WASHINGTON D.C. – Congresswoman Jackie Walorski (IN-02) issued the following statement after the House passed legislation to repeal the Medical Device Tax. H.R. 160, the Protect Medical Innovation Act of 2015, which Walorski is an original co-sponsor, repeals the 2.3 percent tax on device sales, a significant funding mechanism for the Affordable Care Act (ACA), commonly known as Obamacare.
“It’s time to stop propping up Obamacare with a tax on the medical device industry at the expense of the Hoosier economy,” Walorski said. “Because of this burdensome tax, businesses in my district, like Complexus Medical, have been forced to cut their budgets on research and development. This has impeded their discovery of innovative medical technologies. Today, Republicans and Democrats lifted a barrier to the growth of a vital industry. In doing so, the House continued its focus to enable a business climate that encourages, not penalizes, innovation and allows the medical device industry to grow, create jobs, and produce new, live-saving technologies.”
The legislation passed the House by a vote of 280-140 and now heads to the Senate for further consideration.
U.S. Senator Joe Donnelly, who is a co-sponsor of the Senate’s Medical Device Access and Innovation Protection Act (S. 149), said, “My top priority has always been to make sure that every Hoosier that wants a job has a job. One way to do that is to encourage job growth and innovation in our manufacturing sector, including the medical device industry. I am pleased the House passed bipartisan legislation to repeal the medical device tax and hope the Senate will follow suit. Repealing the medical device tax continues to be one of my priorities because it would make a difference for Hoosier businesses and workers, as well as the patients who use their products.”
Indiana is home to many innovative medical device companies, which collectively employ about 20,000 Hoosiers. The medical device industry accounts for more than 40 percent of the jobs in Indiana’s life sciences industry, making Indiana the fifth-largest state in the country in percentage of medical technology sector jobs, according to a 2012 BioCrossroads report. The same report found that the state’s medical device industry generated more than $10 billion of annual economic output. BioCrossroads announced in February 2014 that Indiana ranked second in the nation in export of life science products, which include medical device products.
A 2.3 percent medical device tax went into effect on January 1, 2013, under the Affordable Care Act. Currently, the tax is levied on the sale price of any medical device as defined by the Food and Drug Administration. Products subject to the tax include items ranging from surgical drapes and catheters to advanced imaging equipment.
