[Congressional Record (Bound Edition), Volume 158 (2012), Part 6]
[House]
[Pages 8650-8666]
[From the U.S. Government Publishing Office, www.gpo.gov]




                 HEALTH CARE COST REDUCTION ACT OF 2012

  Mr. CAMP. Mr. Speaker, pursuant to House Resolution 679, I call up 
the bill (H.R. 436) to amend the Internal Revenue Code of 1986 to 
repeal the excise tax on medical devices, and ask for its immediate 
consideration.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. Simpson). Pursuant to House Resolution 
679, in lieu of the amendment in the nature of a substitute recommended 
by the Committee on Ways and Means printed in the bill, the amendment 
in the nature of a substitute consisting of the text of Rules Committee 
Print 112-23 is adopted and the bill, as amended, is considered read.
  The text of the bill, as amended, is as follows:

                                H.R. 436

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Health 
     Care Cost Reduction Act of 2012''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:
       Sec. 1. Short title; table of contents.
       Sec. 2. Repeal of medical device excise tax.
       Sec. 3. Repeal of disqualification of expenses for over-
           the-counter drugs under certain accounts and 
           arrangements.
       Sec. 4. Taxable distributions of unused balances under 
           health flexible spending arrangements.
       Sec. 5. Recapture of overpayments resulting from certain 
           federally-subsidized health insurance.

     SEC. 2. REPEAL OF MEDICAL DEVICE EXCISE TAX.

       (a) In General.--Chapter 32 of the Internal Revenue Code of 
     1986 is amended by striking subchapter E.
       (b) Conforming Amendments.--
       (1) Subsection (a) of section 4221 of such Code is amended 
     by striking the last sentence.
       (2) Paragraph (2) of section 6416(b) of such Code is 
     amended by striking the last sentence.
       (c) Clerical Amendment.--The table of subchapters for 
     chapter 32 of such Code is amended by striking the item 
     relating to subchapter E.

     SEC. 3. REPEAL OF DISQUALIFICATION OF EXPENSES FOR OVER-THE-
                   COUNTER DRUGS UNDER CERTAIN ACCOUNTS AND 
                   ARRANGEMENTS.

       (a) HSAs.--Subparagraph (A) of section 223(d)(2) of the 
     Internal Revenue Code of 1986 is amended by striking the last 
     sentence.
       (b) Archer MSAs.--Subparagraph (A) of section 220(d)(2) of 
     such Code is amended by striking the last sentence.
       (c) Health Flexible Spending Arrangements and Health 
     Reimbursement Arrangements.--Section 106 of such Code is 
     amended by striking subsection (f).
       (d) Effective Date.--The amendments made by this section 
     shall apply to expenses incurred after December 31, 2012.

     SEC. 4. TAXABLE DISTRIBUTIONS OF UNUSED BALANCES UNDER HEALTH 
                   FLEXIBLE SPENDING ARRANGEMENTS.

       (a) In General.--Section 125 of the Internal Revenue Code 
     of 1986 is amended by redesignating subsections (k) and (l) 
     as subsections (l) and (m), respectively, and by inserting 
     after subsection (j) the following new subsection:
       ``(k) Taxable Distributions of Unused Balances Under Health 
     Flexible Spending Arrangements.--
       ``(1) In general.--For purposes of this section and 
     sections 105(b) and 106, a plan or other arrangement which 
     (but for any qualified distribution) would be a health 
     flexible spending arrangement shall not fail to be treated as 
     a cafeteria plan or health flexible spending arrangement (and 
     shall not fail to be treated as an accident or health plan) 
     merely because such arrangement provides for qualified 
     distributions.
       ``(2) Qualified distributions.--For purposes of this 
     subsection, the term `qualified distribution' means any 
     distribution to an individual

[[Page 8651]]

     under the arrangement referred to in paragraph (1) with 
     respect to any plan year if--
       ``(A) such distribution is made after the last date on 
     which requests for reimbursement under such arrangement for 
     such plan year may be made and not later than the end of the 
     7th month following the close of such plan year, and
       ``(B) such distribution does not exceed the lesser of--
       ``(i) $500, or
       ``(ii) the excess of--

       ``(I) the salary reduction contributions made under such 
     arrangement for such plan year, over
       ``(II) the reimbursements for expenses incurred for medical 
     care made under such arrangement for such plan year.

       ``(3) Tax treatment of qualified distributions.--Qualified 
     distributions shall be includible in the gross income of the 
     employee in the taxable year in which distributed and shall 
     be taken into account as wages or compensation under the 
     applicable provisions of subtitle C when so distributed.
       ``(4) Coordination with qualified reservist 
     distributions.--A qualified reservist distribution (as 
     defined in subsection (h)(2)) shall not be treated as a 
     qualified distribution and shall not be taken into account in 
     applying the limitation of paragraph (2)(B)(i).''.
       (b) Conforming Amendment.--Paragraph (1) of section 409A(d) 
     of such Code is amended by striking ``and'' at the end of 
     subparagraph (A), by striking the period at the end of 
     subparagraph (B) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(C) a health flexible spending arrangement to which 
     subsection (h) or (k) of section 125 applies.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after December 31, 2012.

     SEC. 5. RECAPTURE OF OVERPAYMENTS RESULTING FROM CERTAIN 
                   FEDERALLY-SUBSIDIZED HEALTH INSURANCE.

       (a) In General.--Paragraph (2) of section 36B(f) of the 
     Internal Revenue Code of 1986 is amended by striking 
     subparagraph (B).
       (b) Conforming Amendment.--So much of paragraph (2) of 
     section 36B(f) of such Code, as amended by subsection (a), as 
     precedes ``advance payments'' is amended to read as follows:
       ``(2) Excess advance payments.--If the''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after December 31, 2013.

  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Camp) and 
the gentleman from Michigan (Mr. Levin) each will control 45 minutes.
  The Chair recognizes the gentleman from Michigan (Mr. Camp).

                              {time}  1430


                             General Leave

  Mr. CAMP. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days to revise and extend their remarks and to 
include extraneous material on H.R. 436.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  Mr. CAMP. Mr. Speaker, I yield myself such time as I may consume.
  I come to the floor today in support of H.R. 436, the Health Care 
Cost Reduction Act of 2012.
  This bill would repeal two of the harmful tax hikes contained in the 
Democrats' health care law: the medical device tax and restrictions on 
using health-related savings accounts for over-the-counter medication.
  The legislation also includes a provision that will increase 
flexibility for health care consumers who use flexible spending 
arrangements. All are fully paid for by recouping overpayments of 
taxpayer-funded subsidies used to purchase health care in the 
government-run exchanges. Notably, every one of these provisions has 
bipartisan support.
  As a result of ObamaCare, beginning in 2013, a 2.3 percent tax will 
be imposed on the sale of medical devices by manufacturers or 
importers. This tax will increase the effective tax rate for many 
medical technology companies, threatening higher costs, job loss, and 
reduced investment here at home. One study predicts that as many as 
43,000 American jobs are at risk if this goes into place.
  A recent Washington Post piece by George Will reinforced the threat 
to job creation and investment, noting that Zimmer--based in Indiana--
is laying off 450 workers and taking a $50 million charge against 
earnings; Medtronic expects an annual charge against earnings of $175 
million; and ZOLL Medical Corporation's CEO, Rich Packer, says the tax 
will impact the company's investment in research and development, 
stating that means fewer jobs for engineers. Plain and simple, this tax 
hike is a job killer, and it must be repealed. I commend committee 
member Erik Paulsen for introducing this legislation.
  Another ObamaCare tax increase, the medicine-cabinet tax, imposes new 
restrictions on the purchase of over-the-counter medications through 
tax-advantaged accounts used to pay for health care-related needs. 
Because of the Democrats' health care law, patients must now get a 
prescription from a physician if they want to use these accounts to pay 
for over-the-counter medications. The ban affects everyday lives. It 
prevents a mom from using her FSA in the middle of the night to buy 
cough medicine for her sick child without a prescription. It also 
leaves doctors saddled with unnecessary appointments to get a 
prescription so that a parent can use their FSA to buy Claritin for 
their son's allergies.
  One study estimates that even eliminating half of these unnecessary 
appointments could save patients time and the health care system more 
than 20 million visits each year, reaping a savings of more than $5 
billion. These new restrictions must be repealed, and I'm happy that 
the provision introduced by committee member Lynn Jenkins is being 
considered today.
  The last provision is a new approach that allows consumers the 
freedom and flexibility to keep more of their money. Under current law, 
employees' FSA balances must be spent by the end of the year or they 
will forfeit any unused balance back to their employers under the use-
it-or-lose-it rule. Such a rule encourages wasteful and needless 
spending at the end of the year. This legislation would allow 
participants to cash out up to $500 in FSA balances, and those funds 
would be treated as regular taxable wages.
  Allowing Americans to keep more of their hard-earned dollars in these 
difficult times is a commonsense goal that should be widely supported. 
This provision, championed by Dr. Boustany, is a commonsense one; and I 
urge its passage.
  Finally, I would like to take just a moment to talk about the offset 
for this legislation, asking those who receive higher tax payer-funded 
premium subsidies than they are eligible to receive to repay all of the 
overpayment. Let me be clear: this is a bipartisan offset. Increasing 
the amount of overpayments to be repaid was a proposal first put 
forward by congressional Democrats in the 2010 Medicare doc-fix 
legislation which passed the Democrat-controlled House 409 2. Such an 
offset was used again when the House passed and the President signed 
the 1099 repeal last year and more than 70 Democrats supported that 
bill. In fact, Health and Human Services Secretary Sebelius said:

       Paying back subsidy overpayments makes it fairer for all 
     taxpayers.

  This legislation, and the provisions included here, are supported by 
job creators big and small, patient advocates, senior organizations, 
and physician groups. I urge my colleagues to join me in supporting 
these groups by voting for the Health Care Cost Reduction Act.
  With that, Mr. Speaker, I reserve the balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield myself such time as I may consume.
  This bill is mainly a smoke screen. It is an effort to cover up the 
failure, indeed the refusal, of Republicans to act on the key issue 
facing our Nation: jobs and economic growth.
  As ranking member, I sent a letter last Friday to Dave Camp, who 
chairs the committee with the jurisdiction over the bill before us 
today, urging action on six major jobs bills within the committee's 
jurisdiction: extension of the section 48(c) advanced energy 
manufacturing credit; extension of the production tax credit for wind 
power and other vital advanced-energy incentives; extension of the 
highly successful build America bonds program, which financed more than 
$180 billion in infrastructure investment; extension of the 100 percent 
bonus depreciation; creation of a 10 percent income tax credit for 
small businesses that do create new jobs or increase their payroll; an 
extension of a jobs-related expired provision, such as the R&D tax 
credit.

[[Page 8652]]

  The answer: silence and continued inaction by Republicans in this 
House.
  Another bill over which the committee has jurisdiction, the highway 
bill, remains unacted upon. That bill would mean millions of jobs. No 
action. The Republican House message on the highway bill is: our way or 
the highway. And that means no highways.
  It is June. There is now the likelihood of no action or none before 
the construction season is over in numerous States. That inaction is 
not an accident. It is deliberate. It is implementing the goal stated 
20 months ago by the Senate Republican leader:

       ``The single most important thing we want to achieve is for 
     President Obama to be a one-term President.''

  It is reflected in the recent interview by the House Republican 
leader. Mr. Cantor said the rest of the year will likely be about 
``sending signals, we have huge problems to deal with.''
  Sending signals? The American people don't need and want signals. 
They need for us to take action to strengthen the economic recovery.
  We will hear today Republican efforts to describe the bill before us 
to repeal the tax on medical devices as a jobs bill. What it really is 
is another Republican effort to repeal health care reform, step by 
step, costing, in this case, $29 billion.
  We Democrats want more Americans to have access to medical devices. 
Health care reform helps do this by expanding insurance coverage to 
over 30 million individuals, which indeed will help the growth of and 
the innovation in the medical device industry. And as was true for 
other health groups benefiting from increases in health coverage, the 
medical device industry was asked to help to pay for health care reform 
so it would be fully paid for, not add to the deficit, as so many 
Republican measures, but it would be fully paid for.

                              {time}  1440

  They signed a letter with others pledging:

       We, as stakeholder representatives, are committed to doing 
     our part to make reform a reality in order to make the system 
     more affordable and effective for patients and purchasers. We 
     stand ready to work with you to accomplish this goal.

  The first signature on that letter is from and by the President and 
CEO of the Advanced Medical Technology Association.
  Now the Republicans are attempting to give that industry a free 
pass--a free pass--contrary to their stated commitment. The industry 
has not proposed any alternative whatsoever to meet that obligation 
reflected in the letter they signed. There is an effort here to cast 
repeal of the tax as a small business bill.
  The 10 largest companies in this submarket would pay 86 percent of 
the taxes relating to nondiagnostic devices. According to CRS, the 10 
largest companies that manufacture medical devices had total 
companywide profits on all their lines of businesses, both devices and 
other products, of $42 billion in 2010, including companies mentioned 
here, and $48 billion in 2011, and these companies had gross revenues 
from the sale of medical devices in 2010 of $133 billion.
  There was an effort here also to cast the bill as an effort to stop 
offshoring, but this point needs to be made. It's a fact: The tax 
applies to all covered devices, including those that are imported. So 
if anybody thinks they can just move overseas and bring it back here 
and not pay a tax, they're simply incorrect.
  The effort to cast this as a jobs bill involved allegations repeated 
here during the debate on the rule, which were analyzed by a neutral 
source and found to be simply erroneous. A Bloomberg group analysis 
made that clear: ``The study used by Republicans cites no evidence for 
the job loss claim.''
  Further, the study's assumptions, ``conflict with economic research, 
overstate companies' incentives to move jobs offshore, and ignore the 
positive effect of new demand'' created by the health care reform law.
  Before Rules yesterday, I asked that my substitute be placed in order 
to allow debate on two real jobs initiatives mentioned in my letter to 
you, Chairman Camp: a tax credit for employers that expand their 
payrolls, and an extension of bonus depreciation. Those two provisions 
would help create hundreds of thousands of jobs, not speculation, but 
real, including in small businesses. This has not been allowed.
  So we have open rules, as we have seen the last few days on some 
bills, that often mainly result in numerous amendments, shifting some 
monies from one place to another in an agency, not often helping to 
create a single job, but a closed rule when it comes to bringing up 
provisions helping to create American jobs and economic growth.
  This is further evidence of what is really going on here in this 
Congress, a deliberate effort now increasingly undisguised to close the 
door on action to engender job creation and economic growth before the 
election.
  November 6 is what is driving the Republican Congress. Politics, not 
people. That is only not cynical, it is, indeed, pernicious. We owe it 
to the American people to blow the whistle on this. Too much, indeed, 
is at stake.

                                  National Women's Law Center,

                                     Washington, DC, June 6, 2012.
     Re Vote No on Protect Medical Innovation Act of 2011, H.R. 
         436.

       Dear Representative: The National Women's Law Center writes 
     in strong opposition to H.R. 436, the Protect Medical 
     Innovation Act of 2011, because it would undermine a critical 
     protection in the Affordable Care Act (ACA) and reduce 
     financial security for women and families. The bill would pay 
     for the elimination of the modest excise tax on medical 
     devices and other revenue provisions of the ACA by increasing 
     the tax liability of individuals and families receiving 
     premium tax credits through the new insurance exchanges.
       The modest excise tax on medical devices is a fair way to 
     raise revenue to help finance affordable health care coverage 
     for millions of Americans. The expansion of health care 
     coverage will benefit a wide range of health-related 
     industries, including the medical device industry, by 
     increasing demand for their products. Other industries in the 
     health sector are contributing to financing an expansion from 
     which they will profit; it is entirely appropriate to require 
     the medical device industry to make a contribution as well. 
     The tax will have minimal impact on consumers, because it 
     does not apply to medical devices that consumers buy at 
     retail, such as eyeglasses or hearing aids, and spending on 
     taxable medical devices represents less than one percent of 
     total personal health expenditures. And the tax will not 
     encourage manufacturers to shift production overseas: it 
     applies equally to imported and domestically produced 
     devices, and devices produced in the United States for export 
     are not subject to the tax. Repealing this tax and forgoing 
     $29 billion in needed revenues would be irresponsible--even 
     without the outrageous step of imposing this cost directly on 
     Americans without access to affordable health care coverage.
       Increasing the tax liability of individuals and families 
     receiving premium tax credits for health insurance coverage 
     is unfair and would reduce coverage for hundreds of thousands 
     of Americans. The ACA provides premium tax credits to 
     families with household income at or below 400 percent of 
     poverty who enroll in coverage through an exchange. An 
     advance payment of the premium tax credit will go directly to 
     insurance companies so that the monthly insurance premium 
     paid by families is reduced, thereby making health coverage 
     more affordable for millions of families. However, there is a 
     ``reconciliation'' at the end of the year when a family files 
     taxes to ensure that the right amount of credit was paid to 
     the insurer on the family's behalf. The ``reconciliation'' is 
     based on actual household income for the year, while the 
     advance payment is based on a projection that could be based 
     on current income or past tax returns. The ACA included an 
     important protection by including a cap on the amount of 
     repayment penalty a family would have to pay based on 
     ``reconciliation.''
       The proposal expected this week would entirely eliminate 
     this protection, leaving families vulnerable to an 
     unaffordable tax bill. Many families will be discouraged from 
     enrolling in coverage because of the potential tax liability 
     at the end of the year. Much of the savings from the proposal 
     are achieved because hundreds of thousands of people are 
     expected to refuse coverage if the cap is eliminated. Women 
     will be particularly affected by the elimination of the cap. 
     Women have lower incomes than men and experience larger 
     income variability from one year to another. This suggests 
     women will be more at risk for repayment penalties. Women 
     also often make the health care decisions for the family and 
     will be faced with the difficult decision of enrolling in 
     affordable coverage or forgoing that coverage because of a 
     potential tax penalty.

[[Page 8653]]

       The cap on the repayment penalty has already been 
     increased. Eliminating the cap would eliminate all 
     protections for families that are doing their best to provide 
     the right information to the exchange but face mid-year 
     changes in income or family size. A server in a restaurant 
     could gain new shifts or be promoted to manager. An employer 
     may give unexpected bonuses in December. A couple could get 
     married mid-year without fully understanding the impact on 
     household income and poverty level. The cap on the repayment 
     penalty needs to remain in place in order to protect families 
     and provide the stability promised in the ACA.
       We urge you to protect the security of families and the 
     revenue provisions of the Affordable Care Act so millions of 
     Americans can receive affordable health care by voting no on 
     H.R. 436 and any proposal to eliminate the cap on the 
     repayment penalty.
           Very truly yours,
     Judy Waxman,
       Vice President, Health and Reproductive Rights.
     Joan Entmacher,
       Vice President, Family Economic Security.
                                  ____



                                               ConsumersUnion,

                                        Yonkers, NY, June 6, 2012.
     Hon. Pete Stark,
     U.S. House of Representatives, Cannon House Office Building, 
         Washington, DC.
       Dear Congressman Stark: Consumers Union, the advocacy arm 
     of Consumer Reports, urges you to oppose H.R. 436. This bill 
     would subject consumers seeking to afford health insurance to 
     unfair penalties in order to pay for repeal of the medical 
     device excise tax under the Affordable Care Act (ACA). The 
     Congressional Budget Office estimates that repealing the 
     device tax would cost $29 billion dollars over the next ten 
     years. CU opposes measures that would undermine the 
     Affordable Care Act's financing and thus jeopardize the 
     expansion of health insurance coverage to currently uninsured 
     or underinsured individuals.
       Proponents of the device tax repeal argue that it would 
     hinder the device industry's competitiveness and ultimately 
     force manufacturers to move jobs overseas. But the excise tax 
     was structured in such a way as to avoid this result. The 2.3 
     percent excise tax applies to imported as well as 
     domestically manufactured devices but does NOT apply to 
     exports. Thus, it should not disadvantage American 
     manufacturers trying to sell products abroad. Nor would it 
     disadvantage domestically produced products sold in the US, 
     as foreign competitors are subject to the same tax.
       When fully implemented the ACA is expected to create 30 
     million newly insured consumers in the health sector. The 
     Affordable Care Act finances the expansion of coverage by a 
     range of payment modifications to other sectors of the health 
     industry. The medical device industry also stands to gain 
     from the increased demand for medical devices that a large 
     newly insured population will bring. The device tax does not 
     apply to devices that individuals can buy retail such as 
     hearing aids and eye glasses. The device industry makes the 
     case that many devices are used in acute care settings, where 
     care may be provided whether a person is insured or not. But 
     this would ignore the many devices that are used for joint 
     replacement, treatment of incontinence and other non acute 
     surgeries and treatments. It is only fair that the device 
     industry pays its share in exchange for significant new 
     revenue opportunities.
       Further, CU opposes the proposed offset for the 
     legislation, the elimination of caps on subsidy repayments 
     for individuals.
       Under the ACA, eligibility for tax credits subsidies to 
     purchase private plans through health exchanges will be based 
     on an individual's annual income, determined retrospectively 
     when taxes are filed. To ease the cash flow considerations 
     associated with purchasing coverage, these credits are 
     advanceable, meaning that families can receive an estimate of 
     their credit and use those funds to pay for coverage earlier 
     in the year. However, since many low- and middle-income 
     families experience income variation throughout the year due 
     to job changes, seasonal employment and the like, it may mean 
     that too much or too little credit was awarded during the 
     year.
       The law currently current caps the amount individuals must 
     pay back in the event of this circumstance. We believe that 
     the current cap structure strikes a balance between 
     discouraging individuals from abusing the system and taking 
     money to which they are not entitled and not penalizing 
     individuals for working hard to increase their family income 
     so as not to need a subsidy. Last year Congress lowered these 
     caps, exposing subsidy users to more liability. We fear 
     eliminating these caps would have a chilling effect on low 
     income family's willingness to use the subsidies to purchase 
     insurance.
       For these reasons Consumers Union urges you to reject H.R. 
     436. We look forward to working with you on more constructive 
     ways to improve the ACA in the future.
           Sincerely,

                                              DeAnn Friedholm,

                                                         Director,
                                               Health Care Reform.

  I reserve the balance of my time.
  Mr. CAMP. Mr. Speaker, I yield 2\1/2\ minutes to a distinguished 
member of the Ways and Means Committee, Mr. Paulsen of Minnesota.
  Mr. PAULSEN. I thank the chairman for yielding, and I thank him for 
his leadership on the committee as well.
  Mr. Speaker and Members, the medical technology industry is one of 
America's greatest success stories. This is an industry that has led 
the global device industry for decades with life-improving, lifesaving 
technologies that help patients and literally save lives.
  This device industry employs 423,000 Americans across the country. 
Some of our States, like Minnesota, have a high propensity because we 
have a huge ecosystem of medical technology--35,000 jobs, alone, in my 
State.
  But all that will change, Mr. Speaker, unless we act to stop a new 
medical device, a new $29 million tax that is going to be imposed in 
just a little over 6 months that was part of the President's new health 
care law. Now, this is an excise tax. It is not on profits. It is a tax 
that is going to be on revenue.
  What does that mean? Well, we all know the names of the big companies 
that are successful and do really well across the country and sell 
throughout the world.
  I will tell you this: almost every week I get a chance to tour a 
company that has five employees, that has 10 employees. You have never 
heard of these companies, but they are working on lifesaving and life-
improving technologies. They are doctors. They are engineers. They are 
entrepreneurs. They are innovators. This tax will change all that 
because it's estimated that this tax will cost 10 percent of the 
workforce.
  I talked to a company earlier this day, a CEO of a company earlier 
today, of a 13-year-old medical device company. It employs 1,500 
workers here in the United States, and he's consistently added 300 jobs 
a year for the last few years. He said, point blank, if this tax goes 
into effect, it will cost the company $14 million. That means 200 
people less will be hired this next year.
  Mr. Speaker, what is worse to point out, companies are already 
preparing right now for the impact of this tax. Companies are already 
laying off employees. We have heard of companies in Michigan that are 
laying off 5 percent of their workforce in anticipation of the tax. So, 
Mr. Speaker, jobs are clearly at risk.
  And this will especially hit startup companies hard, companies that 
are not yet profitable, because this is a tax on revenue, not on 
profits.
  We have a chance and an opportunity to stop this tax dead in its 
tracks because it's an opportunity to protect jobs. We passed the bill 
in committee just a week ago, under the chairman's leadership, with 
bipartisan support. We have 240 coauthors of support for this 
legislation with bipartisan support. I anticipate we will be successful 
moving forward.
  I ask and urge support for the legislation.
  Mr. LEVIN. I yield 3 minutes to the distinguished gentleman from 
California, a senior member of our committee, Mr. Stark.
  Mr. STARK. I thank the gentleman for yielding.
  I rise in strong opposition to H.R. 436, one more piece of Republican 
legislation that protects special interests at the expense of working 
with families. This is just another message in an attempt to undercut 
the Affordable Care Act. It repeals a small excise tax imposed on the 
medical device industry as their contribution to health reform in light 
of their expanded market.
  I might remind you that repealing this tax costs $29 billion in 
deficit losses.

                              {time}  1450

  How do they finance this legislation? Like they always do--take it 
out of the hides of low- and middle-income working families and give it 
to rich manufacturers.
  The bill eliminates protections in the health reform law that prevent 
families from potentially being hit with an unexpected tax because of 
unforeseen

[[Page 8654]]

income changes. According to the Joint Committee, this change by the 
Republicans would cost over 350,000 people to become uninsured.
  It's important to note that the medical device industry stood with 
President Obama and others in the health care industry in May of 2009 
and pledged to contribute their fair share toward making health reform 
a reality. Well, it's time to put your money where your mouth was.
  The medical device industry gains more than 30 million newly insured 
Americans through health reform, many of whom will use medical devices 
at some point in their lives. Our analysis shows that the vast majority 
of this tax would be paid by the 10 largest device companies--and 
they're all highly profitable.
  Protecting the very profitable medical device industry from paying a 
small contribution toward health reform should not be our priority in 
this Congress. We must create jobs, ensure patients maintain access to 
physicians and Medicare, and prevent student loan rates from doubling 
on July 1. Those are the priorities facing our Nation.
  I urge all of my colleagues to join me in voting ``no'' on this 
Republican giveaway to special interests.
  Mr. Speaker, I am submitting the following Statement of 
Administration Policy opposing H.R. 436, the Protect Medical Innovation 
Act, as well as letters in opposition to the bill.

                   Statement of Administration Policy


            H.R. 436--Health Care Cost Reduction Act of 2012

       (Rep. Camp, R-Michigan, and 240 cosponsors, June 6, 2012)

       The Affordable Care Act made significant improvements to 
     the Nation's health care system that are helping to improve 
     individuals' health and give American families and small 
     business owners more control of their own health care. These 
     important changes include: ending the worst practices of 
     insurance companies; giving uninsured individuals and small 
     business owners the same kind of choice of private health 
     insurance that Members of Congress have; and bringing down 
     the cost of health care for families and businesses while 
     also reducing Federal budget deficits.
       H.R. 436, which would repeal the medical device excise tax, 
     does not advance these goals. The medical device industry, 
     like others, will benefit from an additional 30 million 
     potential consumers who will gain health coverage under the 
     Affordable Care Act starting in 2014. This excise tax is one 
     of several designed so that industries that gain from the 
     coverage expansion will help offset the cost of that 
     expansion.
       This tax break, as well as other provisions in the 
     legislation relating to tax-favored health spending 
     arrangements, would be funded by increased repayments of the 
     Affordable Care Act's advance premium tax credits, which 
     would raise taxes on middle-class and low-income families, in 
     many cases totaling thousands of dollars, notwithstanding 
     that they followed the rules. This legislation would also 
     increase the number of uninsured Americans.
       In sum, H.R. 436 would fund tax breaks for industry by 
     raising taxes on middle-class and low-income families. 
     Instead of working together to reduce health care costs, H.R. 
     436 chooses to refight old political battles over health 
     care. If the President were presented with H.R. 436, his 
     senior advisors would recommend that he veto the bill.
                                  ____



                    Consumer Groups Oppose H.R. 436

       ``This bill would subject consumers seeking to afford 
     health insurance to unfair penalties in order to pay for 
     repeal of the medical device excise tax . . . When fully 
     implemented the ACA is expected to create 30 million newly 
     insured consumers in the health sector . . . The medical 
     device industry also stands to gain from the increased demand 
     for medical devices that a large newly insured population 
     will bring . . . It is only fair that the device industry 
     pays its share in exchange for significant new revenue 
     opportunities.''--Consumers Union.
       ``Medical devices are a $65 billion industry that has seen 
     double-digit growth in each of the last five years. A small 
     2.3% tax is reasonable considering the substantial sales 
     growth they will experience when health insurance benefits 
     are extended to an additional 33 million people beginning in 
     2014. Repealing the [medical device] tax would be a gift to 
     large corporations at the expense of middle-class 
     families.''--Health Care for America NOW!
       ``The Affordable Care Act established taxes on a wide range 
     of industries that will benefit from the law . . . it is 
     simply punitive to demand that low and middle-income families 
     be asked to fund a tax cut for a profitable industry that 
     refuses to do its share.''--American Federation of State, 
     County and Municipal Employees, AFL-CIO.
       ``The expansion of health care coverage will benefit a wide 
     range of health-related industries, including the medical 
     device industry, by increasing demand for their products. 
     Other industries in the health sector are contributing to 
     financing an expansion from which they will profit; it is 
     entirely appropriate to require the medical device industry 
     to make a contribution as well . . . Repealing this tax and 
     forgoing $29 billion in needed revenues would be 
     irresponsible--even without the outrageous step of imposing 
     this cost directly on Americans without access to affordable 
     health care coverage.''--National Women's Law Center.
       ``The Affordable Care Act protects consumers by capping the 
     tax penalty they will owe if the monthly premium credit 
     received during the year exceeds the amount of credit due 
     based on unexpected changes in income or family status. 
     Eliminating the caps on repayment will force lower- and 
     middle-income individuals and families to make a difficult 
     decision: Receive advance payments and risk having to pay 
     back some or all of the premium assistance received at the 
     time of reconciliation or go without coverage.''--Families 
     USA.
                                  ____



                                  Health Care for America NOW,

                                                     June 6, 2012.
       Dear Representative: On behalf of Health Care for America 
     Now, the nation's leading grassroots health care advocacy 
     coalition, we urge you to oppose H.R. 436, a bill to take 
     away money from middle-class families who purchase health 
     insurance with the assistance of premium tax credits and give 
     it to medical device manufacturers. The provision would raise 
     taxes on families whose midyear changes in income or 
     circumstances cause a year-end recalculation of their premium 
     tax credit.
       Medical devices are a $65 billion industry that has seen 
     double-digit growth in each of the last five years. A small 
     2.3% tax is reasonable considering the substantial sales 
     growth they will experience when health insurance benefits 
     are extended to an additional 33 million people beginning in 
     2014.
       Repealing the tax would be a gift to large corporations at 
     the expense of middle-class families. Under current law, 
     families without an offer of affordable insurance at work 
     will receive premium subsidies based on income. Changes 
     during the year--when someone gets a new job or receives a 
     raise or when a family member obtains other coverage--might 
     cause the amount of the advance payment to differ from the 
     payment calculated in the end-of-year reconciliation, even 
     when income changes have been reported in an accurate and 
     timely way. Under existing law, families are required to 
     repay any excess credit, but that repayment is capped for 
     low- and middle-income families earning less than 400% of the 
     federal poverty level.
       This legislation removes the repayment cap and jeopardizes 
     the financial security of middle-income families who face 
     unexpected lump-sum repayments. Fear of repayment will cause 
     approximately 350,000 people to refuse the premium tax credit 
     assistance and go uninsured and unprotected against 
     potentially catastrophic health problems and medical bills. 
     Over time, the consequence will be fewer families with 
     insurance and higher premiums for everyone else who buys 
     health insurance coverage.
       This bill is another partisan attempt to undermine the 
     Affordable Care Act and demonstrates troubling priorities. We 
     should not increase the number of uninsured in order to give 
     tax breaks to wealthy corporations. We urge you to oppose 
     this measure.
           Sincerely,
                                                       Ethan Rome,
     Executive Director.
                                  ____

                                     American Federation of State,


                              County, and Municipal Employees.

                                     Washington, DC, June 6, 2012.
       Dear Representative: On behalf of the 1.6 million members 
     of the American Federation of State, County and Municipal 
     Employees (AFSCME), I am writing to urge you to oppose H.R. 
     436 which is scheduled for consideration this week.
       H.R. 436 would repeal the excise tax on medical devices 
     that was enacted to help pay for health care reform. The 
     Affordable Care Act established taxes on a wide range of 
     industries that will benefit from the law, including 
     hospitals, home health agencies, clinical laboratories, 
     insurance companies, drug companies and the manufacturers of 
     medical devices. In fighting to repeal the tax, the industry 
     has made dubious claims about the impact it will have on 
     jobs. In fact, an analysis by Bloomberg Government concluded 
     that the effect of the tax ``could be offset by demand from 
     millions of new customers.'' No doubt, the prospect of 
     millions of new paying customers led other industries to 
     accept a share of the cost of achieving reform.
       The Joint Committee on Taxation estimates that repealing 
     the excise tax would cost $29 billion over 10 years. In order 
     to pay for this loss of revenue, H.R. 436 would eliminate the 
     caps on repayments of subsidies received by families who 
     later experience an improvement in their financial 
     circumstances. Such an improvement might come about as the 
     result of a new job or a marriage.
       Because it is hard to predict the future and because the 
     repayments could far exceed the

[[Page 8655]]

     penalty for failing to obtain coverage, many people will 
     choose to forgo coverage. The Joint Committee on Taxation 
     estimates that it would cause 350,000 people to choose to 
     remain uncovered. As this is likely to be a healthier group, 
     participants in the exchange risk pool would be less healthy, 
     leading to higher premiums in the exchange. Moreover, it is 
     simply punitive to demand that low- and middle-income 
     families be asked to fund a tax cut for a profitable industry 
     that refuses to do its share.
       We urge you to oppose H.R. 436.
           Sincerely,
                                              Charles M. Loveless,
     Director of Federal Government Affairs.
                                  ____

                                                     June 7, 2012.
     Hon. Pete Stark,
     House of Representatives,
     Washington, DC.
       Dear Congressman Stark: On behalf of the American Cancer 
     Society Cancer Action Network, American Diabetes Association, 
     and American Heart Association, we are writing to express our 
     concerns about the offset used in H.R. 436, the Health Care 
     Cost Reduction Act. Collectively our organizations represent 
     the interests of patients, survivors and families affected by 
     four of the nation's most prevalent, deadly and costly 
     chronic conditions, cancer, diabetes, heart disease and 
     stroke.
       We are deeply concerned that repealing the repayment caps 
     for low- and moderate-income families who are eligible to 
     receive tax credits to help make insurance coverage 
     affordable would undermine the goals of the Affordable Care 
     Act and result in an estimated additional 350,000 Americans 
     going uninsured, according to the Joint Committee on 
     Taxation. This policy would discourage individuals and 
     families from enrolling in health insurance coverage through 
     state-based exchanges.
       Moreover, the policy could disproportionately affect people 
     with chronic conditions like cancer, heart disease and 
     diabetes for two reasons. First, in the exchanges, premiums 
     will be age adjusted, and because people with chronic 
     conditions are generally older, their premiums will be 
     relatively more. Thus, if they have to repay part of a 
     subsidy that was used to purchase health insurance, the 
     amount will be relatively large. Also, the fear of having to 
     potentially pay back part of a subsidy may make them less 
     willing to obtain the coverage they need. Second, some 
     younger and relatively healthy people may also choose not to 
     enroll and use a subsidy to help them purchase health 
     insurance because they fear a change in income may put them 
     at risk of having to return part of the subsidy to the 
     government. The loss of young, healthy people in the 
     insurance pools undermines the overarching goal of universal 
     coverage and raises the premiums of those who remain in the 
     pools.
       Thank you for your consideration of our views.
           Sincerely,
     Christopher W. Hansen,
       President, American Cancer Society, Cancer Action, Network;
     Shereen Arent,
       Executive Vice President, Gov't Affairs & Advocacy, 
     American Diabetes Assn.;
     Mark A. Schoeberl,
       Executive Vice President, Advocacy & Health Quality, 
     American Heart Assn.
                                  ____

                                     Washington, DC, June 5, 2012.
     House of Representatives,
     Washington, DC.
       Dear Representative: On behalf of Families USA, the 
     national organization for health care consumers, we are 
     writing to express strong opposition to a proposal likely to 
     be considered on the House floor this week that would 
     undermine protections in the Affordable Care Act for middle-
     class families and put the financial security of these 
     families at risk.
       The proposal being considered as part of H.R. 436, the 
     Protect Medical Innovation Act of 2011, would eliminate what 
     remains of a ``safe harbor'' that protects individuals and 
     families from substantial tax penalties. We urge you to 
     reject this proposal.
       Under the Affordable Care Act, families with annual income 
     at or below 400 percent of poverty ($92,200 for a family of 
     four in 2012) are eligible to receive tax credits to help pay 
     for the cost of their health insurance premiums. Families can 
     get credits paid to insurance companies on a monthly basis to 
     offset the cost of monthly premiums. At the end of the year, 
     families face a ``reconciliation'' to ensure that the right 
     amount of credit was paid, based on a family's actual--rather 
     than projected--income. The Affordable Care Act protects 
     consumers by capping the tax penalty they will owe if the 
     monthly premium credit received during the year exceeds the 
     amount of credit due based on unexpected changes in income or 
     family status.
       Eliminating the caps on repayment will force lower- and 
     middle-income individuals and families to make a difficult 
     decision: Receive advance payments and risk having to pay 
     back some or all of the premium assistance received at the 
     time of reconciliation or go without coverage. The problem 
     with this is threefold:
       (1) Eliminating the safe harbor will likely result in 
     millions of Americans remaining uninsured. The fear of facing 
     sizeable repayment penalties at the time of tax filing would 
     create a powerful disincentive for individuals and families 
     to take up the premium credits and enroll in exchange 
     coverage.
       (2) Eliminating the safe harbor runs counter to the 
     coverage and cost-containment goals of the Affordable Care 
     Act. By undermining the affordability and availability of 
     coverage for lower- and middle-income individuals and 
     families, this proposal would also lessen the ability of the 
     Affordable Care Act to help bring the cost of care and 
     coverage under control for all Americans.
       (3) Eliminating the safe harbor undermines the 
     effectiveness of the tax credits. Families who choose to 
     receive advance payments and then face a tax penalty at the 
     time of reconciliation will be, understandably, angry. 
     Likewise, those who choose to forgo the receipt of advance 
     payments and cannot afford coverage as a result will be upset 
     that they must go without coverage and pay a penalty because 
     of it.
           Sincerely,
                                                Ronald F. Pollack,
                                               Executive Director.

  Mr. CAMP. I yield 2\1/2\ minutes to a distinguished member of the 
Ways and Means Committee, the gentlewoman from Kansas (Ms. Jenkins).
  Ms. JENKINS. I thank the gentleman for yielding, and I thank him for 
his leadership on this very important issue.
  Mr. Speaker, last Thursday, H.R. 5842, the Restoring Access to 
Medication Act, which I authored and introduced, passed out of the full 
Ways and Means Committee markup with bipartisan support. It is now 
included in this bill that is being considered on the floor today.
  We all know the President's health care law is full of pitfalls that 
make health care more expensive for average Americans. While we await 
the Supreme Court's ruling on constitutionality of the entire health 
care overhaul, there is bipartisan, bicameral agreement that requiring 
folks to have a doctor's prescription to buy medicine as simple as 
Advil or cough syrup with their health savings account or flexible 
savings account is simply wrong.
  This provision would repeal the unnecessary and punitive ObamaCare 
limitation on reimbursement of over-the-counter medications from health 
FSAs, HRAs, and Archer MSAs that took effect back in 2011. Given the 
economic climate where jobs are hard to find, families are struggling 
to make ends meet; and when every dollar counts, this provision ensures 
that consumers have the flexibility to use these savings accounts as 
they see fit to purchase over-the-counter medications they need, 
exactly when they need them.
  Republicans are committed to looking for commonsense solutions that 
address the chief concern facing both families and employers: costs. 
This bill and this provision is about lowering costs so both families 
and job creators have some of the relief that ObamaCare failed to 
achieve.
  I urge my colleagues to support H.R. 436 today.
  Mr. LEVIN. It is now my pleasure to yield 3 minutes to another 
important member of our committee, the gentleman from Seattle, 
Washington (Mr. McDermott).
  Mr. McDERMOTT. Mr. Speaker, I never cease to be amazed. I think I've 
seen the silliest thing in the world and then I come out here and 
they've done it again.
  Sometime in the next 23 days, the Supreme Court is going to make a 
ruling on whether the Affordable Care Act is constitutional. If they 
throw it out, as the Republican Party at prayer is hoping, this tax 
will have never existed. It will be gone because it's never been 
implemented. It's not affecting anybody. This is a PR stunt for the 
election. The Republicans are helping the device industry back out of a 
deal they made during health care reform.
  In May 2009, the president of AdvaMed, which is the professional 
organization of the device manufacturers, signed a letter to President 
Obama stating: ``We are ready to work with you'' to do health reform.

[[Page 8656]]

  The industry later agreed to the excise tax, knowing the cost would 
be offset by the new demands for devices created by the 30 million new 
people who would be insured. That was the deal they made.
  You can't make a deal with a Republican and think it's going to last. 
It surely won't. And all the other sectors of the health care industry 
made similar deals.
  Unlike the Bush-era Congress, the Democrats insisted their 
legislation be paid for. We paid for the whole thing. Well, guess what? 
AdvaMed now wants out of the deal. They never meant it. They were a 
flim-flam operation when they came in in the first place. They also 
claim that, Oh, my God, we're going to lose 43,000 jobs. You know who 
did the study? AdvaMed contracted with somebody to do a study; and lo 
and behold, they lost 43,000 jobs. Bloomberg had an independent 
consultant look at it, and they find that there is no evidence that 
there will be any jobs lost whatsoever. That was entered into the 
Record during the earlier debate, and I won't do it again.
  The demand for devices will remain steady even after the tax kicks 
in, and the tax does not only apply to devices made in America and 
shipped overseas. It applies to every one of them. There's no way 
you're going to get out of it.
  So the argument about offshoring jobs is just political nonsense. 
They want to call this is a jobs bill--we're saving 43,000 jobs. They 
were never in doubt, never in question.
  That a company is laying off somebody today in anticipation of a tax 
that goes in effect in 2013, folks, 6 months from now that might be 
repealed by the Supreme Court, you cannot tell me that the management 
of these companies are that foolish.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. LEVIN. I yield the gentleman an additional 1 minute.
  Mr. McDERMOTT. They're going to pay for it by having the IRS claw 
back the subsidy to middle-income families who will be in the new 
health plans. The Treasury will pay these subsidies directly to the 
health plan so the individuals won't even know it happened. So they 
will be invisible to the newly insured, but at the end of the year, 
middle class people are suddenly going to get a bill from the IRS for 
something they never knew went there.
  So, in other words, we're going to let a hundred-billion-dollar 
industry pull out of a deal and pay for it by requiring working people 
across this country to write a check to the IRS. Welcome to Republican-
style health reform.
  Vote ``no'' on this bill. It's simply another way to try and repeal 
ObamaCare. Mr. Obama cares. He passed a bill. The Republicans have done 
nothing since they have been in charge.
  Mr. CAMP. I yield 2\1/2\ minutes to a distinguished member of the 
Ways and Means Committee, the gentleman from Louisiana, Dr. Boustany.
  Mr. BOUSTANY. I thank Chairman Camp for his leadership on this issue.
  I rise in support of this bill. Let's be clear: successful health 
care reform efforts must begin by lowering costs, promoting high-
quality health care, and fostering innovation. ObamaCare does the 
opposite.
  Even Medicare's own actuary warns that the President's medical device 
tax will increase Americans' monthly premiums. The tax will also 
eliminate more than 40,000 jobs. Passage of this bill will reduce costs 
and save jobs by repealing this tax.
  Mr. Speaker, as a heart surgeon, I have used medical innovations that 
have saved thousands of life. I want to highlight something. Back in 
the 1950s, when we had no surgical treatments for heart disease, a 
surgeon watched a woman die helplessly. After 8 or 9 months, he 
actually devised the very first heart-lung machine in his shop. This 
led to an explosion in technology that has saved millions of lives the 
world over. This was an American innovation.
  Eighty percent of device companies today have fewer than 50 
employees. These are innovators. These are the people who create jobs. 
These are the guarantors of American innovation.

                              {time}  1500

  And without this, what are we going to have with our health care 
system? That's what's made American health care the best on the planet. 
We don't want to take a step back. Putting this tax in place will 
discourage these startup innovators. They will not take risks, and 
we'll harm patients in the long run because of the lack of 
breakthroughs.
  I'm also very pleased that this bill contains Ms. Jenkins' provision 
that will prevent a middle class tax hike. It will allow individuals to 
use their flexible spending arrangements to purchase over-the-counter 
medications without having to go see a doctor for a prescription, which 
is costly and time-consuming.
  Finally, I'm pleased that the bill includes bipartisan legislation 
that I authored with Congressman John Larson of Connecticut to make it 
easier for Americans to save their pretax dollars in FSAs without 
losing the money if they don't use it at the end of the year. It's 
their money. They should be able to keep the money and use it for their 
own health care purposes or for whatever purposes they deem essential 
for their families.
  Americans need tax relief to help them with the rising out-of-pocket 
costs of health care and other costs that they have. We should be 
encouraging and not punishing new medical breakthroughs.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. CAMP. I yield an additional 30 seconds to the gentleman.
  Mr. BOUSTANY. I urge my colleagues to support these commonsense 
solutions in H.R. 436.
  Mr. LEVIN. Mr. Speaker, I now yield 3 minutes to another very 
distinguished member of our committee, the gentleman from New Jersey 
(Mr. Pascrell).
  Mr. PASCRELL. Mr. Speaker, I thank the ranking member. This bill 
repeals the 2.3 percent excise tax on medical devices used in the 
United States that was originally enacted as part of the Affordable 
Care Act. Now let's talk straight to the American people. How many 
bills do we have to go through until you will admit that all you're 
doing is trying to bleed the legislation, which is now law in the 
United States, so that the resources are not there to carry out the 
mandate? No industry gets a free pass when it comes to health care 
reform. All sectors of the health care industry, from pharmaceutical 
companies to hospitals to drug manufacturers and the medical device 
industry, contributed to the cost of health reform and were at the 
table during these discussions. How different is that? They agreed to 
this.
  In fact, in a letter to President Obama in 2009, the medical device 
industry pledged to do their part in lowering health spending by $2 
trillion. What made them change their mind? They committed to making 
health care reform a reality. They put it in writing. It's all in--it's 
all in--to lower health care costs. Now we've had some kind of a moral 
change of sorts.
  Many of these companies were present when it was discussed, and they 
understood the long term benefits. Thanks to health care reform, the 
medical device industry stands to gain a lot of customers and increase 
a lot of revenue. According to the RAND Corporation, an estimated 33 
percent of newly insured adults will be of the age 50-64, an age group 
when many people will need medical devices. By bringing so many new 
people into the insurance market, the Affordable Care Act will provide 
patients the opportunity to access medical devices that save and 
improve their lives.
  This bill that we have before us is not about patient care. It is not 
about saving money in our health care system. It's just another attempt 
by the majority to dismantle health care reform piece by piece. 
Repealing this provision from the Affordable Care Act once again 
undermines financing for the law and will unfortunately do more harm 
than good.
  Unlike what happened in the previous 8 years, we want to pay for 
things so we don't get ourselves deeper into debt. You don't get it.
  The SPEAKER pro tempore. The time of the gentleman has expired.

[[Page 8657]]


  Mr. LEVIN. I yield the gentleman an additional 1 minute.
  Mr. PASCRELL. And to pay for this change, the majority once again 
returns to the true-up provision--how many times are you going to go 
there?--which only hurts the middle class, who receive needed subsidies 
to enter the health insurance market.
  So here's what's going to happen in the health care bill: insurance 
companies gain a lot of new customers, adding to free enterprise. We're 
not against that. Medical device companies are going to get a lot of 
new customers, particularly in the age group which I mentioned before. 
We're not against free enterprise. But they agreed at the table, since 
they were all in, and they put it in writing, that they were willing to 
provide those lowering of costs of close to $2 trillion. You can't go 
back on a deal--let's call it that. An agreement--let's make it better.
  I urge my colleagues to protect the Affordable Care Act. Vote ``no'' 
on this legislation. It will not bring us any closer to health care 
reform in this country.
  Mr. CAMP. Mr. Speaker, at this time I yield 2 minutes to the 
distinguished chairman of the Health Subcommittee, the gentleman from 
California (Mr. Herger).
  Mr. HERGER. I rise in strong support of the Protect Medical 
Innovation Act.
  Mr. Speaker, it's a well-known principle if you increase taxes on 
something, you get less of it. The medical device tax is a tax on 
innovation. It's a tax on creating good-paying American jobs, and it's 
a tax on the development of potentially lifesaving medical treatment.
  Because it taxes sales instead of income, it will be especially 
harmful to new startup businesses that aren't turning a profit yet. My 
friends on the other side object to the offset in this bill even though 
it merely requires that people pay back benefits they make too much 
money to qualify for. Their view seems to be that we should make it as 
easy as possible for people to sign up for taxpayer-funded benefits. 
And if that means we waste some money along the way, so be it.
  Mr. Speaker, at a time when we're borrowing 32 cents of every dollar 
we spend, I suggest we should be doubly careful to ensure that benefits 
go only to those who truly need them.
  The question before us today is simple: do we want less innovation, 
less entrepreneurship, less high-tech jobs, and less medical 
breakthroughs? If you think America has too much of these things, vote 
``no.'' But if you want to see more jobs, more startups, and more 
health care innovation, vote ``yes'' and repeal this damaging tax.
  Mr. LEVIN. It's now my pleasure to yield 2 minutes to the very 
distinguished Member from Minnesota (Ms. McCollum).
  Ms. McCOLLUM. Mr. Speaker, I thank the gentleman from Michigan for 
the time.
  Mr. Speaker, I want the Affordable Care Act to be fully implemented 
for the benefit of all Americans. I also support a healthy growing 
medical device industry in Minnesota and across America. I support 
eliminating this medical device tax, which should never have been 
included in the Affordable Care Act. But at the same time, I strongly 
oppose the offset in this bill.
  This Tea Party Republican-controlled House has voted over and over 
again to eliminate health reform's protections and benefits, denying 
millions of Americans access to lifesaving care, including medical 
devices. The Republican goal is to kill health care reform; my goal is 
to strengthen it.
  Today, I will vote to send this bill to the Senate, where I know a 
responsible offset can be found. My two Minnesota Senators are 
committed to repealing this tax, and they will find an offset that does 
no harm. Eliminate this tax and strengthen health care for all 
Americans, that's my goal.
  Mr. CAMP. At this time I yield 2 minutes to a distinguished member of 
the Ways and Means Committee, the gentleman from Washington State (Mr. 
Reichert).
  Mr. REICHERT. Mr. Speaker, I thank the chairman for yielding me this 
time.
  Mr. Speaker, we have been here before. We're here today to talk about 
the Health Care Cost Reduction Act, and it's an act reducing costs from 
a bill that's called the Affordable Health Care Act. So let's just 
bring a little bit of context into this, Mr. Speaker.

                              {time}  1510

  This isn't the first time, as I've said, we've been here. The 1099 
reform, language included in the so-called Affordable Care Act, more 
commonly known as ObamaCare, a burdensome tax on small businesses. The 
Democrats agreed it needed to be removed from the bill. The President 
agreed and signed it into law.
  The CLASS Act that was announced by the Secretary of Health, 
Secretary Sebelius, we can't afford to implement the CLASS Act. That 
was designed to help with long-term health care issues. Can't do it; 
can't afford it under the Affordable Care Act.
  The Independent Review Board, we've passed a bill here in the House 
to eliminate that. What does that do? It takes away all the choice from 
the American people, especially seniors and veterans, on what you want 
to do with your own health care.
  So, time after time after time we're finding language in this bill 
that is not affordable, that does not give Americans the opportunity to 
choose for themselves. It takes away choice. It takes away freedom.
  Today we're talking about a 2.3 percent tax that will cost thousands 
of jobs--about 10,000 in the State of Washington--and it will increase 
the price of these medical devices on things that you may not even 
think about. For example, a filtration device on a dialysis machine, 
that's going to be a medical device that will be taxed. Who's going to 
pay for that? Well, the claim is that these companies that are making 
so much money, they'll be the ones to pay for it. This bill is paid for 
through those companies. Those costs are passed on to the customers, to 
the patients.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. CAMP. I yield the gentleman an additional 15 seconds.
  Mr. REICHERT. Thank you, Mr. Chairman.
  So I would say, Mr. Speaker, this bill does not have a real good 
track record, and we should vote for this Health Care Cost Reduction 
Act. I encourage my colleagues to do the same.
  Mr. LEVIN. Mr. Speaker, I now have the privilege of yielding 2 
minutes to the gentleman from Pennsylvania (Mr. Critz).
  Mr. CRITZ. I thank the gentleman for yielding.
  Mr. Speaker, the medical device industry is a unique American success 
story, both for patients and for our economy. Within the last two 
decades, we have seen a rapid growth in medical technology companies in 
my home State of Pennsylvania, providing tens of thousands of jobs, 
billions of dollars in revenue, and contributing to better health 
outcomes for millions of Americans and patients globally. These are 
good-paying jobs that help sustain the middle class in our country, and 
we must create an environment that encourages 21st century innovative 
industries like medical device manufacturing.
  As our economy continues to struggle, an additional 2.3 percent 
excise tax would be a burdensome charge on an industry that is steadily 
growing and creating jobs. One medical device company that employs 
hundreds in my district told me:

       We are at full capacity and need to expand. This excise tax 
     will prevent any plans for growth in the near future.

  Mr. Speaker, we simply cannot allow the potential for job growth, the 
potential for further American innovation and competitiveness to be 
lost in today's economy.
  Last year, I cosponsored the original version of the Protect Medical 
Innovations Act. There is bipartisan support to repeal this tax, but in 
the past week Republicans have muddied the process and decided to play 
politics with this bill.
  While I strongly disagree with the path Republicans have decided to 
take, the issue at hand is about sustaining

[[Page 8658]]

and creating American jobs, and I support the repeal of the excise tax 
on medical devices.
  Mr. CAMP. Mr. Speaker, at this time, I yield 2 minutes to a 
distinguished member of the Ways and Means Committee, the gentleman 
from Illinois (Mr. Roskam).
  Mr. ROSKAM. Thank you, Mr. Chairman.
  What I'd like to do is just reflect for a minute on some of the 
promises around President Obama's health care law.
  You remember he said during the course of the debate about the health 
care law, Mr. Speaker, that if you like what you have, you can keep it. 
But what we've found is that some estimates say that up to 30 percent 
of employers will actually drop their health care coverage. So those 
folks that have that coverage, they don't get to keep that coverage, 
Mr. Speaker.
  There was also a promise that the law would actually lower premiums, 
and yet family premiums are already increasing by as much as $1,600 per 
year.
  But there was one promise that was made that was actually kept, and 
it was a promise, Mr. Speaker, from the gentlelady from California, 
who, as Speaker of the House, said, in a nutshell, We've got to pass 
the bill so that you can know what's in it.
  Well, she did, and we do.
  What's in it was a cascading group of mistakes. One was the 1099 
bill--big mistake. It wasn't found the first time around, but we were 
able to fix that. The second was the CLASS Act, a recognition that it 
was a failure and inoperable. It hasn't been dealt with by the 
administration, but at least they put the white flag up and said it's 
ridiculous.
  Two other things now have come to our attention. The first is well 
discussed. That is the medical device tax. Even the gentleman from 
Washington, from the other side of the aisle, makes an argument 
criticizing the study, but at best he creates a Hobson's choice. At 
best, he says, well, it may not kill jobs; but then in the alternative, 
Mr. Speaker, it's just going to raise health care costs. That's what 
that study says.
  The irony is now we have the chance, under the leadership of the 
gentlelady from Kansas (Ms. Jenkins), to make it so that working moms 
don't have to have the hassle of going to see a physician when their 
child is sick in order to buy an over-the-counter medication. This is 
well thought out. It makes perfect sense. We need to support this.
  I urge an ``aye'' vote.
  Mr. LEVIN. Mr. Speaker, I now yield 3 minutes to another 
distinguished member of our committee, the gentleman from Texas (Mr. 
Doggett).
  Mr. DOGGETT. Well, Mr. Speaker, our long wait is over. A year and a 
half after their move to repeal the Affordable Care Act, the 
Republicans are back with the ``replace'' part of their ``Repeal and 
Replace'' slogan. And rather than offering an answer to comprehensive 
health care for 30 million more Americans, who need it, all they have 
to offer today is a tax break for Tylenol. Well, I'll tell you, health 
care in this country is more than a two-Tylenol headache, and it needs 
a more comprehensive response.
  Of course, the real purpose of their action today is just this week's 
attempt to wreck the Affordable Care Act and to protect health 
insurance monopolies. Some of these are the very same health insurers 
that demand more than 20 cents of every dollar for their overhead--20 
cents; 10 times the administrative cost of the Medicare system.
  But our Republican colleagues never let reality get in the way of 
ideology when they question most any government initiative that is 
called ``public,'' as in public education, or ``social,'' as in Social 
Security. As usual, they continue to demand legislation that offers 
more comfort for the comfortable, while actually increasing the number 
of uninsured by 350,000. Understand that. If this legislation becomes 
law, instead of decreasing the number of uninsured American families, 
we'll have 350,000 more Americans that don't have health insurance. 
That's their plan.
  Our country continues to face a real health care crisis. Too many 
small businesses and individuals are paying too much for too little 
health care. Millions of families are just one accident on the way home 
from work this evening, or one illness, one child with a disability, 
from facing personal bankruptcy. That has not changed.
  The Affordable Care Act I believe is too weak. It should be much 
stronger. But it is so much better than the system we find ourselves in 
today with so many lacking so much. And it's far superior to the 
Republican do-little or do-next-to-nothing approach; give the American 
people half a life preserver, which is their approach.
  As always, when there is a need for public action, whether it is 
building a better bridge or more bridges, or providing an opportunity 
for more young Americans to get a college education, or health care--be 
it preventive care, school-based care, long-term care--the Republican 
answer is always the same: No. No. And their excuse is always the same, 
too: ``The deficit made me do it.''
  ``I'd like to do something about long-term care, but we just can't 
afford to do it.'' What a contrast when it comes to bills like that of 
today.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. LEVIN. I yield the gentleman an additional 1 minute.
  Mr. DOGGETT. Because whenever it is about depleting the Treasury's 
ability to fund those affordable needs for our country, they don't 
worry too much about the deficit. $46 billion earlier in the year; this 
bill is part of a package of almost $42 billion of additional revenue 
depletion. Later in the summer, we are told they will come up with $4 
trillion of Bush tax cut extensions.
  What this will ultimately lead to, if we pursue the irresponsible 
path,--of which this is just another step--is that vital public 
programs that work--Medicare and Social Security--cannot be sustained.

                              {time}  1520

  They cannot be financed. There is no free lunch to retirement and 
health security in this country. It requires that we invest in a 
responsible way, and that's what the Affordable Health Care Act does.
  Reject this legislation today, which will undermine that reform, and 
set us back in our efforts to provide health care security to millions 
of American families.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the distinguished majority 
leader, the gentleman from Virginia (Mr. Cantor).
  Mr. CANTOR. Mr. Speaker, I thank the gentleman from Michigan, 
Chairman Camp.
  Mr. Speaker, I rise in support of the legislation before us to reduce 
health care costs and expand patient freedom in health care decision-
making.
  Speaker Boehner and I made clear yesterday that the House will not 
act to raise taxes on anyone. The bill on the floor today is one step 
of many that we will need to take this year to ensure that end.
  Even though the medical device tax has not yet been applied, the tax 
has already led to job losses, and threatens to reverse America's role 
as a global leader and innovator in the life sciences industry. We know 
if we want to encourage innovators, we cannot tax them.
  Mr. Speaker, with all of the bipartisan action in the House and 
Senate on legislation to improve the approval process for drugs, 
biologics, and medical devices at the Food and Drug Administration, it 
would be reasonable to assume that Congress could find common ground on 
issues that are core to promoting jobs and innovation.
  Unfortunately, don't expect this bill to reach the President's desk 
in a timely fashion, even with Members from both parties calling for 
the repeal of this harmful tax. The medical device tax was created as 
part of the new health care law and, for that reason alone, the 
administration continues to defend this tax which was only created to 
fund an unworkable law.
  In fact, Mr. Speaker, the President has threatened to veto our bill 
because the tax will pay for his health care law. We should not be 
increasing taxes to

[[Page 8659]]

pay for a law that a majority of Americans want repealed, a law that 
even some ardent supporters admit will not work as intended.
  Mr. Speaker, the real price is being paid by the American people. A 
tax on medical devices will harm patient care, not improve it. With 
this tax, it will now be more expensive for patients to walk into the 
exam room because the bed itself can be classified as a medical device. 
The tax will dramatically alter the research and development budgets of 
medical device companies.
  Mr. Speaker, just yesterday, a constituent of mine from Richmond 
requested that Congress recognize the vital importance of research 
funding and the direct impact that it could have for her son, Joshua, 
who was born with a rare and serious heart defect. Only 8 years old, 
Joshua has already braved three open-heart surgeries. There's no 
medical procedure today that can help this little boy. We need to 
encourage the medical innovations, not stifle them with taxes, so that 
there can be hope for kids like Joshua.
  Further, the tax is directly causing job losses and could directly 
impact small business growth, as the medical device companies often 
start with just a few employees. Overall, this tax could result in the 
loss of tens of thousands of American jobs in an industry that is key 
to economic growth.
  Mr. Speaker, the President's veto threat is notably silent on the 
other two major provisions of this bill, provisions championed by 
Representative Lynn Jenkins and Representative Charles Boustany, to 
give patients more control over their health savings accounts and 
flexible spending arrangements, respectively. Are these provisions 
acceptable to the White House?
  Will health savings accounts even be permitted if the President's 
health care law remains on the books?
  The uncertainty caused by the law highlights, once again, how truly 
flawed it is, and why all of the President's health care law must be 
repealed.
  Mr. Speaker, there are many difficult issues that Congress must 
address to ensure America remains a country of opportunity, innovation, 
and growth. Supporting this bill should be easy.
  I'd like to thank Representative Erik Paulsen for his leadership in 
advancing this legislation to eliminate a harmful tax. And I want to 
recognize the leadership of Chairman Dave Camp, who is working to put 
forward pro-growth tax reform that will make our Tax Code simpler and 
fairer and result in a growing economy.
  Mr. LEVIN. Could you please indicate how much time there is on each 
side?
  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Levin) has 
17\1/2\ minutes remaining. The gentleman from Michigan (Mr. Camp) has 
26\1/4\ minutes remaining.
  Mr. LEVIN. I yield myself 30 seconds.
  It's the Republicans who've combined these three bills. The 
Republicans.
  And the leader talks about jobs. I wish he would give instructions to 
the Ways and Means Committee to consider and bring up jobs bills that 
are just languishing from inaction. We need more than signals. We need 
action.
  I yield 3 minutes to the gentleman from California (Mr. Thompson), a 
distinguished member of our committee.
  Mr. THOMPSON of California. I thank the gentleman for yielding.
  Mr. Speaker and Members, I rise today in opposition to this bill. And 
this is not a tax that I like. As a matter of fact, I don't like this 
tax at all.
  The medical device industry has been on the forefront of creating 
jobs, pushing medical innovation, and keeping all of us healthier. But 
we didn't pass this provision in a vacuum, and today we're not voting 
to repeal it in a vacuum. We didn't pass it to be vindictive or mean or 
because we just felt like it.
  This provision was passed as part of a larger bill that was a 
response to a national crisis in health care that we're experiencing in 
our country. In order to do this, we had to make some really hard 
choices so our grandkids and our great grandkids weren't stuck with the 
bill for this response, like they were for the drug benefits for 
seniors or the tax cuts their grandparents enjoyed.
  This wasn't done lightly, and the device industry isn't alone in 
sharing in some of this responsibility. But the device industry will 
also see the benefits of having 30 million additional people covered by 
health care. Many of those will be customers of the device industry.
  I'd vote to repeal this provision today, yesterday, or tomorrow if we 
were having a serious discussion about the provision with a serious 
pay-for. Instead, we're repealing a tax on an industry that had over 
$40 billion in profits in 2010, and we're paying for it on the backs of 
middle class people, some of whom, for the first time in their adult 
lives, will have access to quality, affordable health care.
  Now, this is probably the tenth time in this Congress that we've 
repealed, or we will vote to repeal, part of the Affordable Care Act. 
In addition to that, we've also voted to repeal the entire act.
  This is not honest debate on policy but, rather, another political 
cheap shot at the Affordable Care Act. For these reasons, I urge a 
``no'' vote on this legislation.
  Mr. CAMP. I yield 2 minutes to the gentleman from Pennsylvania (Mr. 
Gerlach), a distinguished member of the Ways and Means Committee.
  Mr. GERLACH. I thank the chairman for his leadership and recognition.
  Mr. Speaker, I rise today in support of this legislation and urge my 
colleagues to vote to stop now a $30 billion tax increase on medical 
innovation. This pending tax means higher costs for doctors and 
hospitals, less investment in finding new ways to improve treatments 
for patients, and fewer jobs for American workers.
  What's at stake in Pennsylvania are an estimated 20,000 high-tech 
manufacturing jobs. Approximately 600 medical device manufacturers have 
helped our Commonwealth's workforce transition from a rust-belt economy 
to a high-tech leader in life sciences, biotechnology, and medical 
device manufacturing. However, this looming tax on innovation threatens 
to bring a little bit of that rust back to our manufacturing base.
  Some of the medical device manufacturers in Pennsylvania have said 
that forcing them to write larger checks to the Internal Revenue 
Service would mean facing decisions about cutting back on research and 
development or raising prices. Cutting research and development would 
mean patients wait longer for groundbreaking treatments and products.
  Raising prices would put American workers at a disadvantage compared 
to their European competitors who are often propped up by huge 
government subsidies.
  Now, I realize the President's in full campaign mode. He's traveling 
around the country talking about the importance of working together to 
create jobs. So I would respectfully submit then that passing this 
legislation to protect American jobs we already have would be at the 
top of the to-do list that we keep hearing about from the White House.

                              {time}  1530

  Mr. Speaker, we should be providing incentives that spur innovation 
rather than the Federal Government's taking more out of the private 
sector, which will threaten to drive these manufacturers out of 
business or overseas.
  I ask that all Members support this legislation today so that we can 
stop a $30 billion tax hike in 2013 and prevent putting up new barriers 
that will cost American workers their jobs.
  Mr. LEVIN. It is now my pleasure to yield 3 minutes to another 
distinguished member of our committee, the gentleman from Massachusetts 
(Mr. Neal).
  Mr. NEAL. I thank the gentleman.
  Mr. Speaker, I rise to talk about the simplicity of the medical 
device excise tax and to remind people, as the majority leader said, 
that this is really about repealing the Affordable Care Act. This is 
not a debate about just the medical device excise tax. This is an 
effort to repeal the entire action.
  This is a tremendous industry. I've worked with them for years. There 
are 400 medical device companies that employ 24,000 people and about 
82,000 people indirectly. It is critical to the Massachusetts economy.

[[Page 8660]]

  We are debating the same issue we debated 2 years ago when I worked 
closely with colleagues. By the way, the way Congress once functioned 
was to work with labor and the respective industries and with Members 
on both sides of the aisle in order to have an outcome that everybody, 
if they didn't love it, could at least come to say that they liked.
  I negotiated decreasing that tax from 5 to 2.3 percent, and I stood 
up to those who thought it ought to be 5 percent. The big request from 
the industry was that they wanted the devices that were imported to be 
subject to the same tax. They were absolutely correct. We reached a 
compromise with the industry that bought into this suggestion because 
they knew that they would benefit from the expansion of insured 
individuals under the Affordable Care Act. I should note something that 
is very important today, which is that the industry receives Medicare 
payments indirectly via payments from hospitals.
  Now I worry about the impact of the tax on the medical device 
industry. If we had a good pay-for today and if everybody agreed that 
we were going to try to hold onto the basis of the Affordable Care Act, 
count me in. One medical device company recently said to me, If we're 
going to get hit with a new tax, it's going to cost our company $100 
million a year. To withstand that kind of tax increase, we're going to 
have to look at cutting jobs.
  I understand that, and I'm concerned about the push for companies 
that are going to cut back on research and development; but I cannot 
support this piece of legislation due to the offset which would repeal 
the true-up protections for lower- and middle-income families that use 
the Affordable Care Act's premium tax credits. According to Joint Tax, 
350,000 fewer individuals will become insured if those protections are 
repealed, and I can't support that.
  The reality is that this vote is simply another political stunt to 
chip away at the health care reform act. I am open to working with 
Chairman Camp. If we can find a path forward, as I've indicated, count 
me in. This is not the path to pursue. This is not the way to do it. A 
reminder: This really is not the way that this Congress functioned when 
I came to it, particularly on the Ways and Means Committee, when you 
work with industry and labor to accomplish extraordinary things.
  Mr. CAMP. At this time, I yield 2 minutes to the distinguished 
chairman of the Energy and Commerce Committee, the gentleman from 
Michigan (Mr. Upton).
  Mr. UPTON. Mr. Speaker, last week, the House passed, by 387-5, major 
legislation that impacts millions of jobs by allowing the faster and 
safe approval of medical devices and pharmaceutical drugs.
  Rather than sending those jobs overseas, they're staying here. The 
administration's impending tax on medical devices is a ticking time 
bomb for manufacturing jobs and innovation across the country and 
especially in Michigan, which is why we need to repeal it and pass this 
legislation.
  Last month, I visited Stryker, a major device manufacturer that is 
headquartered in Kalamazoo and Portage, Michigan. They reinforced the 
harmful impacts that this tax will have on our corner of the State. 
Stryker employs about 2,500 workers in Kalamazoo County. They tell me 
that the tax is going to cost their company alone $150 million, and 
that number does not include the millions of dollars and thousands of 
man-hours that they're going to have to expend on ensuring that they're 
in compliance with that tax. These are dollars that could be better 
spent on wages, research, development, and investments in lifesaving 
technologies, which would not only help the employment sector but, 
obviously, patients as well. Stryker also recently announced the 
elimination of 1,000 jobs worldwide, which is a 5 percent reduction in 
its global sales force. The cause of that reduction: making up the cost 
for this impending tax.
  The President said earlier this year that he would do whatever it 
takes to create jobs in America. He needs to sign this bill because, 
without it, it's going to cost jobs--as has been proven in Michigan 
alone.
  Mr. LEVIN. I yield myself 30 seconds.
  We very much favor the medical device industry. They agreed to pay 
for health insurance coverage. In 2011, Stryker had revenue of $8.37 
billion on these products with a net income of $1.3 billion. Everybody 
is going to have to participate, as they promised, to make health care 
work. If everybody ducks out, people will go uninsured.
  It is now my privilege to yield 3 minutes to the gentleman from 
Wisconsin (Mr. Kind).
  Mr. KIND. I thank the ranking member on the Ways and Means Committee 
for yielding me this time.
  Mr. Speaker, in the waning days of the work we were doing to get the 
Affordable Care Act in shape for consideration before the entire 
Congress, I wasn't an enthusiastic supporter of the medical device 
manufacturing tax as one of the pay-fors in order to pay for health 
care reform. I, however, agreed with the President wholeheartedly that 
health care reform had to be fully paid for. In fact, the idea was to 
pay for it, and then some, so that we had the ability to start reducing 
our budget deficits out into the future.
  Because of the work that was done and because of the hard 
negotiations and the tradeoffs that were made, the Congressional Budget 
Office, in its analysis of the Affordable Care Act when it passed, said 
it would reduce the budget deficit by over $1.2 trillion over the next 
20 years. Now, that is a significant achievement--that we are able to 
start reforming a health care system in desperate need of reform, pay 
for it at the same time, work to improve the quality of care and the 
access of care for 33 million uninsured Americans, but also start 
bending the cost curve in healthcare.
  I was concerned about the medical device tax as an element of the 
pay-for, however, because of the vital role that the medical device 
industry has in our economy. They play an important role when it comes 
to job creation. They enjoy certain competitive advantages here in the 
United States market. I was concerned about the tax applying to the 
sales of the products as opposed to profits because of the impact it 
will have on smaller manufacturers, which operate on a much smaller 
margin.
  That's why I support the legislation before us today, but I do so 
under the proviso and with the understanding that the pay-for that is 
being used right now is controversial on our side. I don't think it's 
the ideal pay-for. I don't believe that it's going to be the pay-for 
that the Senate would consider if it takes this measure up. It 
certainly won't be the pay-for that the President will feel comfortable 
signing into law. So there is going to be additional work that we're 
going to have to do together to try to find an acceptable bipartisan 
pay-for if we're going to repeal this tax on an important industry in 
our country.
  I would also submit to my colleagues on the other side that there are 
many proposals under the Affordable Care Act that have enjoyed wide 
bipartisan support in the past, proposals that can help find savings in 
the healthcare system. They include the build-out of the health 
information technology system that our health care providers 
desperately need, which will not only improve the efficiency of care 
delivered and reduce medical errors, but will finally start collecting 
that crucial data so we know better what works and what doesn't work in 
the delivery of health care. There are delivery system reforms in the 
health care reform bill that are already proving effective and that 
lead us towards a system that is more integrated, that is more 
coordinated, that is patient-focused, thus producing a much better 
outcome of care but at a better price.
  Ultimately, we have to continue working together to change the way we 
pay for health care in this country so that it's based on the value--or 
the quality or outcome of care that's given--and no longer on the 
volume of services and tests and things that are done regardless of the 
results. There has been wide bipartisan agreement in the past over 
these issues which are included in the Affordable Care Act, but you 
would never guess it by listening to the terms of the debate today.

[[Page 8661]]

  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. LEVIN. I yield the gentleman an additional minute.
  Mr. KIND. While I support the legislation and what it's trying to 
accomplish here, I still think, following today's debate, there is 
going to be a lot more work that we're going to have to do in dealing 
with the other side of the Capitol, with the Senate, as far as coming 
up with acceptable pay-fors, in its mind, and also in working with this 
administration.

                              {time}  1540

  So hopefully we can reduce this tax burden on an important industry. 
But we can do it in a more reasonable and commonsense fashion so we 
don't jeopardize the health care access of over 350,000 Americans, 
which may be adversely impacted with this ``true-up'' provision, that 
is being used today to pay for the repeal of this revenue measure.
  I thank my colleague for the time I was yielded.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to a distinguished member of 
the Ways and Means Committee, the gentleman from Illinois (Mr. Schock).
  Mr. SCHOCK. Mr. Chairman, thank you for your leadership on this 
important piece of legislation.
  Mr. Speaker, I rise today in support of the repeal of the 2.3 percent 
medical device tax created in the health care law.
  This tax will have a devastating impact on jobs, estimated to be over 
1,200 job losses in the State of Illinois, which already has an 
unemployment rate higher than the national average. Instead of working 
on policies that will incentivize economic growth, this tax will stunt 
it while adversely affecting small businesses and local communities.
  Not far from my hometown is Canton, Illinois, an example of what can 
happen when device manufacturers partner with small communities. In May 
of 2013, Cook Polymer Technology, a raw material manufacturer, 
announced plans to open a second plant in Canton, Illinois, a town with 
a population of just under 15,000. These two facilities jump-started 
Canton's economy, leading to the creation of over 100 new well-paying 
jobs.
  This partnership also led to a full percentage point drop in Canton's 
unemployment rate. According to Canton's mayor, private developers are 
now building more homes than at any time in the last 15 years combined 
in this little town's history. None of this would have been possible 
without Cook's decision to invest in Canton. Unfortunately for Canton, 
the looming medical device tax has already resulted in Cook's decision 
against building a new factory in the United States.
  This tax will lead to future job losses as companies decide to close 
or cut back on their operations in R&D work. Communities like Canton 
will see their recent economic gains stalled, and it is why it is 
imperative that Congress repeal this device tax before job losses are 
realized and America finds it is no longer the leader in medical device 
technologies.
  I urge passage of this bill and the repeal of the tax.
  Mr. LEVIN. I yield 1 minute to the gentleman from North Carolina (Mr. 
Watt).
  Mr. WATT. Mr. Speaker, I thank the ranking member for yielding time.
  I walked in on the last two speakers, neither of whom said anything I 
disagree with, except that I can't support the bill because of the pay-
for that is in the bill.
  I'm convinced that we should repeal the medical device excise tax. I 
think it's driving jobs and innovation offshore, and a lot of that is 
happening in my congressional district. I also think it is 
counterproductive to talk about doing it and paying for it in the way 
that has been proposed in this bill. And I will therefore unfortunately 
not be able to support the bill as it is written today and introduced 
because of the manner in which it's being paid for.
  I don't think there is anything complicated about this. We need to 
find a more acceptable way to do what I think a lot of us agree needs 
to be done, which is to repeal the medical devices tax. But this is not 
the way to pay for it, and we must find an acceptable pay-for.
  I thank the ranking member for yielding time.
  Mr. CAMP. I yield 2 minutes to a distinguished member of the Ways and 
Means Committee, the gentlewoman from Tennessee (Mrs. Black).
  Mrs. BLACK. Mr. Chairman, thank you for yielding.
  Mr. Speaker, I hope in the coming weeks, the Supreme Court strikes 
down this disastrous piece of legislation, but the reality is that no 
one knows for sure what the court is going to do. So we must continue 
to do everything we can to get rid of this law.
  Today, as a cosponsor of this Health Care Cost Reduction Act of 2012, 
I continue to fulfill my pledge to defund, repeal, and replace 
ObamaCare with commonsense solutions.
  First, this bill defunds ObamaCare by getting rid of these job-
killing taxes. The 2.3 percent Medicare device tax would cost the 
taxpayers almost $30 billion, and the cost to the manufacturing 
industry would be about 43,000 jobs, forcing them either to close down 
or to ship these jobs overseas.
  This bill also repeals ObamaCare's over-the-counter restrictions on 
flexible spending accounts. ObamaCare's government-must-know-everything 
mentality takes the flexibility out of the flexible spending accounts 
and drives up the health care costs. Most importantly, we're replacing 
it with real reforms that promote consumer choice, quality care, and 
reduced health care costs.
  This is what the good people of the Sixth District of Tennessee 
expect me to do, why they sent me to Washington, and why I'm continuing 
to fight every day to defund, repeal, and replace ObamaCare with 
commonsense solutions.
  Mr. LEVIN. Mr. Speaker, I reserve the balance of my time.
  Mr. CAMP. At this time, I yield 1 minute to the distinguished 
gentleman from Illinois (Mr. Dold).
  Mr. DOLD. Mr. Speaker, I certainly want to thank the chairman for his 
leadership.
  I'm pleased to rise in support of this legislation because it will 
save jobs. We hear time and time again all across the country that the 
biggest issue that we face is jobs and the economy.
  We've got an unemployment rate of 8.2 percent, and we need to be 
focusing in on growing our economy. This special tax increase on 
medical device manufacturers frankly would do quite the opposite. It 
would cost jobs. In the 10th District of Illinois, thousands of 
individuals are employed by manufacturers that provide medical devices. 
Frankly, we need to create an environment here in Washington, D.C., 
that promotes innovation, promotes these medical device companies from 
all around the globe to come here to our country.
  So I'm pleased to support this legislation, and I urge my colleagues 
to support it as well, because we cannot have additional anxiety, 
uncertainty that is out there in the marketplace. We need to make sure 
that we are growing our economy, and we need to do that by providing an 
environment right here in Washington. Frankly, we're not doing that 
today. I support the legislation, and I urge my colleagues to do the 
same.
  Mr. LEVIN. I reserve the balance of my time.
  Mr. CAMP. At this time, I yield 1 minute to the distinguished 
gentleman from California (Mr. Bilbray).
  Mr. BILBRAY. Mr. Speaker, I rise today in strong support of this 
legislation that will repeal the job-killing, innovation-destroying tax 
on medical devices. I want to thank Congressman Paulsen for introducing 
this legislation.
  Mr. Speaker, California, and particularly San Diego, is a hub of 
medical device activity. Companies such as NuVasive or Edwards 
Lifesciences Corporation are but a few of the companies that are 
located in my district in California, San Diego.
  While considering this device tax, we've got to understand that the 
medical device industry in San Diego alone is a $4.9 billion job-
generating, job-creating industry. This industry represents one-third 
of all the life sciences

[[Page 8662]]

industries, employing in my district 10,000 employees with an average 
income of $100,000.
  The medical device tax will cost jobs. That's not just in my 
district, but across the country. Hopefully we'll see this tax 
repealed. Because in the long run, this tax may not only cost jobs, but 
could cost lives.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. CAMP. I yield the gentleman an additional 30 seconds.
  Mr. BILBRAY. Thank you very much. I appreciate it, Mr. Chairman.
  Let's join together and pass the repeal of this destructive tax and 
move forward with good legislation that will provide affordable health 
care while providing job opportunities for our citizens.
  Mr. CAMP. Mr. Speaker, at this time, I yield 1 minute to the 
distinguished gentleman from Virginia (Mr. Hurt).
  Mr. HURT. Mr. Speaker, I rise today in support of the Health Care 
Cost Reduction Act.
  The American people know that the President's health care law is 
costing us more in premiums and more in taxes. It's costing us our 
constitutional liberties, and it is costing us American jobs.
  One of the tax increases that will support this law is a $20 billion 
tax on our manufacturers that will result in thousands of lost American 
jobs at a time when our unemployment rate is over 8 percent for the 
third year in a row. Today's vote keeps faith with the American people 
as we continue working to repeal this law and to replace it with 
reforms that will deliver higher quality health care, lower costs, and 
that will preserve American jobs.
  I urge my colleagues to support this bill, and I thank the chairman 
and the committee for its work on this bill.

                              {time}  1550

  Mr. CAMP. Mr. Speaker, I yield 1 minute to the distinguished 
gentleman from Illinois (Mr. Schilling).
  Mr. SCHILLING. Thank you, Mr. Camp. I appreciate your hard work on 
this.
  Unemployment is the largest problem we face today, so why would 
anyone want to punish innovation by forcing more taxes on American 
medical device companies. That is exactly what the President's health 
care law does, but we have a chance to repeal this tax today.
  I hope the Senate will follow suit. This tax will hurt the medical 
device industry, including companies like Cook Medical, which has two 
facilities in my district in Canton, Illinois. Cook currently has 100 
employees, but is looking to expand and provide more jobs for men and 
women in Illinois.
  Support H.R. 436 to promote innovation, jobs and growth across our 
country.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the distinguished 
gentleman from Ohio (Mr. Turner).
  Mr. TURNER of Ohio. Thank you, Mr. Chairman.
  Mr. Speaker, I strongly support the repeal of the ObamaCare medical 
device tax, which stifles research and costs jobs at a time when our 
economy is struggling to recover.
  My bill, H.R. 1310, which repeals this tax on first responder medical 
devices, shares the goal of H.R. 436, the Health Care Cost Reduction 
Act.
  In my community, Mound Laser and Photonics Center, which provides 
services to the medical device industry, was forced to layoff 10 
employees as a result of this impending tax. Ferno, another company in 
my community which manufactures emergency health care products, says 
this tax will result in reduced research, development and production of 
new products.
  Mr. Speaker, I urge all of my colleagues to support H.R. 436 and 
repeal this burdensome tax.
  Mr. Speaker, beginning in 2013, a 2.3 percent excise tax will be 
imposed on the sale of medical devices by manufacturers, providers, or 
importers. This tax will place yet another burden on American 
businesses, stifling development of innovative life-saving products and 
costing jobs when our economy is struggling to recover, and will result 
in higher costs and inferior care for patients.
  I strongly support the repeal of the 2.3 percent medical device 
excise tax. That is why I authored H.R. 1310, to repeal this tax on 
medical devices used by first responders. My bill shares the goal of 
H.R. 436, the Health Care Cost Reduction Act, which includes a 
provision to completely repeal the excise tax.
  Earlier this year, a company headquartered in Miamisburg, Ohio in my 
district, Mound Laser & Photonics Center, MLPC, wrote to me about the 
negative effect of this new tax. MLPC specializes in laser-based micro 
and nano-fabrication and provides services to a number of markets, 
including the medical device industry. The firm is a tremendous 
research and development success story in southwest Ohio, growing from 
three employees to over forty. The majority of these workers have 
backgrounds in science and engineering, critical fields our country 
needs to compete in the global economy.
  However, MLPC recently scaled back its operations and was forced to 
lay off 10 employees due to the loss of business from one of its 
medical device clients. Specifically, Dr. Larry Dosser, President and 
CEO of MLPC wrote:

       This is an unprecedented and devastating decision, which I 
     believe is a direct result of Obama's Healthcare Reform Act. 
     Not only does this impact the lives of these very good 
     people, it also impacts MLPC's progress on a new facility 
     that would be a major demonstration project for advanced 
     manufacturing in the Dayton region.

  I have also met with business leaders from Ferno-Washington Inc., a 
global leader in manufacturing and distribution of professional 
emergency and healthcare products based in Wilmington, Ohio. Ferno says 
the tax increase will cause the company to scale back research, 
development, and production of new products, hampering the company's 
ability to compete. The executives at Ferno estimate the cost of the 
tax is equivalent to 23 jobs.
  Mr. Speaker, now is not the time to impose an extra burden on 
American businesses when our economy is struggling to get back on 
track. I urge all my colleagues to support H.R. 436 and repeal the 2.3 
percent medical device excise tax.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to a distinguished member of 
the Ways and Means Committee, the gentleman from Texas (Mr. Brady).
  Mr. BRADY of Texas. Mr. Chairman, thank you for your leadership on 
this issue.
  The economic news has been pretty grim lately. Last month, America 
created a mere 69,000 jobs, the lowest in a year. The job growth has 
been cut by two-thirds just the last few months. The unemployment rate, 
the only reason it went down is so many millions of Americans have just 
given up looking for work.
  Now we learned today of all the 10 economic recoveries since World 
War II, this recovery ranks 10th, dead last, and dead last isn't 
acceptable to anyone.
  This bill stops the killing of 43,000 American jobs; 43,000 American 
jobs will be lost if this new tax on our medical devices, on our stents 
and pacemakers and others, goes into place. This bill is all about 
saving jobs.
  It also lowers the costs for patients because all those taxes get 
thrown right back on the patients and carried through, and it stops a 
tax on innovation in America, at which we are very good. It's key to 
our economic future. This bill prevents that attack. It also allows 
families the freedom to use their health savings accounts to buy over-
the-counter prescriptions, which saves them money and allows them to 
keep more of their health savings account amounts the end of the year 
so that way they don't use it or lose it.
  In Texas, we'll lose 2,000 jobs if this bill isn't signed by the 
President. I know he has vetoed it, but these are jobs, Mr. President. 
This is health care costs; this is innovation. This is what we ought to 
be rewarding in America, not punishing.
  I support this bill strongly. I applaud Chairman Camp and the members 
of the Ways and Means Committee who are bringing it to us.
  By the way, to make sure it doesn't add to the deficit, if you get a 
Federal subsidy in health care for which you're not eligible, we'll 
have you pay it back. We just have you pay back what you didn't earn. 
That's the right way to do it, and that's the right way to pass this 
bill.
  Mr. CAMP. I yield 2 minutes to the distinguished gentlewoman from 
Washington (Mrs. McMorris Rodgers).
  Mrs. McMORRIS RODGERS. I thank the gentleman for yielding.

[[Page 8663]]

  Beginning in a few short months, a 2.3 percent excise tax on medical 
devices will go into effect as a result of the President's health care 
bill. As George Will recently wrote, this new tax will ``tax jobs out 
of existence.''
  Last year, I had the opportunity to host a jobs and innovation 
roundtable discussion with leaders from the medical device industry. 
One of the CEOs that was a part of the roundtable stated that if you're 
trying to destroy an industry, you're doing a very good job of it.
  He was referring both to the delays at the FDA, as well as the 
medical device tax. In my home State of Washington, there are 17 
medical device companies that provide over 8,700 people jobs. These are 
high-paying jobs with an annual payroll of over $500 million. These 
companies cannot hire new employees because of this job-killing new 
tax; 900 people would lose their jobs in Washington State. Nationally, 
it's estimated 43,000 U.S. jobs will be lost directly due to this tax.
  This is one of 18 new taxes brought to you by ObamaCare. This one 
will cause medical device companies to reduce their research and 
development funds in order to pay for the new tax.
  Who thinks that decreasing jobs in this economy is a good idea?
  Patients deserve safe and effective medical devices, and Americans 
deserve the jobs that create medical devices. This legislation will 
help preserve what has been just a great American success story driven 
by our medical devices manufacturers that are developing lifesaving 
treatments.
  I urge all of my colleagues to support H.R. 436.
  Mr. CAMP. At this time we have no further speakers and are prepared 
to close, if the gentleman is prepared to close.
  Mr. LEVIN. I yield myself the balance of my time.
  In a sense, there is much at stake in this debate. If this bill were 
to become law, it would unravel health care reform. What this industry 
seems to be asking is a reversal of their commitment to make health 
care reform work. If this Congress and the President were to say okay, 
every other industry that participated in saying they pay their share 
to make it viable, they'd come in line, and there would be no answer to 
them. In that sense, this debate, this issue is significant.
  But in another sense it really isn't. This bill isn't going anywhere. 
The Senate leadership has already said it's not taking it up. There's 
been issued a Statement of Administration policy. The recommendation is 
the President would veto it. There's a certain emptiness to this debate 
because the bill isn't going anywhere.
  The real significance is that it's being brought up despite that, 
raising the question, Does the majority in this House want a bill that 
goes somewhere relating to jobs?
  The word ``jobs'' has been mentioned here more than any other word. 
As mentioned earlier, there is no evidence that jobs would be lost, as 
indicated by the majority.
  The only study says that the 43,000 claim is wrong. So what's really 
at stake here, the significance of this debate is this: Will the 
majority do more than signal in this session, in its remaining months, 
or will it take up jobs legislation? I think there's an increasing 
indication that they, the majority, do not want a jobs bill that will 
go anywhere.
  I mentioned earlier the letter I wrote to the chairman of our 
committee. I mentioned in there six provisions clearly relating to jobs 
in America, the 48C Advanced Energy Manufacturing Credit that once had 
bipartisan support.

                              {time}  1600

  The production tax credit for wind power, the Republicans came before 
the Ways and Means Committee and said, Extend it. But, silence. The 
Build America Bonds program. It helped to create hundreds and thousands 
of jobs--$180 billion in infrastructure investment. The 100 percent 
bonus depreciation that both sides say they support. But nothing but 
inaction. The proposal by the President for a 10 percent income tax 
credit for small businesses that could create jobs, not the illusory 
statements mentioned here. And then the R&D tax credit that the 
chairman of this committee and I have championed for years--and all we 
do is have a hearing.
  And so this bill raises starkly this issue: Does this majority want 
bills going nowhere, or will they do more than signal and act to help 
create jobs that the people of this country badly need. That's the real 
issue before us today.
  I urge a ``no'' vote on this bill on the merits. I urge the majority 
to start saying ``yes'' to jobs bills for the people of the United 
States of America.
  I yield back the balance of my time.
  Mr. CAMP. I yield myself such time as I may consume.
  I would just say to my friend from Michigan that we in the committee 
are in the process of reviewing all of the tax extenders. There's going 
to be about a hundred of them that expire at the end of the year, 
research and development being one of them--one I, obviously, have 
supported over the past.
  Given our budget situation and given the record deficits run up by 
this administration, we're taking a close look at all of these 
provisions to make sure that they're justified, to make sure that they 
really bring economic benefits and jobs to this country, not just pass 
them along because that's what's been done in the past, but to really 
take our oversight responsibilities, review responsibilities seriously 
to make sure the things that we're doing are efficient, are effective, 
and really get to the core of how do we get this economy moving again.
  We had the jobs numbers last Friday. They were abysmal. Clearly, the 
economic policies of this administration have been a failure. We're, 
obviously, trying to address some of the other policies of this 
administration that aren't going to work. And clearly, there are flaws 
in the health care bill. We've had bipartisan support to fix some of 
them, like repealing that onerous 1099 provision that would have put a 
wet blanket over all small businesses as they try to file paperwork on 
every expenditure over $600. It was a ridiculous provision. We had 
strong bipartisan support to repeal it. The President signed it. That 
is law.
  We're now looking at today what we can do to improve other problems 
in this health care bill. One of them, clearly, is we need to help 
people save and allow them to afford the kinds of medications they 
need. For example, they tax over-the-counter medications by saying you 
can't use your tax-free savings account to buy cough syrup for your 
sick child.
  So what's happening is many people are going to doctors. They're 
actually having to get a prescription so they can use their flexible 
spending account, the account that they have set aside to save for 
their medical needs. And don't we want parents to be able to try to 
find a least-cost alternative? If cough syrup will fix the problem that 
their child is having and meet their medical need, shouldn't we do that 
first, before going to the ER or before going to get a prescription? 
Again, what we want to do is keep parents in the driver's seat. Let 
them make the medical decisions that effect them and their children.
  So we believe that it's so important that we allow over-the-counter 
medicines to be purchased out of an FSA. That is just a critical thing. 
And that has had strong bipartisan support.
  The other issue is regarding medical devices. Clearly, taxing the 
medical devices is going to do one of two things. It's going to cost 
jobs. As Stryker Corporation in my home State of Michigan says, it's 
responsible for about a thousand layoffs as they try to plan for the 
future. Or, it's going to raise costs. Either one is a bad choice for 
those people who have medical needs that they need to meet.
  And the last provision in this is, can people keep some of the money 
in their health care or flexible spending account if they don't have 
all their medical needs requiring the use of money out of that account? 
Can they save some of it, or do they have to use it or lose it and buy 
extraneous things or things they don't really need. What this bill 
would do is say you can keep

[[Page 8664]]

some of those dollars--up to $500. You would pay tax on it. And that 
means that if you've overestimated what your medical needs are, you can 
get some of those dollars back and use those. Again, it's your wages. 
You've put it in there. It's yours. You should be able to get it back.
  I think these are all strong provisions. They've all had good 
bipartisan support, both for the substance of them as well as for the 
pay-for in the bill. That has had strong bipartisan support as well.
  So I would urge support for this legislation. I do think it has a lot 
of support in the Senate as well, and I think we're going to see this 
legislation move forward. So I urge a ``yes'' vote, and I yield back 
the balance of my time.
  Mr. DINGELL. Mr. Speaker, I rise today in opposition of H.R. 436. We 
find ourselves, yet again, going through another Republican dog and 
pony show as my colleagues attempt to repeal the Affordable Care Act 
bit by bit without replacing any of these pieces. I cannot even count 
how many of these circuses we have gone through this session. Instead 
of working for their constituents, my friends across the aisle are busy 
concocting schemes solely for political gain that will ultimately cost 
the American people, this time to the tune of more than $29 billion. 
That's right, the non-partisan Congressional Budget Office estimates 
that if the medical device tax is repealed it will add to our deficit.
  I think we would all agree that the medical technology industry is a 
critical industry, employing more than 400,000 workers nationwide and 
more than 9,000 in my home state. The work that they do is critical to 
keeping the American people healthy and to keeping our country 
competitive. During the drafting of the Affordable Care Act, the 
medical device industry, along with pharmaceutical companies, insurance 
companies and hospitals, committed to doing their part to make health 
reform a reality. Advocating to repeal the medical device tax appears 
to me to be going back on that commitment to the President and the 
American people.
  Supporters of H.R. 436 like to say the medical device tax hurts small 
manufacturers, but the reality is the ten largest manufacturers will 
pay 86 percent of the tax. These same supporters claim the tax will 
result in the loss of jobs, but they seem to forget about the millions 
of new customers that the ACA will provide device companies. It seems 
to me that if you have 33 million more people with the ability to 
access medical devices, companies may need some employees to help them 
meet this new demand. I agree that it is important that the medical 
device industry can continue to succeed, and I believe that the 
Affordable Care Act will do so.
  In addition to abolishing the medical device tax, H.R. 436 aims to 
repeal the definitions the Affordable Care Act put in place for tax-
advantaged flexible spending accounts and health savings accounts. A 
small minority of workers benefit in minor ways from these accounts, 
whereas millions of Americans will be guaranteed access to 
comprehensive, affordable health care through the ACA. By enacting 
these provisions the ACA raises over $4 billion. The Republicans think 
they will pay for dismantling the ACA with changes they already used to 
finance two earlier pieces of legislation. Dipping repeatedly into a 
pot of money that will force hundreds of thousands of citizens to forgo 
health care coverage is not a viable solution. While my colleagues 
speak about wanting to balance our budget and reduce our deficit they 
are busy repealing a tax that would add to our precarious fiscal 
circumstances and taking away provisions enacted in the ACA that 
generate vitally needed dollars. And, my friends, we are all aware of 
the age old axiom that actions speak louder than words.
  Mr. Speaker, this legislation is not a constructive use of this 
body's time. We cannot re-litigate the debates of the past. If we are 
to improve the health care that we are delivering to patients, and 
inspiring and encouraging innovation in our industry, I stand ready and 
willing to work with my colleagues on bipartisan legislation that will 
do so.
  Ms. SCHWARTZ. Mr. Speaker, today's vote is nothing more than a 
political stunt by Congressional Republicans to once again undermine 
the health care reform law. Republicans included a ``poison pill'' to 
ensure limited Democratic support rather than work in a bipartisan 
manner on an important policy issue. This once again proves they are 
more interested in politics than policy.
  We should take a serious look at corporate tax policy and its impact 
on innovation in this country. In Pennsylvania, the medical innovation 
industry is vital to economic growth, employing more than 80,000 people 
and pumping more than $13 billion into the local economy. I am proud 
that Pennsylvania companies are on the front lines of this innovation, 
and it is essential that they have the ability to grow and thrive.
  We must work together to strengthen America's role as a global leader 
in the medical innovation sector, which will yield the next generation 
of life-saving treatments and strengthen our economic competitiveness. 
I urge my Republican colleagues to work with us to implement tax 
policies that will preserve, promote and grow these innovative 
industries.
  Mr. PENCE. Mr. Speaker, I rise today in support of the Health Care 
Cost Reduction Act of 2012, H.R. 436, offered by Rep. Paulsen of 
Minnesota, which will repeal the 2.3 percent tax on medical devices 
included in ObamaCare that is set to take effect at the end of this 
year.
  This tax will have a dramatic impact on Indiana, which is one of the 
leading states in the medical device industry. The ``orthopedic capital 
of the world'' is in Warsaw, and across the state 20,000 Hoosiers 
design, manufacture, and sell a multitude of life-saving and life-
enhancing products, creating a $10 billion economic impact.
  The medical device tax threatens all of that success. Unless it is 
repealed, Indiana stands to lose more than 2,000 jobs in the medical 
device sector. This job-killing tax will stifle innovation, harm 
patients and raise the cost of health care for Hoosiers.
  Repealing the medical device tax will ensure that Hoosiers can 
continue to lead in the medical device industry. Let us show our 
commitment to innovation and job growth today by passing the Health 
Care Cost Reduction Act and fully repealing the medical device tax.
  Mr. MARCHANT. Mr. Speaker, this legislation will stop an impending 
tax created by Obamacare on medical devices. This tax stifles 
innovation, reduces jobs, and increases costs on patients. Congress 
must act to ensure that the medical device tax does not come in to 
effect.
  Additionally, I support the new choices this bill gives consumers. 
Users of Health Savings Accounts will once again be able to access 
their HSA funds for over-the-counter purchases. This change reduces 
unnecessary doctor's office visits that are being made solely to obtain 
a prescription to use HSA funds. Lastly, this bill greatly improves 
Flexible Spending Accounts. Rather than forcing unneeded end of year 
purchases, this bill allows for a $500 cash-out option to be considered 
as taxable income. This change makes FSAs much more attractive, giving 
consumers another choice to determine the health care plan that is best 
for them--rather than the government making that choice. I urge support 
of the bill.
  Ms. RICHARDSON. Mr. Speaker, I rise today in opposition to H.R. 436, 
the ``Protect Medical Innovation Act.'' This bill would repeal a 2.3 
percent tax on the sale of medical devices that was scheduled to take 
effect in 2013 as a part of the healthcare reform legislation. The 
Joint Committee on Taxation, however, has said that this tax 
elimination would cost the government $29.1 billion in lost revenue 
through fiscal year 2022.
  This decrease in revenue would be offset by the elimination of the 
cap on repayments of advance premium tax credits. This provision had 
been introduced to aid low- and moderate-income families whose economic 
circumstances changed dramatically during the year. The current 
repayment cap on tax credits is important to millions of American 
families facing economic uncertainty because it offers a guarantee that 
they will not be hit with unexpected tax bills at the end of the year. 
H.R. 436 brings the threat of uncapped expenses and will effectively 
serve as a deterrent for families considering purchasing healthcare 
coverage.
  The Joint Committee on Taxation has estimated that the loss of 
revenue will therefore increase the number of uninsured Americans by 
350,000, and I fear that the 37th Congressional District of California 
will be particularly impacted. In the city of Los Angeles, it was 
reported this month that unemployment had risen to 8.2 percent, or 13.6 
percent for African Americans and 11 percent for Latinos. In 
construction alone, 28,000 jobs were cut, along with 13,000 in 
government. As we debate the repayment cap, we must keep in mind these 
thousands of hardworking citizens and their families who might 
otherwise feel the security of affordable healthcare coverage in 
uncertain times.
  Mr. Speaker, healthcare reform legislation does not unfairly target 
the medical device industry, as many are claiming today. In the spring 
of 2009, representatives from various healthcare sectors, including 
medical device companies, pledged in a letter to work with President 
Obama to accomplish the goal of a

[[Page 8665]]

more affordable and efficient healthcare system. This tax serves as the 
industry's contribution to the cost of reform. It is not an 
unreasonable sum, especially when the industry stands to benefit from 
an additional 30 million insured customers. Of those, roughly 10 
million will fall between the ages of 50 and 64, an age group with a 
high proportion of people needing medical devices.
  The passage of this bill would send a dangerous message to other 
healthcare sectors who are contributing to the cost of comprehensive 
healthcare reform. Pharmaceutical companies, health insurance 
companies, skilled nursing facilities, laboratories, and home health 
providers have all taken on additional costs and taxes. We should be 
wary of setting a precedent that exempts one industry from its promised 
contributions, should other sectors then push for a similar repeal.
  Supporters of this bill have also aligned themselves with small 
businesses; however, any tax relief would be siphoned off to large 
corporations. Industry analysts predict that the ten largest companies 
manufacturing medical devices, who in 2011 had net profits of $48 
billion, will pay 86 percent of this tax. The medical device industry 
is already very profitable, and the benefit of ten million new 
customers will outweigh the cost of the tax.
  I would like to take an additional moment to address the Republicans' 
claims that this bill will stop job loss and decelerated innovation. 
There is currently no incentive for medical device companies to shift 
jobs overseas because the tax does not apply to devices sold to other 
nations. Moreover, devices imported into the United States are subject 
to the same 2.3 percent tax. This means that there will be no 
unfavorable advantage for foreign-manufactured devices in domestic 
markets, and there will be no added cost to selling American devices in 
the international market.
  Mr. Speaker, I was an original supporter of President Obama's plan 
for healthcare reform, and I believe that H.R. 436 would only be a step 
backwards. I will vote against this legislation, and I urge my 
colleagues to do the same.
  Mr. RAHALL. Mr. Speaker, I believe that changes to the Patient 
Protection and Affordable Care Act are necessary and have cosponsored 
and supported several bills in this Congress to amend the health care 
law before it takes full effect.
  West Virginians--our working families, our seniors on fixed incomes, 
our small businesses--are looking for and deserve substantive action 
from the Congress to address rising health care costs and access to 
quality care and I regret that the only thing the House majority in 
this Congress has brought to the floor is a slew of bills purposely 
designed to generate gridlock and stall in the legislative process.
  While I do not support this measure, I believe that the Congress has 
a responsibility to address the concerns that have been raised by 
health care providers and medical device manufacturers, and I hope that 
it will do so.
  Mr. PRICE of North Carolina. Mr. Speaker, I will be voting against 
H.R. 436, not because I believe that the current tax on the device 
industry is perfect, but because I object to the politicization of the 
issue and the use of a fundamentally-flawed offset.
  As one of their first acts upon taking the majority, House 
Republicans voted to repeal the Affordable Care Act. Since then, they 
have voted to dismantle the law piece by piece. Today, they are at it 
again, and instead of addressing industry concerns in a concise and 
targeted manner, the majority has crammed together a politically-
motivated bill designed to stick it to the President. Don't just take 
my word for it. Compare the bill we have before us today with the 1099 
repeal law. Both deal with problematic revenue raisers included in the 
health reform law, but the 1099 repeal bill took a targeted approach 
that represented practical policymaking at its best. This effort is 
purely political, and the result is a legislative goody bag.
  Moreover, while the 1099 bill's offset, a modification of the health 
insurance subsidy recapture cap, was a difficult pill to swallow, H.R. 
436's offset is a poison pill. H.R. 436 would fully lift the cap, 
leading an estimated 350,000 people to forgo health insurance, 
according to the bipartisan Joint Committee on Taxation. These are 
working Americans earning between 133 and 400 percent of the federal 
poverty level. Why would the Majority ask working and middle income 
people to bear this burden alone? It is unacceptable.
  As the representative from a part of our country known for its 
research and innovation, I fully understand the importance of the 
device industry. Medical devices have the potential to save and enrich 
the lives of Americans, and the companies that produce them are helping 
our economy recover by investing in new technology and providing high-
paying, high-skilled jobs. Those companies also tried to be good actors 
in the health insurance reform debate. Like other industries, device 
companies understand that the skyrocketing cost of health care 
represents one of the greatest threats to families, small business 
owners, state and federal budgets, and the overall economy. Attempting 
to reverse this trend is one of the reasons Congress enacted the 
Affordable Care Act, and AdvaMed, the trade association representing 
medical device manufacturers, participated in the effort to ensure that 
the legislation would be deficit-neutral.
  The final law brought the original $40 billion levy on device 
manufacturers down to a $20 billion contribution through a 2.3% excise 
tax on medical devices. However, as the ten-year budget window has 
shifted, industry reports that they expect to paying closer to $29 
billion. We need to monitor this carefully and find a fair solution 
that accounts for the additional business the device industry may 
acquire as a result of the Affordable Care Act, while underscoring the 
need to keep the industry vibrant and innovative. That is not the 
discussion we are having today, but I hope it is one House Republicans 
will be willing to have in the near future, and I stand ready to work 
with them to do just that.
  Mr. YOUNG of Florida. Mr. Speaker, I am pleased to support the 
passage of H.R. 436, the Protect Medical Innovation Act of 2012, 
legislation I agreed to cosponsor last year aimed at repealing yet 
another harmful job killing provision put into place by the President's 
controversial health care reform law. Unless Congress moves to repeal 
it, beginning in 2013, a 2.3 percent excise tax will be imposed on the 
sale of medical devices by manufacturers or importers across the 
country.
  The medical device tax will increase the effective tax rate for many 
medical technology companies. Unfortunately, the tax would be collected 
on gross sales, not profits, meaning companies could end up owing more 
in taxes than they produce in profits. As a result, device companies, 
many of which are small, entrepreneurial firms, are expected to pass 
the cost of the tax onto consumers, lay off workers, or cut R&D. These 
actions are unacceptable for an industry currently employing tens of 
thousands of Americans, as well as leading the way in innovation and 
scientific discovery. And in Florida, which is home to one of our 
nation's largest medical device economies, the impact of this excise 
tax would be particularly devastating in a state hit hard by the 
economic downturn.
  Throughout the past year we have been listening to our local business 
owners who tell us the economy will not grow and new jobs will not be 
created until there is more certainty in our economy and more certainty 
in government fiscal and tax policies. H.R. 436 is a great first step 
in doing just that by permanently preventing the medical device tax 
from being implemented.
  Mr. Speaker, I urge my colleagues in the United States Senate to 
follow our lead and quickly pass this legislation and send it to 
President Obama for his signature into law. Further delaying the effort 
to repeal this harmful tax will only lead to greater uncertainty 
throughout the medical technology sector, causing business owners to 
delay crucial decisions about long-term investment and expansion.
  Mrs. CAPPS. Mr. Speaker, I rise today out of concern regarding the 
Protect Medical Innovation Act of 2011 (H.R. 436).
  I am extremely disappointed that this bill, which addresses important 
issues, was needlessly injected with partisanship.
  The medical device industry is integral to both our health care 
system and our economy.
  Regardless of our political leanings, we should all be able to agree 
that it is in all of our best interests to support a thriving domestic 
medical device industry.
  I have met with a variety of people on this issue--innovators, 
manufacturers, patients, consumer advocates, and many other 
stakeholders.
  I understand their concerns about the impact that this policy would 
have, especially on small firms and in California, and wish we had the 
opportunity to look at a range of options to address them.
  Unfortunately, in the bill before us, the House Majority has once 
again found a way to poison a bill by slashing important insurance 
provisions in the Affordable Care Act.
  Yet again they have shown that they are willing to disregard American 
families in order to get a pithy sound bite and further their own 
divisive agenda.
  By removing protections for low- and moderate income families who 
receive subsidies to purchase private health insurance, this bill pits 
American families verse manufacturers.
  It essentially punishes people for improving their situation by 
getting a new job or a raise.
  The result? According to the Congressional Budget Office, an 
estimated 350,000 families

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would be added to the uninsured ranks, and others would be left 
debating between going for a promotion or paying a hefty tax bill.
  Health care is a right deserved by all, and shouldn't come with fear 
of punishment.
  And the idea of asking American families to choose between having 
health insurance and improving their financial situations is 
preposterous.
  Through this bill, the other side has shown that they are more 
concerned with dismantling health care reform than ensuring that the 
American people have access to health care.
  And therefore I cannot vote for it.
  Mr. GENE GREEN of Texas. Mr. Speaker, I oppose H.R. 436 but I am 
opposed to the Medical Device Excise Tax. I support the Affordable Care 
Act, but just like all bills, it was not perfect.
  In Texas, the medical device industry supports nearly 55,000 jobs. It 
is an industry at the cutting edge of technological innovation and is 
critical to addressing many of the health challenges we face now and 
will in future. I believe this industry, just like any other, should 
pay their fair share, but I am worried that a tax like this will chill 
innovation. The tax is on revenue and not profits, which will have a 
disproportionate effect on small and mid-sized companies. Medical 
devices are incredibly expensive to develop and it takes a lot of 
revenue to offset overhead. By taxing revenue, instead of profit, it 
adds additional costs. Most business taxes are calculated on the 
profits after expenses, but this one is not.
  A company near our district in Houston, Cyberonics, employs hundreds 
of Americans. A few years ago, I toured their facilities. I was 
surprised to learn that they did all of their manufacturing in-house, 
in Houston. This is an increasingly rare way to do business, but one we 
should encourage. Their company is a good example of American 
innovation and entrepreneurship. I am concerned that the way this tax 
is structured, it will negatively impact Cyberonics and companies like 
it. We should be taking steps to support research, design, and 
manufacturing job growth in our country.
  While I oppose this tax, I am also opposed to the way this bill pays 
for the repeal of the tax. We should not replace a poorly designed 
policy with more poorly designed policies. This bill shifts the cost on 
to low and middle income earners and potentially risks their health 
insurance coverage under ACA.
  We should find a better way to fix this and I want to work with my 
colleagues to craft a compromise that will not endanger American jobs 
but at the same time won't shift significant costs on to those who can 
least afford it.
  Mr. VAN HOLLEN. Mr. Speaker, H.R. 436 is primarily focused on 
dismantling the Affordable Care Act, which is why I will oppose it 
today.
  Medical devices offer important benefits to individuals throughout 
the country. In some cases they save lives; in other cases, they 
improve the quality of life. An important part of the Affordable Care 
Act was to expand access to the benefits of medical devices by making 
health insurance more affordable. Indeed, as a result of the Affordable 
Care Act, over 30 million more Americans will have access to affordable 
care. This is good for the individuals, and it is also good for the 
manufacturers of these devices, who will now have more people who can 
afford their products.
  Now, the medical device industry apparently wants to keep the 
benefits of having more insured people capable of benefiting from their 
products without contributing to the effort that allows those 
individuals to afford their coverage in the first place. If every group 
that joined the effort to expand insurance coverage took that approach, 
the entire health care reform effort would fall apart--which is 
precisely the outcome the Republican majority is seeking with this 
legislation.
  Additionally, rather than finding a different way to pay for 
extending affordable health insurance to over 30 million Americans, 
this repeal--and the rest of the bill--is offset by eliminating 
existing protections for middle and lower-income citizens who receive 
tax credits for insurance they purchase on the exchange, a change the 
nonpartisan Joint Committee on Taxation estimates will increase the 
ranks of the uninsured by 350,000.
  While I would support the provision in this bill allowing health care 
flexible spending account holders to recover up to $500 in unspent 
funds from their FSAs if it came before the House as a freestanding 
bill, the vast majority of this legislation is clearly aimed at 
undermining the Affordable Care Act.
  Accordingly, I urge a ``no'' vote.
  Mr. CARNEY. Mr. Speaker, I rise today to express my thoughts about 
the tax on medical devices.
  The House voted on H.R. 436, the Health Care Cost Reduction Act of 
2012. This bill would have repealed the 2.3 percent tax on medical 
devices that was instituted to pay for the Affordable Care Act. While I 
did not support H.R. 436, I recognize that medical device makers are at 
the forefront of innovation and that Federal legislation should support 
those efforts. I am concerned about the impact that the medical device 
tax will have on American jobs. Particularly during these difficult 
economic times, I believe we must do everything we can to encourage, 
not stifle, job creation.
  I believe the Affordable Care Act will provide critical health care 
coverage to millions of Americans, and I also believe that paying for 
it responsibly is important. I did not support H.R. 436 because I do 
not believe that Americans already struggling to afford the cost of 
healthcare coverage should bear the burden of eliminating this tax. 
Moreover, I believe we should refrain from making significant changes 
to the funding structure of the Affordable Care Act until the Supreme 
Court has rendered its decision on the constitutionality of the law. At 
that time, the House should revisit repealing the medical device tax 
with an offset that protects American families while being fiscally 
responsible.
  Ms. LORETTA SANCHEZ of California. Mr. Speaker, I rise today to 
discuss my vote on H.R. 436, The Protect Medical Innovation Act of 
2011. As many of my colleagues know, I helped lead the charged 
throughout the 2010 healthcare debate to ensure the medical device 
industry was not overly burdened by the Patient Protection and 
Affordable Care Act (ACA). During negotiations on the final healthcare 
bill, I made it a point to argue that overly taxing the medical device 
industry would stump innovation, affect patient care quality and burden 
an already struggling job market. When we came together to discuss 
health care reform, we agreed that it was necessary for everyone to 
contribute in order to ensure a successful outcome. That is why I 
fought tirelessly, within my own caucus, to make sure the bill was 
responsible in the way Congress paid for legislation.
  As we approach the 2014 deadline of final implementation for ACA, 
many uncertainties have arisen from both the general public and 
business coummunity. The Republican Majority had addressed this growing 
concern with an onslaught on key revenue provisions of the ACA. In 
fact, they have paid for those repeals by targeting programs from those 
repeals by targeting programs from those individuals who need ACA the 
most. For that reason, I was forced to vote against H.R. 436, which CBO 
estimated, if enacted, could remove over 350,000 individuals off of 
health care. Given that many of my constituents rely on the health care 
benefits provided by the ACA, I could not support this bill as written.
  However, as the full implementation moves forward, I will continue to 
monitor the effects of this legislation on the medical device industry. 
If the capacity that is anticipated to flood the markets does not 
become realized. I am ready and willing to work with the medical device 
industry to unburden them of any unnecessary taxes, while responsibly 
ensuring that the rest of the ACA moves forward.
  The SPEAKER pro tempore. All time for debate has expired.
  Pursuant to House Resolution 679, the previous question is ordered on 
the bill, as amended.
  The question is on the engrossment and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. Pursuant to clause 1(c) of rule XIX, further 
consideration of H.R. 436 is postponed.

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