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Does Compromise With GOP Mean Adios Device Tax?

Does Compromise With GOP Mean Adios Device Tax?
Is the repeal of the device tax going to be the low-hanging fruit in terms of a grand Obamacare compromise between White House and the Republican-led Congress?

The term compromise seems to have a new ring in the air given the results of the mid-term election.

And while President Barack Obama was clear that he wasn't going to undo the Affordable Care Act, there may be some space now to consider smaller provisions in the law that are problematic.

Already there are rumblings and speculation about what parts of the law may see a demise and what the Republican-led Senate should ask for.

The device tax one, at least on the surface, may be easier to dispense with. The Congressional Research Service has recently described the tax as "challenging to justfy" even though it says its effects are relatively small.  The authors believe the effects of the device are small with "output and employment in the industry falling by no more than two-tenths of 1%."

Industry advocate AdvaMed vehemently disagrees with the latter point 

But the point may be moot if the tax is on the chopping block. Given that even one of the most liberal Democratic senators - Elizabeth Warren of Massachusetts - has supported its repeal - the device tax may be one aspect of the law whose demise President Barack Obama may not lose much sleep over.

In fact at Wednesday's press conference, Obama was asked whether repealing the medical device tax, one among many Republican interests, would be a line that he would not cross. 

This is what Obama said, according to a slightly edited version of the transcript of the press conference:

And let’s see -- see -- OK -- medical device tax -- you know, I’ve already answered the question. We are going to take a look at whatever ideas -- let me take a look comprehensively at the ideas that they present. Let’s give them time to -- to tell me. I’d rather hear it from them than from you.

... I’d rather hear from Mitch McConnell and John Boehner what ideas they’d like to pursue and we’ll have a conversation with them on that.

So Obama didn't outright say "Yes, this is a line that I wouldn't cross." And optimists might find some cause to celebrate there.

But realists might say OK, but how will the tax revenue hole be filled? The industry better hope Senator Mitch McConnell and Congressman John Boehner have some answers to that question. 

-- By Arundhati Parmar, Senior Editor, MD+DI
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