Despite making it a priority following the 2014 elections, Congress has not been able to move legislation repealing the medical device tax. However, recent developments show that Congress may finally be making progress.

Last week the Senate Finance Committee, Subcommittee on Health Care, held a hearing to take testimony on the tax’s negative impact on jobs and innovation.  In the lead-up to the hearing, Finance Committee Chairman Orrin Hatch (R-UT) made some encouraging comments including that the Committee plans to mark up a bill to repeal the tax “soon.” What “soon” means is unclear, but it will certainly follow the Committee’s work on trade issues that are consuming the agenda in the near-term. The story is nearly the same in the House of Representatives. Representative Erik Paulsen (R-MN) indicated that the Ways and Means Committee could take up the issue after they deal with trade in the coming weeks. Representative Paulsen has been leading the charge over the past few years to repeal the tax in the House.

The House and Senate repeal bills (H.R. 160 and S. 149, respectively) have broad bipartisan support so when the Committees decide to take them up, they should move through the Committee process quickly. The same might be true for full House and Senate consideration, but one lingering issue that may attenuate the timeframe for enacting repeal of the tax is the cost.  In 2012, the Congressional Budget Office estimated that repealing the tax will cost the federal government $29 billion over 10 years. Representative Paulsen and other repeal proponents in Congress are undecided whether to wait and find an offset or push to proceed without one.

The bottom line: Repealing the medical device tax remains a priority for this congress, there are encouraging signs, but progress is still incremental at this point.

Posted by Vince Sampson

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