Conventional wisdom: If you want less of something, put a tax on it. Obamanomics wisdom: Put a tax on… medical devices?! I.e., add another barrier to the industry whose slightest innovations can directly result in streamlined costs, improved efficiency, better health-care options, and saved lives? What the what?
Embedded within the shadowy depths of the Patient Protection and Affordable Care Act (sometimes, I like to use its official name just to re-appreciate the irony of “patient protection” and “affordable”) is a 2.3 percent excise tax on the sale of taxable medical devices by the manufacturer/importer — and it’s no small thing. Happening now:
Medical device executives will descend on Capitol Hill today to press members of Congress to address the 2.3% medical device tax before it takes effect in January. …
“Without action from Congress, implementation of the medical device tax will cost our economy thousands of high paying jobs,” MITA executive director Gail Rodriguez said in prepared remarks. “These job losses will directly impact patient access to the most advanced, life-saving medical technologies available.” …
The letter includes support from physician groups, venture capital firms and other organizations asking the Senate to repeal the 2.3% levy on medical device sales, which device makers will start paying in at the start of next year.
The tax won’t actually hit until this January 1st, but the repercussions are already making themselves felt in the industry.