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Health Care Reform, Device Tax

What is the medical device tax?

The $20B tax was included in the Affordable Care Act that was signed into law in 2010. The amount is based on a 2.3% excise tax that will be levied on the total revenues of a company, regardless of whether a company generates a profit, starting in 2013. Many companies will owe more in taxes than they generate from their operations. The result will be devastating to innovation, patient care and job creation.

 

What is MDMA’s position?

MDMA was against the medical device tax from the beginning, and continues to work for a full repeal of this onerous provision. The overwhelming majority of innovation from the medical device industry comes from smaller manufacturers who work closely with clinicians and engineers to develop the therapies and treatments of tomorrow. If it is not repealed, this tax will stifle innovation, harm patient care and weaken the position of the United States as the global leader in medical device innovation.

MDMA has pointed out that there is no data or studies that show the costs of this "innovation tax" will be offset due to an increased pool of insured beneficiaries receiving treatment. In fact, since the majority of products impacted are used in acute care settings where there are legal obligations to treat a patient, the effect of expanded coverage is not likely to increase utilization.

MDMA continues to work with elected officials and our members on the bipartisan proposals to eliminate the medical device tax to ensure that patient care, innovation and job creation continue to thrive.
12/05/2012

WASHINGTON, DC – Mark Leahey, President and CEO of the Medical Device Manufacturers Association (MDMA), issued the following statement today regarding the Internal Revenue Service’s final rule for implementation of the 2.3% medical device excise tax:

“This final rule does nothing to prevent the loss of jobs and innovation that has already occurred as a result of the medical device tax, and will unfortunately continue if we do not repeal this bad policy...

11/14/2012

Washington, D.C. – A broad coalition of medical technology companies, physician groups, venture capital firms and leading associations today submitted a letter to Senate leadership urging policymakers to repeal the onerous medical device tax that threatens U.S. jobs, medical innovation and patient care. The Medical Device Manufacturers Association (MDMA), ...

11/07/2012

 

MDMA hosted a member-wide webinar this week to analyze the election results and what it will mean for the regulatory environment, reimbursement and more. 

"The election results make it clear that Americans want bipartisan solutions to the challenges confronting our economy, and that elected officials should remove barriers to innovation and job creation," said Mark Leahey, President and CEO of MDMA.  "Repealing the medical device tax is a perfect example where...

10/11/2012

 

As policy makers continue to examine the best methods for controlling the costs of health care, one of the lead supporters of comparative effectiveness research (CER) is voicing concerns that the Patient Centered Outcomes Research Institute (PCORI) is lacking the sense of urgency to tackle high-impact clinical questions. 

In an article published in Health Affairs, Harold Sox, who co-chaired the 2009 Institute of Medicine panel on CER, argued that due to the slow...

09/13/2012

New research shows that despite providing near-universal health care coverage in the state of Massachusetts, the overwhelming percentage of medical device companies saw no increases in utilization, and in turn profits.  This new data helps debunk the main argument for supporters of the 2.3 % medical device excise tax. 

The report was detailed in a Congressional briefing hosted by CONNECT. 

Alex Lukianov, MDMA Board member and Chairman & Chief...

09/13/2012

Hearings in the U.S. House and Senate this week displayed bipartisan frustration with the IRS, CMS and other agencies that are responsible for issuing rules and regulations on implementation of the Affordable Care Act. 

The Senate Aging Committee held a hearing entitled "Parting the Clouds: Implementing the Physician Payments Sunshine Act," and Senators expressed frustration that CMS had yet to issue final rules regarding the legislation. 

"Many companies have...

09/06/2012

 

A report issued this week by the Institute of Medicine (IOM) detailed billions of dollars of wasteful spending in the nation's health care system.  The report has already garnered much attention from policy makers and the media, and is expected to play a pivotal role in the ongoing discussions on how to reduce costs in the delivery of care. 

According to the report, there was $750 billion in wasted health care spending in 2009.  It described the waste as...

06/28/2012

 

WASHINGTON, DC – Mark Leahey, President and CEO of the Medical Device Manufacturers Association (MDMA), issued the following statement today regarding the U.S. Supreme Court’s decision on the “Affordable Care Act” (ACA): 

“Today’s decision adds new urgency to repealing the medical device tax so that patients and providers can continue to expect innovative devices and technologies.  While MDMA and our members still have seen no evidence...

06/07/2012

WASHINGTON, DC – Mark Leahey, President and CEO of the Medical Device Manufacturers Association (MDMA), issued the following statement today regarding bipartisan passage of H.R. 436, the “Health Care Cost Reduction Act of 2012,” which includes repeal of the 2.3% medical device tax, in the U.S. House of Representatives: 

“MDMA applauds the House passage of legislation to repeal the medical device tax, and we urge the Senate to act on this important...

06/06/2012

WASHINGTON, DC -- A broad coalition of medical technology companies and leading associations wrote to Congressional leaders today urging them to repeal the onerous medical device tax which will destroy jobs and harm innovation.  The letter had more than 700 signatories, including the Medical Device Manufacturers Association (MDMA), the Advanced Medical Technology Association (AdvaMed), the Medical Imaging & Technology Alliance (MITA), the U.S. Chamber of Commerce,...