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McConnell to House: Move Device Tax Repeal Soon

The top Senate Republican is calling on the House to send over legislation to repeal the health care law’s tax on medical devices, following a bipartisan vote among senators in favor of such a move last week.

Appearing Monday evening on the Hugh Hewitt radio show along with Florida GOP Sen. Marco Rubio, Minority Leader Mitch McConnell, R-Ky., said he thought House Republicans should pass a stand-alone repeal of the medical-device tax to see how the Senate would handle it. His chamber voted 79-20 to demonstrate support for abolishing the 2.3 percent excise tax on March 21 as an amendment to the fiscal 2014 Senate budget resolution (S Con Res 8). Thirty-three Democrats and independent Angus King of Maine joined all Republicans in supporting the measure offered by Orrin G. Hatch, R-Utah.

“I think if the House sent us a stand-alone medical device tax, it’s going to be really fascinating to see all these liberal Democrats figure out how they’re going to deal with it,” McConnell said, according to a transcript. “And I think the House now, the Senate having voted the way it did, should send us a bill to do precisely that very soon.”

McConnell noted that while the vote itself on an amendment to the budget plan was non-binding, it signaled overwhelming support that could box in Democrats down the road.

“Seventy-nine members of the United States Senate, including some very liberal Democrats like Elizabeth Warren, actually voted to repeal the medical device tax, so that’s a signal that when we come back to it on a bill that can actually become law, it’s going to be very difficult for them to explain why they voted to repeal it on one occasion and don’t vote to repeal it on another,” McConnell said. “So I think there’s no way you can overstate the significance of that.”

The radio interview came after Rubio gave a lengthy and wide-ranging speech at the minority leader’s namesake McConnell Center at the University of Louisville.

Of course, a number of issues complicate the repeal effort, starting with the price tag for taking the provision off the books. According to a Congressional Budget Office estimate from June, repealing the tax would cost more than $29 billion over 10 years. That means supporters would be under pressure to find an offset amenable to both parties, or Democrats who voted for the budget amendment could withhold their support for another repeal measure based on the pay-for.

There’s also the question of whether the House would send legislation to repeal the tax to the Senate before it passes a comprehensive tax overhaul. Rep. Peter Roskam, R-Ill., responded to the issue in another interview on the radio show Monday, maintaining that the repeal effort and the larger tax effort are not mutually exclusive.

“If there’s a decision that gets made, it can happen in a matter of weeks or months. It’s just a matter of calendar, timing, a decision from a strategic point of view to move forward, and the likelihood of getting it actually through the Senate, as opposed to some sort of game that the Senate has,” Roskam said.

“The other thing is, remember, you’ve got to make sure that there is a commitment on the part of the Senate to move the medical device tax repeal alone, and not load it up with some other tax hike or some other agenda item that the Obama administration wants,” Roskam added.

House Majority Leader Eric Cantor, R-Va., pushed for repeal of the tax at a recent speech to the American Enterprise Institute and is likely to back such a move.

“The Leader made clear in his speech at AEI, repealing the medical device tax imposed by Obamacare is a priority and he’s pleased with the Senate’s broadly bipartisan vote towards that end,” Rory Cooper, spokesman for Cantor, said in an email last week.

McConnell’s comments signal that the issue is likely to remain a focus for Republicans, with the debate starting to sound like a reprise of an earlier battle over repealing a 1099 information reporting requirement that had been in the health care law (PL 111-148, PL 111-152). That effort, which ultimately was successful, was championed in the Senate by Nebraska Republican Sen. Mike Johanns.

Hatch has introduced a Senate bill (S 232) to repeal the device tax, and Minnesota Republican Erik Paulsen is the sponsor of a House repeal measure (HR 523) that has 212 cosponsors. The provision took effect in January and opponents say it has resulted in the loss of thousands of jobs and innovation.

One of the Senate Democrats who has been a vocal supporter of the move to repeal the tax is Amy Klobuchar of Minnesota, home to several device tax companies.

“I will continue to work to get rid of this harmful tax so Minnesota’s medical device businesses can continue to create good jobs in our state and improve patients’ lives,” Klobuchar said in a statement after the Senate vote.

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