Efforts to take down the medical device tax have been repeatedly scrutinized by critics that paint repeal efforts as disingenuous or misguided, most recently in an LA Times editorial calling on the industry to defend its logic.
Dubbing medtech’s repeal campaign "narrow-minded and dishonest," editorial writer Michael Hiltzik challenged the industry to "cite a single objective study that supports its contentions that the tax will suppress innovation in the field and make U.S. manufacturers globally uncompetitive."
Hiltzik throws out the window studies commissioned by medical device industry lobbying group AdvaMed. He then discards 4 studies from groups he dubs "libertarian or anti-tax organizations" – the Pacific Research Institute, the National Center for Policy Analysis, the Business Roundtable and the Heritage Foundation – because "if you ever found a study from any of them endorsing a tax of almost any variety, you could be forgiven for fainting dead away."
Hiltzik is hardly the 1st to challenge the medical device industry’s attempts to characterize the 2.3% excise tax, established by President Barack Obama’s Affordable Care Act and in effect since the start of the year, as a job-killing and innovation-hampering.
Earlier this year the New York Times‘ editorial board published a piece depicting the Senate’s non-binding vote to repeal the tax as the "pay-off" of a "forceful and well-financed campaign." Medtech groups have "donated generously to lawmakers and candidates, taken them on tours of their plants and spent tens of millions in lobbying," according to the Times.
Hiltzik also questioned the motives of members of Congress who voted to repeal the medical device tax, especially the Democrats, illustrating their alignment with repeal efforts as attempts to please their medtech-heavy constituency.
More medical device tax coverage from MassDevice.com.
"Many of those Democratic votes for repeal came from states where medical device makers swing a big stick," he wrote, pointing to Sens. Elizabeth Warren of Massachusetts and Al Franken of Minnesota.
"Minnesota and Massachusetts are the 2nd- and 4th-largest states, by employment, for the industry, which accounted for more than 1% of Minnesota’s entire state gross domestic product and a sizable half of 1% for Massachusetts," he added. "Interestingly, both Democratic senators from California, the top-ranking state by industry employment, voted against repeal. That may reflect how the industry’s 13,000 California workers account for about 7/10ths of 1% of state employment and its output barely 1/4th of a percent of state GDP. Its relatively modest footprint statewide arguably allowed them to see past parochial concerns and look at the big picture."
AdvaMed has defended its allies in Congress before, arguing that the gathering support for repeal is a function of growing understanding of the negative impact the tax will have on the industry.
"Overwhelming bipartisan majorities in Congress want to repeal the medical device tax because they understand how important medical technology is to our economy and patient care," according to a letter signed by AdvaMed president & CEO Stephen Ubl, Medical Imaging & Technology Alliance executive director Gail Rodriguez and Medical Device Manufacturers Assn. president & CEO Mark Leahey.
The groups followed up with now-familiar warnings about the impact of the medical device tax, including that the levy threatens jobs and U.S. leadership in medical technology.
"Money to pay the tax comes from somewhere: reduced jobs, research cuts or more likely both," the medtech group leaders wrote. "Thousands have already been laid off, and analyses show that the tax threatens as many as 40,000 American jobs."
