Are Concierge Medical Fees Tax Deductible? What Patients and Physicians Need to Know

Concierge medicine is booming in South Florida — and for good reason. MDVIP launched right here in Boca Raton back in 2000, and the tri-county area (Broward, Palm Beach, Miami-Dade) remains the national epicenter of the concierge medicine movement. Working from Davie, FL, we sit at the center of this ecosystem, and the tax question we hear most often from both patients and physicians is simple: Can I deduct my concierge medical fees?

The short answer: partially, sometimes, and it depends on how you structure it. The long answer is what follows — and if you're a physician thinking about the business side, the employer deduction angle might be the most valuable section you read all year.

The Core Rule: IRC Section 213(d) and What Counts as "Medical Care"

Under Section 213(d), you can deduct expenses for "medical care" — which includes the diagnosis, cure, treatment, or prevention of disease. The IRS interprets this broadly, but not without limits.

Here's where concierge fees get complicated. A typical concierge retainer bundles two things together:

If your concierge physician charges $5,000 per year and $3,200 of that is allocable to actual medical services, only the $3,200 is potentially deductible. The remaining $1,800 for access and availability is not.

Key Takeaway: The deductibility hinges on what you're paying for, not who you're paying. Access fees are not medical care. Services are.

What the IRS Has Actually Said

There is no Revenue Ruling or Tax Court case that directly addresses concierge medicine retainers by name. But the IRS has provided guidance through adjacent rulings:

• IRS Information Letter 2011-0027 addresses the distinction between paying for access to a physician versus paying for actual medical services. The letter confirms that the access component does not qualify.
• Revenue Ruling 2003-57 defines "medical care" broadly and reinforces that amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease qualify under Section 213(d).

In practice, this means you need documentation. Your physician needs to tell you — in writing — what portion of your retainer goes to actual medical services versus access. Without that allocation, defending the deduction becomes much harder.

The Proposed Regulations: DPC Arrangements (Not Yet Law)

In June 2020, the Treasury Department issued proposed regulations (REG-109755-19) that would explicitly treat payments for Direct Primary Care (DPC) arrangements as deductible medical expenses under Section 213(d). The comment period closed in August 2020.

Warning: These regulations are STILL PROPOSED as of March 2026. They have NOT been finalized. Do not treat DPC retainer fees as fully deductible based on these proposed regs alone. Plan based on current law — the partial allocation approach described above.

If and when these regs are finalized, they could simplify the analysis significantly for DPC arrangements. But until that happens, the access-vs-services distinction remains the governing framework.

The 7.5% AGI Floor — Why Many Patients Get Zero Benefit

Even if your concierge fees qualify as medical expenses, you still face two hurdles before you see any tax savings.

Hurdle 1: The 7.5% AGI floor. Medical expenses are only deductible to the extent they exceed 7.5% of your adjusted gross income. The Consolidated Appropriations Act of 2021 made this threshold permanent. For a taxpayer with $200,000 AGI, that means the first $15,000 in medical expenses produces zero deduction.

Hurdle 2: The standard deduction. For 2025, the standard deduction is $15,000 for single filers and $30,000 for married filing jointly. You only benefit from itemizing medical expenses if your total itemized deductions (including medical, state/local taxes capped at $10,000, mortgage interest, and charitable contributions) exceed the standard deduction.

Here's a realistic example:

For most concierge medicine patients — who tend to be higher-income — the individual deduction often produces no tax savings at all. That is why the employer route (below) is so much more powerful.

Self-Employed Physicians and Patients: A Common Misconception

If you're self-employed, you might assume your concierge fee qualifies for the self-employed health insurance deduction under Section 162(l). It does not.

Section 162(l) applies to insurance premiums — health insurance, dental, long-term care. A concierge retainer is not an insurance premium. It's a fee for services (or access to services). The distinction matters:

• Health insurance premium → Above-the-line deduction under Section 162(l)
• Concierge retainer → Itemized medical expense on Schedule A, subject to the 7.5% AGI floor

This catches people off guard, especially self-employed physicians who pay for their own concierge membership. The deduction is weaker than they expect.

HSA and FSA: Eligible, With Traps

If you have a Health Savings Account (HSA) or Flexible Spending Account (FSA), you can use those funds for the medical services portion of a concierge fee. The same allocation principle applies:

Critical HSA Trap: If the proposed DPC regulations (REG-109755-19) are ever finalized, DPC and concierge arrangements could be classified as "disqualifying coverage" — which would make you ineligible to contribute to an HSA while enrolled in a concierge arrangement. This is not current law, but it is a risk worth monitoring. If you rely on your HSA for tax planning, watch this space carefully.

The Employer Deduction: The Strongest Play in Concierge Medicine

Here is where the tax math gets genuinely compelling. When concierge medicine is structured as an employer-provided benefit rather than a personal expense, the tax treatment improves dramatically for everyone involved.

For the employer: The cost is deductible as an ordinary and necessary business expense under Section 162 — no AGI floor, no itemization requirement, no standard deduction hurdle.

For the employee: The benefit is excludable from income under Sections 105 and 106 when properly structured through a Medical Expense Reimbursement Plan (MERP) or Health Reimbursement Arrangement (HRA). Tax-free to the employee, deductible to the employer.

How to Structure It by Entity Type

Nondiscrimination Warning: Under Section 105(h), self-insured medical reimbursement plans (including MERPs) cannot discriminate in favor of highly compensated employees. You cannot set up a MERP that covers only the CEO's concierge fees. The plan must be available to a broad class of employees. Violations result in the benefit becoming taxable to the highly compensated employees.

For more on entity structure and the S-Corp election, including how 2%+ shareholder benefits flow through, see our detailed breakdown.

The Corporate B2B Opportunity for Physicians

This is where concierge physicians should pay close attention. Companies like Amazon (One Medical), Apple, and Microsoft (Crossover Health) already offer corporate concierge medicine programs. MDVIP has a formal employer program.

A solo concierge physician in South Florida can approach mid-size employers (50-500 employees) and offer executive concierge medicine as a covered benefit. The pitch:

• Employer deducts the full cost under Section 162
• Employee receives the benefit tax-free under Section 105/106
• Physician gets predictable, contracted revenue with corporate billing instead of individual collections
• Everyone wins on taxes

If you are building or scaling a concierge practice, this B2B angle is worth serious consideration. For more on the financial side, see our posts on starting a concierge practice and concierge medicine income in South Florida.

Practical Advice for Physicians: Issue Allocation Statements

If you run a concierge practice, do your patients a favor: issue a detailed annual allocation statement that separates medical services from access fees. This should include:

1. Total retainer paid for the calendar year
2. Amount allocable to medical services (physicals, labs, screenings, visits)
3. Amount allocable to access/convenience (availability, extended hours, direct communication)
4. Description of services rendered during the year

This documentation helps patients claim defensible deductions, makes your membership more attractive to tax-savvy patients, and positions your practice as professionally managed. It also strengthens the employer reimbursement pathway — an HRA administrator will want to see this breakdown.

For more on building a financially optimized concierge practice, explore our guides on tax strategies for concierge physicians and building wealth beyond the practice.

Florida-Specific Considerations

Florida has no state income tax, which means there's no state-level medical expense deduction to worry about — or benefit from. Every dollar of tax savings comes from the federal side.

This actually simplifies planning. You're not juggling different AGI thresholds or itemization rules across federal and state returns. The federal analysis above is your complete picture.

For concierge physicians operating in the Broward/Palm Beach/Miami-Dade corridor, the combination of no state income tax, a concentrated high-net-worth patient base, and the employer benefit structure creates a uniquely favorable tax environment for this practice model.

Frequently Asked Questions

Are concierge doctor fees tax deductible?

Partially. The portion of your retainer allocable to actual medical services (physicals, screenings, specific visits) qualifies as a medical expense under IRC Section 213(d). Access and convenience fees (24/7 availability, same-day scheduling) do not qualify. You need an allocation statement from your physician showing the breakdown.

Are concierge fees tax deductible as a business expense?

Not for individuals — but yes for employers. If your employer provides concierge medicine through a MERP, HRA, or QSEHRA, the employer deducts the cost under Section 162, and you receive the benefit tax-free under Sections 105/106. This is the most tax-efficient way to pay for concierge medicine.

Are medical concierge fees tax deductible on Schedule A?

The medical services portion is deductible on Schedule A as a medical expense, subject to the 7.5% AGI floor. For most higher-income taxpayers, the standard deduction will exceed total itemized deductions, producing zero benefit. Run the math before assuming you'll get a deduction.

Can I use my HSA for concierge medicine?

You can use HSA funds for the medical services portion of a concierge fee. Membership and access fees are not HSA-eligible. Be aware that proposed Treasury regulations could classify concierge/DPC arrangements as disqualifying coverage for HSA purposes if finalized — which would prevent you from contributing to an HSA while enrolled.

What is the employer concierge medicine tax deduction?

When an employer pays for concierge medicine as an employee benefit, the cost is deductible under Section 162 as an ordinary business expense. The employee receives the benefit tax-free under Sections 105 and 106 when structured through a MERP or HRA. C-Corporations get the cleanest treatment. S-Corp shareholders with 2%+ ownership have the benefit included in W-2 wages. Small employers under 50 employees can use a QSEHRA with annual limits of $6,350 (individual) and $12,800 (family) for 2026.

Related Articles

• What Does It Cost to Start a Concierge Medical Practice?
• Concierge Medicine Income in South Florida
• Tax Strategies for Concierge Physicians
• How Concierge Physicians Build Wealth Beyond the Practice
• S-Corp Election: What You Need to Know