Sen. Kay Hagan (D-N.C.) wants Congress to work together to repeal the medical device tax included in President Barack Obama’s healthcare reform law, making her 1 of the few Senate Democrats to go on the record as opposing the tax.
Writing to Lew Ebert, president of the North Carolina Chamber of Commerce, Hagan said that although she supports the Affordable Care Act, she believes the 2.3% excise tax on U.S. medical device revenues should be rolled back in favor of another revenue source.
"I understand and share your concern with the medical device fee in the Affordable Care Act. When it was first proposed, I opposed its adoption. In October 2009, I joined with several of my Senate colleagues in writing to Senate Majority Leader Harry Reid that the fee ‘could have significant ramifications for an industry,’" Hagan wrote, according to a copy of the letter obtained by MassDevice.com. "Now that the medical device fee is law, it is expected to generate a significant amount of revenue. According to the independent and non-partisan Congressional Budget Office, repealing the medical device fee will cost the federal government approximately $29.076 billion over the next ten years in foregone revenue. Yet, given the impact that this fee will have on North Carolina companies, I believe Congress should work together to repeal the fee in a fiscally responsible manner, without negatively impacting North Carolina’s businesses, patients, or students."
The med-tech industry employs more than 8,000 people in the Tarheel State, hagan wrote, with another 16,000 employed by allied industries. Those jobs earn, on average, 37% more than the average job there, she wrote.
"I have been and will continue to be a strong advocate for North Carolina families, jobs, and businesses. It is my sincere hope that we can be partners in that effort, and I look forward to hearing your suggestions on how best to relieve North Carolina’s medical device companies of their tax burden under the Affordable Care Act in a manner that does no harm to our federal budget deficits or our economic recovery," Hagan wrote.
Hagan’s office in Washington, D.C., did not immediately return calls seeking comment.
Her support for repealing the tax (if a suitable "pay-for" can be found), puts her in select company as a Democrat opposed to a portion of Obamacare. Massachusetts Senate hopeful Elizabeth Warren (D) drew national headlines after writing an exclusive opinion piece for MassDevice.comcalling for repeal of the tax.
In Minnesota, where Rep. Erik Paulsen (R) is spearheading the U.S. House push to repeal the tax, Sens. Amy Klobuchar (D) and Al Franken (D) have said they’re concerned about the impact it will have in the Land of 10,000 Lakes, home to 1 of the largest medical device industry clusters in the world. Sen. John Kerry (D-Mass.) has also expressed similar concerns for the Bay State, which also boasts a significant med-tech presence.
A Senate bill repealing the tax would require 60 votes. Assuming full buy-in from Republicans in the upper chamber, the repeal effort would need 13 Democrats to cross the aisle in order to get the measure to Obama’s desk. A House bill repealing the tax passed on a 242-173 bipartisan vote in June. The White House has promised to veto any such legislation, however.