Texas patients and providers will no longer pay taxes on medical records and the systems used to access them.
Texas Comptroller Don Huffines signed an executive order Tuesday abolishing taxes on healthcare technology systems. In a statement, Huffines’ office said the technology was “unfairly” subjected to sales tax under a previous rule – which charged patients and doctors taxes to access medical information.
“When the Legislature wrote these rules, doctors’ offices weren’t running cloud-based record systems and patients weren’t logging into portals,” Huffines said the statement. “A Comptroller doesn’t get to arbitrarily rewrite the Tax Code. If it’s not authorized in the law, it’s not a tax.”
Texas Gov. Greg Abbott appointed Huffines to be the state’s chief financial officer after the agency’s previous leader, Kelly Hancock, stepped down. Huffines defeated Hancock for the GOP nomination in March, and took over the role in August. He is running as the Republican candidate to serve a full term in the upcoming midterm election in November, where he’ll face Democrat Sarah Eckhardt.
The Texas Legislature implemented a sales tax on data processing services in 1987, but Huffines said previous leadership of the Comptroller’s office stretched the decades-old tax rule to cover “things the legislature never intended.”
The rule change clarifies that electronic health records systems, electronic medical records systems, patient portals and other healthcare technology systems used to “maintain, access or share medical records” are no longer taxable.
“No Texan should have to pay a tax to see their own medical records,” Huffines said. “And no doctor should be taxed for pulling up the chart of the patient sitting in front of them. Healthcare is expensive enough. The last thing government should do is pile a hidden tax on top of it.”
The order directs the agency to file a proposed amendment with the Texas Secretary of State. Once it is published in the Texas Register, there will be a 30-day public comment period when Texans can submit feedback to the Comptroller’s office.
Abigail Ruhman is KERA’s health reporter. Got a tip? Email Abigail at aruhman@kera.org.
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