Repeal of medical device tax a good sign

CUMMING, Ga., March 22, 2013—As reported by Rob Brandt of Accredited Medical Equipment Providers of America (AMEPA), the “nearly impossible” has happened. A Republican-led bill passed the Senate 79-20, and repealed a provision of the Affordable Care Act. Job loss and a lot of industry noise is being credited with the repeal of the 2.3 percent Medical Device Tax, which is a good sign for the DME industry. Unfortunately the medical device industry paid over $388 million in taxes since Jan. 1, 2013, and it was reported that many employees were already laid off as a result of the tax. A press release from the bill’s sponsor, Senator Lamar Alexander (R-TN), mentioned: “In February, Smith & Nephew, a medical device manufacturer with a large presence in Tennessee, announced it would be laying off nearly 100 employees in Tennessee and Massachusetts as a direct result of the new tax on medical devices.”

Let’s just hope legislators can learn from this and pass the Market Pricing Program before Medicare’s flawed bidding program begins in July. Quoting directly from the official March 21 press release: “U.S. Senator Lamar Alexander (R-Tenn.) [has] sponsored a budget amendment in the U.S. Senate that would repeal what he called a “wasteful federal taxpayer subsidy for unreliable, expensive wind energy” to help pay for the repeal of the federal government’s excise tax on medical devices.

“This amendment is about ending two damaging tax policies that are costing Americans billions of dollars, and costing Tennesseans good jobs,” Alexander said. “It gets rid of a 20-year-old, multi-billion-dollar subsidy for unreliable, expensive wind energy that stands no chance of powering our nation’s 21st century economy, and it repeals the Obamacare tax on life-saving medical devices—Tennessee’s top export and an important source of good jobs.

“The medical device tax, passed as part of President Obama’s health care law, places a 2.3 percent excise tax on medical device manufacturers. Tennessee’s Department of Economic and Community Development has identified medical device manufacturers as among the state’s most important exports, with U.S. Census data showing its $2.1 billion in 2012 ranks at the top of all state exports by dollar value.”

Learn more, and support our efforts, at www.amepa.us.