Dive Brief:
- AdvaMed CEO Scott Whitaker told reporters on a call Thursday the trade lobby is in discussions with leadership in both the House and Senate to potentially attach a permanent repeal of the medical device tax to end-of-year legislation. In the third quarter of 2018, AdvaMed spent $700,000 lobbying on the repeal of the device tax and other items such as changes to the Stark laws and Anti-Kickback Statute.
- One 2015 Congressional Budget Office estimate found that the repeal of the device tax would cost the federal government $24.4 billion over a 10 year period.
- The House passed a standalone bill permanently repealing the tax in July, 283-132, but the bill's sponsor, Rep. Erik Paulsen, R-Minn., lost his reelection campaign to Democrat Dean Phillips. The legislative proposal has the support of the White House, according to a Statement of Administrative Policy.
Dive Insight:
The 2.3% medical device excise tax, originally passed into law as part of the Affordable Care Act in 2010, has been the target of industry for years, with some success.
Device manufacturers have secured delays of the tax twice, but AdvaMed is pushing to permanently repeal the tax before it goes back into effect at the end of 2019.
The industry argues the tax will lead to big job cuts, though a Congressional Research Services report found it would have negligible effects. Still, CRS economists said the tax was inefficient and would have the effect of raising consumers prices.
AdvaMed is focusing on garnering 60 votes in the Senate to support adding the repeal to a year-end spending bill or another "quickly moving" legislative vehicle.
Whitaker noted that Senate Majority Leader Mitch McConnell, R-Ky., may be hesitant to spend time advancing the standalone device tax repeal legislation due to the crowded floor schedule despite support from key Democrats.
"[Senate Minority Leader Chuck] Schumer is a good example," Whitaker said. "He has said to me repeatedly, and to our CEOs, 'I'm for full repeal.' Same kind of thing with [Senate Finance Ranking Member Ron] Wyden, he supports us."
A Wyden spokesperson told MedTech Dive that the Senate Finance Committee's top Democrat backs permanently repealing the medical device tax but noted the lawmaker has not made any concrete commitment on future efforts to do so.
“Senator Wyden has often noted his past votes to modify this policy, but he has made no commitment on future action. There are major health care issues that Congress must address in the coming months, and this issue should be among them,” the spokesperson said.
Whitaker said he didn't see a lack of offsets to be a hurdle.
"I have heard clearly from both sides of the aisle that an offset isn't the issue," Whitaker said. "The final bill that moves through Congress every year usually isn't fully offset. I doubt this one will be either. If offsets are on the table I'm happy to have that conversation, but that hasn't been part of the concern at this stage from what we've heard from folks on the Hill."
With the impending Democratic control of the House, Whitaker noted "the chances are not as great next year" for permanent repeal if the industry does not garner a victory in the lame-duck session.
Despite a potentially "more challenging" environment next year, Whitaker pointed to Minnesota Sens. Klobuchar and Smith support for the proposal as evidence Democrats could still be amenable to repealing the tax in the next Congress.
