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 dont grow on trees. They were not created developed marketed or sold by government bureaucrats and lawmakers. One of the nations top stent manufacturers Boston Scientific warned at the time that Obamacares 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 Clintons 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 levys 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 1000 workers) this coming year to reduce costs related to Obamacares 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 1800 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 43000. 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 administrations 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. Obamacares 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.
Michelle Malkin is the author of Culture of Corruption: Obama and his Team of Tax Cheats Crooks & Cronies (Regnery 2010).
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 dont grow on trees. They were not created developed marketed or sold by government bureaucrats and lawmakers. One of the nations top stent manufacturers Boston Scientific warned at the time that Obamacares 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 Clintons 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 levys 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 1000 workers) this coming year to reduce costs related to Obamacares 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 1800 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 43000. 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 administrations 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. Obamacares 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.
Michelle Malkin is the author of Culture of Corruption: Obama and his Team of Tax Cheats Crooks & Cronies (Regnery 2010).
