Device industry mixed on healthcare reform

The House's passage of the healthcare reform bill was met with mixed feelings from medical device makers. The bright side for the industry includes an expanded market for its products as 30 million more people are given access to health coverage. But industry advocates aren't happy about the 2.3 percent tax that will be placed on everything from surgical instruments to bed pans starting in 2013. The tax is designed to collect $20 billion over 10 years from devices. It's a major reduction from an earlier plan which called for $40 billion from the medical device industry over 10 years, beginning in 2010.

"MDMA is very concerned about the impact a $20 billion device tax will have on patient care, innovation and small businesses. If eliminating the tax is not possible, structuring it to provide relief for smaller companies is critical," says the Medical Device Manufacturers Association in a statement. The group added that such a tax could cripple small developers and thwart R&D and lead to layoffs.

While AdvaMed expressed some support for the bill, the organization noted that the tax could be problematic for developers. "While we remain concerned about the effects of the medical technology tax, we applaud expanded insurance coverage for millions of American families and the significant progress in a number of important areas, including an enhanced program of clinical comparative effectiveness research that will improve medical decision-making and enhanced transparency in the financial relationships between providers and the health care industry," says AdvaMed CEO Stephen Ubl. Both groups urged Congress to reconsider and, if not eliminate, restructure the medical device tax before 2013.

- read AdvaMed's statement
- see MDMA's statement
- here's the Mass Device write-up

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