A New Health Care Bill, A New Device Tax

by Julie Kirst 5/24/2010 10:40:00 AM

In our "Up Front" column in the April issue, we discussed the new device tax included in the new health care reform bill and what it might mean to the industry. “Section 9009; Imposition of Annual Fee on Medical Device Manufacturers and Importers,” provides for a 2.3% excise tax to begin in 2013.

G. Wayne Moore, BSc, MBA, FASE, president, advanced development group and chief strategy officer of Unisyn Medical Technologies, said:  “The new 2.3% tax will put additional pressure on innovation, as the base cost to bring new novel medical products to market will increase,” Moore said. “Some companies, such as Medtronic, have already indicated that the new tax will cause them to lay off some employees as well as throttle back on advanced research and development initiatives.”

What do you think about this? If you work for a device company, have any changes been discussed in light of the new bill? Click on the comment tab and let us know your thoughts.

 

Comments

Posted by Jerry DeGeare, 5/25/2010 6:14:10 AM

Is it to much to ask that a medical equipment manufacturer give back a bit of their astronomical profits to a medical care system - THAT,  in-effect , has provided them with their million dollar businesses.   Let them give something back to the very industry that enables their existence.  What is also  lost in all of  this is that they may actually make more profits , even with the tax, if the government institutes some type of standards of care requirements - requiring the purchase of some type of advanced medical equipment for medical providers that did not have it before.

To  focus negatively on this tax is to be short sighted.  Maybe lets focus on the fact that maybe, just maybe - some people in our country that could not get medical care before -  may now be able to get it.    I do think that our  medical equipment  industry , both manufacturing and service will survive quite nicely, even though the CEO's of the companies may have to do without one  recreational boat or vacation home.

Thanks

Posted by vsarmiento, 6/7/2010 6:43:13 AM

Medical equipment manufacturers are supposed to have a pre-established /special pricing structured, extended to any government related purchases. This serves as the ceiling, which is supposedly the LOWEST, only available to the government and that if any manufacturers go any lower, will be a violation??.  

Nobody really is sure / know where or whose pocket the 2.3% tax will end up to! Considering the magnitude of markups the manufactures already put on their products, 2.3% is considered negligible. I would guess the government are going to be exempted from this tax, So to whose benefit is it really going to be?

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