The budget deal that received overwhelmingly support from the House on Thursday includes language that would repeal the 2.3% medical device excise tax. In addition, the deal would give FDA access to user fees paid by the device industry in the next two fiscal years. In the 2013 fiscal year, FDA's CDRH branch lost $2.9 million in industry user fees. The budget agreement is headed to the Senate, where it faces some opposition from Senate Republicans, appears likely to pass. While Obama has expressed reserved support the deal, he announced that he would sign it into law if it wins Senate support.
The trade organization AdvaMed announced its support for the deal. "AdvaMed commends Chairmen Patty Murray (D-WA) and Paul Ryan (R-WI) and the other members of the Senate/House budget negotiation committee for their work in crafting a bipartisan budget agreement which replaces the sequester, allows FDA to access the full amount of user fees paid by industry for FYs 2014 and 2015, and calls for repeal of the medical device tax," said Stephen J. Ubl, president and CEO of the organization.
Before the government shutdown, the Republican party lobbied hard to have the medical device tax repealed. The Obama administration strongly opposed conceding to this effort, stating that healthcare reform would make device firms more profitable by expanding their base of customers. Senate Majority Leader Harry Reid (D-NV) was also staunch in his opposition to a repeal, despite, at one point, referring to the tax as "stupid."
While the accord would be a relief to medical device firms, it would leave in place Medicare cuts that would affect hospitals.
