagues, to be paid with pre-tax dollars.
- The PHIT Act could help Americans save 25-50%, depending on their income tax bracket, on the cost of physical activities, exercise programs, and related expenses.
- The PHIT Act tax incentive represents and important tangible benefit that the federal government can provide to promote healthier lifestyles and reverse the rising costs of treating obesity-related chronic diseases.
- Fitness-related tax savings would provide a great incentive for Americans to take an important first step toward reversing their sedentary lifestyles and lowering health care costs.
The next act is the Workforce Health Improvement Program, or simply the WHIP Act.
The WHIP Act
Under current tax law, businesses are permitted to deduct the cost of on site exercise facilities and employees are not taxed on the benefit. However, if an employer provides this same benefit at an off site facility, the employees who take advantage of the benefit must pay income tax on the value of the subsidy. The WHIP act would eliminate this inequity, reaffirming employers' right to deduct the cost of providing off site health club or gym benefits and preventing this wellness benefit from being considered additional income for employees.
Here are the Act's main points
- Current tax law excludes from employee income the value of "on-preises" athletic facilities provided by employers. However, if health club services to employees are provided in off site facilities, the value of the benefit to the employee is taxable income.
- The WHIP Act eliminates this equity, allowing employers to deduct the cost of health club memberships for their employees and ensure that this benefit would not be classified as additional income to employees.
- In 2006, the Joint Committee on Taxation determined that the provisions of the WHIP Act would cost $526 million over a ten year period. This moderate budget estimate stands in stark contrast to the $25 billion in annual health care savings the CDC estimates the federal government could achieve if every American adult engaged in regular exercise.
- The WHIP Act alone will not get every American off the couch and moving, but recent polling reveals that 78% of Americans claim that they would exercise more regularly if their employers subsidized a fitness center membership
- By enacting the WHIP Act, Congress has the opportunity to create the cost conducive environment possible for promoting additional workplace fitness programs at companies, both large and small. Given its relatively low cost to high return on the investment, WHIP represents a win-win wellness benefit that will put more money back into Americans' pockets while at the same time promoting healthier lifestyles and reducing the national health care expenditure.
Hopefully these two Acts have sparked your interest and want to help you get out there and do something. Be sure to contact your local representative and get active! Click here to find your local representative!
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