What do you use to prove to your insurance you had surgery?

[SuperMom 33]

Hi all. My insurance Humana (but alot of Humana are different for different companies) would not pay any of the sleeve surgery. So I did cash pay. Now I need to see about having another surgery (tubes tied). I have basic receipts that say the total amount paid and to the doctor and hospital but I am not sure this is going to swing proving to the insurance company I have paid enough out of pocket for the year. Our out of pocket in network and out is 4,000 and it was wayyyy over that. I called the doctors office and since I have paid up my bill with them, they really do not want to get involved. She is sending me a "statement" whatever that is.......anyone else run into this problem?

Also for filing on taxes next year .....so all you show is your receipts??? CPA said anything surgery over 10,000 should be deductible....

Thanks!

[VSG4aHealthierMe 6]

Hi all. My insurace Humana (but alot of Humana are different for different companies) would not pay any of the sleeve surgery. So I did cash pay. Now I need to see about having another surgery (tubes tied). I have basic receipts that say the total amount paid and to the doctor and hospital but I am not sure this is going to swing proving to the insurance company I have paid enough out of pocket for the year. Our out of pocket in network and out is 4,000 and it was wayyyy over that. I called the doctors office and since I have paid up my bill with them, they really do not want to get involved. She is sending me a "statement" whatever that is.......anyone else run into this problem?

Also for filing on taxes next year .....so all you show is your receipts??? CPA said anything surgery over 10,000 should be deductible....

Thanks!

I don't know about Humana but with my ins anything paid out of pocket only goes toward my deductible & max out of pocket if its a covered procedure/test. For example, for some stupid reason they won't pay for bloodwork because they say EVERYTHING is routine and they don't cover routine blood work (please tell me how a 20 something woman getting her testosterone levels checked- I have PCOS- is routine??!!). So my doc has done a FULL hormone workup and CBC panel 2x now totalling around $800 both times, which they didn't pay on but neither time counted toward my deductible or max out of pocket. I wish it did because then I would be set for the year with both my deductible & max out of pocket after my sleeve next year!I would just call your insurance company and see what their policy is on this type of thing.

[Wheetsin 714]

Out of pocket maximums only apply to covered procedures, that I know of. Elective procedures do not count towards them - elective meaning excluded from your plan. E.g. if your out of pocket maximum was $2000, you could not have breast implants and pay $6000, and consider yourself having met your maximum. You could pay $2000 toward a $40,000 procedure, pretending $2000 was your portion of the agreed charge, and consider yourself having met the maximum.

Hope that helps.

The statement should indicate the charges and what your balance is, if any.

A statement of "anything over $10,000 should be deductible" is not accurate. Eligibility for deduction is on a percentage basis, not a flat rate. Here's the skinny...

(Would you believe I've worked for both a very large insurance company, and a very large tax company? I swear it's true!)

You can only deduct medical costs that exceed 7.5% of your AGI. So the formula is:

AGI * .075 = 75% of AGI.

Your expenses - 75% of AGI = allowed deduction.

Let's say your AGI is $100,000, and your deductible medical expenses are $5000. (not all expenses are deductible)

$100,000 * .075 = $7500.

$5000 - $7500 = no deduction for you.

Let's say your AGI is $20,000 and your deductible medical expenses are $5000.

$20,000 * .075 = $1500.

$5000 - $1500 = $3500 deduction.

If what your CPA told you is accurate and $10,000 is 75% of your AGI, then anything over it should be deductible. Most taxpayers do not reach an OOP amount that's greater than 7.5% AGI. It tends to take a very low income, or very high medical expenses.

More information, examples, and a list of deductible medical expenses can be found in IRS Pub 502

* disclaimer: I hope I didn't fat finger a number up there and completely throw off the math.

[VSG4aHealthierMe 6]

(Would you believe I've worked for both a very large insurance company, and a very large tax company? I swear it's true!)

Don't want to thread jack, just have a couple super quick questions that may help the topic starter too. I read the link and I couldn't get a clear read on a few things.

1. Is WLS considered a covered "weight loss program"?

2. Is the need for cosmetic surgery to repair "a deformity arising from a disease" covered as a tax detectible procedure if the disease was obesity and the deformity is excess skin, due to weight loss, being removed?

3. Can a procedure be tax deductible if it is done out of the country?

Sorry to bombard you with these questions. I have been wondering about these 3 things since I decided to have WLS and when I saw that you might actually know the answer I had to ask.

[Indymom 132]

Wheetsin, I work for a large health insurer too.

Publication 502 is tough to interpret. My personal opinion is that weight loss surgery whether done in the US or outside, should be covered under 502 as a tax deductible expense. Even though it's 'elective,' it's not cosmetic. Elective simply means you decided to have the surgery in advance, vs. needing 'emergency surgery' (or bypass surgery following a heart attack, etc.). Things like hip and knee replacements are also considered 'elective.'

Plastic/cosmetic surgery would typically not be considered a deductible expense, although Kristie does give one pause with her explanation above about obesity=disease and the cosmetic surgery to repair a 'deformity from disease.' You could potentially argue that one but I don't know, I suspect IRS auditors can be pretty shrewd.

In all matters tax-related, I ALWAYS tell my clients to defer to a tax professional.

Back to the opening post, Wheetsin is absolutely correct - any non-covered service (like your cash pay surgery) will not accumulate towards your deductible or out of pocket expense, unfortunately.

[SuperMom 33]

Thanks for the info. I am still going to send it in and see what they say. I will post later and let you guys know how it comes out. At least now I am not expecting much. Still glad I did it!!!

Thanks again!

[VSG4aHealthierMe 6]

Wheetsin, I work for a large health insurer too.

Publication 502 is tough to interpret. My personal opinion is that weight loss surgery whether done in the US or outside, should be covered under 502 as a tax deductible expense. Even though it's 'elective,' it's not cosmetic. Elective simply means you decided to have the surgery in advance, vs. needing 'emergency surgery' (or bypass surgery following a heart attack, etc.). Things like hip and knee replacements are also considered 'elective.'

Plastic/cosmetic surgery would typically not be considered a deductible expense, although Kristie does give one pause with her explanation above about obesity=disease and the cosmetic surgery to repair a 'deformity from disease.' You could potentially argue that one but I don't know, I suspect IRS auditors can be pretty shrewd.

In all matters tax-related, I ALWAYS tell my clients to defer to a tax professional.

Back to the opening post, Wheetsin is absolutely correct - any non-covered service (like your cash pay surgery) will not accumulate towards your deductible or out of pocket expense, unfortunately.

Thanks for the info

[Wheetsin 714]

Don't want to thread jack, just have a couple super quick questions that may help the topic starter too. I read the link and I couldn't get a clear read on a few things.

1. Is WLS considered a covered "weight loss program"?

2. Is the need for cosmetic surgery to repair "a deformity arising from a disease" covered as a tax detectible procedure if the disease was obesity and the deformity is excess skin, due to weight loss, being removed?

3. Can a procedure be tax deductible if it is done out of the country?

Sorry to bombard you with these questions. I have been wondering about these 3 things since I decided to have WLS and when I saw that you might actually know the answer I had to ask.

Don't worry about bombarding me - I'm happy to help if I can. But I'm not a tax preparer, or an insurance claims professional -- I work on the ancillary corporate performance side. I sat next to actuaries and underwriters and tax attorneys so I've picked up a lot of information, but it's not my profession directly. Having said that, these answers are to the best of my knowledge, but I would strongly advise you to follow-up with a pro before you take my word.

1. WLS is generally not considered a "weight loss program." That term tends to apply to things like Weight Watchers, and NutriSystem. You cannot (or could not, last I actually kept up with a lot of this stuff) deduct things like gym memberships or weightloss club fees, nor the cost of "diet food." In 2002 (IIRC) the IRS categorized obesity as a disease, which is when programs became deductible. Anything that's not a recognized "program" is not considered treatment of disease (just as you could not deduct aromatherapy for treatment of heart disease, even if it did help you remain calm and stress-free).

I think it MAY also depend on the procedure. In... 2009? the IRS approved Gastric Bypass/RNY for tax deduction. I don't know if that approval is specific to RNY, or can be more widely applicable to bariatrics. But I will call a friend of mine who will know, and see what she says. I have great insurance and a good income, so my expenses have never exceeded the AGI threshhold so this is not one of the tax sectors I try to keep up on.

2. I actually looked into this around 2007 when I saw how horrible my skin was becoming with my weightloss from lap-band. At the time, the answer was no (assuming you're asking about plastics for saggy skin). I wonder, though, if someone armed with enough evidence could fight that.

Generally, you cannot include in medical expenses the amount you pay for unnecessary cosmetic surgery. This includes any procedure that is directed at improving the patient's appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease. You generally cannot include in medical expenses the amount you pay for procedures such as face lifts, hair transplants, hair removal (electrolysis), and liposuction.

You can include in medical expenses the amount you pay for cosmetic surgery if it is necessary to improve a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease.

Could we make the argument that obesity is a disfiguring disease? I'm not sure. It depends on their use of disease (e.g. "cancer" is a disease, but cancer because of actions you have done to yourself, such as lung cancer from smoking cigarettes, can sometimes be excluded -- and I wonder if obesity would be too, since it's a self-inflicted disease.)

Here's my best guess. Plastic surgery specifically for body function might be deductible. Plastic surgery for cosmetic reasons would not be. I think a panniculectomy may be deductible, since it is a procedure specifically for removing only skin, if you had medical evidence of necessity (e.g. a history of Dr. visits for treatment of skin sores, yeast infections in the area, etc.) I doubt a lower body lift would be deductible. Having said that, I know that breat augmentation following mastectomy has been successfully deducted, and one could argue that fake breasts are "unnecessary" and only for "improving the patient's appearance," and that absence of a breast or breasts "does not meaningfully promote the proper function of the body."

3, Yes! For procedures after 2002. Your travel costs can also be deducted, unless they are included in the cost of your procedure (e.g. if procedure cost includes hotel stay).

Make sure to keep ALL of your paperwork - receipts, doctor/surgeon letters, etc.

Oh and a little birdy once told me that if you call a tax office (rhymes with waych sand car lock), even if they don't do your taxes, they will answer your tax questions free of charge, year-round, though for help in the off season (roughly June - Oct) you'll need to get in touch with a district office. They have two types of tax offices: standard and premium. Premium offices have more experienced tax professionals. I can't attest to the accuracy of any of this, but you might want to tuck it away under "good to know."

[VSG4aHealthierMe 6]

..................tuck it away under "good to know."

Thanks, will do! BTW, the flight is included in "travel expenses" right?

[Wheetsin 714]

Yes, you can include YOUR flight. If you elect to take spouse, children, etc. you cannot deduct their flights. (I'm assuming they don't specify flight along with taxi, bus, etc. because it's relatively unusual to fly somewhere for surgical treatment.) This reimbursement is still subject to the 7.5% limitation.

Keep in mind this is a deduction, not a credit. That one really messes people up sometimes.

A deduction reduces your taxable income.

A credit is a dollar-for-dollar tax reduction.

I take a $2000 deduction on $100,000 worth of income. My taxable income becomes $98,000.

A $2000 tax credit would reduce my taxes owed by $2000.

(We built a house in 2010, and qualified for the $6,500 homeowner credit, and a $1500 energy star credit, so our actual tax refund was increased by $8,000 over what it would have been otherwise).

This is all really simplified, so forgive any technicalities I've left out.

Medical expenses may include:

• Fees paid to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists, and Christian Science practitioners for medical care expenses
• Payments for hospital services, qualified long-term care services, nursing services, and laboratory fees including the incidental cost of meals and lodging charged by a hospital or similar institution if your principal reason for being there is to receive medical care
• Payments for acupuncture treatments or inpatient treatment at a center for alcohol or drug addiction are also deductible medical expenses. You may include amounts you paid for participating in a smoking-cessation program and for drugs prescribed to alleviate nicotine withdrawal
• The cost of participating in a weight-loss program for a specific disease or diseases, including obesity, diagnosed by a physician. In general, you may not deduct the cost of purchasing diet food items or the cost of health club dues
• The cost of drugs is deductible only for drugs that require a prescription, except for insulin
• Admission and transportation to a medical conference relating to the chronic disease of yourself, your spouse, or your dependent (if the costs are primarily for and essential to the medical care). However, you may not deduct the costs for meals and lodging while attending the medical conference
• The cost of items such as false teeth, prescription eyeglasses or contact lenses, laser eye surgery, hearing aids, crutches, wheelchairs, and guide dogs for the blind or deaf, and
• Transportation costs primarily for and essential to medical care that qualify as medical expenses. The actual fare for a taxi, bus, train, or ambulance can be deducted. If you use your car for medical transportation, you can deduct actual out-of-pocket expenses such as gas and oil, or you can deduct the standard mileage rate for medical expenses. With either method you may include tolls and parking fees

You guys owe me when I get my sleeve & have a bunch of sleeve questions.