Republicans in the U.S. Senate, hoping to pass the 1st budget since 2013, released a budget proposal yesterday that includes language to repeal the 2.3% medical device tax enacted as part of President Barack Obama’s Affordable Care Act.
"Obamacare’s onerous medical device tax has harmed healthcare innovation, stifled job creation, and burdened the delivery of quality patient care," Sen. Orrin Hatch (R-Utah) said in prepared remarks. "Efforts to repeal this tax have received overwhelming bipartisan support in the past, and I couldn’t be more pleased [Budget Committee chairman Sen. Mike Enzi (R-Wyo.)] has included the repeal of this disastrous tax in his budget. It is time to end this tax so that more resources can be devoted to healthcare innovation – not to the coffers of Obamacare."
Hatch, a longtime supporter of repealing the 2.3% excise tax on U.S. sales of prescribed medical devices, introduced a separate repeal bill this year that has 33 co-sponsors, including 5 Democrats. A companion bill in the U.S. House of Representatives sponsored by Rep. Erik Paulsen (R-Minn.) has 275 co-sponsors, including 35 Democrats.
"The medical device tax must be repealed because it is causing Pennsylvania employers to hold back on expansion plans and the addition of good paying jobs. This tax not only discourages economic growth and drives up medical bills, but it also hurts the patients who stand to benefit the most from American innovation and ingenuity," Sen. Pat Toomey (R-Pa.) said in a statement.
The medical device tax, enacted in 2010 as part of the ACA, went into effect at the beginning of 2013. In July 2014, MassDevice.com learned via a Freedom of Information Act request to the Internal Revenue Service that the tax bureau collected $1.4 billion from the medical device tax in 2013, far short of all predictions. A U.S. Treasury audit later revealed that the IRS collected a little more than $913 million during the 1st half of 2013, well shy of the $1.2 billion it expected to bring in during those 6 months.