The U.S. House of Representatives yesterday passed a stop-gap budget bill that includes a five-year moratorium on the medical device tax, but its prospects in the Senate are dim because it also includes nearly $6 billion in funding for a proposed border wall.
With the 49 Democratic members of the Upper Chamber unlikely to approve anything that funds the border wall and Republicans needing a 60-vote majority to pass the measure, which would avoid a government shutdown set to begin at midnight, it appears doubtful that the 115th Congress will push the pause button on the tax.
Although the 2.3% levy on prescribed medical devices was enacted as part of the Affordable Care Act in 2010, it didn’t go into effect until 2012 and was mothballed two years later; that moratorium, extended earlier this year, is slated to end in 2020.
“It’s unfortunate that [the device tax] got caught up in the wash of other macro-issues,” Greg Crist, chief advocacy officer at AdvaMed, told MassDevice.com this morning. “It’s not related to anything policy-driven behind the device tax, or any tax.”
It’s all part-and-parcel of a lame-duck session and the political turbulence in Washington, Crist told us.
“It’s part of the whirl of a lame-duck and shifting majorities and what have you,” he said, noting that AdvaMed is always watchful for chances to tack repeal of the tax onto must-pass legislation.
“We are continuously looking for opportunities to jump on openings in the process,” he explained, citing as an example next year’s round of debt ceiling negotiations. “That’s a great opportunity to say, ‘You know what, let’s do something for job creation.’ There are a lot of lawmakers that see [repealing] the device tax as very appealing. There’s a lot of support from both parties, in both chambers.”
As for the incoming 116th Congress, Crist noted that almost 25% of the House is turning over to new members, meaning the trade association will have its work cut out for it in acquainting the newest Congress-critters with the medtech industry. Medtech is losing a long-time champion with the departure of Rep. Erik Paulsen (R-Minn.), who lost a re-election bid last November. Crist told us that AdvaMed is working to develop relationships with new representatives from medtech-heavy districts such as Rep.-elect Angie Craig (D-Minn.), who spent two decades working in the industry.
“Traditional allies have already signaled their supported and their willingness to take an elevated role in leadership [on repealing the medical device tax],” he said.
The five-year moratorium was also included in tax extenders legislation passed out of the House Ways & Means Committee earlier this month. The House has voted several times for an outright repeal of the levy, only to see those bills die in the Senate.
