Device Tax Out or In? The Wrangling Continues

We’re more than two weeks into a government shutdown, and clock continues to tick away toward a Thursday deadline for raising the federal debt ceiling … And is there a budget/debt ceiling deal in sight? Yes and no. But like the old saying goes about the weather in New England, if you don’t like it … wait a minute; it will change.

On Friday, Oct. 10, and over the weekend, a group of Republicans in the Senate led by Sen. Susan Collins (R-Maine) that pushed for a paid-for repeal approach similar to that offered by a bipartisan group of House members. Soon thereafter, rather than a repeal of the tax, lawmakers offered a two-year delay instead of a permanent repeal.

Over the weekend, the proposal floundered as part of broader budget negotiations in the Senate. On Monday, Senate Republicans and Democrats continued to hammer away at a deal that both sides could swallow. Leaders from both sides said a deal was imminent.

In the Senate’s plan, the government would be funding through Jan. 15, allowing it to reopen for at least three months or so. At the same time, negotiations on a budget for the full fiscal year would have a deadline of sometime in December, according to Reuters. The debt ceiling—once again allowing the country to borrow—would be increased through Feb. 7 to put off the threat of default for almost four months. The budget negotiations were expected to address deficit reduction measures and therefore could affect when the debt limit would need to be increased again.

In addition, provisions involving healthcare reforms could be included, such as strengthening verification measures for people seeking federal subsidies to help them purchase health insurance required by the healthcare law. Another possible change to the healthcare reforms would delay a fee on employers, unions and other plan sponsors that raise money to compensate insurance companies for taking on high-risk customers in the early years of the Affordable Care Act.

The device tax was not mentioned as part of the Senate deal.

Enter the House of Representatives on Tuesday morning with a counterproposal. The device tax delay of two years is back in.

House Republicans offered their own proposal that would tack on additional provisions for changing healthcare reforms. Rep. Darrell Issa (R-Calif.) confirmed that the House plan would include most of what is in the Senate agreement while adding a provision to suspend the medical devices for two years and remove federal healthcare subsidies for the president and members of Congress when they obtain health coverage under the reforms. In addition, the House proposal would forbid the U.S. Department of the Treasury from taking extraordinary measures to prevent the government from defaulting, in effect requiring hard deadlines to extend the federal debt ceiling.

According to multiple news outlets, House Speaker John Boehner (R-Ohio) is struggling to come up with the votes necessary to pass the counterproposal—which was driven by the far-right wing of the GOP.

Boehner may have a hard time selling it to House moderate Republicans.

Sen. Bob Corker (R-Tenn.) told CNN that it was time to get a deal done after lengthy delays he blamed on the “unrealistic goal” of gutting the healthcare reform law.

“The fact is we’ve got to figure out a way to move ahead,” he said. “In fairness, on our side of the aisle, we’ve wasted two months, focused on something that was never going to happen.”