New bill introduced to repeal medical device tax gets strong bipartisan support

by Lauren Dubinsky, Senior Reporter | January 08, 2015
Erik Paulsen
On Tuesday, Congressman Erik Paulsen introduced another bill in an effort to repeal the 2.3 percent medical device tax. The Protect Medical Innovation Act received strong bipartisan support with 254 cosponsors, 27 of whom are Democrats.

"The medical device tax continues to stifle innovation, cost American jobs, and drive up health care costs despite bipartisan opposition in both houses of Congress," Paulsen said in a statement. "With over 250 cosponsors [on] day one of the new session, it's clear repealing this tax should be one of the priorities for the new Congress."

The Medical Imaging & Technology Alliance (MITA), Advanced Medical Technology Association (AdvaMed) and the Medical Device Manufacturers Association (MDMA) are applauding the legislation. "Repealing the medical device tax is critical for the United States to maintain its global leadership in this high-tech manufacturing sector and to allocate resources toward the development of new cutting-edge technologies," Stephen J. Ubl, president and CEO of AdvaMed, said in a statement. "This tax on innovation stymies the search for cures and treatments and stalls job creation."
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The organizations believe that the medical technology industry is "an important engine for economic growth in the United States" since it employs over 400,000 workers globally and generates about $25 billion in payroll. But the device tax has resulted in the loss or deferral of over 33,000 industry jobs, according to AdvaMed.

The device manufacturers are also championing the legislation. Dr. Gregory Sorensen, chief executive officer and president of Siemens Healthcare North America, stated that the tax has led to the loss of hundreds of research-and-development jobs at Siemens, which has greatly hindered medical equipment device innovation.

"And at a time when recent data indicate that diagnostic errors are the most common, most deadly, and most costly of medical errors, this tax has discouraged accurate patient diagnosis by taxing the very systems that can facilitate disease discovery at a stage where it is potentially the most treatable," he said in a statement.

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