The medical device industry’s bid to repeal the medical device tax took what might prove to be a mortal blow today when the U.S. Supreme Court ruled the Affordable Care Act constitutional, according to a Boston University law professor who’s amicus brief was cited in the court’s opinion.
"Today was not a great day for people who were hoping to repeal the device tax," Prof. Kevin Outterson told MassDevice.com. Justice Ruth Ginsburg cited a brief prepared by Outterson, his colleagues and students supporting the government’s position that the law is constitutional.
Had the court struck down part or all of the law, Outterson told us, the move for repealing the 2.3% levy on U.S. medical device sales had a decent shot of making it into law.
"I can see how the push to repeal the device tax was an interesting maneuver that could have been really effective, depending on how ACA came out," he said. "If ACA was scrambled by today’s ruling, the industry was well-positioned to get something. Now it doesn’t look very promising."
Although the U.S. House of Representatives passed a repeal bill earlier this year, Outterson said that legislation has virtually no chance of making it through the U.S. Senate or past President Barack Obama’s veto pen.
"That goes nowhere in the Senate or the White House, especially when you need 60 votes in the Senate [to pass the repeal bill]. Good luck," he said.
But if Mitt Romney manages to unseat Obama, Outterson added, the medical device tax repeal effort might stand a better chance.
"It seems to me that if Romney is running on the platform of repealing chunks of Obamacare, that seems like the best bet for people who are hoping to eliminate the device tax," he told us. "But there are other people who got whacked with taxes in the ACA. If device was successful, everyone else would want to jump on the bandwagon.
"If device is able to undo that part of the deal, then for sure other industries will be lining up too, and Congress will know that," Outterson said. "It’s tied to the taxes that are being placed on the insurance industry and the drug industry – are those also going to be unwound? I have my doubts."