House votes to repeal ObamaCare tax

Getty Images

The House voted Thursday to repeal an ObamaCare tax on medical devices that is intended to generate billions of dollars for the law.

The final vote was 280-140, with 46 Democrats voting in favor.

ADVERTISEMENT
Supporters of the bill say the 2.3 percent tax, which affects about 7,000 manufacturers nationwide, is holding back innovation on important devices like X-ray machines and ventilators.

“Only in Washington would you impose a tax on life-saving medical technology and think you will actually reduce healthcare costs," said Rep. Erik Paulsen (R-Minn.), the bill’s lead sponsor.

The House first voted to repeal the tax passed in 2012. While the bill does not include a plan to make up for the lost revenue from repealing the tax, supporters believe it stands a chance of clearing both chambers now that the Senate is controlled by Republicans.

The legislation marks one of the biggest successes in the GOP’s campaign against ObamaCare after more than 50 votes to repeal the entire law. 


Still, it faces an almost certain veto from President Obama because it does not replace the $25 billion in funding for ObamaCare over the next decade.

Dozens of Democrats have also supported repealing the tax in the last several years, including Sens. Elizabeth WarrenElizabeth WarrenWarren questions Puerto Rico board's meeting on Wall Street Overnight Finance: Lawmakers float criminal charges for Wells Fargo chief | Scrutiny on Trump's Cuba dealings | Ryan warns of recession if no tax reform Anti-trade senators say chamber would be crazy to pass TPP MORE (Mass.) and Amy KlobucharAmy KlobucharOvernight Defense: US attempted hostage rescue in Afghanistan | Defense hawks brace for spending fight | Trump slams 'lies' about Iraq war stance Senators want military separation policy to address trauma-related behavior Senate Dems reignite fight for hearing on SCOTUS nominee MORE (Minn.). Both live in states where the device industry has a heavy presence, and have criticized the provision as a tax on manufacturing.

Paulsen has previously said he’s optimistic about his bill’s chances because “there’s new Senate leadership that is interested in bringing the bill forward.”

Many of the Democrats who opposed the measure Thursday said they fear that the legislation would be a slippery slope for other industries with their own grips about the Affordable Care Act (ACA).

"If people vote for this industry to essentially go back on its commitment to participate, other providers are going to ask for the same treatment. And so in that respect, what the Republicans are aiming to do is to unravel — to unravel — ACA," Rep. Sandy Levin (D-Mich.) said.

Repealing the tax has been described as the “low-hanging fruit” of the healthcare law, along with abolishing Medicare’s cost-cutting panel, known as the Independent Payment Advisory Board. Legislation repealing that board will come up for a vote in the House next week.

The medical device tax has been at the center of a yearslong, $200 million industry lobbying campaign that was rebuffed by Democratic leaders in the Senate when they were in the majority.

Those opposed to the repeal, including Sen. Minority Leader Harry ReidHarry ReidThe missed opportunity of JASTA States urged to bolster election security How the White House got rolled on the Saudi-9/11 bill MORE (D-Nev.), have argued that device companies remain extremely profitable despite the tax.

While lobbyists and Republican aides say the Obama administration appears open to repealing the tax, officials say they do not support the bill because of the hole it would blow in ObamaCare’s funding stream.

—Cristina Marcos contributed.