Obamacare Repeal Bill Would Eliminate Tax on Device Companies

Regulatory News

Late Monday, the GOP unveiled its Obamacare replacement bill with at least one provision that medical device companies will like: a permanent repeal of the 2.3% medical device tax.

The tax’s full repeal, which was floated in standalone legislation in early January, would begin 1 January 2018 under the new version of Obamacare, known as the American Health Care Act (AHCA).

That full repeal would also come more than two years after the tax was suspended following a push by AdvaMed, the US device industry group, to link the tax to job losses.

AdvaMed President and CEO Scott Whitaker told Focus on Tuesday: “AdvaMed commends the House Ways and Means Committee for moving forward with legislation that will permanently repeal the medical device excise tax. Bipartisan majorities in both the House and Senate are on record in support of repeal of this onerous tax, which has been associated with significant loss of American jobs.

"Repealing the tax will provide medical technology innovators with the long-term certainty necessary to support future job growth and sustainable, cutting-edge R&D that will ultimately lead to the next generation of breakthroughs in patient care and treatment," he added. "We urge the House and Senate to act expeditiously to pass this important legislation."

Tom Price, the secretary of Health and Human Services, also said he supports the bill in a letter Tuesday to Rep. Greg Walden (R-OR), chairman of the House Committee on Energy & Commerce, and Kevin Brady (R-TX), chairman of the House Committee on Ways & Means, and that the proposals “will provide all Americans with access to affordable, quality healthcare, promote innovation, and offer peace of mind for those with pre-existing conditions.”

Others, however, including Andy Slavitt, the former head of the Centers of Medicare and Medicaid Services, said the bill is “basically a tax cut ($600 billion) funded by gutting Medicaid."