Device Tax Repeal Tops AdvaMed Priority List For Fiscal-Cliff Bill

Article preview from "The Gray Sheet" - October 8, 2012

The post-election, “lame-duck” Congress will face the prospect of letting massive federal spending cuts take effect and multiple tax increases kick in if it does not take action. Device firms hope to leverage the situation to repeal the looming medical device excise tax and make FDA user-fee fixes while avoiding more Medicare provider cuts.

Device Tax Repeal Tops AdvaMed Priority List For Fiscal-Cliff Bill

Article preview from "The Gray Sheet" - October 8, 2012

As Congress seeks to avoid going over a “fiscal cliff” later this year, device industry lobbyists see an opportunity to make some policy gains, including a repeal of the impending medical device excise tax. At the same time, companies are anxious to avoid increased reimbursement pressures.

The “lame-duck” Congress that returns to Washington following the Nov. 6 election will face the prospect of letting massive, across-the-board federal spending cuts take effect and multiple tax increases kick in if it does not take action.

The sequestration provision of the Budget Control Act of 2011 is scheduled to take effect Jan. 2; it would mandate painful cuts, including a consistent 8.2% reduction to non-defense agencies like FDA. Lawmakers will also need to address multiple expiring tax provisions. And on top of that, the latest “fix” to avert double-digit Medicare physician payment cuts expires Dec. 31.

All of this adds up to the high likelihood of a significant end-of-year piece of legislation that, at minimum, puts off the sequester and Medicare sustainable growth rate formula cuts so that the next Congress can address them while also extending some of the tax cuts. Device industry advocates hope that provisions specifically helpful to them can find their way into the mix.

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