- Lawmakers in Congress are once again taking up the biggest item on the device industry's wish list for nearly a decade: Repeal of the 2.3% device tax enacted as part of the 2010 Affordable Care Act. Nearly a year after the House of Representatives passed the last attempt at repeal, Rep. Ron Kind, D-Wis., reintroduced the measure in the new Congress Wednesday.
- The bill has 227 bipartisan cosponsors in the House and is the companion legislation of a Senate version introduced by Sens. Pat Toomey, R-Pa., and Amy Klobuchar, D-Minn., last month.
- New AdvaMed Chairman and Stryker CEO Kevin Lobo told reporters on a call last week the repeal of the medical device tax remains the top priority for the device lobby.
While the ACA enacted many taxes on parts of the healthcare sector to fund coverage expansion, the repeal of the medical device tax arguably has won the most bipartisan support for repeal, thanks in part to years of aggressive lobbying key lawmakers in states with a large industry presence.
The tax has been suspended since 2016 but is slated to go back into effect at the end of the year. Despite the support of lawmakers across the political spectrum for repeal, the biggest sticking point has been finding offsets.
In 2015, the Congressional Budget Office found repealing the medical device tax would cost the government $24.4 billion over a 10-year period. Industry argues the tax is poorly designed given it is an excise tax on gross sales without regard to company profits. Lobo noted the tax is among the many challenges facing small medtech companies.
"America's medical technology industry is facing a $20 billion tax increase at year-end, when the current medical device tax suspension expires. Urgent action is essential to protect future medtech innovations that benefit patients and to avoid putting good-paying U.S. jobs at risk," AdvaMed CEO Scott Whitaker said in a statement.
Last year, the House passed a similar standalone bill, 283-132, but former Rep. Erik Paulsen, R-Minn., lost his reelection campaign. Kind alongside Jackie Walorski, R-Ind., Scott Peters, D-Calif., and Richard Hudson, R-N.C., appear to have taken up the effort in his absence.
The proposal to strike the tax down also has the support of the White House, which last year put out a Statement of Administrative Policy calling for its removal.
AdvaMed EVP of public affairs Greg Crist previously told MedTech Dive the trade lobby would pursue a maneuver to force the House to directly consider the bill. But the procedure, which would use the newly created Consensus Calendar, necessitates 290 cosponsors, indicating it may be an unviable path.
Lobo said AdvaMed will push for the bill through any moving legislative package possible, noting there are several "must pass" legislation packages that are slated to move before the end of 2019.