The
Dictator-in-Chief, along with his socialist cronies continues their narcissistic
small-minded game plan for America. If one truly believes in a better America,
then government-by-fiat must end. When will Americans speak up? You
decide.
Taxing Medical Progress to Death
·
Feb
17, 2012
Two years ago
this month, as public debate over Obamacare raged, former President Bill Clinton
rushed to the hospital because of a heart condition. He immediately underwent a
procedure to place two stents in one of his coronary arteries. It was a timely
reminder about the dangers of stifling private-sector medical innovation. No one
listened.
Stents don't
grow on trees. They were not created, developed, marketed or sold by government
bureaucrats and lawmakers. One of the nation's top stent manufacturers, Boston
Scientific, warned at the time that Obamacare's punitive medical device tax
would lead to worker losses and research cuts. The 2.3 percent excise tax, the
company said, "would be very damaging to Boston Scientific, and the medical
device industry as a whole. In a nutshell, it would raise costs and lead to
significant job losses. It does not address the quality of care but the
political scorecard of savings."
Two years
later, Bill Clinton's doing just peachy. But many medical device manufacturers
are suffering, and many more are preparing for the worst as the White House
gears up to collect on an estimated $20 billion from the lifesaving industry. In
typical Obama-transparent fashion, the Internal Revenue Service quietly released
a complex thicket of medical device tax implementation rules in a Friday
document dump earlier this month. Barring congressional intervention, the
medical device tax will go into full effect in 2013. Cook Medical, which
manufactures products for everything from endovascular therapy, critical care
medicine and general surgery, to diagnostic and interventional procedures, to
bioengineered tissue replacement and regeneration, gastroenterology and
endoscopy procedures, urology, and obstetrics and gynecology, has called for the
levy's repeal. Cook Group chairman Stephen Ferguson noted the tax burden
amounted to a whopping 55 percent of its profits.
"For a
company like ours, which pays 35 percent of our net earnings in federal
corporate taxes and another 4 to 5 percent in state and local corporate taxes,
the excise tax translates to another payment that will consume 15 percent more
of our earnings," he estimated. "This creates tremendous pressure for us to move
manufacturing to Europe and other parts of the world." According to the trade
publication Mass Device, the company has already canceled plans to build a new
factory in the U.S. because of the Obamacare tax burden.
Stryker, a
maker of artificial hips and knees based in Kalamazoo, Mich., announced in
November that it would slash 5 percent of its global workforce (an estimated
1,000 workers) this coming year to reduce costs related to Obamacare's taxes and
mandates.
Covidien, a
N.Y.-based surgical supplies manufacturer, recently announced layoffs of 200
American workers and plans to move some of its plant work to Mexico and Costa
Rica, in part because of the coming tax hit. Mass.-based Zoll Medical Corp.,
which makes defibrillators and employs some 1,800 workers in the U.S. and around
the world, says the medical device tax will cost the company between $5 million
and $10 million a year. Its profit in 2009 was $9.5 million. "Running our
company at close to break even would not be a sustainable position for us," CEO
Richard Packer said in a public statement, "so we will be forced to look at
alternatives."
Those
"alternatives" include cutting payroll, cutting R and D and passing on the costs
to patients, of course. Industry estimates put the tax-induced job losses at
43,000. So far, the number-crunchers at 1600 Pennsylvania are mum on the number
of potential jobs -- and lives -- destroyed by the medical innovation death
tax.
In fact, the
Obama administration's response so far has been a flippant shrug. Treasury
Secretary Tim Geithner, whose only manufacturing claims to fame are faulty tax
returns and near-double-digit unemployment figures, brushed off concerns this
week about the medical device tax. Obamacare's expanded access to health care,
he argues blithely, will create more consumers for their products. "On balance,
it is a good package for people in the health care business," he told Bloomberg
News.
Fewer jobs.
Fewer entrepreneurs. Fewer medical advances. Only with a gallon of self-delusion
does the Obamacare medical tax medicine amount to anything other than economic
and medical malpractice.
Obama 2012:
Winning the future ... by killing it.
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