Paying too much attention to something can be depressing if you’re hoping for change in a particular direction, so device makers might be forgiven for ignoring the goings-on inside I-495, that vaguely circular slab of pavement running ‘round our nation’s capital. So is there any cause for med tech optimism about inside-the-Beltway developments?

I’ll just say that you might want to indulge more frequently in a time-tested mood elevator this summer, one that requires no prescription.

Device tax repeal in limbo

Device tax repeal legislation is nearly invisible right now despite that the embarrassing IRS scandal and the story about DoJ’s surveillance of the press have died down. Still, Congress and the White House may have to raise the debt ceiling again later this year. Another issue is that the House and Senate have a chasm between them where the fiscal 2014 budget is concerned.

This latter predicament is based on the presumption in the House that the sequester will be honored and the Senate’s inclination to drop the sequester like a blind date with halitosis. They don’t have much time to come up with a compromise, either. The new fiscal year starts in less than three months, and one of those months is the August recess.

Both the Medical Device Manufacturers Association and the Advanced Medical Technology Association sounded off in support of the tax reform effort by Sen. Max Baucus and Rep. Dave Camp. However, AdvaMed and MDMA may asking an awful lot to assume Camp and Baucus will be able to work a device tax repeal into their larger tax reform effort.

Baucus sired the device tax, after all, so what’s in it for him? Camp might have to choose between a successful tax reform effort minus a device tax repeal, and a tax reform bill with a device tax repeal that’s DOA in the Senate. Care to guess which he’d choose?

ACA = Actuarially Compromising Activity?

As for the Affordable Care Act, we’ve heard about the Obama administration’s one-year suspension of the employer mandate. There seemed to be some controversy over whether the administration had proposed that health insurance exchange enrollees would not have to document their incomes in order to qualify for subsidies. That seems to have died down, though. The consensus now is that the administration does indeed propose no proof of income to get a subsidy, as was reported in the July 9 edition of Medical Device Daily.

Why should device makers care about this? Only one reason: The oncoming subsidy gold rush invites massive fraud (additional expense), and the loss of penalty cash from employers and individuals who choose not to join the party will lower the revenues needed to make the Affordable Care Act affordable. It’s yet another source of red ink for the ACA, and thus another compelling reason not to repeal the device tax.

My recommendation to opponents of the device tax is to unfold that 9-foot umbrella on the deck, invite the neighbors over, and break out the charcoal. The only way you’re going to dodge the Beltway Blues this summer is to stop thinking about what’s going on inside the Beltway.