The Supreme Court decision in June upholding the Affordable Care Act leaves in place a tax on medical devices that threatens thousands of American jobs and our global competitiveness. It will also stifle critical medical innovation in the industry that gave us defibrillators, pacemakers, artificial joints, stents, chemotherapy delivery systems and almost every device we depend on to save lives. The 2.3% tax will be charged to manufacturers on each sale and takes effect in January. Many U.S. device companies, in response, have already announced layoffs, canceled plans for domestic expansion and slashed research-and-development budgets.
The hit will be severe. For a typical company, a 2.3% tax on revenues equals a 15% tax on profits. When combined with a 35% corporate tax and state corporate taxes, the tax rate for the medical-device industry will exceed 50% in most jurisdictions. Many marginally profitable businesses will then hemorrhage red ink, since they'll have to pay the excise tax whether they are making money or not ... As a result of the looming device tax, production is moving overseas, good jobs are going to Europe and Asia, and cutting-edge medical devices will now be produced elsewhere for import into the U.S. Meanwhile, the impact on the quality of care is incalculable but no less real. Thirty billion dollars must be taken out of operations or R&D. Who knows what lifesaving devices that might have been developed will fall victim to this tax?
That's Indiana's Evan Bayh writing in the Wall Street Journal, sounding the alarm over one of many atrocious provisions in a law that he played a decisive role in passing. Here's the editor's note that accompanies the column:
Mr. Bayh, a Democrat, is a former governor and U.S. senator from Indiana. He is a partner at the McGuireWoods law firm, which represents several medical-device companies.
Partially due to his votes on this issue, Bayh chose not to face voters in 2010. He cashed out and joined a law firm that represents an industry that's going to be decimated by one of the many taxes and accounting gimmicks that Democrats -- himself included -- used to manipulate and hide the true cost of their partisan bill. Note the passive voice in "falling victim." Bayh's concern about American jobs and medical innovation "falling victim" to Obamacare's taxes would be slightly more believable if he hadn't been one of the active victimizers back when this mess could have been stopped. Two additional notes from the Obamacare file in recent days:
(2) Obama: "We're going to reduce costs an average of $2500 per family on premiums." Reality:
But it turns out that family premiums have increased by more than $3,000 since Obama's vow, according to the latest annual Kaiser Family Foundation employee health benefits survey. Premiums for employer-provided family coverage rose $3,065 — 24% — from 2008 to 2012, the Kaiser survey found. Even if you start counting in 2009, premiums have climbed $2,370. What's more, premiums climbed faster in Obama's four years than they did in the previous four under President Bush, the survey data show.
Results and facts are for suckers. Just listen to the words.
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