Industry Groups Applaud 2-Year Suspension of Medical Device Tax

December 21, 2015—President Obama signed the $1.1 trillion omnibus budget bill into law that includes a 2-year suspension of the medical device excise tax in 2016 and 2017. Last week, the Advanced Medical Technology Association (AdvaMed), the Medical Imaging & Technology Alliance (MITA), and the Medical Device Manufacturers Association (MDMA) applauded the US Congress for passage of the year-end legislation.

For 2 years, the budget law also delays the implementation of the Affordable Care Act’s so-called Cadillac tax on high-end health care insurance coverage, which had been set to take effect in 2018, and it suspends the law's health insurance tax for 1 year.

AdvaMed Board Chairman Vincent A. Forlenza, Chairman, CEO and President of BD, commented in the announcement, “America’s medical technology companies, including our nearly 2 million employees and the countless patients we serve, appreciate the broad bipartisan effort to suspend the medical device tax. This critical relief would not be possible without the tireless efforts by a large group of champions in Congress, as well as among the patient, provider, and research communities. Congress and the administration have demonstrated that they recognize the negative effects of this tax. We urge policymakers to continue their work to eliminate the device tax and address other factors that are threatening the health care innovation ecosystem.”

Also in the announcement, MITA Board Chairman Nelson Mendes, President and CEO of Ziehm Imaging Inc., stated, “We are grateful that Congress was able to come together to preserve United States jobs and medical innovation by delaying the device tax for 2 years. The bipartisan cooperation we’ve seen gives us hope that policymakers will continue their work to fully address the device tax for employees, patients, and advocates across the country who have been impacted by its harmful effects.”

MDMA Chairman Scott Huennekens, who is President and CEO of Verb Surgical, added, “MDMA thanks the tireless, bipartisan leadership in Congress that achieved this important milestone on the road towards permanently repealing the medical device tax. MDMA has fought against this misguided policy since it was first proposed in 2009, and while suspension of the medical device tax is a positive step, we will remain focused on repealing a policy that only serves to punish a vital sector of America’s innovation ecosystem.”