The USF "Tech Tax": A Threat to Digital Health Innovation

Ross Marchand, Executive Director of the Taxpayers Protection Alliance, discusses the implications of proposed reforms to the Universal Service Fund (USF) on digital health innovation, telehealth, and healthcare access in a recent episode of the Health Policy Podcast. The conversation highlights concerns over potential taxes on technology that could hinder advancements in healthcare services.

WASHINGTON — October 20, 2026 — In a new episode of the Health Policy Podcast, Ross Marchand, Executive Director of the Taxpayers Protection Alliance, examines the potential impact of Universal Service Fund reforms on digital health innovation. The discussion covers the intersection of healthcare access, telehealth, and the implications of a proposed "tech tax" on digital health solutions.

Marchand emphasizes that the expansion of USF contributions to include technology services could severely hinder innovation in healthcare. He points out that the current USF program, which spends $8 billion annually, already imposes significant costs on consumers, with nearly 40% added to phone bills. "The government always says that they're gonna do something, and the end result is usually the exact opposite," Marchand said, underscoring the inefficiencies of government programs.

The conversation also highlights the importance of technology in bridging healthcare gaps, particularly in rural areas where access to medical services is limited. "Technology is increasingly bridging the gap. That's where these apps, that's where these video games, that's where these virtual services and telehealth come into the mix," Marchand noted. He warns that imposing additional taxes on tech services could stifle innovation and limit access to essential healthcare tools, especially for underserved populations.

Marchand further critiques the focus on increasing contributions to the USF rather than addressing spending inefficiencies. "If USF contributions are expanded to include tech, this is going to be a disaster for hundreds of millions of Americans, especially patients, and especially rural patients," he stated. He calls for a reevaluation of spending priorities within the USF to ensure that funds are used effectively to enhance connectivity and healthcare access.

The Taxpayers Protection Alliance is a nonpartisan nonprofit organization dedicated to holding the government accountable and ensuring that taxpayer dollars are spent wisely.

About the Health Policy Podcast

The Health Policy Podcast focuses on issues related to energy, infrastructure, policy, and economic growth, providing insights and discussions on the intersection of health and public policy.