House Acts to Repeal Medical-Device Tax
In another assault on President Obama’s health care law, the House passed a bill on Thursday to repeal a new tax on medical devices.
The vote was 270 to 146, as 37 Democrats joined 233 Republicans in supporting the repeal. The bill appears to have little chance of approval in the Senate, where Democrats are in control, and Mr. Obama threatened to veto the measure if it reached his desk.
The Supreme Court is expected to rule this month on a challenge to the health care law by 26 states, which contend that its requirement for most Americans to carry insurance is unconstitutional.
Conservatives are divided on whether to continue trying to dismantle the law piece by piece, or whether to insist on wholesale repeal of the measure. In the last 18 months, the House has voted more than a dozen times to repeal the law, in whole or in part, and to reduce money being spent to carry out the law.
The excise tax on medical devices, scheduled to take effect in January, is one of many taxes and fees imposed by Congress to help offset the cost of subsidizing insurance coverage for more than 30 million people.
Critics said the tax would increase health costs and lead to the loss of jobs, but the White House said the bill would undo an essential part of a landmark law. Representative Sander M. Levin of Michigan, the senior Democrat on the Ways and Means Committee, said, “If this bill were to become law, it would unravel health care reform.”
The Congressional Joint Committee on Taxation estimates that the tax, equal to 2.3 percent of the sale price of medical devices, will raise $29 billion in the next 10 years. The tax would apply to manufacturers and importers of devices like pacemakers and stents, defibrillators, artificial hips and knees, surgical tools and X-ray machines.
House Republicans would pay for repealing the tax by recouping some subsidies provided to low- and middle-income people to help them buy insurance. Eligibility for subsidies is based on a person’s income. People who experience an increase in income may receive larger subsidies than they are entitled to. The bill would allow the government to recover those overpayments.
Representative Erik Paulsen, Republican of Minnesota and chief sponsor of the bill, said: “Our country is a leader in medical technology innovation. This new tax would force many companies to lay off workers, move jobs overseas or close their doors altogether.”
Democrats from states with thriving medical technology industries said they, too, wanted to repeal the device tax. These Democrats include Senators Amy Klobuchar and Al Franken of Minnesota, as well as Elizabeth Warren of Massachusetts, who is seeking the Senate seat held by Scott P. Brown, a Republican.
In anticipation of the tax, some manufacturers have announced plans to lay off workers or reorganize operations. The Stryker Corporation of Kalamazoo, Mich., cited the tax as a factor in plans to reduce its global work force by about 5 percent.