Medtech industry mobilizes to repeal med device tax before suspension ends

The medtech industry is rushing to keep the medical device tax, part of Obamacare, from coming back into effect at the start of 2018 after its suspension lapses.

Many in the industry were hopeful the tax would be axed as part of healthcare reform that was slated to repeal and replace Obamacare earlier in the year but never came to fruition.

Industry groups are optimistic that the tax will be repealed before the end of the year, and have support from a number of US House Representatives who signed a letter to Speaker Paul Ryan (R-Wis.) urging him to take action on the tax.

A total of 179 reps signed the letter to Ryan, including 43 Democrats, calling for a full repeal of the tax and warning of the negative impact it could have on the industry and country.

“The suspension of the medical device tax expires on January 1, 2018, and it is critical to the health and sustainability of this vital American manufacturing industry that this tax is not once again applied to its products. This looming tax increase will impact medtech innovation and job creation, threatening this industry and the constituents we serve,” Reps wrote in their letter to Ryan.

Legislators didn’t lay out a specific path to repealing the tax, but were hopeful that the tax will be included in legislation the House will vote on before next year.

Industry group AdvaMed is supportive of the efforts and hopeful that the bipartisan support for a repeal will be successful, according to a report from The Hill.

“We’re fully activated now. We’re engaging with members on both sides of the Capitol, both sides of the aisle regularly on [repealing the medical device tax.] We’ve shared our concerns with the administration,” AdvaMed chief advocacy officer JC Scott said, according to the report.

Not everyone is supportive of a full repeal of the tax, however, and see the tax as an essential part of Obamacare.

“Obviously people would always prefer not to pay taxes. We don’t levy taxes for the sake of levying taxes, but to pay for something which we think is worth having the government do, and in this case it was part of the price to pay for expanding healthcare coverage to many millions more people,” Center on Budget and Policy Priorities senior fellow Paul Van de Water said, according to The Hill.

Van de Water went on to say that he believed the medical device and insurance industries “greatly exaggerated the adverse effects of the taxes,” according to the report.

In August, a coalition of conservative action groups jumped on the bandwagon for repealing the medical device tax, urging Congressional leaders to scrap the 2.3% levy on U.S. medtech sales.

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