By Caroll Neubauer

Medical technology is a success story for both patients and the economy, particularly in Pennsylvania, where it supports more than 79,000 jobs. I am pleased that U.S. Senate Finance Committee chairman Sen. Max Baucus (D-Mont.) and House Ways & Means Committee Chairman Dave Camp (R-Mich.) have recognized the importance of this hub of medical innovation by including Pennsylvania in their nationwide tour to promote the need for fundamental tax reform. 

The U.S. medical technology industry is a global leader, a manufacturing industry that maintains a significant trade surplus with other nations, but that leadership is in peril. The U.S. corporate tax system is a significant obstacle to our continued success, and fundamental reform is necessary to improve America’s competitiveness and rebuild our nation’s economic future. As Congress considers reforming the tax code to make U.S. business more competitive, repealing the medical device excise tax that went into effect in January is a critical first step to protecting jobs and ensuring a level playing field for Pennsylvania and the rest of the U.S. in the global economy

U.S. Sens. Patrick Toomey (R-Pa.) and Robert Casey (D-Pa.) are lead sponsors of legislation to repeal this onerous $30 billion tax, and were critical to the recent passage of a Senate budget resolution that demonstrated the strong bipartisan support for repeal. In the U.S. House of Representatives, with continued leadership from Rep. Charlie Dent (R-Pa.), repeal legislation is supported by a bipartisan group from Pennsylvania, including Reps. Jim Gerlach (R) and Allyson Schwartz (D), along with 11 other members of the state’s delegation. The House repeal bill has more than enough co-sponsors to pass if voted on today. Our state’s elected leaders should be thanked for these efforts.

For companies large and small, the tax’s added expense will needlessly deplete funds firms that might otherwise invest in research and development – the efforts they undertake to find new treatments and cures for heart disease, cancer, diabetes, Alzheimer’s, Parkinson’s and other serious conditions. Adding further harm, the tax limits a company’s ability to make essential capital investments needed for economic growth, such as new facilities or equipment.

Some companies have had to make the difficult decision to lay off employees as a response to the increased tax burden. Thousands of workers have already received this bad news, and more than 1 analysis suggests as many as 43,000 jobs are at risk. At B. Braun, we have been able to hold employment steady, but we have had to make the difficult decision to forgo annual raises.

Layoffs, canceled expansions, reduced research & development, or even raising prices to compensate for the lost revenue – none of these are good options for health care or for the American economy.

Instead of punishing the American medical technology industry through poor tax policy, our government should be encouraging it. Innovations from our industry can help solve important health problems and trim the crushing costs associated with chronic disease. Between 1980 and 2010, medical advancements helped add 5 years to U.S. life expectancy and cut in half fatalities related to heart disease, stroke and breast cancer. And innovations like minimally invasive surgery have helped reduce the duration of hospital stays by more than 50% over the same time period. A recent study showed that minimally invasive coronary revascularization, for example, saves more than $30,000 and allows patients to get back to work approximately 30 days quicker compared to conventional open surgery.

The device industry is also a source of plentiful, well-paying jobs in America, creating more than 2 million direct and indirect jobs nationwide that pay salaries that are 40% more than the national average. These jobs can help fuel our economic recovery and they exist in almost every state in the nation.

With an overwhelming bipartisan majority in the Senate and House having openly sided against the tax, Congress and the president should act now to finish the job and repeal it.

Caroll Neubauer is chairman & CEO of B. Braun Medical, a medical technology company with U.S. headquarters in Bethlehem, Pa., and a board member of the Advanced Medical Technology Assn. (AdvaMed), an industry trade association based in Washington, D.C.