Medical Device Tax

[chanel]

The tax is slated to go into effect next year, and is part of a plan to help pay for expanded health insurance coverage provided for in the federal law. In June, a bill to repeal the tax passed the U.S. House of Representatives by a vote of 270 to 146.

The repeal is expected to face difficulty in the U.S. Senate, and according to a statement from the White House Office of Management and Budget, senior advisers to President Obama are likely to recommend a veto of the bill if it gets that far.

Read more: The Herald-Sun - Perdue joins call for medical device tax repeal

The medical technology industry is a unique American success story. New Jersey has been at the center of that success.

The state is home to more than 20,000 medical device jobs. And they’re good, high-paying jobs, with the average annual salary of nearly $70,000.

Those jobs have indirectly created another 43,000 positions in other sectors. The total economic impact of the device industry in New Jersey alone is nearly $13 billion each year.

Small firms are the norm in this industry. Fully 80 percent of domestic device developers have fewer than 50 employees. Start-ups will be particularly imperiled by this tax.

As a result, firms may choose to expand their operations elsewhere. Indeed, one survey found that more than 87 percent of medical device companies expect their foreign growth to exceed domestic growth in the coming years. This is bad news for New Jersey — along with the rest of the nation

U.S. tax on medical devices a huge burden | NJ.com

Of course Obama will veto the repeal. Sending jobs overseas and destroying small businesses is all part of the plan...

Comments?

 

[uscitizen]

more than 87 percent of medical device companies expect their foreign growth to exceed domestic growth

Hmm must be in those foreign socialized medicine countrys.

 

[onecut39]

My son works in the medical device industry. Everything said here is either false or misleading. Almost everything they make is assembled overseas. In some few instances the parts are made in the US but the assembly is still done overseas. The medical payment system is so screwed up in this country that a device that costs 50 bucks to make may sell for up to a thousand dollars.

These devices are strewn around like popcorn in the hope that enough will be paid for to make a profit.
So far that is working wonderfully well............for the company.

Patients? Not so much.

 

[chanel]

A 2.3 percent excise tax on companies that supply medical devices like heart defibrillators and surgical tools to hospitals, health centers and ambulance services will cost medical device manufacturers an estimated $20 billion in new taxes over the next decade. And they say that will force them to lay off workers and curb the research and development of new medical tools.

"Many small to midsize medical device companies will owe more to the federal government in taxes than they make in profits," said Mark Leahy of the Medical Device Manufacturers Association. "We're talking about a 2.3 percent tax on total sales irrespective of whether a company is making a profit."

California has the highest number of medical device workers with more than 72,400 followed by Massachusetts with nearly 22,000, Florida with nearly 20,000 and Minnesota with more than 18,000, according to industry estimates. Other states with significant medical device hubs include: New Jersey, Pennsylvania, New York, Texas and Ohio.

Richard Packer, CEO of Chelmsford, Mass.-based Zoll Medical Corp., which employs 650 workers in Massachusetts, said the tax will put his company, which produces defibrillators, "at a break-even position" and dismissed the idea that companies should be grateful the tax wasn't higher.

Medical Device Makers: Health Care Law Will Cost Jobs | News | Manufacturing.net

 

[Big Black Dog]

Fuck... Let's tax EVERYTHING and get it over with. That's what the Democrats want.

 

[Pho_King]

Not to worry. Only individuals making over 200k a year ever need medical devices. They will shoulder this tax

 

[uscitizen]

The tax is slated to go into effect next year, and is part of a plan to help pay for expanded health insurance coverage provided for in the federal law. In June, a bill to repeal the tax passed the U.S. House of Representatives by a vote of 270 to 146.

The repeal is expected to face difficulty in the U.S. Senate, and according to a statement from the White House Office of Management and Budget, senior advisers to President Obama are likely to recommend a veto of the bill if it gets that far.

Read more: The Herald-Sun - Perdue joins call for medical device tax repeal

The medical technology industry is a unique American success story. New Jersey has been at the center of that success.

The state is home to more than 20,000 medical device jobs. And they’re good, high-paying jobs, with the average annual salary of nearly $70,000.

Those jobs have indirectly created another 43,000 positions in other sectors. The total economic impact of the device industry in New Jersey alone is nearly $13 billion each year.

Small firms are the norm in this industry. Fully 80 percent of domestic device developers have fewer than 50 employees. Start-ups will be particularly imperiled by this tax.

As a result, firms may choose to expand their operations elsewhere. Indeed, one survey found that more than 87 percent of medical device companies expect their foreign growth to exceed domestic growth in the coming years. This is bad news for New Jersey — along with the rest of the nation

U.S. tax on medical devices a huge burden | NJ.com

Of course Obama will veto the repeal. Sending jobs overseas and destroying small businesses is all part of the plan...

Comments?

"more than 87 percent of medical device companies expect their foreign growth to exceed domestic growth [/B]in the coming years. "

Hmm does this really have anything to do with the tax or is just normal growth?
Yum foods growth has been overseas recently as well.
Emerging foreign markets as we Americans pump more of our money into China and such places.

 

[chanel]

Obviously many of these companies are already doing that. But these companies do employ a lot of people in this country, esp. in NJ.

If this tax eats up more than they make in profits, it would make sense to move operations to lower costs.

I'm no accounting professional, but how many other industries are taxed on total sales and not on profit?

 

[uscitizen]

Yes several "ifs" there.

 

[chanel]

There always are. But that's exactly why the ACA should not have been passed in haste. Too much uncertainty. Too much at stake.

 

[Navy1960]

Something to ponder, am under the impression that if a device is sold for medical purposes it is subject too this tax. So then if Dell computer or say some software company who makes medical billing software for the healthcare industry were to sell these , then they too are subject to this tax. I fail to see how this tax is then not passed on to the consumer which then results in higher medical costs and then higher premiums. If this is indeed the case, then those who are on taxpayer funded healthcare programs will eventually pay more, resulting in a less financially secure public health system. It seems to me that lowering costs in healthcare should start at the delivery point and not at the point where it's paid for.

 

[uscitizen]

There always are. But that's exactly why the ACA should not have been passed in haste. Too much uncertainty. Too much at stake.

I agree. What I think should have passed was single payor system.

ie medicare for everyone.