Medical device tax
EDITOR: Wednesday's paper carried an article from the New York Times about the tax on the sale of medical devices, a revenue-raising provision of the Affordable Care Act (“Tax on sale of medical devices a recurring theme”). I've been wondering why there was such a fuss about this. Everyone knows we need to raise revenue; this seemed to me to be a reasonable way to do so, but it was opposed by lots of lawmakers. Why?
The last paragraph of the article explains and bears repeating: “Implanted devices carry some of the highest profit margins of any medical product. While the industry is composed of thousands of companies, big and small, some major sectors are dominated by a few firms that face little or no generic competition.”
Ah-ha. The devices generate big profit margins because it's a monopolistic industry. No wonder lots of money is flowing to Congress to get this provision overturned.
President Barack Obama deserves thanks for taking on the thankless task of reforming health care. Given the dysfunction in Congress, it's a miracle he's able to get anything accomplished.
We have a long way to go, but the Affordable Care Act is a good start.