FLASH: Medical device tax payments hit the $1B mark

MassDevice.com coverage of the medical device tax

The 2.3% medical device sales tax has cost the industry an estimated $1 billion so far, according to a report released by a coalition of medical device lobbying groups, which called the milestone "frightening."

The tax costs medical device makers an average of $194 million per month, funds which should be going to research & development efforts and to salaries for new employees, according to the Medical Imaging & Technology Alliance, AdvaMed and the Medical Device Manufacturers Assn. 

"Each day that goes by with the medical device tax in effect is a major roadblock for patient care, job creation and innovation," MDMA president & CEO Mark Leahey said in prepared remarks. "This issue is a shining example where there is overwhelming bipartisan support in both chambers of Congress to right a wrong, and MDMA continues to work with all stakeholders to get repeal of this onerous policy across the finish line."

The tax, implemented by the Affordable Care Act in order to help raise funds for healthcare reform, took effect at the start of 2013, despite the efforts of medtech industry groups to strike the levy in Congress. Although device makers have managed to generate support from lawmakers on both sides of the aisle, repeal efforts have been hindered by disagreements on how to make up for the $30 billion in revenue the tax is supposed to raise over the course of a decade.

The industry has made tried to distance its medical device tax repeal from discussions about healthcare reform, framing the issue as one concerning corporate tax reform. Opponents of the tax may have a new vehicle to hitch their hopes to as Congressional duo Sen. Max Baucus (D-Mont.) and Rep. Dave Camp (R-Mich.) recently embarked on a nation-wide tax reform tour, but in the mean time the industry is required to make semi-monthly sales tax payments of about $97 million each.

"The $1 billion threshold is frightening as every dollar spent paying for this medical device tax threatens medical innovation and American jobs," MITA executive director Gail Rodriguez said in the press release. "MITA is pleased to see bipartisan support for repeal of the tax building in both the House and the Senate, but Congress cannot wait any longer to repeal this burdensome tax and protect jobs and essential R&D funding."

RSS From Medical Design & Outsourcing

  • MTD Micro Molding releases micro materials menu
    MTD Micro Molding, a long-time leader in micro-injection molding, has released an updated “Materials Menu” of materials that can be successfully micromolded to help guide engineers at medical device companies. Material selection is a crucial step in product manufacturability. The correct material drives tolerance, dimension, strength, usabality, speed-to-market, design, critical features, and cost. Through MTD’s […]
  • MedTech Chat: Elastic technology for drug delivery
    Dr. Zhen Gu and Dr. Yong Zhu from North Carolina State University are both co-senior authors of a research paper describing their recent work. Dr. Gu, Dr. Zhu and other researchers from North Carolina State University and the University of North Carolina at Chapel Hill have developed a drug delivery technology that consists of an […]
  • B. Braun’s OEM Division offers large bore normally closed low-pressure check valves
    Infusion therapy and pain management device manufacturer B. Braun said today it is offering normally closed large-bore low-pressure check valves through its valve-focused contract manufacturing OEM division. The valves, offered by Bethlehem, Pa.-based B. Braun, are designed for the intermittent injection of fluids during medical treatment and open automatically when pressure is applied. The newly […]
  • Continuous 225W with natural convection for medical type BF power supply
    Powerbox, a European power supply company, introduces new Medline 225 series ac and dc single output open frame converters for medical type BF applications. The new OFM225 with its 3 x 5 in. footprint and 1.5 in. height is designed for a continuous output power of 225W with natural convection and 40°C ambient temperature, increasing to […]
  • Using data science to achieve ultra-low dose CT image reconstruction
    Prof. Jeff Fessler and Prof. Yong Long, Ph.D. of the University of Michigan-Shanghai Jiao Tong University (UM-SJTU) Joint Institute are collaborating on a project to develop a dramatically improved approach to low-dose X-ray CT image formation by extracting and using information from a big-data corpus of regular dose X-Ray Computed Tomography (CT) images. The research is […]
  • New vented dust caps from Qosina prevent damage and contamination on a new level
    Qosina is pleased to announce the addition of eleven new soft TPE vented dust caps (#11300, #11301, #11320, #11330, #11331, #11340, #11341, #11350, #11360, #11361 and #11380) in stock and ready for immediate delivery. These components are available in a variety of colors including blue, green, red, white and yellow; sizes range from 0.187 in. […]
  • Nader Najafi: A dream that saves lives
    Miniature wireless sensing and computing devices have the potential to improve people’s health, even save lives. Twenty years ago, working on microelectromechanical systems (MEMS) as a student at Michigan, Dr. Nader Najafi had a dream to be part of this future reality. He turned that dream to action when he left a promising career at […]
  • PBC Linear’s guide for approved bearing inspection method
    Understanding the method to properly inspect the Frelon liner in PBC Linear’s Simplicity plain bearings is essential to taking full advantage of the product. The Frelon liner supplies numerous attributes that make it preferable in many unique applications; however, being a teflon-based material requires a different method of inspection: Approved Inspection Method: Pin Gauges (AKA: Go or […]
  • 3W to 10W DIP-24 DC-DC converters have medical certification
    TDK announces the introduction of the TDK-Lambda PXC-M series of DC-DC converters. Operating over a 4:1 input range, the 3W, 6W and 10W products are enclosed in the industry standard 1.25 x 0.8 x 0.4 in. DIP-24 package. Applications include a wide variety of medical applications and battery powered equipment. With a 5,000 Vac input […]
  • How do you mend a broken heart? By converting fat cells into stem cells that can help that vital organ repair itself
    Editor’s Note: This article is written by Jeannie Kever and discusses the recent research from the University of Houston. There has been little time to savor the successes of the moment as Dr. Robert Schwartz and members of his lab push relentlessly toward their goal. Their goal is to begin clinical trials that will showcase how common fat cells, treated […]
  • MNX Global Logistics opens new Life Sciences Logistics Center in Amsterdam
    MNX Global Logistics announces the opening of its dedicated supply chain and logistics facility in Amsterdam, the Netherlands, located just outside of Amsterdam Airport Schiphol. This facility with validated temperature-controlled supply chain capabilities will serve as the operations and warehousing hub for its life sciences and medical device customers throughout Europe. “The demand for our services […]

Leave a Reply